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Why US companies should hire talent from Colombia

Access to talent
CXC Global7 min read
CXC GlobalMay 14, 2024
CXC Global

Broadening the talent search beyond borders

Five years ago, working remotely was an anomaly. Not even a trend.

“Wow… you work remotely? That’s so cool!”.

One crippling global pandemic later, and remote work is the standard working model for huge segments of the professional world.

Forward thinking companies – not those desperately trying to get workers back in the office full-time – are capitalising on the remote working trend. And a primary way they’re doing this, is by expanding their traditional hiring practices and talent pools to a global workforce.

There’s plenty of strategic advantages of hiring outside of your local market. At a minimum these include:

  • Optimising labour costs. Offshore workers frequently cost less than local workers.
  • Elevated brand image, on a global scale.
  • A great way to expand globally, without having to transfer talent from your home-based headquarters.
  • A great way to diversify skills in your business and combat skills shortages.
  • International markets can expand your business’ operating hours.
  • …. amongst others.

One of the key markets proving to be a rich source of quality talent is Colombia. With a burgeoning creative and tech talent base, a skilled and diverse workforce and an easy time-zone integration, Colombia is fast becoming an exemplary talent opportunity for US companies.

Today, we’re looking at the strategic advantages of sourcing talent in Colombia, including the best way to leverage talent to optimise your business potential.

Core advantages of hiring Colombian talent

Cost-effective talent solutions

The economic benefits of hiring workers from Colombia provide an opportunity for competitive advantage for US companies. With salaries and labour costs typically lower than other offshore talent sources with similar skill levels, Colombia is an attractive option for US companies hoping to expand their footprint, while reducing operating expenses.

Top-level professionals that come without top-level US salaries are a clear strategic advantage. Given the lower cost of living in Colombia, salary expectations for highly qualified professionals are incredibly competitive for US companies hiring in the region. This allows employers to achieve significant cost savings without compromising on workforce quality.

Overall, Colombia provides an economically sound option for companies looking to optimise their payroll expenses.

Of course, when hiring talent in Colombia, understanding the financial and tax landscape is crucial to gain greatest investment advantage.  And this comes down to your payroll strategy. Partnering with a global payroll provider (like CXC), is the most effective way to access tailored processes aligned to your business needs, while being compliant with all Colombian workplace laws and statutory requirements. More on this later.

A skilled and diverse workforce

Colombia is a culturally diverse country with a heritage of creativity, collaboration and innovation. The diversity of Colombian workers offers a valuable source of ideas to the workplace, offering fresh perspectives to US companies.

Colombia’s education system produces a highly skilled, highly educated workforce. Many universities in the country offer industry training in fields including technology, engineering, and business so university leavers start in the workforce with real world experience.

Increasingly, Colombia is becoming known for high-quality talent excelling in the technology and creative industries. For technology, the Colombian business ecosystem is harnessed heavily on digital transformation, making the country one of the main providers of technology-based services in the region. To this end, Colombia is looking to the future with a mission to reduce inequality while boosting local equity for its population. Its growing software and IT services industry is a great example of this mission. The industry boasts specialised technology solutions in verticals including fintech, government, telecommunications, healthcare, oil and gas, energy, agribusiness, logistics, digital marketing, virtual and augmented reality and big data.

For creative industries, Colombia launched a new public policy to stimulate the creative economy in 2017. Dubbed The Orange Economy, this is a policy that is unique in its approach to supporting creative endeavours and mainstreaming creativity and culture across the Colombian economy. The policy has been the impetus for the creation of creative districts or Orange Development Areas (ADNs). Creative Districts are growing in Colombia, as knowledge of creativity and innovation-based development strategies gain increasing recognition as drivers of local economies.

ADNs are seen as an opportunity to congregate people, ideas, industry and policymakers around creative economy projects that promote innovation, raise artist revenues and generate positive impact on urban renewal.

Source: OECD

Cultural and time zone compatibility

Colombia offers US companies the opportunity for seamless business expansion and collaboration due to both the time zone compatibility, and cultural similarities.

Colombia’s geographic location shares the same time zone as many states in the US and Canada. This makes it easy to establish real-time collaboration and easy communication with talent based there. Factors like last-minute meetings and daily correspondence are seamless when the offshore team isn’t working in a time zone eight to 12 hours ahead of your headquarters.

The cultural similarities with US companies also allow for easy assimilation of workers. Known for their adaptability, work ethic and collaborative mindset, cultural compatibilities between Colombian employees and US based teams further enhance the appeal factor of Colombian talent. Colombian workers have a familiarity with and tendency to focus on relationship-building and teamwork. This cultural mindset aligns with the globalised nature of many US based industries, and so the ability to create a sense of unity and shared goals in the workplace, inevitably materialises.

English proficiency and international outlook

As a working nation, Colombians are becoming more and more globalised in their outlook and working experience. Most Colombians are bilingual or multilingual with proficiency in English and Spanish – a hugely beneficial factor for companies operating out of the US, where communication with clients and colleagues is critical.

Also, Colombians are known for their impressive communication skills, eliminating one of the major hurdles of remote collaboration. Companies in the US with a Colombian based team typically experience better communications between global teams, greater transparency and clarity around projects and work demands and importantly, a better, more unified cross-border company culture.

Colombian workers are becoming increasingly accustomed to the global way of doing business. Their working lens tends to be international, with an increasing desire to be a part of the global working landscape. And with government support such as the ‘Work From Colombia’ initiative, the country is an attractive destination for remote workers: with heavy investment in digital infrastructure, there is widespread internet access and reliable connectivity throughout the country.

Legal and compliance considerations

An awareness and compliance with labour laws is critical for US companies engaging workers in Colombia. The Colombian Labor Code (Código Sustantivo del Trabajo) specifies the rights and responsibilities of both employers and employees, and is the primary source of Colombia’s labour law system.

It’s recommended US employers allocate resources to stay informed about changes or updates to the labour laws, hire legal representation when necessary, and implement internal company policies that keep the organisation compliant. An investment in legal compliance is paramount for the long-term sustainability of US businesses engaging Colombian talent.

Failure to adhere to the Labor Code can result in significant fines and legal challenges, not to mention reputational damage for the US business, in the local talent market.

In addition, it’s important to understand the different categories of talent in Colombia so as a US based business, you can engage talent that are suited to your specific needs. Broadly, these categories are:

Fixed-Term Contracts (Contrato a Término Fijo):

  • These contracts with a finite duration, often linked to a specific project or a temporary need within the company.
  • The employment relationship automatically terminates at the end of the agreed term.

Indefinite-Term Contracts (Contrato a Término Indefinido):

  • Employment contracts with no fixed end date and continue until terminated by either the employer or the employee.
  • These contracts provide more job security for the worker.

Part-Time Contracts (Contrato a Tiempo Parcial):

  • Contracts with reduced working hours compared to a standard full-time position.
  • Workers receive full-time equivalent benefits based on their part-time status.

Fixed-Term Task Contracts (Contrato de Obra o Labor):

  • Like fixed-term contracts, these are used for provision of specific tasks or projects.
  • The contract ends upon the completion of the allotted tasks.

Apprenticeship Contracts (Contrato de Aprendizaje):

  • These contracts for workers in training or apprenticeship programs.
  • They have a finite duration and are typically associated with educational or vocational training.

Intermittent Contracts (Contrato Intermitente):

  • Intermittent contracts allow for irregular periods of work with breaks in between.
  • This is a contract suitable for jobs that have inconsistent work patterns or requirements.

Telecommuting Contracts (Contrato de Teletrabajo):

  • With the rise of remote work, some contracts may specifically address telecommuting arrangements.
  • Terms related to remote work, communication, and performance expectations are outlined in such contracts.

Seasonal Contracts (Contrato de Temporada):

  • Seasonal contracts are used for work that is tied to specific seasons or periods of the year.
  • Common in industries such as agriculture, retail, hospitality or tourism.

As a US business, it’s important that you select the right contract for your worker based on the nature of the work they will be undertaking. This is where classification of workers comes into play, and where a partner like CXC can help mitigate the risk. Click here for deeper insights into compliance and worker classification.

Leveraging Colombian talent for competitive advantage

The strategic benefits of incorporating Colombian talent into a US workforce make hiring in this Latin American nation incredibly appealing. From cost efficiency, enhanced innovation and talent diversity to cultural and language alignment with the US, there’s plenty of competitive advantage to be gained from engaging Colombian workers.

As a US based organisation, we encourage you to consider Colombia as a strategic and commercially valuable component of your global talent acquisition strategy. To achieve long-term success partnering with a professional employment organisation (PEO) will make your hiring and global expansion into Colombia seamless, compliant, and most importantly – commercially worthwhile.

Expand your talent horizons by tapping into Colombia’s dynamic workforce. With CXC’s expertise in Employer of Record (EOR) services, your company can effortlessly integrate Colombian talent into your team, ensuring compliance, cultural fit, and competitive edge. Contact us to explore how we can support your global talent strategy.

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About CXC

At CXC, we want to help you grow your business with flexible, contingent talent. But we also understand that managing a contingent workforce can be complicated, costly and time-consuming. Through our MSP solution, we can help you to fulfil all of your contingent hiring needs, including temp employees, independent contractors and SOW workers. And if your needs change? No problem. Our flexible solution is designed to scale up and down to match our clients’ requirements.

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