Remote work is a lifeline for modern businesses. Market fluctuations, unavailability of skilled talent, and unforeseen events like the 2019 pandemic threw a blacklight on the shortcomings of traditional modes of work. Ever since, demand for skilled talent located in previously untapped regions have been growing. The global talent pool has also expanded. Latin America (LATAM) and the Philippines are two such popular regions for sourcing remote talent. There are several similarities between hiring remote talent from LATAM and the Philippines. There are also key differences.


A few hard facts to consider:

  • LATAM is a group of countries with 669 million people. The Philippines is a single island country of 119 million people. Naturally LATAM offers a larger pool of talent.
  • LATAM and the Philippines have very high literacy rates. 95% of LATAM is literate; the Philippines has a literacy rate of almost 95%.
  • Salary costs are lower in the Philippines. While individual numbers depend on industries and experience, LATAM workers are paid roughly 30% more than Filipino workers.

This article compares hiring remote talent in LATAM and the Philippines across several key factors to help you make better and more informed decisions based on your company’s specific needs.

Factors to consider before hiring remote talent in LATAM or the Philippines

Time Zone

LATAM: One of the biggest advantages of hiring from LATAM is the time zone compatibility with North America. Countries like Mexico, Colombia, and Brazil operate within time zones that closely align with those in the United States and Canada. This overlap makes real-time communication very easy. Teams can work simultaneously, and this is great for roles that require frequent interaction, such as project management and customer support.

Philippines: The Philippines is in the GMT+8 time zone, which is 12-15 hours ahead of North America. This is beneficial for companies looking for extended coverage. Philippine-based teams can continue work after their US counterparts have finished their day. This would obviously require careful planning.

Language

LATAM: English proficiency varies across LATAM. In countries like Argentina, Mexico, and Colombia, English is widely spoken. But proficiency levels can differ even within different regions of the same country. Companies may need to invest in additional language training or prioritize candidates with strong English skills, particularly for roles that need client interaction.

Philippines: English is one of the official languages of the Philippines. Schools teach English from the first grade and it is the primary language for business and communication. This high level of English proficiency is one of the key reasons why the Philippines has become a hub for outsourcing and remote work, especially in customer service, technical support, and content creation.

Cultural Compatibility

LATAM: Cultural compatibility between LATAM and North America is relatively high. There are many shared values and work practices, which can make integration into a North American company smoother. However, cultural nuances vary from country to country. For instance, business practices in Brazil may differ from those in Mexico or Chile. Brazil’s work culture is far more informal than Mexico’s. But understanding these nuances is also quite easy.

Philippines: The Philippines has a long history of cultural exchange with the US and there are cultural affinities with Western practices, making Filipinos generally well-suited to work with North American and European companies. The domestic work culture of Filipinos respects hierarchy and community, which can translate well in team-oriented environments.

Education

LATAM: Argentina, Brazil, and Mexico have excellent engineering and finance universities. Tech hubs like Buenos Aires, São Paulo, and Mexico City employ thousands of developers, engineers, and data scientists. The region’s proximity to the US and Canada has also led to the adoption of similar business practices and standards, making LATAM talent a good fit for roles requiring technical expertise.

Philippines: The Philippines has amazing talent in the fields of customer service, BPO, and content creation. Their government has invested in quality education, and Manila has some of the best universities in Asia. While the focus has always been more on service-oriented roles rather than high-tech industries, this is gradually changing.

Cost of Labor

LATAM: Labor costs in LATAM are lower than in North America and Europe but higher than in the Philippines. But numbers depend on the individual country. Salaries in Argentina and Colombia are more affordable, while Brazil tends to have higher wages due to its large economy. However, LATAM in general offers competitive labor costs for skilled tech and finance professionals.

Philippines: The cost of living is lower here than in many LATAM countries, which means lower salaries for remote workers. This makes the Philippines a good option for companies looking to maximize their budget, especially for roles like customer support, virtual assistance, and administrative tasks.

Infrastructure

LATAM: The quality of infrastructure in LATAM varies by country. Major cities in Argentina, Brazil, and Mexico have well-developed infrastructure, including reliable internet connectivity, modern office spaces, and access to technology. However, rural areas and smaller cities may face challenges such as slower internet speeds and less reliable power supply. Companies hiring remote talent from LATAM should consider the infrastructure of the specific region where their employees are located.

Philippines: The Philippines has tried hard to improve its infrastructure particularly in urban areas like Metro Manila, Cebu, and Davao. The government does its best to buttress the growing BPO industry. But, like LATAM, rural areas still have severe connectivity issues. This isn’t a real issue because companies normally hire from and around urban areas.

Legalities

LATAM: The legal framework in LATAM is close to the American one, so it’s not very difficult for US companies to hire from the region. However, labor laws, taxes, and employment contracts must be carefully managed to ensure compliance. Some countries in LATAM have more flexible labor laws, making it easier to hire and manage remote workers. However, it’s essential to understand the specific legal requirements of each country to avoid potential legal issues.

Philippines: The Philippines has a well-established legal framework for remote work and outsourcing because their laws are designed to accommodate the large BPO industry. There are clear guidelines for remote employment. Companies hiring from the Philippines will find that the legal processes are generally straightforward and there are rather attractive incentives for foreign companies investing in the country.

Talent Availability

LATAM: LATAM has a growing pool of talent, particularly in tech and creative industries. Cities like Buenos Aires, São Paulo, and Mexico City are becoming tech hubs, attracting skilled professionals in software development, digital marketing, and engineering. The region’s proximity to the US also means that many professionals are familiar with North American business practices and expectations. Competition for top talent in these fields is also increasing, as more companies look to LATAM for remote workers.

Philippines: The Philippines excels in fields like customer service, virtual assistance, and IT support. The country’s focused training in these areas helps create many professionals. However, as the demand for tech-related roles increases, the availability of highly skilled professionals in more specialized fields like software development or data science may be more limited compared to LATAM.

Government Support and Incentives

LATAM: Several LATAM countries offer official incentives for foreign companies looking to hire remote talent. Colombia has policies to promote the tech sector, offering tax incentives to companies that invest in local talent. Mexico has free trade agreements with the US and Canada, making cross-border business operations easier.

Philippines: As mentioned earlier, the Philippine government has been proactively supporting the BPO industry, offering tax breaks, training programs, and infrastructure development to attract foreign companies. The Philippine Economic Zone Authority (PEZA) provides benefits to businesses operating in designated economic zones, making it more cost-effective to hire remote talent from the Philippines.

Wrapping Up

Both LATAM and the Philippines are excellent choices for building remote teams in. LATAM is best for roles that require real-time interaction with North American teams, particularly in tech and engineering fields. But we must think of the variability in economic and political circumstances across LATAM countries when choosing the best location for remote hires.

The Philippines has excellent professionals in customer service, IT support, and administrative functions. Most of them speak English fluently and blend really well into an American workspace. Their labor market is reasonably priced and the political scene there is quite stable.

If you feel unsure about taking the leap, InCommon is here to help! We are available to guide you to a better understanding of the markets and enable you to hire exactly the talent you want in a place that suits you. We hire, equip, and manage all remote talent, so everything is super simple for our clients!