U.S. tech firms are replacing workers with cheaper talent in Latin America


IMAGE/Camillo Freedman for Rest of World

Poaching and coaching novice developers is local startups’ only solution.

For Andrea Campos, founder of the Mexico-based mental health app Yana, finding developer talent nowadays reminds her of the dating scene growing up in Cancún. 

“If you wanted a boyfriend, you had to accept the hard reality that the guy you chose had already dated at least one of your friends before,” Campos told Rest of World. Much like potential dating partners in a small city, these days senior developers with experience and skills are a scarce commodity in Latin America, forcing her to flirt with other startups’ talent, she said. “There is just no option but to poach from other startups.”

Campos has been on the prowl for a while now. When Rest of World first met her early last year, Latin American startups and tech companies were struggling to recruit and retain talent. Her predicament was exacerbated by the fact that many U.S. companies had taken advantage of their geographic proximity to the region and outsourced jobs across the border — one company offered $15,000 a month to one of Campos’ former developers. “We can’t compete with that,” Campos had told Rest of World in January 2022. Now, she says finding experienced tech workers has become even harder.

Rest of World spoke to 18 entrepreneurs, recruiters, and developers in Mexico, Peru, and Uruguay, all of whom acknowledged that the recent layoffs across the tech sector globally haven’t freed up experienced developers for hire by regional companies. One of the major reasons for this, they say, is that though U.S. companies are tightening their belts, their technical needs remain the same, leading them to look abroad for cheap programming labor. This has forced Latin American startups to become creative in fulfilling their own hiring needs — from training junior employees to poaching more senior programmers from competitors.

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