U.S. Tech Firms Hunt for Cheap Home-Based Hires in Latin America

26th February, 2022.      //   Technology  // 

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The remote-work revolution has led some U.S. technology companies, from startups to Coinbase Inc. and Shopify Inc., to seek new hires in Latin America — where they can find qualified people in roughly the same time zone who’ll work for much lower pay.

It’s a logical extension of the pandemic work-from-home drift away from hubs like San Francisco and New York to less expensive locations — including across national borders. And the way currencies have shifted in the pandemic is only reinforcing the trend.

Brazil, in particular, has become steadily more appealing to those with dollars to spend. The Brazilian real has lost more than a fourth of its value since the beginning of the pandemic. Other Latin American currencies including the Argentinian peso and Colombian peso are also among the big underperformers of the past two years.

That’s why when someone like Alexandre Rocco is hired by a Silicon Valley startup, the deal looks attractive for both sides.

The Sao Paulo resident got a LinkedIn message from Brazilian headhunter Revelo in May, asking if he’d ever considered working for a U.S. firm. The 41-year-old said he’d always been curious about the idea, but had thought there’d be complex barriers to overcome. That turned out not to be the case, and within months he was working from his home as an engineering manager for San Francisco-based startup Walrus Health.

Rocco says he’s aware that he’s likely to be paid less in dollar terms than a U.S. hire would be. But it’s still a good deal for him. He says his pay went up by about 40% when he switched jobs, while declining to disclose his exact salary.

‘So, So, So Hot’

At the other end of the bargain, Walrus is benefiting from a cheaper labor pool abroad, at a time when U.S. businesses are being forced to raise wages because of inflationary pressures at home. “The Bay Area just got so, so, so hot,” according to Kimball Thomas, the chief executive officer of Walrus.

Thomas had lived in Brazil in the 2010s and knows that — despite some additional bureaucracy — “salaries are dramatically lower there.” He ended up hiring a handful of Brazil-based programmers, including Rocco, who now make up half his development team. “This is not an ad hoc solution,” Thomas said. “We really want it to work long term, and we want to invest in it.”

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