As of the beginning of 2022, the shortage of tech talent has reached almost a million open tech positions worldwide. Most businesses are struggling to hire IT specialists for months. US and UK companies are looking for new labor markets in a bid to solve this issue. And this is when Europe gets the spotlight. This article provides an overview of team extension services in Europe. We will take a detailed look at:
Ready to dive into the world of team extension services in Europe? Let’s go!
First of all, in this article, we will focus on the team extension model, also known as staff augmentation services. This type of outsourcing allows you to tap into the global tech talent pool and expand your in-house development capabilities with the help of experts hired elsewhere in the world.
How it works:
Yes, it is as simple as that. This form of IT outsourcing allows you to expand your development unit easily and closely monitor the work of your new engineers, as they become a part of your team and work under your management.
What are some other benefits of staff augmentation?
For this section, we have gathered information from reliable sources and based our analysis of the companies’ profiles on one of the largest dedicated directories. We have analyzed the list of companies that have “staff augmentation” and “team extension” listed in their services and have a significant presence in Europe.
Different sources estimate the European tech talent pool between 6.5 million and 8.4 million experts. Around 60% of these specialists reside in Western Europe. For example, the number of IT specialists in Germany has exceeded 1.9 million people. The vast majority of these experts are employed by the myriad of product companies that have a strong presence in Europe. Many experts are working for tech giants like Microsoft, IBM, or Samsung. The Eastern European pool of experts is estimated at 1.5 million specialists with a much lower competition for talent. Countries in this region have more experience with IT outsourcing and nearshore development for Europe.
As of February 2022, Clutch listed 740+ companies with expertise in staff augmentation in Europe. While some companies might not be listed there, the estimate and share of the companies per country should remain the same. The largest number of such companies is located in Ukraine: 220+ vendors.
Next comes Poland with 160+ firms, then Romania and Germany with a little under 50 companies. The remaining countries have a little over 200 companies combined.
While on the subject of nearshore development in Europe, let’s also take a look at the breakdown of the vendors by their size. Almost 60% of these companies are small boutique agencies. The rest are mid-size and large companies.
You will have no problem finding a tech partner of any size. Make sure to take a look at the portfolio and the expertise before contacting them.
When discussing nearshore development in Europe, we should also consider the type of clients they are partnering with. So who actually looks for team extension to Europe? First of all, let’s take a look at the size of these companies.
Our research shows that the share of small and midsize clients is similar, whereas the share of enterprise-level clients is slightly lower.
However, the size of these companies is not significant on its own. We would also like to point your attention towards the domain expertise of companies that choose Europe for staff augmentation. Clutch states that the largest share belongs to healthcare, finance, and IT services. A significant number of vendors also have expertise in eCommerce, retail, telecom, and education verticals.
Whatever your industry is, you will be able to find experts with the needed technical expertise and understanding of the domain, as most companies can source those at your request or even already have them in-house.
If you are looking into nearshore development in Europe, remember to carefully examine all potential vendors. Make sure they have both the technical and domain expertise you need, as well as a proven track record of successful partnerships.