Cost of Hiring in Latin America vs the US (2026 Breakdown)

The Real Cost of Hiring: US vs Latin America

When US companies compare hiring costs between domestic and LATAM talent, most only look at base salary. That is a mistake. The true cost of an employee includes benefits, payroll taxes, equipment, office space, recruiting fees, onboarding time, and management overhead. When you account for all of these factors, the savings from hiring in Latin America are even larger than the salary gap suggests — typically 50-70% lower total cost. This guide breaks down every component so you can build an accurate budget. Updated February 2026.

Total Cost Breakdown: What You Actually Pay

Let us start with the full picture. Below is a breakdown of every cost component for a US-based employee versus a LATAM employee hired through Nexus. We use a senior software engineer as the example, since it is the most commonly hired role.

The total savings per senior engineer position is approximately $167,000 per year — or $14,000 per month. This is not a theoretical estimate; it reflects the real cost structure that Nexus clients experience across hundreds of placements.

Salary Comparison by Role (10+ Roles)

Cost savings vary by role. Technical roles (developers, data engineers) have smaller percentage savings because LATAM tech salaries are rising. Non-technical roles (VAs, customer support) have the largest percentage savings. Below is a comprehensive comparison across the most commonly hired positions.

Hidden Costs of Hiring in the US

Many US hiring managers underestimate the true cost of domestic employees because several expense categories are invisible at the offer stage. Here are the hidden costs that make US hiring significantly more expensive than it appears.

• ✓Recruiting fees — External agencies charge 20-25% of first-year salary. For a $168,000/year engineer, that is $33,600-$42,000. Internal recruiting teams cost $80,000-$120,000/year per recruiter.
• ✓Time-to-hire — The average US tech hire takes 36-42 days. Every unfilled day costs the company in lost output. At $700/day for a senior engineer, a 6-week vacancy costs $21,000 in lost productivity.
• ✓Health insurance — Employer-sponsored health plans cost $7,000-$18,000 per employee per year, depending on plan type and family coverage.
• ✓Payroll taxes — Employers pay 7.65% for FICA (Social Security + Medicare), plus state unemployment taxes (0.5-5.4% depending on state).
• ✓Office space — Even hybrid employees need desk space. Average cost in major metros: $500-$1,500/month per seat.
• ✓Turnover costs — The cost of replacing a US employee is estimated at 50-200% of annual salary when you factor in recruiting, onboarding, and productivity ramp-up. US tech turnover averages 13-15% annually.
• ✓Benefits administration — HR software, compliance, open enrollment, 401(k) administration — these overhead costs add $200-$400/month per employee.

When you add up recruiting fees, time-to-hire costs, benefits, taxes, office space, and turnover risk, the true cost of a US employee is typically 30-45% higher than their base salary. This is why the salary gap between US and LATAM understates the real savings.

ROI Calculation: Building a 5-Person LATAM Team

Let us model a realistic scenario. A US SaaS company needs to hire five remote employees: two senior software engineers, one senior React developer, one customer support specialist, and one virtual assistant. Here is the annual cost comparison.

The annual savings for this five-person team is approximately $600,000. That is enough to fund three additional LATAM hires, invest in product development, or extend runway by 12-18 months for an early-stage startup. Over three years, the cumulative savings exceeds $1.8 million.

Cost Comparison by Country

Within Latin America, costs vary by country. The table below shows average monthly salaries for a senior software engineer in each country, along with other cost-of-hiring factors.

For maximum cost savings, Colombia is the clear winner. For the best quality-to-cost ratio on technical roles, Argentina leads. For time-zone alignment with the US East Coast, Colombia and Mexico are ideal. Brazil is the best option when you need to hire a large team quickly due to the sheer size of its talent market.

When to Hire LATAM vs US

LATAM hiring is not always the right choice. Here is a framework for deciding when to hire in Latin America versus domestically.

Hire in LATAM When:

• ✓You need to reduce burn rate or extend runway without cutting headcount.
• ✓The role does not require US-specific credentials (e.g., CPA license, security clearance).
• ✓You are comfortable with remote work and have remote management processes in place.
• ✓You need to hire quickly — LATAM agencies like Nexus can deliver candidates 2-3x faster than US recruiting.
• ✓The role benefits from time-zone overlap (LATAM offers 4-8 hours of overlap with US business hours).
• ✓You want to scale a team (3+ people) without proportionally scaling overhead costs.

Hire in the US When:

• ✓The role requires US-specific licenses or certifications (CPA, bar admission, security clearance).
• ✓The position involves handling sensitive government contracts with domestic-only requirements.
• ✓You need someone on-site for physical tasks (hardware, lab work, in-person client meetings).
• ✓The role is C-suite or senior leadership where in-person presence drives culture and strategy.
• ✓Your company does not yet have remote work infrastructure or culture.

Maximizing Your Savings

To get the most value from LATAM hiring, follow these best practices: pay at the 60th-75th percentile of local market rates (this reduces turnover, which is the biggest hidden cost). Use a staffing partner that handles compliance (to avoid misclassification penalties, which can reach $50,000+ per incident). Invest in onboarding — a structured 30-60-90 day plan increases 6-month retention by 40%. And consider hiring two mid-level professionals instead of one senior — the output is comparable at 60-70% of the cost.

See Transparent Pricing by Role

Nexus publishes salary ranges and pricing on every role page — no "request a quote" forms. Explore the roles below to see what your next LATAM hire will cost.

Hire a Software Engineer — See Salary & Pricing →

Hire an Accountant — See Salary & Pricing →

Hire a Virtual Assistant — See Salary & Pricing →

Hire Customer Support — See Salary & Pricing →

Start Saving with LATAM Hiring

The math is clear: hiring in Latin America saves US companies 50-70% on total employment costs while accessing a deep pool of skilled, English-speaking professionals in overlapping time zones. Whether you need one virtual assistant or a team of ten engineers, the ROI is immediate and compounding.