Tech’s Offshore Hiring Has Gone Into Overdrive

The past year has seen more recruiters trying to get in touch with the developer than before. There was a particular message that caught his attention. Sebastin, who asked that his last name not be used to jeopardize his current job, was excited by the potential growth opportunity.

He wants to know how companies in the US work. As the rise of remote work and a US talent shortage have spurred searches for more globalized teams, many other experienced developers outside the US have found themselves in high demand from American tech companies.

According to a report from Commit, offshoring software development roles would increase by 70% over the next year. Some companies are hiring aggressively outside the US to fill technical roles. Alex Bouaziz is the CEO of Deel, a startup that provides payroll and remote hiring services. There was a 50 percent increase in the number of US based clients hiring abroad.

Companies used to strategically build offices in secondary markets to find more talent. Dylan Serota is the co-founder of Terminal, a company that connects developers in Latin America, Spain, and Poland with startup companies in the US and UK. Many smaller companies don't have the resources to put in place the infrastructure needed to offer benefits and pay local taxes. Serota says that the rise of remote has made companies rethink their approach to talent.

To help facilitate this process, companies like Terminal and Telescoped vet developers and then provide benefits like health insurance, pay local taxes on behalf of the developers, and make sure the developers receive perks like paid time off and equity. Serota says that 80% of the developers they work with have equity in the startup they work with.

The Philippines, Argentina, Brazil, and India are some of the countries where new hires come from. Tech companies have long sought out those markets to cheap staff call centers, content moderation positions, and IT departments, but are now following talent to fill open roles on their teams. Jimit is a partner at the research firm Everest Group. This is a talent story. The talent is there.

Companies based in the US are interested in the talent from Latin America. The region shares time zones with the US, so it's easier for startups to find talent in cities like Mexico City or Bogota. According to Coders Link, a platform that connects Latin American talent with US-based tech companies, the average monthly salary for a software engineer in Mexico is $3,170. A software engineer in San Francisco makes about 20% of that. The war in Ukraine has accelerated this trend. As workers were forced to flee their homes or fight the Russian invasion, foreign companies have sought new places to offshore their work, and Serota says the demand has shifted rapidly to Latin America.