Outsourcing is about more than cutting costs; it's also about improving efficiency and establishing worldwide connections in order to access a broader talent pool.
Latin America isn't typically on the radar for startups and teams. However, in recent years, regions throughout Latin America have developed an IT industry as well as a facility with various programming languages. Mexico is one of these places, producing more than ever before130,000 engineers and computer scientists every year, making outsourcing developers work from these countries a win-win situation for U.S companies.
According to the World Bank, there are about 6.5 million IT professionals in Latin America. Some major profile firms have taken notice of the region's technological talent. Amazon Web Services has recently expanded its operations in the region by adding a new location in Argentina; this follows existing offices in Mexico, Brazil, Chile, and Colombia.
Reasons for Latin America’s IT Growth
Latin America has seen significant increases in internet use and penetration, as well as a boom in tech industries. In 2015, Latin America's internet usage increased by 1,644.3 percent, with an internet penetration rate of 61 percent in 2015 compared to 43 percent in 2019. Mexico is also seeing large numbers of graduates from prestigious institutions with computer science.
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There are several advantages for U.S businesses in outsourcing and recruiting young talent from Latin America:
- Language: Latin American countries have significant cultural connections to the United States, particularly in terms of company practices and work habits. In some cases, English is only taught as a second language. In many parts of Latin America, for example, English is learned almost from birth. According to the EF English Proficiency Index in 2015, Peru, Chile, Ecuador, Mexico, and Brazil are among the most competent countries in terms of speaking English well.
- Adaptability: Many of these young developers are eager to embrace new possibilities, making them highly agile employees accustomed to working with startups. As a result, they're more adaptable and inventive.
- Costs Savings: Another benefit of outsourcing Latin tech talent is the cost savings for businesses in the United States. While maintaining quality, the average wage from top talent in the region will vary, but it will generally be low.
- Business Environment: Brazil beats India in the race for top country to conduct business in. Brazil is also home to the most attractive business environment. Financial attractiveness: According to the 2016 A.T. Kearney Global Services Location Index, a study tracking the offshoring landscape, six Latin American countries rank in the top 20 for financial attractiveness, people skills, and infrastructure; Brazil (4), Mexico (8), Chile (9), Costa Rica (19) and Colombia(20). These nations are becoming increasingly popular offshore choices due to their economic stability and favorable business regulations.
- Market growing very fast: Latin America is becoming increasingly competitive, as businesses across the world seek to outsource their operations to save money. With Brazil, Colombia, and Chile leading the charge, Latin America is rapidly establishing itself as a top destination for offshoring services. According to a 2014 KPMG study, while Latin America's outsourcing industry currently accounts for only 5% of global spending with a 10% annual growth rate
- Due to the high demand, Mexico's southern neighbor has seen a boost in technology industries. According on the U.S.'s technological progress index, Mexico ranks as the best Latin American nation. Mexico City, Monterrey, and Guadalajara are known for producing skilled and versatile developers. We've seen just how creative and well-versed Mexican developers are as a hiring partner that works with the communities of developers in Mexico.
Let us know what you want to learn about Mexican developers, or discover more about sourcing Latin American talent and the other options for scaling your team.
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