Our voices

The sourcing industry contributes 6.6% to Bulgaria’s GDP and marks a double-digit growth in development despites of the Covid-19 crises

The size of the sourcing sector in Bulgaria amounts to EUR 3,3 billion for 2020. This is identified by the data in the Annual Report of the Association for Innovation, Business Excellence, Services and Technology (AIBEST) for the development of the sourcing industry in the country. Last year, the sector contributed 6,6% to Bulgaria’s GDP compared to 5,5% in 2019. Despite the pandemic 2020, the sourcing industry marked double-digit growth in its development, as in 2020 operating revenues increased by 11,2%. Our preliminary data for 2021 show that even this year the growth will also remain in double digits and even higher. The forecast for 2024 indicates that the industry will continue to develop and be a major pillar in the Bulgarian economy, as its relative share in the country's GDP will reach 11,2%.

The annual analysis is created by SeeNews and includes data about 677 Bulgarian companies dealing with business processes services (BPO) and IT services (ITO) in 2020. The ratio between the two subsegments shows an advantage for ITO – 358, while the number of companies in the field of BPO is 319.

The industry is also strengthening its position as a preferred employer. Although the number of employees in the sector is just over 77,000 in 2020, ie. almost unchanged from the very successful 2019, the costs of employees and taxes paid by companies to the state treasury are increasing.

The sector marks a significant social and economic footprint. It became the backbone for the development of the new middle class in Bulgaria and for the retention of young people in the country.

Salary costs in the challenging 2020 have increased by an average of 16% per employee. For the first time, the companies in the sector formed 10.4% of all salary expenses in the country, compared to 9.4% the previous year. In terms of paid social security contributions, companies in the sector contributed a total of 8.2% of all social security contributions in the economy compared to 7.4% in 2019. Their amount is almost equal to the projected total capital expenditures in the budget of Sofia Municipality for 2021. The industry has doubled in five years term from 2016 to now both wage costs and costs for insurance.

"We will continue to be an attraction for talents and a preferred employer because of the development opportunities we provide to young people. The first Covid lockdown froze the recruitment of new employees, but from the middle of 2020 the market returned to its usual dynamics and now the shortage of staff is again a hot topic for companies in the sector. With the opportunities we offer for career start and development, we fulfill one of our most important priorities - the retention and return of Bulgarian talents in our country. Because namely the talents are the fuel for the development of our industry. We continue to develop our partnerships with universities, local and state authorities because this is the way to maintain our sustainable growth and develop the knowledge economy in Bulgaria.", comments Iliya Krastev, Chairman of the Managing Board of the Association and CEO of A Data Pro.

The pandemic in 2020 slowed down the regional expansion of the outsourced industry, but in 2021 many companies moved some of their operations outside Sofia, looking for new labor opportunities. The largest hubs for outsourced services remain in the big cities with universities - Sofia, Plovdiv, and Varna are the three largest centers, as Burgas, Ruse, and Veliko Tarnovo are also attracting more and more new companies.

The full report could be found here - http://aibest.org/annualreport2021
Made on