Labor Talent Crisis Solutions: Offshoring and Nearshoring for Business Boost. In recent years, the United States has faced a growing labor talent crisis, characterized by labor shortages, high turnover rates, and high initial and replacement hiring costs. According to a report by the Bureau of Labor Statistics, in 2021, the unemployment rate in the United States was 4.6%, while the number of job vacancies reached a record 11 million, highlighting the growing labor shortage. Additionally, according to the Society for Human Resource Management (SHRM), the average cost of hiring a new employee in the United States is $4,425, and a startling report by Gallup indicates that labor turnover costs companies more than $1 billion annually.
Given this scenario, one possible solution to this labor talent crisis is offshoring and nearshoring solutions, administrative and information technology services to Latin America. The region has experienced an increase in educational levels and an improvement in English proficiency, making it an attractive option for US companies in search of labor talent.
The Latin American workforce is highly talented and motivated. According to a report by the Organization for Economic Cooperation and Development (OECD), Latin American countries are increasingly investing in education and training, leading to higher educational levels and greater specialization in fields such as information technology and engineering.
For example, in Peru, the enrollment rate in higher education has steadily increased in recent years and reached 48% in 2021, according to a UNESCO report. Additionally, the country has implemented policies to promote specialization in technology and has seen a 50% increase in the number of graduates in the technology field in the last decade.
In terms of figures, offshoring to Latin America can offer significant economic benefits. According to a study by consulting firm Deloitte, offshoring can reduce labor costs by up to 70%. Additionally, the report highlights that the quality of work performed in Latin America is comparable to that of US workers.
In the US real estate industry, high turnover rates, high labor costs, and talent shortages are common problems in the administrative and information technology areas. According to a report by the National Association of Realtors (NAR), labor turnover in the real estate industry is 16%, representing a significant cost for companies.
Offshoring and nearshoring solutions administrative and information technology services to Latin America could help address this problem. For example, US real estate company Keller Williams has established a shared services center in Mexico to manage administrative and information technology tasks, which has reduced labor costs and improved efficiency.
The labor talent crisis in the United States can be addressed through offshoring or nearshoring administrative and information technology services to Latin America, where educational levels have increased, and the workforce possesses great talent and English proficiency. In particular, the real estate industry can benefit from this strategy to address problems such as high turnover rates, high labor costs, and talent shortages in the administrative and information technology areas.
DigitalHub, from our service hub in Lima, Peru, offers specialized business process solutions as well as digital solutions that are ideal for nearshoring our clients in the United States. Through our experience, we have an ideal team for the real estate industry, specifically linked to companies seeking to improve their productivity and process efficiency, through our capabilities such as Talent Management, Process Analysis, and Digital Transformation.