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Nearshore Challenges in Latin America

Challenges of hiring nearshore tech talents in Latin America

With the soaring demand for technology professionals from American companies, Latin America has become a constant hotbed for talent search nearshore. In recent years, the number of tech professionals has seen a substantial increase, and the trend is expected to keep expanding.

According to the IDC report, IDC FutureScape: Latin America IT Industry Predictions 2024, the technology sector in Latin America is poised to grow by 5% in 2024, with the IT industry experiencing an even more impressive growth rate of around 11%.

Another research demonstrates the trend increase of the Software development market in Latin America from 2021 to 2028.

Table 1: Compound Annual Growth Rate (CAGR) of Latin America Software Development Market (2021-2028).

Year CAGR
2021 10.3%
2022 10.5%
2023 10.8%
2024 11.0%
2025 11.2%
2026 11.4%
2027 11.6%
2028 11.8%

(Source: Global Market Insights)

Nearshoring in Latin America has emerged as the prime destination for hiring tech professionals, capitalizing on the advantageous alignment of time zones, cultural similarities, and competitive rates. American companies reap the benefits of the many advantages the region offers. With competitiveness increasing due to the high demand for qualified technology professionals, some outsourcing challenges may arise when considering nearshore hiring.

It’s natural for doubts to arise when considering hiring overseas. How can one ensure that the candidate possesses the right skills and will integrate well into the team? How does one navigate the legal aspects of hiring an employee offshore? These and other questions may instill apprehension when contemplating hiring in another country. To address these concerns, we’ve compiled some of the key challenges of hiring tech talent from Latin America and provided solutions to overcome them.

Intense Talent Competition:

As observed, the number of technology professionals in Latin America has been significantly increasing, along with the demand. Many companies have recognized the benefits of nearshore hiring due to lower costs and similar time zones to the US. However, with these advantages comes intense competition. Tech recruiters find it challenging to identify the perfect candidate with all the necessary skills. The hiring dynamic has shifted—professionals are now more passive than active, and recruiters must reach out to them rather than the other way around. Consequently, many companies struggle to find the perfect fit for the role, especially in a region unfamiliar to many. As a result, the hiring process often takes much longer than necessary.

Solution: A well-structured team of tech recruiters familiar with the Latin American region and adept at locating potential candidates can help streamline the hiring process.

Language Barrier:

One initial hurdle companies encounter is navigating linguistic and communication disparities. Although widely spoken, it’s hard to find proficient candidates due to the sheer volume of qualified folks.

Solution: Implement clear communication strategies to bridge potential gaps, ensuring that instructions, feedback, and project details are accurately understood. During the hiring process, prioritize candidates who have undergone thorough screening for English proficiency.

Legal and Regulatory Compliance:

The legal aspect of hiring can pose a barrier when deciding whether to opt for nearshore hiring. Despite the various benefits and perks, the headache of understanding different laws and compliance in another country can weigh heavily on the final decision and delay the hiring process.

Solution: Seek expert advice to avoid potential pitfalls and ensure a seamless hiring process.

Talent Retention:

When hiring in another country, it’s common for various challenges to be involved in the remote work model. As a result, maintaining talent after acquisition has become a recurring issue in recent years—whether due to new job opportunities or because professionals aren’t fully engaged in the work and lack a full-time contract.

Solution: Establishing effective communication channels with tech professionals to keep them engaged in projects, along with actively seeking committed professionals who are willing to work full-time for your company in the long run is crucial to address this challenge.

Conclusion:

Having considered all the challenges mentioned above, we’ve concluded that the solutions to nearshore hiring challenges don’t need to be a concern for you. Geekhunter facilitates the process for companies looking to hire top-tier tech professionals from Latin America, eliminating the exhaustive efforts associated with traditional hiring processes.

Our thorough pre-screening process ensures that candidates are an ideal fit, possess proven English proficiency, work full-time for our clients, and handle legal compliance. Our goal is to overcome the barriers and the competition that arise with extensive nearshore hiring, making it easier for you to build a skilled and dedicated team.

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