Due to the pandemic, many companies have adapted to remote practices. For this reason, most people are already familiar with effective remote operations, so they can now seamlessly transition to nearshoring.

Unlike offshoring, nearshoring focuses on locations close to the United States. As a result, there is greater time zone compatibility between companies and nearshoring workers, which means teams can collaborate and communicate in real time via video, documents, or digital channels.

In addition, nearshore services enable greater business agility because companies can demand specific results that may not be possible through their internal teams. Businesses can develop and test products and services at a faster rate and iterate accordingly.

These agile processes create greater flexibility between teams and shape a workforce ready for scalability.

Diversity also comes into play with nearshoring. With studies showing that diversity influences stronger and more creative teams, companies that choose to work with people of diverse backgrounds can benefit from a new perspective on problem solving.

Considering that many companies prioritize diversity and inclusion efforts in the new normal, nearshoring is a powerful way to increase diversity without asking people to leave their homes, families, and cultures.

Another obvious benefit is that nearshoring reduces expenses for American startups. For early-stage companies in Silicon Valley or other tech hubs, nearshoring is much more affordable, as wages and cost of living are lower than in the U.S. Not to mention, companies don’t have to cover the sponsorship of visa or transfer packages associated with the H-1B visa.

Nearshoring Hotspot for the United States:

Latin America is a clear option for US-based companies considering nearshoring.

The region has a maximum time difference of a few hours and traveling between many cities in Latin America and the United States requires only a short flight.

Knowledge of the English language is also impressive: Argentina, Chile, Mexico, Ecuador and Brazil surpassed China in terms of English proficiency.

Meanwhile, countries like Panama and Colombia have national plans in place to achieve bilingualism.

The top five Latin American locations for nearshoring include Argentina, Belize, Nicaragua, Puerto Rico, and Colombia. Argentina has an impressive record of higher education rates, along with the best English proficiency in Latin America and the promise of 5G capabilities on the way.

Belize has a workforce with experience in the tourism industry, so it is used to North American culture. Nicaragua is expefueling a large investment from the US and is committed to having more technology in education, which means younger generations are tech-savvy and show interest in the field.

Puerto Rico already has technology companies like Microsoft and GE on the island and is planning a new artificial intelligence technology center. Meanwhile, Colombia has a ministry dedicated to promoting science, technology, and innovation in the country and is home to the on-demand unicorn delivery company, Rappi.

Colombia also has an impressive number of highly qualified developers; Between 2001 and 2013, the group of IT professionals in the country reached 340,000.

How to choose a Nearshoring partner

Unlike freelance developers and tech workers, nearshoring offers companies a strategic partnership for their home teams. Nearshoring partners act as mediators to help companies find and evaluate people for projects ranging from small technical fixes, product testing, or full product launches.

They also bring their prior business experience and technical acumen, comprehensive remote operational capabilities, formal structure, high levels of compliance, and support for team success and delivery to the field.

When looking for nearshoring partners, companies must first identify the skills they need for data projects. Therefore, they must turn to nearshoring partners who have a deep understanding of these skills and target markets.

It is also useful if the partners have experience working with developers and engineers with complementary skills.

Also, it is helpful to see testimonials from companies in similar industries that have worked with the nearshoring partner and recommend their services. In short, look for experience and social proof.

At the same time, the companies are in charge of carrying out their functions and investigating the places where they want to approach the coast. Being informed about the political situation, nearshoring legislation, technology infrastructure, data capabilities, education, and quality of life in desired areas is helpful in deciding where to invest in equipment.

Opportunities and challenges

International workers are the backbone of technology in the United States. With the pandemic, the demand for developers remains high, no doubt as companies move online to stay afloat during quarantine measures.

As companies realize the benefits associated with nearshoring, it is likely to become a long-term model for partnering with foreign workers and markets. However, companies must act quickly to secure their preferred nearshoring partner and maintain business continuity for customers and stakeholders.

If you have any questions regarding nearshoring don’t hesitate to book a call with one of our experts.