IT Outsourcing Market in Latin America: An Overview

IT outsourcing mexico

As the local technology industry thrives, it becomes increasingly challenging for US-based businesses to overcome a shortage of talent and create stable teams. To meet the growing need for software developers, many leaders opt to tap into the IT outsourcing market in Latin America in the hopes of accessing a suitable set of skills. 

If the Latin American software industry is still uncharted territory for you, read our overview of the local IT market to get an idea about its potential. In this post, you will find an overview of the three major outsourcing destinations that reign supreme in the Latin American software development market, such as Brazil, Argentina, and Mexico. Let’s dive in!

Latin American software industry: Brazil

Key facts: 

  • Home to 212 million people
  • 9th largest economy in the world
  • Language: Portuguese
  • Time zone: UTC-03:00
  • 20 unicorns
  • Number of developers: 500,000K
  • English proficiency: Low

There’s an opinion that Brazil is the promised land when it comes to the number of software developers ready to tackle your project. With nearly 25,000 IT companies operating in Brazil, attractive developer rates, and high standards of education, this region is a true magnet for many US-based companies looking for outsourcing opportunities in the Latin American software development market.

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Brazilian IT development market

Valued at $49.5 million, the country’s market accounts for the largest share of the entire IT outsourcing market in Latin America.

The top three countries that invest heavily in the local IT sector are the US, Japan, and the UK. According to ABES, software exports grew by 8.6% over 2020 and counting. There are over 6,400+ companies operating in the field of custom software, which are mostly companies with up to 100 employees in-house. Those serve such industries as Finance, Telecom, e-Commerce, and IoT. 

The IT market in Brazil focuses on the following fields:

  • Outsourcing companies (40.9%)
  • Support services (15.6%)
  • Custom-made software (12.7%)
  • IT consultancy (9.4%)
  • Other (7.7%)

As you can see, over 40% of IT companies are ready to tackle outsourcing projects, mostly working as nearshoring services for US-based companies. Among companies that chose Brazil over other options available in the IT outsourcing market in Latin America are such behemoths as Meta, IBM, Amazon, Google, Uber, Oracle, Microsoft, and Dell. 

When it comes to software development talent, Statista reports that Brazil also takes a lion’s share in the Latin American software industry: Nearly 500,000 engineers are available to join distributed IT teams. 

As far as STEM education goes, 27 universities in Brazil entered the Top Universities in Ranking QS World University Rankings (2022). The country generates over 227,000 graduates annually specializing in one of the STEM disciplines. 

According to Coursera’s 2021 Global Skill Report, Brazilian engineers are most skilled in such fields as Cloud, Software Engineering, Computer Programming, and Databases. 

According to Salary Explorer, a software developer earns BRL105,000 annually, which equals to USD22,000. According to, most software development firms charge between $25-$49 for an hour of their services, excluding fees and taxes.  

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Latin American software development market: Argentina

Key facts: 

  • Home to 45 million people
  • Second largest economy in Latin America
  • Language: Spanish
  • Time zone:  UTC−03:00
  • Number of developers: 115,000
  • 11 unicorns
  • English proficiency: High

Argentina plays a leading role in the Latin American software development market. It is well-positioned to provide solid outsourcing services and contributes 3,800 domestic IT companies to the overall Latin American software industry. A favorable time zone, solid language skills, and affordable rates are named among the most common reasons why US companies select Argentina as their go-to nearshoring region. 

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Argentinian IT development market

Argentina is one of the most promising sections in the entire Latin American software development market, as $2.7 billion in revenue is expected to be yielded within the next 5 years. The US is the biggest contributor to the development of the country’s IT sector, accounting for nearly 60% of all software outsourcing ventures. 

According to, Argentina has a strong presence in custom software development and IT consulting as well as mobile app development, web development, cloud development and IT managed services. The local IT companies provide services mostly for Finance, IT, Business, e-Commerce, and Consumer Products & Services. Most IT companies employ on average from 50 to 250 employees. 

In 2020, according to the Software & IT Services Chamber of Commerce from Argentina (CESSI), the exports of software services reached $1.6 million. Because of the pandemic, foreign investments in software decreased by 9.4% in 2020. 

Lots of well-known companies chose Argentina as a source of tech talent, including Microsoft, Google, IBM, Nokia, Cisco, and more. 

According to Statista, Argentina boasts 115,000 software developers, which is the third-largest pool of talent in the IT outsourcing market in Latin America, just behind other countries featured in our overview – Brazil and Mexico. 

When it comes to education opportunities, nearly 100,000 students pursued STEM-related education in 2020. 24 universities in Brazil entered the Top Universities in Ranking QS World University Rankings (2022). 

According to Coursera’s 2021 Global Skill Report, Argentinian developers are most skilled in such fields as Computer Programming, mobile development, and Cloud computing. 

When it comes to English proficiency, Argentinian developers are ahead of the pack in the entire Latin American software development market, taking 1st place in the region. 

According to PayScale, an Argentinian developer earns on average ARS469,000 annually, which equals USD56,000. According to, most IT companies here charge between $25-$49 per hour, without fees and taxes. 

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IT outsourcing in Mexico 

Key facts: 

  • Home to 128 million people
  • Language: Spanish
  • Time zone: UTC -7:00/-6:00
  • Number of developers: 220,000
  • 7 unicorns
  • English proficiency: Very low

Mexico has a reputation as one of the best places for sourcing IT talent, especially for US-based companies. A beneficial time zone, close geographic proximity, skilled and diverse workforce, and high ranking in the Ease of Doing Business are among the reasons why Mexico remains such a notable player in the Latin American software development market.

 Mexican IT development market

The country remains among the leaders of the Latin American software industry in terms of profitability: In 2021 Mexican IT companies generated $60 billion in revenue, showing an 8% growth compared to 2020. The credit for this notable achievement goes to such sectors as IT service providers and product development. At the same time, cloud services providers saw a 20% increase in revenue over the past few years, which makes them the most profitable sector. It’s also worth mentioning the startup sector is also seeing an unprecedented growth – it generated $3.38 billion in 2021. shows that IT outsourcing in Mexico deals mostly with Finance projects, Consumer Products & Services, and Telecom services. Most companies have an internal staff of up to 50 employees. Global tech companies that rely on Mexican talent include Netflix, Google‍, Microsoft, and Amazon.

According to Statista, Mexico’s pool of tech talent is estimated at 220,000 software developers, which makes the country a forerunner to Brazil in terms of its capacity. Forbes also reports that 110,000 graduates join the IT market each year. 

Not only is Mexico the largest pool of tech talent in the Latin American software development market, it’s also considered to be the most skilled. According to SkillValue, Mexican developers come second in the ranking of the best software programmers and developers globally. Global Innovation Index reveals that Mexico now takes second place among Latin American countries, just behind Chile. 

24 universities in Mexico entered the Top Universities in Ranking QS World University Rankings (2022). 

According to Coursera’s 2021 Global Skill Report, Mexican developers are most skilled in such fields as Mobile development, Database and Operating Systems development. 

When it comes to English proficiency, Mexico is well behind Argentina and Brazil and takes 92nd place globally. 

According to Glassdoor, a software developer in Mexico earns MXN385,596 per year, which equals to USD19,7593. According to, most firms specializing in IT outsourcing in Mexico charge between $25-$49 hourly, not taking into account fees and taxes. 

READ ALSO: How to Pick the Best Nearshore Software Development Company


As a company that specializes in the IT outsourcing market in Latin America, we can say that the region is rather promising in terms of business climate and a variety of tech talent. We at nCube can help you build a skilled team of software developers based in Latin America, so feel free to contact us to discuss your tech talent needs. 

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