Nearshore Americas

Salaries for Specialized IT Talent Start to Spike in Costa Rica

Costa Rica is often considered to be the poster child for the Nearshore sector. Strong infrastructure and long-term governmental thinking have laid the foundations for the country’s in success in attracting major multinationals to its shores. But with a population of only five million, scaling up is always a concern. Now, in the highly-skilled area of technology, finding talent is getting tough.

Back in 2014, the Manpower Talent Shortage Study was already noting that “51% of the 620 Costa Rican employers surveyed said they cannot find suitable professionals to perform the tasks required by their company,” with the main cause said to be “the lack of technical skills”.

Last year’s findings were equally worrying. According to the 2020 study, scarcity of tech talent in Costa Rica was at the same level as Canada, Singapore and Belgium. Other Nearshore locations within the same scarcity bracket were Brazil, Argentina and Mexico. 

Costa Rican STEM college students are signing lucrative contracts with major tech names including IBM and Intel and in cases for the most in-demand roles, those failing to finish a degree will still be snapped up, explains Jeremy Benza, a Costa Rica tech recruitment specialist. 

Jeremy Benza explains that demand for tech workers is so high in Costa Rica that even those who don’t graduate get employed

“There aren’t too many universities in Costa Rica that offer all the skills of the full stack course, for example. University of Costa Rica is one and if you graduate from there you’ll almost certainly have a job lined up for when you leave. Even students who don’t actually graduate usually get hired,” Benza told Nearshore Americas recently. 

The Crest of the Wave

The original tech salary rise in Costa Rica began years ago, explains Marco Tonti of CEO and Founder of IT Services company Softon ITG, based out of San Jose. “Every time a new company, generally from the U.S., entered the market, it would disrupt the status quo,” he said.  “But now, given the strong experience Costa Rica has in serving U.S. clients and the skill level found here, we’re becoming really, really popular.”

In the BPO space, Concentrix has recently added an additional 1,000 staff while Bill Gosling announced plans to launch another delivery center in the country. Companies from the real estate, finance and tele medical worlds in particular have drummed up the need for more agents and have had an impact on tech demand too.

“Even students who don’t actually graduate usually get hired” — Jeremy Benza

Rising tech salaries have added extra layers of difficulty to the recruiters duty. Investment towards digital channels to address the support of the now distributed workforce, consumption patterns that have changed as a result of social distancing, enhancements to resolve newly-exposed supply chain weaknesses and automation of processes will grow, Deloitte reported in February. Banking and securities and technology and telecommunications companies showed the highest average technology budget as percentage of revenue with 10.14% and 7.05% respectively, against 4.25% average across all industries. 

Meanwhile, in September, KPMG said that Covid-19 had forced “one of the biggest surges in tech investment in history.”

Recruiters in Costa Rica are now tasked with finding now tech workers in a market were demand continues to rise. Naturally, wages have shot up, says Benza. “Five years ago, a junior developer would require an average budget of $1,000 per month. Today, the same position will cost an average of US$3,000 and could rise as high as $4,000,” he explained.

The talent drought doesn’t sit evenly across all positions in Costa Rica, however. “Take a look at LinkedIn and you’ll only find 300 – 400 DevOps engineers in the country,” he said. Because of that, a mid-level DevOps engineer will earn between US$3,800 and $4,500 per month.

QA engineers are among the most in-demand positions at present and their specific skillset allows QAs to earn among the highest of any tech role even if a candidate is lacking experience. “A junior QA can earn up between US$3,000 and US$4,500 monthly – even more than a full stack engineer. This is because it takes real sharpness to move to QA; they have to have a very strong ability in just this role. However, because demand for quality QAs is so high, they often move to supply services on a freelance basis and provide services individually rather than within the company set up,” Benza said. 

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“Take a look at LinkedIn and you’ll only find 300 – 400 DevOps engineers in the country” — Jeremy Benza

The wage potential and lack of Salesforce developers is seeing many Salesforce administrators up their game and make the move to the dev side, says Benza. Salesforce developers now earn between $4,500 to $5,500 monthly, though with certification they can earn even more. 

Meanwhile, iOS engineers will bring in between US$2,000 and US$3,000 and data scientists between US$3,600 and US$4,600 monthly. 

Only Way is Up?

Despite the squeeze that the digital transformation is putting on tech talent in Costa Rica and other countries of Latin America, Benza does not foresee the country’s talent pool ever running dry. 

The main reason is the education system, which forms a fundamental part of successive governments’ long-term vision to make Costa Rica the tech epicenter of the region. Aside from the Ministry of Public Education’s strategy to make the country bilingual by 2040, efforts are being made to graduate greater numbers of tech-related professionals and plug the gap that has been widening.

“A recent company report stated that the number of students beginning an engineering type degree grows by 300% per year,” Benza said.

Peter Appleby

Peter is the Managing Editor of Nearshore Americas. Hailing from Liverpool, UK, he is now based in Mexico City. He has several years’ experience covering the business and energy markets in Mexico and the greater Latin American region. If you’d like to share any tips or story ideas, please reach out to him here.

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