7 Benefits of Hiring International Employees

These days, the top job candidates have a lot of options open to them — and many businesses are struggling to make quality hires. If you’re having trouble filling roles at your company, it’s easy to believe that the talent you need just isn’t out there. 

But what if you’re looking in the wrong place? 

Thanks to rapid improvements in communication technology over the past decade or so — and a shift in perspective brought about by the pandemic — more and more companies are no longer considering location as a key factor in their hiring decisions. 

When you open your eyes to hiring international employees, you’re no longer limited to the few hundred people with the right qualifications who happen to live within commuting distance of your office. Suddenly, you have a pool of thousands of skilled, talented professionals to target.

And hiring internationally has plenty of other benefits too.

7 advantages of hiring international employees for your company

Here are some of the top benefits you could see if you choose to hire internationally instead of sticking to candidates in your local area.

1. Access to a wider talent pool

The best talent isn’t necessarily located where you are, so why limit yourself to a local talent pool? When you consider hiring abroad for remote positions, you open the door to a huge pool of talent around the world. 

This is particularly important for companies located in populated urban areas where competition is high. In these places, the top talent has a lot of options to choose from — and can command high salaries. However, by choosing not to limit yourself by geographical location, you can uncover hidden talent pools in areas with less competition.

2. Increased diversity

Most of us instinctively know that diversity is a good thing for a company to aim for — but it makes good business sense too. According to McKinsey research, companies in the top quartile for racial and ethnic diversity are 35% more likely to have above-average financial returns for their industry. And according to People Management, companies with diverse teams are 87%  better at decision-making. 

By choosing to hire internationally, you can organically build a strong and diverse workforce. This can help you to create an international, multi-cultural environment that encourages everyone to thrive, no matter their background — and you may even see great business results too.

3. Creativity and innovation

Another advantage that comes from hiring people of different nationalities, cultures and backgrounds is the wealth of experience and diverse viewpoints they’ll bring with them. And a company whose employees have a wide range of ideas and unique perspectives is an ideal environment for creativity. 

The potential for innovation is far greater in companies with diverse teams than in homogenous ones. In fact, a recent Forbes article suggests that companies with above-average diversity produce a 19% greater proportion of their revenue from innovation than those with below-average diversity.

4. A rich and fulfilling company culture

One of the most important things you can do as an employer is to create a rich, fulfilling and inclusive company culture where everyone feels welcome and encouraged to succeed. And, while it may seem strange to suggest that having a workforce that’s spread around the globe can help you to achieve this, the fact is that the sharing of international perspectives and ideas can have a huge impact on your culture. 

When you hire internationally, this sends a message to each employee, telling them that you truly value them and their work, wherever they’re located — and that you believe they’re the best person for the job, not just the best available in your city.

5. Improved access to international markets

Are you planning an expansion overseas? While this is an exciting time for any company, the fact is that many planned expansions flop because companies fail to fully understand the culture and values of the country they’re trying to expand into. 

Naturally, having employees in multiple countries can give you an edge over other companies when it comes to accessing those markets. Your employees can give you access to a nuanced understanding of their own country, including its culture, customs, language, and connotations — so you can avoid embarrassing marketing blunders and make your expansion a success.

6. Potential cost saving

Many companies choose to hire overseas employees as a way of saving money — and there are many unethical and even abusive practices that go on in this area. However, it is possible to save money by hiring internationally in a way that’s open and fair to everyone.

For example, you could look for talent pools in countries or cities where demand for particular skills is lower, but where there are nonetheless highly skilled professionals looking for work. In many cases, it’s possible to offer a competitive salary that compensates your employees fairly, while still saving you money compared to the market rate in your local area.

7. Improved customer service

Your customers are — more than likely — not one homogenous mass. And your team will be better equipped to serve them if they’re not either. Recruiting employees from different parts of the world can help you to provide a more well-rounded, personalised, and appropriate service to your customers. 

Naturally, a big part of this is having multilingual employees who can communicate with your clients in their own language. But there’s a cultural side to it too: a 2013 Harvard Business Review found that when at least one team member shares an ethnicity with a client, the team was 152% more likely to fully understand the client’s needs.

Hiring internationally: what are your options?

While hiring international employees can bring a wide array of benefits to your business, it can be a bit of an administrative headache. When you’re hiring overseas, you need to make sure you’re doing so in a way that’s legal, compliant, and fair — and doesn’t put your company at risk in terms of tax liability or other issues. 

There are a few different routes you can take if you want to hire staff members who live and work abroad.

Open a local subsidiary

The traditional way to engage employees abroad is to open a subsidiary company in the country where the employees are based. A subsidiary is a legally independent business entity that can be wholly owned by your main company, but which must comply with the employment laws and tax obligations of the country it operates in. 

This is a good route to take if you only want to hire in one country, you need to set up a physical location there, and you’re familiar with the laws and hiring customs of the country. However, it can also be a costly and time-consuming undertaking, and is often not worth it to just hire one or two remote employees.

Hire foreign independent contractors

In some circumstances, you may be able to engage foreign nationals as independent contractors instead of hiring new employees. This is an attractive option as it doesn’t usually require you to get to know the laws, tax regulations and other particularities of the countries where your contractors are located. It can also be a financially prudent option, as you’ll only pay the fee negotiated with the contractor and not the numerous other costs associated with hiring a foreign worker. 

However, this is a method that should be used with caution, as companies can face legal consequences if they’re found to be engaging in false self-employment. You should only choose this route if the contractor will legitimately be working as an independent, external partner, and not an employee.

Use an employer of record (EOR) or global employment organisation (GEO)

Alternatively, you could choose to work with an employer of record (EOR), a global employment organisation (GEO), or another organisation that’s set up to help companies employ overseas talent. 

If you choose this option, the company would be your employees’ official employer for tax purposes. They are usually responsible for the administrative side of the hiring process and handle things like background checks, income tax declarations and withholding, payroll and benefits, and even making arrangements for visas and work permits.

CXC: your international hiring partner

If you’d like to access the benefits you can get from hiring talent overseas but you’re not sure where to start, working with an organisation like CXC could be the solution you need. We’re experienced in helping companies of all sizes to hire talent overseas, and can handle everything from sourcing to compliant, international payroll. 

Interested? Learn more about our global payroll service here.

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