As of February 2025, Ukraine had approximately 206,000 active IT self-employed individuals (FOP) — 56,000 fewer than a year earlier. According to DOU data, which analyzed the Unified State Register, the 21% decline represents a record drop for at least since 2016. For an industry that generates 4.4% of GDP and accounts for over 37% of Ukrainian service exports, this is far more than just statistics.
Three reasons — and none are obvious
The programming sector suffered the most: minus 35,000 FOPs, or 67% of all closures. In the data processing sector — minus 9,327 people (-26.5%), in web portals — minus 26%.
But "closing an FOP" and "leaving the market" are not the same thing. Maria Shevchuk, Executive Director of IT Ukraine Association, explained the mechanics of the outflow to DOU: from the beginning of 2025, entrepreneurs are obligated to pay unified social contribution (ESV) even without income, so those not actively working found it financially disadvantageous to maintain an FOP. Simultaneously, companies are massively transitioning specialists to gig contracts or employment agreements within Diia.City.
The third factor is geographical. Many IT professionals who have been living abroad for several years are transitioning to local contracts and registering under the legislation of their country of residence, closing their Ukrainian FOPs as unnecessary baggage.
"There is a gradual transition of IT specialists to other forms of cooperation — gig contracts or employment agreements, including within Diia.City"
Maria Shevchuk, Executive Director of IT Ukraine Association, to DOU
What the numbers reveal about the actual scale
DOU's salary survey records a structural shift: if in summer 2022, 87% of IT professionals were registered as FOPs, then by late 2024 — only 62%. Meanwhile, the share of those working on gig contracts or registered under another country's legislation has increased.
That is, part of the "vanished" FOPs is not a loss of specialists, but migration between legal forms. However, the actual outflow of people from the market — through mobilization, emigration, and global IT layoffs — is also occurring. According to the Lviv IT Cluster, in the most pessimistic scenario, up to 20,000 IT professionals could leave the country — approximately 8% of the market.
Against the global backdrop, pressure is intensifying: the Layoffs.fyi tracker recorded that in 2025 alone, over 122,000 IT workers worldwide lost their jobs at 257 companies. Among Ukrainian players affected by layoffs were airSlate (170 people), Favbet Tech, and others.
Regulatory context: the state is pressing, the industry adapts
The International Institute for Economic Freedom directly called the government's efforts to worsen working conditions for FOPs — particularly the possible introduction of VAT — "a measure to squeeze out small business entities" in its 2025 economic summary. This is not neutral regulatory background: every new norm changes the mathematics of FOP model profitability.
Meanwhile, the industry overall is holding up: in the first half of 2025, Ukraine's computer services exports increased by 0.1% compared to the same period in 2024, and the share of IT in total exports increased from 38.5% to 43%, according to the NBU. So fewer FOPs does not mean less money in the sector.
If the government does introduce VAT for Group 3 FOPs — which is being discussed in the context of budget consolidation — the next wave of closures could prove to be not structural but forced. And then there would be no option to "just switch to a gig contract."
