Hungary enjoys a flourishing economy and has a strong tourist sector. Budapest, with its 1.8 million inhabitants has been seen as one of the most promising locales for business start ups in the whole of Europe. The country also prides itself on a highly-competitive corporate tax regime, while a very high 85 percent of all its 25-34 year olds have educations at university or roughly equivalent level.
And Hungarian young professionals are in undoubted demand. Employment rates of graduates in 2013 was 85.6 percent, compared to the European Union average of 80.7. 1 in 4 of all students major in business and administration, and a further 13,200 specializing in IT. The country, in general, has a large pool of graduates with a good understanding of international business processes.
Pros of Outsourcing to Hungary
What makes Hungary one of the most attractive nearshoring outsourcing destinations is the EU membership, vast talent pool and mid level of the English language. Moreover, Hungarian labor legislation is completely compatible with the European laws and standards, therefore; the country is in high demand among Europe’s businesses. Hungary, despite its small size has a vast number of IT specialists. According to the most recent data, local IT market employs up to 150K specialists which amounts to 1.5% of the country’s population.
But we need to balance this great starting point with a dose of reality. Those nice taxes are not as low if you are a bigger company in key sectors especially if you’re foreign-registered. Hungary got a very respectable 31st in AT Kearney’s Global Services Location Index for desirable locations for business to outsource/offshore in 2014, but it is still a work in progress. English skills and infrastructure challenges can be significant disadvantages as well. Also, the typical wages and rates paid are rising.
Overall Hungary has more pros than cons for outsourcing. But as with most things it’s too unique for each person or business to say anything for sure.
