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Why Nearshoring is Vital to the U.S. Tech Sector Right Now


In June 2020, President Trump temporarily suspended work for H-1B visa holders in the United States. Demand for top-tier tech talent was already fierce in the U.S. before the decision. Still, the ban has placed significant additional pressure on companies that can no longer rely on sourcing international workers. Here is why nearshoring is vital to the U.S. tech sector right now.

The tech sector hires 85,000 foreign specialists every year and finds alternative ways such as nearshoring to sustain its workforce.

Before the Ban

An option prior to the ban, nearshoring, has been emerging as an attractive solution, particularly as remote work becomes even more commonplace in the tech sphere. Nearshoring is when companies hire teams overseas but in locations close by and share a time zone.

Not only is nearshoring ideal to harness foreign tech talent, but it can also save businesses up to 80 percent on costs. Considering many companies are struggling financially because of the COVID-19 pandemic, such savings are a much-needed lifeline.

Big data experts, programming consultants, and digital strategists from software engineers, the scope of potential nearshored roles, are vast. Here’s why nearshoring is vital to the U.S. tech sector right now:

The Value of Nearshoring

As many businesses have adjusted to remote practices due to the pandemic, most people are already familiar with operating effectively at a distance so that they can make a seamless switch to nearshoring.

Unlike offshoring, nearshoring focuses on locations within proximity to the U.S. As a result, there is greater time zone compatibility between businesses and nearshored workers, meaning teams can collaborate and communicate in real-time via video, in documents, or via digital channels.

Likewise, nearshore services allow for heightened business agility because companies can request specific deliverables that may not be possible through their in-house teams. Companies can, therefore, develop and test products and services at a faster pace and iterate accordingly.

These agile processes create greater flexibility among teams, as well as shape a ready-to-scale workforce. By accelerating the time to market and having an on-the-ground presence in international markets, nearshoring helps identify places to expand into and poises companies for quicker growth.

Diversity also comes into play with nearshoring. With studies showing that diversity influences stronger, more creative teams, companies that opt to work with people from different backgrounds can benefit from a new perspective on solving problems.

Considering that many businesses prioritize their diversity and inclusion efforts in the new normal, nearshoring is a powerful way to boost diversity without asking people to leave their homes, families, and cultures.

Another noticeable draw is that nearshoring reduces expenses for U.S. startups. For early-stage ventures in Silicon Valley or other tech hubs, nearshoring is far more cost-effective, as salaries and living costs are lower than in the U.S. Not to mention, companies don’t have to cover visa sponsorship or relocation packages associated with the H-1B visa.

Nearshoring Hotspots for the U.S.

Latin America is a clear choice for U.S.-based companies facing obstacles related to the H-1B visa suspension.

The region has a maximum time difference of a few hours, and travel between many Latin American cities and the U.S. requires only a short flight.

English-language skills are also impressive there – Peru, Chile, Mexico, Ecuador, and Brazil have all surpassed China in English proficiency.

Meanwhile, countries like Panama and Colombia have ongoing national plans to reach bilingualism.

The top five Latin American spots for nearshoring include Argentina, Belize, Nicaragua, Puerto Rico, and Colombia. Argentina has an impressive track record of high education rates, along with the best English proficiency in Latin America, and the promise of 5G capabilities coming soon.

Belize is home to a workforce with experience in the tourism industry, so it is accustomed to North American culture. Nicaragua is experiencing elevated investment from the U.S. and has committed to having more technology in education, meaning younger generations are tech-savvy and show an interest in the field.

Puerto Rico already has tech companies like Microsoft and GE on the island and has plans for a new artificial intelligence technology center. Meanwhile, Colombia has a ministry dedicated to furthering science, tech, and innovation in the country, and is home to the unicorn on-demand delivery company, Rappi.

Colombia boasts an impressive number of highly-skilled developers, too; between 2001 and 2013, the country’s pool of IT professionals hit 340,000.

How to Choose a Nearshoring Partner

As opposed to freelance developers and tech workers, nearshoring offers companies a strategic partnership to source teams. Nearshoring partners serve as mediators to help companies find and vet people for projects ranging from small technical fixes, product testing, or full product launch.

They also bring to the table their previous business experience and technical acumen, full remote operation capabilities, formal structure, high compliance levels, and support for the team to thrive and deliver.

When looking for nearshoring partners, companies should first identify what skills they need for the given projects. They should then approach nearshoring partners that have a deep understanding of these skills and target markets.

It’s also worthwhile if the partners have experience working with developers and engineers with complementary skill sets.

Additionally, it’s useful to see testimonials from companies in similar industries that have worked with the nearshoring partner and recommend their services. In short, look for experience and social proof.

At the same time, companies are responsible for doing their own homework and researching the locations they want to nearshore in. Being informed about the political situation, legislation for nearshoring, tech infrastructure, data capabilities, education, and quality of life in the desired areas, is useful when deciding where to invest in teams.

Opportunities and Challenges

International workers are the backbone of tech in the United States, and abruptly preventing them from accessing the country is not a sustainable option for companies. Amid the visa ban and pandemic, developers’ demand remains high – no doubt, due to companies moving online to stay afloat during quarantine measures.

While Trump’s order certainly blocks access to international talent in the U.S., it actually opens the door for foreign developers with niche skills that aren’t always available locally.

As companies realize the perks associated with nearshoring, it’s likely to become a long-term model for leveraging overseas workers and markets. Nonetheless, companies need to move quickly to secure their nearshoring partner of choice and maintain business continuity for clients and stakeholders.

Image Credit: iStock

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Remote Recruitment – Tools, Best Practices, and Latest Trends

remote recruitment

With an increase in companies and organizations working remotely, there has been a significant rise in remote recruitment. Naturally, this has created a change in the organizational structure and the means of communication between the recruitment team and hiring managers.

HR professionals and recruiters are trying to adjust to remote recruitment while ensuring that the efficiency of information flow among the team is maintained. In such a scenario, it is imperative to choose the right set of tools and follow the best practices that can aid in remote recruitment.

Unless you do so, you risk losing the best talents due to the sheer lack of adaptability from your end.

How to choose the right set of HR tools to use in 2020?

remote recruitment tools
Remote Recruitment: Tools to use

There are many recruitment tools available, and choosing one depends on the goal that you want to achieve using the tool.

The remote recruitment process involves sourcing the candidates, scheduling interviews, screening amp; interviewing candidates and hiring them.

Recruitment tools assist in all these areas and help in streamlining workflow.

Recruitment tools help in sourcing candidates, screening amp; assessing candidates, scheduling interviews, maintaining a database of candidates, engaging with the candidates, interviewing them across different platforms, sharing the candidate profiles with the hiring managers, and getting feedback from the candidates.

Use tools that help you with either all or some of the steps involved in the hiring process.

Here are some of the tools that recruiters use to streamline their hiring process.

Applicant Tracking System (ATS)

According to research by Capterra, almost 75% of recruiters and talent managers use recruitment software or ATS. Of those, 94% agree that using those software has improved their hiring process by reducing cost and fastening the entire hiring process.

  • ATS is one of the most widely used recruitment tools and helps recruiters simplify their hiring process. Most ATS has these following features.

    -Advanced job sourcing and job board integration.
    -Saved candidate profiles and candidate databases for easy search.
    -Resume parsing and screening.
    -Interview scheduling, customized interview questions, and automated email replies.
    -Hiring metrics and insights.
    -Easy team collaboration.

    Some well-known ATS are- Taleo, Jobvite, Greenhouse Software, Homegrown, etc.

  • Candidate Sourcing Software

    Candidate Sourcing Software assists recruiters in sourcing both active and passive candidates through the web. Recruiters can source high-value candidates without frantically searching across different platforms.

    Job aggregators, candidate sourcing platform, and AI sourcing tools are some common forms of Candidate Sourcing Software.

  • Candidate Relationship Management (CRM) Software

    CRM Software is used by recruiters to improve candidate engagement and experience. According to a Glassdoor study, about 47 % of job applicants cited untimely responses and lack of information about job responsibilities as the primary causes of frustration.

    The importance of candidate engagement and experience has increased now, more than ever. Through CRM software, HR professionals can engage with candidates in a timely and personalized manner and build a good relationship with them.

  • Some well known CRM software are – Smashfly, Avature, etc.
  • Recruitment Marketing Software

    The significance of the employer brand has never been so important. A study by TalentNow highlights that, for 84% of job seekers, the employer’s reputation is an important factor, with 50% of candidates stating that they wouldn’t work for a company with a bad reputation even if the pay increases.

    Recruitment Marketing Software helps recruiters use marketing techniques to create brand awareness, generate interest towards your company, and attract top talent for open positions.

    Recruitment Marketing helps in employer branding, candidate engagement, CRM, candidate experience, and uses analytics for data-driven decisions.

  • Video Interviewing Software

    With remote recruitment gaining momentum, Video Interviewing Software has also become an essential tool for the recruitment process.
    Video interviewing software enables recruiters to connect with candidates anywhere globally and enjoy a seamless interview experience powered with analytics.

    Well known video interviewing software are ConverIQ, Hire Vue, and Spark Hire.

  • AI and automation Software

    In recent years, AI in recruitment has been tremendous growth and potential. AI for recruitment uses Artificial Intelligence to automate repetitive tasks and helps HR professionals streamline their entire workflow.

    AI software not only assists in reducing the bulk load of recruiters and hiring faster, but it also reduces human bias in recruitment, diversity hiring, facial expression analysis, personalized candidate engagement, and automated interview process.

    Some of the emerging AI tools for recruitment:

    -Arya- Automated sourcing of candidates.
    -X or Chatbot recruiting assistant that communicates with candidates across various platforms.
    -FreJunHR– Streamlines the entire interview process from scheduling to sending.
    -WhatsApp messages; auto-dialing to generating candidate analytics using AI.

How to communicate with recruiters working remotely?

When working remotely, communication is one of the most critical factors for ensuring accountability and information sharing among team members. This explicitly holds for recruiters who need to ensure that information flow between hiring managers (frejun) are maintained, and the hiring process is working smoothly.

Here are the tips for communicating effectively with recruiters working remotely.

  1. Plan a remote communication policy with your team.
  2. Choose the tools to use for communication.
  3. Minimize emails and focus on automation.

Best practices for remote recruitment

remote recruitment best practices
Remote recruitment: Best practices

Whether you are new to remote recruitment or have been recruiting remotely for a while, there are some best practices that you should follow to up your recruitment process. Here are some of the things remote recruiters should do daily for an efficient remote hiring process.

  1. Maintain a standard recruitment process

    Since remote recruiters work from different locations, a centralized process is vital for proper information flow between recruiters, teams, and managers.

    Recruiters should follow a standard recruitment process through a well-documented recruitment policy. Among other things, the policy should include your mode of communication, meeting schedules, and tools amp; platform to be used for different levels of the recruitment process.

  2. Use technology to assist you in the hiring process

    Hiring can be a daunting task when you are continually juggling from one step to another. But with assistance from digital tools and technology in every step of the hiring process from sourcing to remotely screening to interviewing to onboarding, you can significantly improve the speed and efficiency of your hiring process.

  3. Maintain regular communication with teams

    Remote recruitment thrives in communication. To ensure that recruiters are sourcing the right candidates, recruiters should not only be clear about the job description but should also be clear about the company’s culture and the type of candidate that fills the culture.

    Hence, it is essential for recruiters to maintain regular communication with their teams and hiring managers.

  4. Engage with candidates

    Engaged candidates are more likely to show up for the interview and have a good candidate experience. Remote recruiters should understand the popular digital channels their target profiles use to engage with them accordingly.

    Some of the ways to engage with candidates are through social media channels, emails, text messages, and phone calls.

  5. Practice video interviewing often

    For remote recruitment, video interviewing is a core skill that will help recruiters and hiring managers to understand and evaluate the candidates better.

    Practice video interviewing every day to get comfortable with the process. Also, always double-check your network connection, software, and hardware before starting the interview.

    Always keep a plan B handy, in case there are some unexpected errors or glitches from either end.

  6. Focus on building the employer brand

    According to a survey by Careerbuilder, 64% of candidates said they research a company online after finding a job offer, and 37% said they would move on to another job offer if they can’t find information on the company.

    Along with an updated company website, an active social media presence that highlights the company’s values and cultures significantly improves employer branding.

    Ways to build employer branding:-Use your company’s career page to highlight your company values and culture.
    -Use social media platforms like LinkedIn and Facebook to engage with your prospects.
    -Hold interactive sessions for students through podcasts, webinars, job-related quizzes, hold virtual career fairs, etc.

  7. Use AI tools for smart hiring and streamlining

    A LinkedIn study states that 76% of recruiters believe that AI’s impact on recruiting will be significant. Using AI to assist in high volume repetitive tasks helps recruiters to focus on the more important steps of the recruitment process.

    Areas where you can use AI in recruitment:

    Automate candidate sourcing
    -Automate scheduling calls
    -Rediscovering the required candidate from the database
    -Getting candidate insights through natural language processing and facial expression analysis.

Recruitment industry changes

Over the years, there have been significant changes in the recruitment industry, mostly owing to technological advancements.

  1. The growing importance of company culture

    According to a Glassdoor survey, three in four adults consider a company’s culture before applying for a job and more than half of employees prioritize a company’s culture over salary.

    The trend by Glassdoor is an interesting trend that emphasizes the need for better employee engagement, building a clear mission statement, and focusing on a strong employer brand.

  2. Job search through mobile

    The rise of smartphones for job search among different age groups has been phenomenal. A Glassdoor survey reveals that 58% of Glassdoor users search for jobs using their mobile phones.

    Hence, employers should focus on mobile-friendly applications to attract more talent and not frustrate them when applying for the job.

  3. The increasing use of AI in recruitment

    AI in recruitment has been the talk of the town for quite some time now. And the trend is likely going to increase in 2020. And no, it is not here to replace humans. It is here to assist them.

    As John Jersin, vice president of LinkedIn Talent Solution says, “I certainly would not trust any AI system today to make a hiring decision on its own. The technology is just not ready yet.�

  4. Read: Tapping into the human side of AI
  5. Gaining prominence of soft skills

    The importance of soft skills in recruitment has been increasing with HR professionals selecting candidates based on the culture-fit. Candidates now are evaluated not just on their hard skills but also on their soft skills.

  6. Diversity inclusive hiring

    Bias in recruiting in terms of culture and gender is likely to decrease as the focus on company culture and employer branding increases. According to a study by McKinsey, companies were likely to have 33% higher financial returns than their industry counterparts.

    Focusing on inclusive diversity hiring will not only shed a positive light on the company culture but also enhance the creativity and productivity of the organization.

  7. Growing prominence of candidate experience amp; employer branding

    Research by Talent Adore states that, for 78% of job seekers, the candidate experience that they receive indicates how much the company values its employees.

    This is a very powerful message for companies to increase their focus on candidate experience and employer branding.

  8. Use of Analytics in HR

    Data and analytics are driving HR decisions at every level. The use of various tools to streamline each stage in the recruitment process and subsequent use of metrics and data improves the decision-making process.

    With the rise of big data and analytics, HR managers are more likely to make informed decisions backed with data and analytics.

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