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Latin America vs. India: Where to Outsource Software Development?

Latin America vs. India: Where to Outsource Software Development?

Lower costs, access to skilled workforce, and a flexible work environment are among the top factors that make India a lucrative outsourcing destination. Still, many companies choose LatAm countries like Mexico, Brazil, and Chile for outsourcing. The reason is simple ‒ why look for outsourcing vendors overseas when reliable partners are close by and the price might not even differ significantly?

When we look closer, Latin America is truly a strong competitor in this regard. The region is known for its huge tech talent pool, reasonable salaries, and qualified developers, therefore can claim the title of the attractive outsourcing destination.

Choosing the Ideal Destination for Nearshore Software Development in Latin America

That’s why, if you are currently trying to decide between outsourcing to India and Latin America, roll up your sleeves since the choice is not that simple. Fortunately, as you’re here, you are not alone ‒ Bridge will help you make a smart decision. As a global recruitment company, we source engineers in 13 countries and can help you compare India and Latin America considering the most important factors like developer salary, tech talent pool, and more. Let’s find a perfect destination for your next tech project!

Latin America vs. India: core factors to consider

Since both India and Latin America offer promising opportunities for business companies, we will focus on key details to help you find a perfect destination to outsource your project. The first one that might influence your decision is a tech talent pool, so let’s analyze the statistics.

Talent pool

According to the Deloitte and Nasscom Report, around 5.4 million professionals are employed in the tech industry in India, while nearly 2 million people are digitally skilled experts. What’s more, India boasts of around 2 million new STEM graduates annually.

In contrast, Latin America has a tech talent pool of almost 2 million professionals that are located mainly in the top IT outsourcing destinations, such as Brazil, Argentina, and Mexico. According to Statista, 500,000 software engineers are involved in offshore development in Brazil, 225,000 ‒ in Mexico, and 115,000 ‒ in Argentina.

Cost to hire tech talent

There is a popular belief that Indian tech talent is not expensive. Perhaps, it used to be such, but today this assumption is not totally accurate. According to Statista, the overall salary increment for the IT-BPM sector is expected to increase up to 9.5% in 2023, while the average salary increment in the IT industry increased from 8.8% in 2021 to 9.7% in 2022.

What’s more, based on the research conducted among IT professionals, almost two-thirds of Indian respondents expect their pay to increase in a year, while 39% of IT experts received between 5.1% and 10% more in compensation last year.

Despite the wage growth, the average salary of software developers in India is around $900 per month according to Glassdoor, while a senior specialist can earn up to $1600 a year. Yet, it might differ based on specialization, seniority level, and more.

When it comes to Latin America, software developer salaries vary depending on the country. For example, an average software developer’s salary in Mexico is nearly $1700, while an equal professional in Brazil can make around $1100 monthly. As you see, LatAm salaries seem higher than those in India at first sight, but mind that when outsourcing to Latin America, you have numerous countries to choose from and pick the one that perfectly fits your project and budget requirements.

You can also learn more about software development salaries across the globe by reading our related article below:

Average Software Developer Salary Worldwide: Manager’s Guide

Business culture

Business culture can significantly influence how business is conducted in the region, including how companies interact with customers, partners, and employees. So before making a choice in favor of India or Latin America, make sure you understand key elements of local business cultures and can adapt to them if necessary.

One key aspect you should consider when outsourcing to India is efficient communication. India Standard Time is 9 hours and 30 minutes ahead of Eastern Time in the US, which might cause difficulties in establishing clear communication between remote teams. In contrast, the time difference between Washington D.C. and Mexico City (Mexico) is 2 hours, while New York is only one hour ahead of Bogota (Colombia), allowing companies to communicate in real-time during work hours.

Culture-wise, Indian business culture often places a strong emphasis on hierarchy, while decision-making is often top-down. Hierarchy can be present in Latin America, but there is often more flexibility in decision-making. There are also differences in negotiation styles, business etiquette, and more.

Anyway, LatAm countries seem like an appealing outsourcing destination that meets the basic tech industry’s requirements. It offers a large pool of professionals who are often bilingual or multilingual, which is perfect for tech companies that require English proficiency. For instance, Costa Rica is ranked 37 out of 111 on the English Proficiency Index, while Chile is in the 45th place. To compare, India is in the 52nd position.

As a recruitment company with years of experience, Bridge doesn’t face language issues when communicating with potential candidates. We work with local tech-savvy sourcers who speak the same language as candidates and possess in-depth knowledge of both legal regulations and cultural nuances of the specific country.

Development expertise

Coursera, an online learning platform, analyzed skills of around 100 million people across the globe and estimated overall skill proficiency in a specific country or region. India is ranked 68th in the Coursera Global Skill Report 2022. The report findings revealed 46% technology proficiency, while proficiency in Data Science is ranked 26%. The most trending technology skills are Cloud Computing (74%), Theoretical Computer Science (64%), and Operating Systems (58%). In Data Science, the proficiency is not that high with 41% for Machine Learning, 39% ‒ Mathematics, and 26% ‒ Probability and Statistics.

Coursera also researched Latin American countries, so let’s analyze some of them in terms of skill proficiency. For example, Mexico is ranked 89 in the global rating, demonstrating a 5-point increase. It has 53% proficiency in technology and 41% ‒ in Data Science. The most trending skills are Cloud Computing (91%), Web Development (86%), Computer Networking (76%), Probability and Statistics (83%), Mathematics (55%) and Data Management (55%).

We can take a look at one more LatAm country, for instance, Brazil. It is in the 63rd position in the global rank with 73% technology and 34% Data Science proficiency. Again, Cloud Computing shows the highest percentage ‒ 99%, followed by Web Development and Software Engineering with 78% and 64% respectively. Brazilians are most proficient in such Data Science skills as Data Management (88%), Machine Learning (52%) and Statistical Programming (46%).

Latin America vs. India: comparison chart

Let’s summarize key findings in a chart to simplify the process for you.

IndiaLatin America
Talent pool~ 5.4 million~ 2 million
Developer salary~ $11,000 yearlyDiffers across countries
Business cultureHas significant differences with the USA in terms of business regulations and work cultureHas similarities with the USA due to geographical proximity
Development expertise67th position in the Coursera Global Skill Report The level of skill proficiency differs across different countries of the region

Hire expert developers with Bridge

Bridge can help you hire remote talent in various corners of the world, including LatAm countries. For example, one of our clients, an influencer marketing agency Obvious.ly, needed qualified data analysts and data scientists to improve their platform. Bridge recruiters sourced 5-10 viable candidates a week, while all engineers were from Latin America. That’s what we call sourcing-as-a-service. By choosing this offer, you get a list of candidates carefully vetted to meet your project requirements and hire them now or in the future. And the best part is that you only pay a fixed monthly fee which is significantly cheaper than hiring a full-time recruiter. 

If you need to quickly ramp up your team with top tech experts, consider our IT staffing offering. In this case, Bridge sourcers look for candidates, assess their skills and work experience, and pick the most qualified ones for an interview. Next, you approve applicants, while we hire them and help onboard. You pay only a daily or monthly rate for the developer’s work.

Tell us your project requirements and we will start sourcing for candidates in your chosen location!

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