The case for near-sourcing in Mexico
With more and more companies looking to near-source, augment, or build out remote tech teams, there is an increased interest in LATAM talent and the potential cost-savings of hiring developers in Mexico. Apart from the competitive salary ranges when compared with other popular outsourcing areas like Ukraine or India, Mexico has a number of other advantages.
With its proximity to the U.S., ability to span any Continental U.S. timezone, and recent investment in tech education and infrastructure, Mexico provides a perfect launching point for U.S. companies wanting to expand and grow their tech capabilities. As CodersLink notes in their Mexico Tech Salaries Report 2021, companies can save between 40% – 60% on staff salaries without sacrificing quality by hiring LATAM talent, particularly from Mexico.
A note about process and salary amounts
The following salary analysis comes from interviews with currently employed IT professionals, 14,523 registered CodersLink users, and information provided by 149 partners. Salary data is based on net salaries. Salary comparisons are using monthly averages between Junior, Intermediate, and Senior Developers and do not include benefits, bonuses, taxes, or recruiting fees.
To learn more about our process, check out Mexico Tech Salaries Report 2021.
Overall salary breakdown between different seniority levels of engineers and developers in Mexico
As is the case with the US, salaries differ between three main candidate designations.
- Junior developers or engineers have anywhere from 1-3 years of experience.
- Intermediate developers or engineers have anywhere from 4-7 years of experience.
- Senior developers or engineers have anywhere from 8-10+ years of experience.
On average, high-demand software engineers at a junior level in Mexico make an average of $2,400/month. That amounts to $14/hour, less than the minimum wage in most US states.
For intermediate software engineers in high demand roles, the average monthly salary (not including, bonuses, benefits, or taxes) is $3,733, which amounts to $22/hour.
For senior level positions, the salary range increases with years of experience, certifications, and training, but on average starts at $4,800 per month in Mexico. This breaks down to a starting rate of $28 per hour.
To put these numbers in perspective, the starting hourly rate of a senior level software developer or engineer in Mexico ($28/hr) is less than the starting hourly rate for an entry level software developer or engineer in the US ($36/hr), according to GlassDoor.
Overall Mexico salary contrast with US and India
In CodersLink recent report Mexico Tech Salaries Report 2021, we found that the average intermediate salary of overall IT salaries in Mexico are 67% less than those in the US, with an even greater difference in certain regions of Mexico, like the Yucatan Peninsula.
By the numbers, the average monthly pay for an intermediate level software engineer or developer (not including bonuses, benefits, taxes, or recruiting fees) is $3,165 per month. In the US, the average is $10,154 per month.
Not only are there significant savings in hiring LATAM talent instead of US talent, studies show there is a cost advantage in hiring LATAM talent in most software and IT fields over hiring the same roles in India.
For example, the average full stack developer has a net salary of $3,156 in Mexico. The same role in India pays $4,564 per month ($8,582 per month in the US). Not only would a company have to deal with time zone differences and greater travel costs, they would pay more to hire an equally qualified candidate in India as opposed to Mexico.
A closer look at specific jobs:
Here is a look at how the average net pay of high demand IT and software jobs compare between Mexico and the US. These are all averages based on Intermediate Level experience and do not include bonuses, benefits, taxes, or recruiting fees.
Lower Cost Does Not Mean Lower Quality
The data does not lie, companies can save a lot of money by hiring LATAM talent to fill IT positions. However, there is always the fear that lower cost equals lower quality.
In recent years, the Mexican government has made significant investments in cultivating tech talent and bolstering tech infrastructure. HP, Motorola, Oracle, and IBM have made Guadalajara their second home and Mexico City has been named the Latin American FinTech capital.
Highly rated universities and institutes, like the Tecnolgico de Monterrey and the National Polytechnic Institute, graduate highly skilled developers and engineers every year. With the combination of great schools, intentional investment, and a growing qualified talent pool, companies can build US quality tech teams with Mexico prices.
Learn more at our salary report
To learn more about tech salaries in Mexico and with a more thorough breakdown of specific jobs, as well as what to expect in benefits cost, check out CodersLink Mexico Tech Salary report 2021.
More about CodersLink
CodersLink empowers scaling companies to build, grow and manage remote tech teams in Latin America. Through remote staffing and direct placements, we ensure the best companies find the best talent to continue growing their technology teams, fill skill-gaps and respond to scaling needs.
If you’re ready to scale your company with LATAM talent, connect with us here.
