Mexico has taken great strides to make a name for itself in the technology industry. It is currently one of the fastest-growing tech hubs in all of Latin America. For technology companies in the United States ̶ who for many years have bet for distant outsourcing destinations such as India, Ukraine, or China ̶ this represents an opportunity to access an untapped pool of IT professionals familiarized with North American culture.
Outsourcing software development costs is beneficial for companies that want to grow but need to keep expenditures down.
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What are the top offshore destinations to outsource technology?
The popularity of certain countries in Europe, Latin America, and Asia is based primarily on their cost competitiveness. However, when choosing an outsourcing destination, it is essential to consider other factors. For example: whether it is a highly developed IT market, whether or not it has a high-quality educational infrastructure, and the ability to communicate in the language of your choice (in this case, English).
Yes, there are choices of where to outsource software development, but the landscape has shifted considerably in the last few years. As an example, this is a short table of salaries from our Tech Salaries Report 2023, the U.S., and Poland (as an example of a European country commonly used as outsourcing destinations. )
|Full stack developer||$4,433 (senior)||$8,920||$6,087|
|Mobile developer||$5,067 (senior)||$13,037||$2,614|
As a result of the aftermath of covid, the economic situation of the economy, and the geopolitical conflicts around the world, including the war in Ukraine, some of these destinations have changed drastically and are no longer viable competitors on the world stage. In the case of Ukraine, for example, many of the tech professionals have been displaced as their society struggles with an ongoing conflict- making it very difficult to maintain the needed stability.
Interestingly, software engineers’ salary in the United States differs significantly from those in Asia, Eastern Europe, and Latin America. Consequently, companies can reduce costs between 40% and 60% by hiring a remote team in these outsourcing destinations without losing quality.
But cost is not the only factor that makes Mexico the most competitive tech hub. Mexico’s diverse ecosystem has a lot to offer. Dive into some of these unique characteristics of the Mexican tech labor market in our Tech Salaries Report 2023.
Why are India and China no longer an option for outsourcing IT?
We’ve talked about how the tech giants hire remote software developers or expand their operations to offshore countries before. This has helped them broaden their international value, optimize their resources through budget savings, and apply more efficient software development strategies like the Follow-The-Sun model.
For many years, the US technology sector opted to grow its teams in India and China. However, these countries have been caught in the crossfire of an intense geopolitical confrontation. Companies such as Facebook, Google, Dropbox, Apple, among others, have been blocked from operating in these countries.
Now, large technology companies and startups, and SMEs turn to Latin American countries to expand their operations and hire remote software engineers.
Top 5 countries to outsource software engineers in Latin America
In addition to Mexico, other LATAM countries that have attracted attention as places to hire remote tech talent include:
- Costa Rica
IT outsourcing in Latin America can also offer cost savings and resource optimization for US technology companies. At the same time providing access to a pool of highly trained talent fluent in English and cultural affinity. In addition to the advantage of similar or identical time zone, which allows real-time communication and proximity to travel.
Latin America Outsourcing Destination Salary Rates
When choosing where in Latin America to select an outsourcing provider, you should examine the different benefits each region offers you, education statistics, available workforce, government technology initiatives, and private, and of course, the wage rates.
Wages, of course, seem to be the most deciding factor. The table below shows data from 2021: the salary averages of the most sought-after IT roles (with intermediate level) in Mexico, Brazil, Argentina, Costa Rica, and Colombia.
|Full Stack Developer||$3,156||$5,584||$6,049||$4,159||$2,170|
|Front End Developer||$3,162||$5,595||$6,060||$4,167||$2,174|
|Back End Developer||$3,377||$5,975||$6,472||$4,451||$2,322|
Our latest 2023 research published in the Mexico Tech Salaries Report 2023, states the average tech salary by region as follows:
The CodersLink salary report abounds in detail salaries and benefits for other roles and can give you a closer look at Mexico’s technology ecosystem, business opportunities, business climate, programs, and government incentives for US companies looking to hire or expand operations to Mexico.
Outsource Software Development Costs to LATAM and Grow Your Team
In the last few years, Mexico has shown its strength as a place to hire remote software developers and engineers. Whether your company is in the tech industry, healthcare, or real estate, hiring quality technical professionals to help your company reach new heights is an essential part of the great digitalization. The Latin American market is open for business and it has a lot to show for itself.
Learn more about hiring online software developers in the leading Latin American tech hub.