In my previous article we discussed top web design trends popular all over the world. Today, I will introduce you another booming trend among tech companies - business process outsourcing (BPO). IT outsourcing is a hotly debated topic all over the world, and if you are reading this article, you are part of it, too.
What makes it really attractive is the fact that outsourcing gives businesses access to global knowledge base, and at the same time significantly cuts the costs to have a positive impact on a company’s bottom line. In today’s business world, outsourcing has become the key term to describe how successful enterprises are managed.
Recently, IT outsourcing to Armenia has become a booming trend among various countries all over the world, like Canada, Australia, USA and many others. In 2016, the Prime Minister presented statistics, according to which 70 percent of the Armenian IT products are being exported. He said that 79 percent of those exported products are delivered to Canada and USA, 10.8 percent to Europe, 8.8 percent to Russia and CIS countries.
So, why to outsource to Armenia? Many people wonder why and how is a small country like Armenia becoming an IT outsourcing hub. That’s why In this article I want to introduce you with some data about the IT industry and the historical background of technology in Armenia.
IT Sector in Armenia
Armenia is one of the chief information technology (IT) zones among the neighboring CIS and Middle East countries. Traditionally, Armenia has been a leader in high-tech research, development, and production from the Soviet Union times. The country produced 35% of all the military electronics for the USSR countries. After gaining independence in 1991, the IT sector has gathered a momentum.
Over the past twenty years, the IT industry has been growing by an average of 25% per annum, mostly due to high scale of IT outsourcing to Armenia.
Today, IT firms continue to be the fastest-growing sector of Armenia’s economy. Having a very small population of fewer than 3 million people, the IT sector employs over 20,000 specialists. Preliminary estimates by the Ministry of Economy show that the combined output of some 450 Armenian IT companies grew by nearly 25% to a level equal to $550 million. The sector has created a lot of new jobs, generating about 5% of Gross Domestic Product, according to government data.
Armenia has an enormous Diaspora, which means that there are 7 -10 million Armenians living abroad, compared to 3 million population of the country. Thus, the growth of the IT sector came when Diaspora Armenians in the American and European IT industries returned to Armenia mostly for the low-cost supply of highly skilled labor with good knowledge of English and communications. Thus, IT outsource to Armenia gained a huge popularity. Today, many web design and development (PHP development) studios, as well as custom software development companies, choose to create their team in Armenia.
Let’s compare IT specialists’ wages in Armenia and in the US to have an idea why a lot of businessmen choose to outsource to Armenia On average, a senior developer or a team lead in an Armenian web development agency can earn about $1,200 a month, about five times the average Armenian wage ($250). Still, it is a fraction of the average monthly salary of $4,300 earned by an entry-level programmer in the United States and 10 times less than a senior developer’s salary ($12,000), who is using the same tools and technology to follow web design trends and provide custom IT solutions. So, outsourcing your IT project to Armenia is at least 10 times affordable.
In my next article, I am going to write about world famous IT giant companies in Armenia, so stay tuned! Now, I suggest you to watch a short video about Armenia.