Latin America is home to creative talent with a high capacity for teamwork, highly entrepreneurial, with a good academic background and looking precisely for challenges that are up to their level. Historically, this was reason enough for the region’s talent to be in high demand to participate in the most innovative projects in terms of new technologies and digital transformation in the world, particularly companies in the United States.

In recent times, the benefits of nearshoring have brought new interest to the market. Latin America, for example, has made significant progress in terms of digital transformation.

According to recent data from the consulting firm IDC, Latin America will experience the second highest growth rate in the world in terms of digital transformation investments between now and 2025: 18.2%. That is just a few tenths of a percent below China, that leads this segment with 18.6%. What does this mean? It means that professionals in the region are highly familiar with new technologies.

But that’s not all. The region has access to high-quality public universities –in some countries, such as Argentina, they are free of charge– and some of Latin America’s educational institutions are usually well ranked globally.

Another benefit is that in some sectors in Latin America there is a considerable number of people who have a good command of English, which is essential for working with companies in the United States – the main consumer of nearshore in the region. This fact was confirmed by the EF English Proficiency Index 2022, which detected that, for example, in the case of Argentina –located among the best scoring nations in the world– the level is “high”. Chile, Paraguay, Bolivia, Brazil, Uruguay and Ecuador also received satisfactory scores.

Benefits that accrue

For some time now, North American companies have had their best allies in the other segment of the continent to build high-quality development teams, with a very high rate of people who speak English and who share a culture and their concept of work ethics.

The historical benefits often cited as advantages of nearshoring include simplified communication (beyond language, a person from the United States and one from Latin America are likely to find common ground in terms of social customs or ways of conducting themselves in a business meeting, or even in matters such as the use of leisure: entertainment, dining, travel, movies, music) and appropriate time zones that promote real-time –mostly synchronous– communications with people located at their desk at reasonable hours. Should an emergency arise, there will surely be someone available on the other end to deal with it.

“Time zones linked to nearshore facilitate collaboration between our teams and this is a great benefit,” confirms Eliezer Perez, Director of Software Engineering at agribusiness data solutions provider VAS, a Making Sense partner.

Land of opportunity

Latin America is also a resilient region by nature: its inhabitants are known for adapting to almost any scenario, solving problematic situations with ease using only the tools they have available and achieving their goals despite adversity – all qualities that are almost essential when it comes to structuring software development teams.

The opportunity is enormous for the region: the Inter-American Development Bank (IDB) estimates that the potential gain for Latin America linked to nearshoring opportunities could represent an increase in exports of up to US$78 billion.

The meeting point posed by the nearshoring model brings remarkable benefits for both parties: excellent quality talent for companies and a pay above what they can get in their country of origin, cutting-edge projects and an approach to the heart of digital transformation for developers. For both companies and professionals, the possibility of generating synergies and aligning their purposes is closer than they imagine.