8 reasons for outsourcing software development to Romania in 2024

Eastern European companies are becoming increasingly attractive to many businesses in terms of offshore software development, and Romania is among them. Over the last 20 years, the Romanian IT sector has significantly grown in this country, making it one of the most favorable outsourcing locations. With over 100,000 software development professionals available, Romania is extremely popular as an offshore/nearshore location among Western European countries.

There are plenty of factors that make Romania an excellent software outsourcing destination, which we’ll be exploring today.

Country Overview of Romania

• Capital: Bucharest
• Official Language: Romanian
• Currency: Leu
• Population: 19 million
• Timezone: GMT+3
• Number of developers: More than 139,000
• Average developer’s salary: $56,000 ⁽*¹⁾
• Business Climate: A3 ⁽*²⁾
• Risk Assessment: B ⁽*³⁾
• Political Stability: 0.53 ⁽*⁴⁾
• Ease of doing business: 43.33 ⁽*⁵⁾

⁽*¹⁾ according to Glassdoor, Senior Software Engineer, 7-9 years of experience.

⁽*²⁾ according to Coface. It includes the ease of running a business, the political situation in the country, and whether the legal system provides fair conditions and business protection for companies. Rating scales: A1, A2, A3, A4, B, C, D, and E.

⁽*³⁾ according to Coface. It refers to the country’s ability to transfer currency for foreign payments. Rating scales: A1, A2, A3, A4, B, C, D, and E.

⁽*⁴⁾ according to The World Bank. These statistics show the political stability and absence of violence. It ranges from -2.5 (lowest) to 2.5 (highest).

⁽*⁵⁾ according to The World Bank Doing Business 2020 report.

Benefits and Reasons to Choose Romania for Software Outsourcing

Business Service Leaders in Romania and KPMG have listed Romania as the number one country among the mature outsourcing markets. Clients of Romanian IT companies most commonly operate in banking and insurance, work in tech and startups, and industrial and consumer goods. They usually look for high-quality custom software development services, and they find them in Romania. Even back in 2015, a company called Pierre Audoin Consultants (PAC) mentioned Romania to be a perfect outsourcing alternative to India, thanks to highly competitive costs, plus a significant number of IT professionals with excellent tech and linguistic skills.

Romania has shown incredible growth in various sectors, which further boosted its credibility as an outsourcing destination. The 2021 Global Services Location Index ranked Romania in the 32nd position regarding best locations for outsourcing. Their GPD has grown almost 5.88% in 2021, and an impressive 6.4% in 2022. The software industry in Romania was expected to reach a turnover of 9 billion euros in 2025.

These statistics demonstrate the technological and economic progress in the country within the past few years. And here are some more factors that establish Romania as one of the best locations for outsourcing software development:

Huge Talent Pool

With more than 139,000 developers, backed by an outstanding education system that produces plenty more new talent year after year, Romania offers a large pool of technical talent for all varieties of software projects. Even with the high demand for hiring software developers, Romanian software agencies can offer high-quality candidates for outsourcing.

Technical Expertise

The technical talent in Romania is not just splendid in quantity but also in quality. Developers in the country have displayed top-notch skills and expertise and are proficient in using the latest software technologies. 

Tech talent of Romania includes thousands of developers skilled in technologies like Java, JavaScript, and Python, to name a few. A considerable portion of Romania’s tech talent mainly specializes in web development, and well-established software developers have successfully reputed companies like Gameloft, Ubisoft, Oracle, Microsoft, Ericsson, Adobe, etc.

Affordable Rates

Perhaps one of the most significant factors that makes Romania a perfect outsourcing destination is its competitive, affordable rates. The average hourly rate for software development in Romania is around $45 to $63, which is much lower than the rates in the US (around $92), most Western European countries (for example, $78 in the UK), and sometimes even lower than the typically cheaper locations in Central and Eastern Europe like Poland (around $62), Czech Republic (around $65).

However, it’s important to understand that the average rates take into account both the lowest and highest rates. In addition, the software and IT industry are dynamic in nature, so the rates fluctuate quite often. So the actual rates of particular Romanian software development companies or software developers may be more or less than the average figures.

Communication Skills

Romanian may be the official language of Romania, but they promote a multilingual culture. That is why most developers in the country are proficient in the English language. And due to the increasing number of businesses outsourcing software projects to Romania, the developers there are also quite experienced in communicating with international clients.

Suitable Time Zone

Romania is located close to many European countries with more minor time zone differences. It is 1 hour ahead of Eastern European countries and 2 hours ahead of Western European countries. The more negligible time difference makes it very convenient for European companies to coordinate with the development teams in Romania.

The time difference is higher for the US, as Romania is 10 hours ahead of the West Coast cities like Los Angeles and 7 hours ahead of East Coast cities like New York. Even so, the developers in Romania are flexible when cooperating with US clients, so it shouldn’t be challenging to work with them as long as you come up with a feasible schedule.

Economic Growth

Romania also enjoys the many socio-economic benefits of being a member of the European Union. Most importantly, as an EU member, they provide a stable and secure business environment for software outsourcing projects. Now, the country belongs to the top 5 countries with the most rapid economic growth in the European Union.

Education System

Romania has an outstanding education system that covers information technology and computer science, as well as all STEM subjects. With 49 public and 8 private universities, they produce more than 7,000 IT graduates every year. A constant supply of fresh graduates from their education system means that their talent pool of high-quality software developers will increase with time.

Government-Backed Economic Stability

The Romanian government is highly supportive of the country’s economic growth and stability. Not only do they back the country’s economic structure with regular funding and supporting regulations, but they also attract a lot of foreign investments from international organizations and highly invest in the local IT market, open new IT hubs and support innovative initiatives.

So if you are looking for offshore software development options, IT outsourcing projects in Romania should be your preferred location, and you will not be disappointed. Romania’s status is based on not just one or two but numerous factors, as you can see for yourself. Their impressive growth statistics, stable education, technological and economic system, and, most importantly, a large talent pool at an affordable cost all together make Romania one of the best offshoring locations for software development. Businesses situated within the EU will benefit significantly by outsourcing to Romania due to smaller time zone differences.

Comparative Analysis of the Cost of Software Development in Romania

Budget and cost are decisive factors when choosing where to outsource. As mentioned earlier, Romania has cheaper rates for software development. But let’s take a closer look at how much it costs to hire developers in Romania compared to other countries.

Before we jump into the rates and costs, do keep in mind that the actual rates frequently fluctuate due to the dynamic and rapidly changing nature of the software and IT industry and the ever-growing demand for IT services in modern industries. Thus, the actual rates can be higher now than what we’ve mentioned below.

Yearly Salary Rates For Junior, Middle, And Senior Software Engineers In Romania

The average base salary for software developers in Romania is about $39,428 per year.

The average yearly salary for junior-level developers with less than three years of experience is around $21,046.

At an intermediate level, developers with 3 to 8 years of experience can earn anywhere between $38,000 to $46,000 per year.

Senior developers with eight or more years of experience earn an average salary of $87,743 per year.

Regarding the average salary, we can see and assume that there are more high-quality and senior-level engineers in the country than junior IT specialists.

Average Salary Rates In Romania Based On Technologies

The most popular software technologies and average hourly rates for each case are listed below. You can also see the comparison between the US rates and the average rates of Romanian developers on the YouTeam platform.

You should understand that the average rates of Romanian and US developers include only the salary that the engineer earns. No additional bonuses, hiring costs, or expenses for the equipment are not included. In the column of YouTeam rates, you can see the price you will pay to work with an outsourced software developer.

Source: SalaryExplorer, YouTeam

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Hourly salary rates to hire senior developers from Romania

Most well-established businesses often aim to hire senior software developers, as they have more experience and expertise required to handle complex software projects. So, the hourly salary rates for senior developers in Romania are listed below, alongside the rates in the US, for comparison.

Source: SalaryExpert, Glassdoor, Indeed, YouTeam

Once again, there is a stark difference in the rates, clearly demonstrating that hiring Romanian software developers is much cheaper than outsourcing services in the US. The good thing is that despite the difference in rates, the level of skills and expertise are still comparable in both countries. Romania is cheaper for outsourcing because of the country’s economic conditions and low cost of living.

Note: The rates mentioned above are averages – compiled from aggregate salary data of developers, and it only considers the base salary, which means it doesn’t include any bonus, compensation, or extra benefits that are usually included when you hire with outsourcing companies. Hence, the actual rate can be somewhat higher or lower than the figures above.

What To Watch Out For Working With Software Developers From Romania

So far, we’ve seen a lot of positive aspects of outsourcing to Romania. But despite all that, some factors must be considered in advance when working with offshore software companies. Here are some important things you must watch out for and plan beforehand when outsourcing software projects to developers and IT companies in Romania:

1. The first and foremost step is to ensure that you’re hiring the right talent for your project. So, thorough screening and evaluation of the development team is a must. Check the records and projects for previous clients. Schedule an interview with the developers so you can review their skills and abilities face-to-face. Arrange quick live coding sessions where you can witness their technical expertise firsthand.
2. All of these things will give you a clear idea of whether the software development company and its developers can complete your project successfully.
3. Since you’ll be cooperating with the developers remotely, the project’s entire schedule must be pre-planned. Discuss your expected deadline and whether the team can realistically deliver within that time. Plan out various stages of the software development process and the approximate timeline of completion for each stage. You must have an outline of the entire project and discuss it with the development team.
4. Communication is vital when working with remote teams. You can’t visit them and review their work physically. The only thing you can do is communicate. You must communicate with them as frequently as possible and keep yourself updated with day-to-day progress. So, it is a crucial part of outsourcing to choose the right collaboration strategy to avoid any issues.
5. Even if you are confident in the ability of the offshore team, apart from the technical expertise of the development company, you should also review their management team and the company hierarchy. If they have strong internal management, you won’t have to supervise the team too much and can directly communicate with the project manager who oversees the project.
6. Pay close attention to the company’s values, culture, and work ethics. If their methodologies do not resonate with your organization’s culture, long-term cooperation with such a company can lead to problems and differences in ideas and opinions.

Disadvantages of Outsourcing Software Development to Romania

Despite the many benefits of outsourcing to Romania, there are some minor drawbacks as well, and businesses must be aware of those.

The main challenge is cultural and time zone differences from the US. If you and your core team are located there, you have to organize your workflow to make it comfortable for everyone.

Cultural differences and some soft skills are always a cause of concern when outsourcing to any location, so that applies to Romania as well. The communication can differ, but most outsourced developers say that they accumulate to this in a month. You just have to take this time.

Due to the proximity to Western Europe, Romanian developers have successfully adopted western standards and business practices. At the same time, they’re also a bit more risk-averse as a result of decades of oppressive communism. Within the software development industry context, this sometimes means that Romanian developers lack an innovative approach.

Time zone is also another critical factor. Most European countries are close to the Romanian time zone, but the difference in the time zone for the US is around 7 hours (it might be more or less as the US has multiple time zones). Still, many companies don’t see any issues. You can discuss your schedule at the beginning and find the developers that prefer working in the evenings.

Where to Hire Software Developers from Romania

There are different ways to find developers or offshore companies in Romania, each with its own pros and cons. Below, you can learn more about the most common channels and choose the most suitable one for you.

Remote Contracting Websites

You can post job offers on some local job boards in Romania where developers with relevant skills can apply with their resumes. Also, you can look for the CVs of the developers and invite suitable candidates for the interviews.

Some remote employment websites and job boards in Romania are:

• ejobs.ro
• findjob.ro
• International job websites like Indeed.com

Traditional Outsourcing

With traditional outsourcing, you’ll be manually searching and contacting Romanian development agencies, be it through a web search or from platforms like Clutch. However, the disadvantage of traditional outsourcing is that there’s a risk of hiring unreliable companies only to regret it later on.

Specialized Marketplace for Outsourcing Developers

There are special platforms just for finding and hiring remote developers. YouTeam is one such platform that is the most reliable, as they we a vast community of 50,000 developers, each one verified and vetted. When hiring through YouTeam, you’re guaranteed to find developers that are the best fit for your projects and deliver exceptional results.

Key Takeaways

Romania has many positive aspects that make it one of the best outsourcing destinations – a large talent pool of highly skilled developers, low rates, and a fast-growing economy, to name a few. But at the same time, you should be careful about screening various companies and hiring reliable developers who can complete the project with the expected results within the decided deadlines. And even with so many benefits, you must still be aware of some issues such as minor political instability, time zone, and cultural aspects of Romania.

With all these things in mind, you’ll be able to make the right decision. But in the end, there’s no doubt that Romania has established itself as an excellent location for offshore software development. If you think it’s the right destination for your project, YouTeam can help you find the best developers in Romania from among our community of thousands of vetted experts and professionals.

If you want to learn more about outsourcing software development to other countries, read our blogs about Bulgaria, Hungary, Czech Republic, Ukraine, and Serbia.