If you’ve already decided to nearshore, the question is: Where should you build your nearshore team? Should you look for opportunities in nearshoring in Mexico or consider other tech hubs?

For North American businesses, nearshoring in Mexico is a safe bet. The Mexican tech sector has been amping up recently, attracting investment from global brands. Moreover, there’s a reasonable time difference between Mexico and North America, which contributes to close collaboration with a nearshore branch. 

As a company that builds tech teams in Mexico, we are familiar with the local software development landscape. In this post, we share everything you should know in 2024 about nearshoring in Mexico. Let’s begin!

Overview of software development in Mexico

Mexico is the 14th-largest economy in the world and the second-largest in LATAM by GDP. Thanks to robust market dynamics, nearshore software development in Mexico showcases huge potential. Let’s take a look at it.

In 2022, the market size of Mexican ICT was worth USD 53.31 billion. By 2027, it’s projected to reach USD 99.61 billion, growing at a CAGR of 13.32% per year. Overall, the revenue from ICT providers (including nearshoring) in Mexico will amount to USD 440.04 billion between 2022 and 2027.

Statista confirms a predictable year-to-year growing tendency for revenue driven from nearshoring software development in Mexico. In 2024, it’s going to reach USD 13.83 billion. Bolstered by a robust IT infrastructure development, this trajectory is expected to persist.

In 2022, the high-technology exports in Mexico reached $85.9 billion, including scientific instruments, R&D products, pharmaceuticals, computers, aerospace, and electrical machinery.

Trade agreements play a key role in the volume of exports. One key agreement is the United States-Mexico-Canada Agreement (USMCA). Implemented in 2020, it’s had a positive impact on economic collaboration among the countries.

Also, it’s worth mentioning Mexico’s proactive membership in G20, OECD (Organization for Economic Cooperation and Development), and the Pacific Alliance, which confirm that the nation is on solid ground when it comes to providing economic stability in the sphere of nearshore software development in Mexico.

Undoubtedly, Mexico holds a respectable place among the world’s tech hubs. In the Global Innovation Index 2023, Mexico took 58th place (out of 132 contenders), which shows competitiveness in innovation and technology.

Kearney Global Services Location Index, a tool that defines the best locations for offshoring, also places Mexico high. In fact, in 2023, the country rose one spot, jumping to the 10th position. Such a high ranking solidifies its position as a preferred location for businesses looking to nearshore software development. Mexico’s high position in this reputable ranking is a testament to its strong potential for international companies seeking high-quality solutions.

Speaking of foreign investment (including IT services and nearshoring software development), Mexico enjoys a significant inflow of foreign direct investment (FDI). The country is the second-largest trade partner of the United States, following Canada, which means it plays an integral role in the North American outsourcing dynamic.

Mexico boasts a solid foundation built on talent, innovation, and strategic partnerships. The local IT industry is in good shape and poised for success on the global stage, providing ample opportunities for nearshoring.

What do software development companies in Mexico look like?

As a tech hub, Mexico attracts both startups and large companies. The country is ranked 37th within startup ecosystems globally and comes first in the Central American startup scene.

With 821 startups on the map, their field of specialization varies, the most common being Fintech (57%), and e-Commerce (37%). Today, Mexico is home to 8 unicorns: Kavak, Bitso, Clip, Konfio, Merama, Stori, Nowports, and Clara.

The landscape of software development companies in Mexico is also represented by global enterprises. Several of the world’s leading companies have set up shop in Mexico, tapping into the pool of skilled local professionals. Among them are DELL, Google, Salesforce, Microsoft, Oracle, HP, Siemens, IBM, Intel, Facebook, Apple, Amazon, Accenture, Cisco, Netflix, LinkedIn, Globant, Nielsen, to name a few.

The current market scenario presents both opportunities and challenges for nearshore software development in Mexico. While the presence of major industry players fosters intense competition for talent, it also catalyzes skill enhancement among IT professionals and prompts local companies to enhance their efforts in talent retention.

According to Clutch, there are about 480 active software development companies in Mexico. Their areas of expertise include:

The size of software development companies in Mexico varies from large IT providers to small agencies and freelancers.

  • 15 Large (1000-10000)
  • 32 Mid-size (250-1000 employees)
  • 430 Small (up to 250 employees)

What are the whereabouts of software development companies in Mexico? Most of the startups are concentrated in the capital, Mexico City. Other significant tech hubs attracting venture capital are:

  • Guadalajara, also known as the Silicon Valley of Mexico, houses around 93 nearshore software development companies;
  • Monterrey, with 61 nearshoring providers, is emerging as a hub for IT outsourcing.
  • Tijuana, near San Diego, is seeing a rise in software and manufacturing firms.
  • Puebla Technology Park, Parque Tecnológico Innovación, supports local startups.

Several government initiatives play a key role in the growth of software development in Mexico.

  • 500 Startups LATAM and Fondo Nacional Emprendedor: These initiatives let young software development companies in Mexico secure funding and mentorship to introduce new technologies and scale their businesses.
  • Tech Parks: The country boasts 20+ tech parks, which serve as hubs for innovation, research, and development. Creative Digital City, Guadalajara Software Center, Apodaca Technology Park, and Monterrey Technology Park are examples of high-tech complexes.
    Prosoft: This initiative strives to secure a place for Mexico in the top three digital economies globally.
  • Jóvenes construyendo el futuro:” The program provides training and certification in IT skills, contributing to a skilled workforce.
  • The National Council of Science and Technology (CONACYT): This is a special grant that is aimed at supporting innovation and entrepreneurship for software development in Mexico.
  • Global commerce and free-trade agreements: Mexico maintains free-trade agreements with several jurisdictions, including the EU, Norway, Israel, Switzerland, Costa Rica, Colombia, and Japan.
  • Fintech Law: This is a regulatory framework that boosts fintech transparency, competitiveness, and security – contributing to the rise of Fintech startups in Mexico.

Another point to consider is the specialization of software development companies in Mexico. According to the GlobalData market analysis, The most perspective business verticals in the local IT scene are as follows:

The leading product/service segments in Mexico’s ICT market are Software as a Service (SaaS), Internet of Things (IoT) Software, and IoT Hardware. Moreover, SaaS is anticipated to emerge as the dominant segment in the ICT market during 2022-2027.


Talent pool: The number, location, and skills of Mexican developers

The population of software developers in Mexico is one of the highest in Latin America. In 2023, Mexico had 220,000 software developers. To compare, Brazil has a talent availability of 500,000 IT specialists – the largest number in LATAM. Argentina takes 3rd place with 115,000 software developers.

When it comes to the number of Mexican developers, major tech hubs like Mexico City and Monterey harbor the majority of IT talent. The first three cities have attracted the most considerable amount of software experts, capital, and global tech companies. We analyzed LinkedIn data to find out how many developers reside in the major areas so you can size up opportunities for nearshoring software development in Mexico.

Nearshoring software development in Mexico can be a gateway to a varied talent pool. CodersLink’s report in 2023 shows that the most popular programming languages, frameworks, and roles  among Mexican developers are:

Coursera’s Global Skills Report is another significant analysis to assess the potential of nearshoring software development in Mexico. It focuses on the workforce in terms of its potential in business, technology, and data science. According to the research in 2023, Mexico ranks as high as number 2 in LATAM for overall skill proficiency, second to Colombia. The country is ahead of the pack in the region for technology and data science skill scores. According to the report, the Mexican talent pool’s expertise lies in the following areas:

In 2022, Pentalog once again addressed the question of where the best software developers are located. In their recent ranking, Mexico takes 2nd place, surpassing a number of formidable nearshoring competitors, such as Romania, Ukraine, and Poland. As such, when selecting nearshoring software development in Mexico, businesses are unlikely to come across quality issues.

Mexico also proudly holds a spot in the top 10 markets worldwide with the best Total Workforce Index that shows the most attractive workforce – courtesy of the nation’s high skills availability, employment-friendly regulatory environments, and remote-ready infrastructures.

Mexico software developer salary

One of the primary reasons for the popularity of Mexico among North American companies is the cost-effectiveness of software development there. When considering the salary rates or average payroll for engineers, it’s essential to take into account various factors such as geography, experience, and specialization within the field.

We analyzed Mexico Tech Salaries Report 2022 by CodersLink and several IT job boards to gain an understanding of the average Mexican software developer’s salary.

According to the report, the average Mexican software developer’s salary is $3,828 per month. Just to compare, ZipRecruiter reports the average salary for the same position in the USA is $9,320 – about 144% higher than in Mexico, which speaks in favor of nearshoring in Mexico.

What about the situation in other LATAM countries? Salaries in Mexico tend to be on the lower side compared to other Latin American countries. Let’s see how the monthly salaries for software development in Mexico stack up against its nearshoring counterparts:

In Mexico, the salary of engineering professionals varies based on location. For instance, Guadalajara, Monterrey, and Mexico City are the top three cities in terms of the tech workforce volume. So how do Mexico’s software developer salaries vary across the country’s tech hubs? Take a look:

It’s worth mentioning that tech hubs like Mexico City and Monterrey are highly populated with developers, and the cost of living is higher. So, the salary expectations are higher as well for these cities.

Another important factor impacting Mexico’s software developer salaries is seniority. The more years under the belt a developer has, the more they expect to earn. Let’s take a look:

Mexico software developer salary by role

The CodersLink report analyzes the Mexico developer salaries for mid to senior professionals and advanced English, without taxes and employee bonuses. Below is the salary range you can expect for this type of professional.

To provide insight into software developer salaries in Mexico by technology, we analyzed various job boards. Below is the range based on our speculations.

According to the same report, the highest-paid professionals specialize in Cobol, Go, Swift, Delphi, and Ruby.

Software development in Mexico: Education

Well-educated IT specialists are the backbone of nearshore software development in Mexico. In 2021, the Mexican talent pool was replenished by 407,000 graduates from technical and technological secondary education.

When it comes to specialization, 21% of graduates come from Programming, Computer Support, and Systems Maintenance Careers. 8 % graduate from careers related to Electromechanics, Automotive Industry, Motors, and Industrial Maintenance.

Moreover, Mexico takes the lead globally when it comes to STEM graduates. In 2020, Mexico had 1.7 million enrolled STEM students. That’s the first place among OECD countries:

  • 1st Mexico: 1.7 million
  • 2nd Germany: 1.1 million
  • 3rd Brazil: 800 thousand
  • 4th Poland: 796 thousand
  • 5th Spain: 313 thousand

Mexico benefits from the presence of seven prominent engineering universities, collectively contributing to a rich pool of highly educated talent. These institutions, including Tecnológico de Monterrey, Universidad Nacional Autónoma de México, Instituto Politécnico Nacional, Universidad Autónoma de Nuevo León, and Universidad de Guadalajara, among others, adhere to globally recognized educational standards.

This robust foundation in engineering education positions Mexico as a valuable resource for companies engaged in nearshore software development initiatives.

English skills of Mexican developers

English proficiency is a decisive factor in choosing to nearshore software development in Mexico. Although Spanish is the country’s official language, a considerable portion of the population masters English, especially in business communities. English is also the go-to language for communication in major cities and regions bordering the US. Competence in English is a major driving factor for salary raises for Mexican developers. It’s a fact that engineers with advanced levels can secure up to 100%-200% higher salaries than those without this skill. Many software engineers in Mexico demonstrate exceptional English skills, particularly those engaged in international corporate environments or involved in collaborations with clients and colleagues from diverse cultural backgrounds.

We’re here for all your nearshore software development needs in Mexico

With so many nearshoring destinations in LATAM, Mexico plays strong as a lucrative, time-tested, and budget-friendly option for North American businesses. Several factors contribute to Mexico’s efficiency as a nearshoring center:

  • Abundant tech talent: Mexico has invested heavily in its IT industry and provided many incentives for young people to become software engineers, generating a vast pool of well-educated technologists.
  • Robust IT infrastructure: Mexico has a well-developed IT infrastructure, including 20+ tech parks, creating opportunities for innovation and domain experience for local software developers.
  • Real-time collaboration: With 5 to 8 common business hours, it’s easy for US businesses to work in real-time with Mexican developers, without losing time when it comes to communication.
  • Diverse talent pools: Mexico offers a wide range of expertise in such areas as mobile and web development, IT consulting, cloud consulting, and AI development, making its talent highly competitive across various fields in LATAM.
  • Cost-effectiveness: While nearshoring in Mexico is more affordable than in-house development, it still delivers the high-quality work you would expect from US-based talent.

Contact us to discuss your nearshoring need, and let’s build your team of skilled Mexican developers.