The rapid advancement of IT technologies related digital transformation (DX) and artificial intelligence (AI) has been remarkable lately. What was once considered the cutting edge or a niche technology has progressively become an integral part of business operations, creating continually rising demand for software development expertise. Today, those involved in software development are facing a significant shortage of skilled developers worldwide, which has naturally led to rising labor costs.
Worldwide challenges have resulted in an increase in businesses turning to offshore software development and IT outsourcing solutions. Such approach provides access to a large pool of highly skilled and cost effective talent. Offshore development destinations have been popular throughout Asia, Eastern Europe, and Latin America. Amongst these regions, Vietnam has stood to be among the most appealing as its ever-growing reputation gets them to be a leading software development and IT outsourcing services hub.
Based on the previous article, this article presents the latest developments and trends in Vietnam's IT market. The findings, published in the newest Vietnam IT Market Report 2024–2025 by TopDev, Vietnam's leading IT talent platform, along with our two decades experience at ISB Vietnam in offshore software outsourcing service providers, together, these data form the basis of this article, which explores the current state of Vietnam's IT industry and highlights the unique advantages it offers as an outsourcing destination.
Vietnam’s Population and Workforce Provide Abundant IT Talent
According to Key insights and trends for software developers in Vietnam 2024-2025, Vietnam boasts a robust IT workforce, with approximately 560,000 professionals employed in computer science and IT-related fields. This is bolstered by about 55,000-60,000 students joining computer science and IT-related majors every year, adding to the tank of skilled software developers and IT specialists.
This abundant IT talent is supported by several factors, with Vietnam's demographics being one of the first. Vietnam's population continues to rise, and by December 2023, the population reached nearly 100 million people, making it the 15th largest population worldwide, and ranks 3rd in Southeast Asia.
| Year | Vietnam’s Population |
| 2021 | 98.51M |
| 2022 | 99.46M |
| 2023 | 100.3M |
Vietnam's youthful population, as depicted by its population pyramid, makes its median age fairly young at 33.1 years as reported by the CIA’s The World Factbook. For perspective, on the other end of the scale, the median age in the U.S. is 38.9, in the U.K. 40.8, in Germany 46.8, in Singapore 39.4, in Australia 38.1, and in Japan 49.9. This youthful age profile, where the larger segment of the Vietnamese population belongs to the age relative to the working force, provides a solid advantage for the country in promoting its IT sector.
For software developers and IT professionals, it is essential to keep pace with the changing leaps in technology. The younger workforce is generally flexible, eager to learn, and quick to embrace new tools and practices. Moreover, with Vietnam having a high percentage of under-20s, it guarantees a steady supply of working-age talent for many decades forward.
As highlighted in the article Key insights and trends for software developers in Vietnam 2024-2025, talented individuals in Vietnam increasingly seek careers in the IT sector, drawn by attractive salaries and growth opportunities. This trend aligns with the government’s strategic focus on developing IT talent, ensuring that Vietnam’s software development workforce continues to grow in both quality and quantity.
Vietnam’s IT Service Revenue
The revenue trend for the IT services industry in Vietnam is useful information. Vietnam has experienced continuous growth in IT service revenue over the years, and this upward trajectory is projected to continue. By 2024, the sector is expected to reach $2.07 billion, with a compound annual growth rate (CAGR) of 11.51% from 2024 to 2026. Looking further ahead, Vietnam’s IT service revenue is forecast to expand to $3.2 billion by 2028.
The growth in the IT Outsourcing segment of the four segments—Business Process Outsourcing (BPO), IT Consulting & Implementation, IT Outsourcing, and Other IT Services—is particularly noteworthy. Vietnam's IT Outsourcing revenues are projected to grow dynamically from $0.7 billion in 2024 to $0.83 billion in 2025, $0.98 billion in 2026, $1.13 billion in 2027, and $1.28 billion in 2028, almost doubling in size within a period of four years.
This growth comes through a possible commercial advantage of Vietnam as one of the most captive destinations for outsourcing. While global demand for IT solutions continues to increase with a shortage of qualified IT professionals, Vietnam has strategically positioned itself as a reliable and cost-competitive partner for businesses round the globe.
Given those trends, Vietnam is poised to further expand in software outsourcing and offshore software development. The advantage of providing high-quality IT services at affordable prices makes it remain an attracting country in meeting the global demand of IT.
Average Salaries and Rates for Software Developers in Vietnam
As noted earlier, Vietnam has a rich, highly skilled IT labor force and serves as a fast-growing destination for IT outsourcing. One major reason for Vietnam's attractiveness is the cost of IT talent.
The report mentioned the average gross salary for software developer in Vietnam is around $1,300 per month. Including various costs such as management costs, the average hourly rate for software developers in Vietnam is around $20 to $40. Naturally, these rates vary depending on the developer's level, years of experience, skills, and tech stack etc.
Like this, the salary and rates levels of developers in Vietnam are low when compared to Western countries. This feature opens the door for strong cost competitiveness of Vietnam and a cost-effective alternative to having local developers or outsourcing to local software companies in many parts of the world.
While labor costs remain subdued, the quality of software developers is on an upward trend in Vietnam, which reflects advances in the experience and skill levels of the workforce. By outsourcing to Vietnam, offshore development offers an acceptable blend of quality and expense because of the competitiveness of developers there.
The balance between level of technologies and IT workforce cost-effectiveness puts Vietnam in an advantageous position to be one of the leading software outsourcing and offshore development destinations. Companies can access skilled developers across a wide array of technologies at a fraction of the cost compared to Western markets.
Conclusion
Vietnam's IT sector is one of the most remarkable success stories. With over 100 million people and still growing, the median age in Vietnam is about 33 years, presenting a young workforce with a high proportion of working-age people. This demographic advantage, together with the fact that 55,000-60,000 computer science and IT-related students come in every year, provides long-term talent supply for IT professionals.
In 2024, approximately 560,000 experts are already working in IT-related fields, and this number is expected to increase more in the coming years. With both private and public initiatives churning out IT talent in droves, this human resource from Vietnam has indeed been highly developed to continue attracting attention globally.
The revenues of the IT Outsourcing industry of Vietnam are thus seen to surge and probably double in the next four years. It replicates the growing reputation of the country as one of the most favored destinations for offshore software development and outsourcing. With abundant skilled professionals at economical rates, Vietnam can well cater to the increasing demand for software development services across the globe.
Arguably, one of the most significant competitive advantages for Vietnam is cost-effectiveness. It making the country much cheaper compared to Western nations and even to many other outsourcing countries around the world. While it remains affordable, its quality and developer expertise are improving day by day to offer businesses a perfect blend of cost and capability.
For companies considering software outsourcing or offshore development, Vietnam really has much to offer. With the powerful workforce, rapid industry growth, and unmatched cost competitiveness, it is unparalleled for a variety of businesses in search of high-quality and scalable IT solutions.
If one considers outsourcing or offshore development, then no doubt Vietnam will also be among those worthy destinations to head to. Immense opportunities avail here, and their values as an IT outsourcing hub can only rise upwards in the time to come.
About ISB VIETNAM
As a leading software development and offshore services provider, we specialize in delivering high-quality and cost-efficient solutions for our partners for the past 20 years.
ISB Vietnam is proud to have a team of highly skilled software developers based in Vietnam, known for their technical expertise and commitment to excellence. Leveraging a vast network of developers both within Vietnam and across the globe, we are uniquely positioned to deliver tailored software development solutions that meet the diverse needs of our clients.
For any inquiries related to IT Outsourcing Solutions, we are the right partner.
Don’t hesitate to contact us to discuss how we can work together to make your project a success.
