Why US Mid-Size Companies Should Consider Nearshore Software Development in Latin America

Latin America has become one of the fastest-growing technology hubs worldwide, offering plenty of untapped opportunities for software outsourcing.

In recent years, the region has experienced remarkable growth in its economy, technology sector, and entrepreneurial spirit, catching the attention of the global business community. In fact, a recent study found that the number of companies interested in hiring talent from Latin America has tripled, with software engineering taking the lead.

There are some great reasons to feel optimistic. In the US, inflation has cooled down after reaching a four-decade high, which eases concerns about a possible recession. Although challenges remain, as digital transformation continues to accelerate, companies are reallocating budgets that were tight during the COVID-19 pandemic to invest in next-generation technologies.

According to Gartner's 2023 CIO Agenda report, a whopping 80% of CEOs are increasing their investments in digital technology to overcome economic pressures, such as limited talent availability and supply constraints. Analysts predict that top priorities will include cybersecurity, application modernization, cloud platforms, integration technologies like artificial intelligence and machine learning, as well as business and data analytics tools.

Considering the shortage of tech talent in the US, exploring the option of outsourcing your software development to Latin America should be at the top of your digital agenda. Onshore rates shot up by 23% last year, making them simply unaffordable for most small to medium-sized companies.

Now, rates have also risen in Latin America due to increased interest from big tech companies and fast-growing startups. However, Latin American professionals have the expertise and resources to onboard new projects faster and at a more affordable cost than what you'd expect to pay in the US. Plus, the time zones align well, and most Latin Americans have a strong command of English, making communication a breeze. They are also familiar with Western business culture.

But here's the thing: outsourcing isn't just about finding cheap resources to fill the gaps in your in-house team. At InstinctiveIT, our goal is to help you build outstanding software engineering teams quickly, reliably, and affordably, as an extension of your in-house team.

In today's highly competitive market, companies need to adapt their leadership approach and foster a borderless culture built on genuine relationships with their contractors. It's not just about salaries. If your engineering talent doesn't feel valued, they'll leave as soon as a better offer comes their way.