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🌎 THE LATAM RECRUITER - July 2023 Issue

In this issue: Staffing secrets for U.S. startup leaders. Learn about the cost-saving benefits and high-quality talent acquired through nearshore hiring as a strategic alternative to onshore recruitment.

Breaking Down Costs: A Comparative Analysis of Nearshore vs Onshore Hiring

The increasing expenses associated with hiring locally in the United States, where the median yearly salary for tech roles reached $91,250 in 2022, often pose difficulties.

So, where do we turn when the traditional methods no longer cut it? Businesses are actively considering other options like nearshoring to Latin America.

The allure of nearshore hiring in Latin America lies in its potential for significant cost savings while maintaining high-quality talent. This strategic approach allows businesses to optimize costs, drive efficiency, and achieve a positive return on investment (ROI).

Detailed Cost Comparison

When comparing onshore and nearshore costs, it's crucial to consider each option's unique attributes. The average salary for tech roles in Latin America falls around $36,000-$46,000, according to PayScale - a substantial reduction from onshore hiring costs. This significant cost advantage extends beyond salaries, including benefits, overhead expenses, and tax incentives. According to our research at TECLA, hiring nearshore talent can lead to cost savings between 40%-55%.

Explore the success story of Wesper, which experienced remarkable cost reductions and improved output quality by building a nearshore development team in Latin America.

Talent Pool and Innovation

Latin America is home to highly skilled professionals, offering a rich talent pool for companies looking to nearshore their operations. Tech hubs such as Medellin, Guadalajara, and Buenos Aires are churning out over 700,000 STEM graduates annually. Deel's report also highlights Latin America as the world's number one talent pool for outsourcing.

Scalability, Flexibility, and Cultural Alignment

Nearshoring to Latin America provides businesses the flexibility and scalability to swiftly adjust their team size based on project requirements. Companies can choose engagement models that suit their needs, such as dedicated teams or project-based contracts.

Additionally, nearshoring mitigates the challenge of aligning working hours with the main office, a common issue in offshoring that often leads to decreased productivity. Bloomberg reports that 80% of North American-based companies are actively considering nearshoring, further highlighting its growing popularity.

LatAm's Software Nearshoring Potential

In conclusion, onshore recruitment may offer a sense of familiarity regarding staffing. However, embracing the opportunities of nearshoring in Latin America can unlock many benefits.

Not only do these models provide cost-efficient alternatives, but they also tap into a vast reservoir of talented professionals and foster innovation. With scalability and flexibility at their core, businesses can adapt swiftly to changing needs and seize new growth opportunities.

By venturing into nearshore hiring, companies can propel themselves to new heights, achieving sustainable growth and long-term success.

If you're interested in further exploring your strategy and discussing it in more depth, feel free to contact me via email or connect with me on LinkedIn!

Stay in contact!

I hope you enjoyed this edition of the LatAm Recruiter! If you'd like to discuss hiring in LatAm, or get advice about the LatAm market, reach out via LinkedIn or email me at [email protected]. I'd be happy to help!

- Gino Ferrand, CEO and Founder at TECLA.