??What makes Vietnam a shrewd destination for IT outsourcing?

The landscape of the IT software outsourcing market has shifted notably in the wake of the COVID-19 pandemic. Previously, India held the reins as the foremost country for software offshoring, this market is now showing signs of saturation. This has prompted foreign businesses to swiftly explore alternative spots, with Vietnam emerging as a prominent choice. According to Forbes, Vietnam is gradually asserting itself as the next hotspot of IT outsourcing in the Asia-Pacific. A.T. Kearney’s 2023 GSLI also positioned Vietnam among the top 7 destinations excelling in IT and business process outsourcing (BPO).

So, what factors contribute to Vietnam being a savvy decision for IT offshoring?

?? High-skilled labor force

Vietnam is gaining a more competitive edge than other Asian-Pacific nations due to its abundant pool of highly skilled workforce, especially young talents. In 2022, it was reported that the country boasted nearly 480,000 IT experts, with universities aiming to produce around 57,000 IT graduates annually.

Indeed, the Vietnamese government has consistently allocated funds to advance research and scientific endeavors at the university level, fostering tech spirit through STEM education. Consequently, Vietnamese IT workers are fairly young, well-educated, and possess a high level of technical literacy.?

Furthermore, Vietnam has achieved multiple international successes, solidifying its reputation as a mighty? IT outsourcing powerhouse in the Asia-Pacific. These achievements include being ranked in the Top 6 globally in TopCoder (2016) and Top 29 in the global IT ranking of SkillValue (2018), etc.

At Golden Owl, we foster a human-centric spirit and strive to build up a well-qualified development team at the early stage for the best software services. From our recruitment process, we have organized career expos at national key universities of Vietnam for talent acquisition, ensuring an input workforce rich in IT. On top of that, our technologists have been aided in learning and developing core skills continuously throughout practical projects.?

?? Cost efficiency?

It’s the topmost purpose for many overseas corporations to optimize their labor costs in the era of global economic downturn. Compared to leading outsourcing counterparts like China, India, or Singapore, Vietnam offers more financially beneficial options in terms of labor hiring for businesses. On average, hiring a software engineer in Vietnam costs around $9,600 to $18,000 per year, while in Singapore, this cost can reach $38,000 to $84,500 per year.

Running in a promising market for cost-oriented optimization, Vietnamese offshoring firms could propose diverse technological outsourcing packages that meet multinational corporations' demand for employment expenses. With a much lower expenditure for one IT headcount, foreign clients are served a comprehensive software solution that could achieve the same peak performances as one team, alongside A-Z customer service.

?? Socio-economic stability

At the time being, several Asian countries, particularly Thailand and Malaysia, are grappling with political and social instability. Vietnam, fortunately, stands as a stable nation, ranking among the Top 7 safest regions in Asia-Pacific (Global Peace Index 2023).?

Currently, this country is experiencing robust growth thanks to its government initiatives for business. Over the past two decades, the Vietnamese government introduced new policies aimed at appealing to multinational technology firms. According to the World Bank, Vietnam achieved strong economic performance with 8% GDP growth in 2022, surpassing Thailand, China, and the Philippines in the Asian economic race. As a result, the Vietnamese tech and outsourcing sectors have experienced substantial growth, posing a competitive challenge to other prevalent IT offshoring hubs.?

?? Language proficiency

Vietnam ranks 65th worldwide and 13th in Asia on the EF Education First English Proficiency Index. Additionally, the educational system also prioritizes English as a second language within universities, moving beyond a foreign language status.

In Vietnam, many IT outsourcing companies, particularly Golden Owl, value transparent communication between software engineers and clients. Therefore, the demand for English skills among software engineers has evolved from “nice-to-have” to “must-have”, enabling IT workers to engage in offshore projects willingly. We also invest in the Learning and Development (L&D) team to enhance developers' English proficiency, facilitating project coordination and superior performance.