Destinations Catalog

Romania

Romania
Population:
19 638 000
Capital:
Bucharest
UTC:
+02:00
Ease of Doing Business Index:
45
Currency:
RON ($1 = RON 4.31)
Unemployment Ratio:
4.3%
Income Tax:
10%
Corporate Income Tax:
16%
Social Tax:
35%
Notice Period:
Upon parties agreement
Dismissal Period:
Depends on the reason of dismissal
Turnover Ratio:
$480 million
Office Rent:
$9-30/m2
IT Headcount:
125 000
IT Graduates:
17 000
Average Salary
Junior
Middle
Senior
Lead
$ 900
$ 1 815
$ 2 750
$ 3 300
English Level
High Proficiency
Main IT Outsorcing Destinations
Cities
IT Headcount
Main IT Outsorcing Destinations
Cities
IT Headcount
Romania
Country Description

Romania is the country in Southeastern Europe. Romania is one of the most dynamically developing countries of the European Union. In 2015, the Romanian economy was in the first place in the EU in terms of GDP growth. GDP level is growing every year, which makes Romania a successful economic power. Also, from January 1, 2018, the Romanian government have reduced the personal income tax from 16% to 10%, which also accelerate economic growth. The population of Romania is about 20 million people, and the number of partisans in the IT technology market is equal to 120 thousand people. - this number includes all the staff involved in the business process outsourcing: custom software development and product development, client and product support, as well as miscellaneous supporting functions.

Population
19 638 000
Capital
Bucharest
UTC
+02:00
Currency
RON ($1 = RON 4.31)
Ease of Doing Business Index
45
Unemployment Ratio
4.3%
Income Tax
10%
Corporate Income Tax
16%
Social Tax
35%
Notice Period
Upon parties agreement
Dismissal Period
Depends on the reason of dismissal
Turnover Ratio
$480 million
Office Rent
$9-30/m2
IT Headcount:
125 000
IT Graduates:
17 000
Average Salary
Junior
Middle
Senior
Lead
$ 900
$ 1 815
$ 2 750
$ 3 300
English Level
-------

Country Description

Romania is the country in Southeastern Europe. Romania is one of the most dynamically developing countries of the European Union. In 2015, the Romanian economy was in the first place in the EU in terms of GDP growth. GDP level is growing every year, which makes Romania a successful economic power. Also, from January 1, 2018, the Romanian government have reduced the personal income tax from 16% to 10%, which also accelerate economic growth. The population of Romania is about 20 million people, and the number of partisans in the IT technology market is equal to 120 thousand people. - this number includes all the staff involved in the business process outsourcing: custom software development and product development, client and product support, as well as miscellaneous supporting functions.

Income Tax

Personal Income Tax in Romania is the flat income tax rate of 10% compared to 16% last year.

Romanian government also established a certain system of tax exemption for the specialists in the ICT sector, namely

  • IT specialists (possible, however based on a strict set of provisions);
  • Employees with disabilities (granted upon the strict provisions veirified by the healthcare system of Romania);
  • R&D or TechDevelopment employees (certain conditions shall be met)

Corporate Income tax rate is based on the income within a fiscal year and amounts to 16%.

Social Тax

Social (Pension) and Health Insurance Contribution for an employee amount to 25% and 10% respectively. Whereas, an employer pays 2,25% as Work Insurance Comtribution per employee.

Notice Period

The employment contract shall be terminated by the parties agreement and is envisaged by the contract individually.

In case of dismissal, notice period shall not exceed 20 working days.

In case of resignation or leaving upon the employee’s wish, the notice period is based on the position:

  • 20 working days for executives
  • 45 working days for management

Dismissal Conditions

According to the Romania legislation, there are dismissal conditions that depend on an employee and those that are not.

Dismissal conditions related to employee:

  • Disciplinary dismissal - violation of the corporate or disciplinary regulations;
  • Imprisonment exceeding 30 days under the terms of the Romanian Criminal Procedure Code;
  • Physical or mental inaptitude - shall be medically verified;
  • Lack of professional skills

Dismissal conditions not related to employee are usually limited to closure of the position/redundancy.

Hiring Period

5-120 working days

Office Rent

The cost of office rent varies between $9-28.70/m2

Moreover, the price doesn’t include operational service cost – $1.80-5/m2

As to the office classe, the prices comprise as follows:

  • A-class – $24.2-29/m2 (operational costs included);
  • B-class – $13.80-17.40/m2 + operational costs ($3/m2) + utilities($1.20/m2);
  • C-class and lower – $9-10.2/m2 + operational costs ($2.40/m2) + utlitlities($1.20/m2)

Prices normally do not include VAT.

IT Headcount

The latest ANIS (Employers’ Association of the Software and Services Industry) report on Software and IT industry in Romania informs that 70% of the local IT industry is currently controlled by foreign investors primarily, hence, providing Romania with a substantial advantage in terms of its labor market reliability and vast talent pool – around 125K employees are currently working in the software development industry.

The IT market is primarily based on outsourcing activities. Yet, comparatively low cost of living is another point that attracts foreign businesses whereas the companies’ salary expenses here are lower if compared to the same in Western Europe.

The EU membership has greatly influenced the labor market in the IT industry. 12% of the total number of IT employees have been hired by the top IT companies.

The key IT cities of Romania are Cluj Napoca, Iasi, Timisoara, Brasov, and Bucharest.

IT Graduates

Romania makes a huge investment in the future generations of software developers and engineers, establishing the higher education system adapted to the demands of the modern developing world. Since 2015, there have been realized numerous initiatives for involving schools into the preparation for future employment in the IT&C sector.

To provide technical education, Romania has five Polytechnic Universities, 59 domain-specific universities, and 174 private colleges. What makes Romania even more advantageous for foreign investors and employers is a strong pool of skilled talent as well as the companies willing to hire “resourceful, open-minded and creative individuals” striving for learning new technologies. There are over 17K graduates annually allowing the companies growing their departments rather quickly.

Average Salary

Salaries for Romanian IT specialists are not as high as in the Western European companies although there is a large number of foreign companies present in the local IT sector. However, the average salary based on experience or position are amidst the highest in Eastern Europe. However, in recent times, the situation has improved, therefore, the average salaries in the industry are as follows:

  • Junior Software Engineer – $900
  • Middle Software Engineer – $1815
  • Senior Software Engineer – $2750
  • Technical Lead – $3300
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