This year, the Latin American IT outsourcing market is set to reach a whopping $17.89 billion, Statista reports. There’s no doubt that LATAM is establishing itself as a prime nearshoring destination, but how do its countries compare to one another? Take a look at Colombia and Peru, both of which have booming tech sectors. Yet Colombia vs Peru for nearshore technology outsourcing offers unique strengths in talent, tech trends, and business environment.
I’m David Gomez, Lead IT Recruiter for Latin America at Alcor. With Alcor, you can build your own team of Silicon Valley-caliber software engineers in LATAM and Eastern Europe. Our solution includes full-cycle IT recruitment, seamless EoR support, and comprehensive back-office services.
In this article, I’ll describe Colombian and Peruvian tech industries for nearshoring software development, the key differences between these countries, and share the best solution to scale in LATAM with ease!
Why Choose Between Colombia and Peru
You may be wondering: What makes Colombia and Peru such appealing destinations in terms of nearshore IT outsourcing? How do they differ from Costa Rica and Chile, for instance? Well, see for yourself:
- Both countries boast a well-educated workforce, with Colombia producing 13,000 STEM graduates annually, while Peru leads the pack in the region with nearly 30% of its graduates pursuing STEM degrees.
- Colombia and Peru are the places to be for US tech companies looking to expand their teams! Both countries are in the GMT-5 time zone, and they provide only a one-hour difference from EST.
- The countries’ startup scenes are nothing short of booming! In 2024, Colombian tech startups have already attracted a staggering $1.2 billion in investment, while Peru is set to receive around $250 million for its tech ecosystem this year.
And yet, that’s just the beginning of what these destinations have to offer for software development outsourcing… there’s so much more to boast about!
Colombia and Peru Tech Sector: Key Statistics
Let’s take a closer look at the key stats that highlight why Colombia and Peru are prime choices for nearshore technology outsourcing:
| Colombia | Peru | |
| Talent pool | 150,000+ | 38,000 |
| Average annual gross developer salary | $54,800 | $48,200 |
| Tech Stack | JavaScript, Python, C++, PHP, Java, and Ruby | SQL, Java, HTML/CSS, Python, JavaScript, .Net, and PHP |
| Coursera rating | #1 in data science in Latin America Rank highly in operating systems and computer networking | #1 globally in machine learning Rank highly in cloud computing and data management |
| Main tech hubs | Bogotá, Medellìn, Cali | Lima |
| Big tech companies | Accenture, Microsoft, Teravision, Amazon | IBM, Amazon, Microsoft |
| Number of startups | 1,280 | 159 |
| Startup Ecosystem | #2 in South America, #38 globally in Startup Ecosystem Index | #6 in South America, #69 globally in Startup Ecosystem Index |
| Business climate | A4 67/190 for ease of doing business | A4 76/190 for ease of doing business |
| Government initiatives | MinTIC and INNpulsa grants | Innóvate Perú, Concytec |
| English language proficiency | 17th out of 20 in Latin America | 9th out of 20 in Latin America |
| Sources: Coursera Global Skills 2024, English Proficiency Index 2024, StartupBlink, Coface. | ||
Market
The IT services market in both countries is thriving – Colombia is projected to generate $2.05 billion in 2024, while Peru is expected to reach $1.51 billion. The future forecast also paints a promising picture, as both Colombia and Peru are projected to experience nearly identical growth rates of 6.21% and 6.22%, respectively. The resulting market volume by 2029 is set to soar to $2.77 billion in Colombia and $2.04 billion in Peru. Overall, these figures and growth trends showcase the vibrant potential of nearshore IT outsourcing in both nations.
Talent
While both nations are on par in terms of the IT outsourcing market, the same can’t be said about their talent pools. The Colombian talent pool is almost 4 times as large as the Peruvian one, proudly standing as one of the biggest in LATAM. Regarding tech skills, Colombian software developers shine as the region’s JavaScript wizards, rallying over 3,000 communities and igniting meetups in 8 different cities. At the same time, Python and Java are the hottest programming languages among Peruvian talent.
What about culture? Well, software engineers in Colombia and Peru are known for their adaptability, emotional intelligence, and excellent negotiation skills. As for their differences, Colombian developers excel at time management, while in Peru, they’re renowned for their resilience.
Discover more insights about Latin American developers!
Costs
The software engineer’s salary in Сolombia is around 13% higher than in Peru. Yet both countries offer significant cost advantages compared to the United States. While software engineers with the same level of expertise in the U.S. command an average of $97,140, their counterparts in these vibrant countries charge 2 to 3 times less. It’s no surprise that 87% of IT businesses consider nearshore software development—it’s a win-win solution for companies looking to save!
Innovation
When it comes to innovation in tech nearshoring, these two nations are in a league of their own. Colombia’s startup scene is skyrocketing in such burning hotspots as Bogotá, Medellín, and Cali, and standout unicorns like Rappi, LifeMiles, and Habi calling the country home. While Peru may not have as many unicorns as Colombia, it is rapidly emerging as a decent player in the regional startup scene, particularly excelling in fintech with its 38 startups, including Somos Moto, Prestamype, and others.
Thus, Colombia’s commitment to technology innovation is evident as it ranks 5th in Latin America on the Global Innovation Index, making it more forward-thinking than Peru, which holds the 8th position.
Conclusion: Colombia and Peru both offer excellent opportunities for nearshore technology outsourcing, particularly in terms of STEM education, moderate salaries, geographical proximity, and cultural affinity. However, Colombia provides a larger talent pool and a more innovative technology environment than Peru.
Key Differences of Tech Nearshoring to Colombia and Peru
Tech Trends
Both destinations are brimming with potential for nearshore tech outsourcing, but when it comes to technology trends, they each bring something different to the table. In the end, it all boils down to your product goals and what you’re after. So, let’s dive into what each one has to offer:
Political and Economic Stability
But before you lock in your ideal IT nearshoring destination, be sure to consider political and economic stability. At the moment, Colombia and Peru appear to be heading in different directions.
Colombia has successfully maintained a stable political and economic environment in recent years, positioning itself as the 4th largest economy in Latin America and the Caribbean. It is also one of the longest-standing democracies in Latin America and has recently been upgraded from ‘partially free’ to ‘free’ in Freedom House’s 2023 “Freedom in the World” report.
In contrast, Peru has been grappling with a political crisis that began in 2016, with the country cycling through over 7 presidents in just a few years. This instability has led to a decline in its status, dropping from ‘Free’ to ‘Partly Free’ according to the Freedom in the World report. Nevertheless, amidst this turmoil, Peru continues to stand tall as one of the top 10 economies in the region by GDP.
Secret Tip to Ease the Process
The Latin American tech landscape is truly vibrant and diverse but navigating it alone can be tricky. If you’re set on hiring developers from Colombia, Mexico, Chile, or Argentina, Alcor is your trusted partner in success!
Ultimately, Alcor is an outsourcing killer, enabling you to build your own development team abroad from scratch while saving up to 40% compared to traditional outsourcing providers. Here’s how we make this possible:
- Full-Cycle IT Recruitment: Our dedicated recruitment process ensures you gain access to the top 10% of talent in the industry, fully committed to your product’s success. Forget about buy-out fees and markups; the development team is yours from day one!
- Comprehensive Employer of Record Support: You can launch your R&D center in just 2-3 months without needing a legal entity. We handle everything from the employment of engineers and onboarding to payroll, tax management, and legal compliance.
- Back-Office Services: We take care of all administrative tasks, allowing your team to focus on what they do best—software development. You name it: office lease, procurement management, employer branding, and much more.
Launching your own software development center in Colombia or other Latin American and Eastern European countries has never been easier! Just look how we did it for People.ai:
But the success stories keep coming! Alcor has already empowered companies like Sift, Ledger, and Gotransverse to conquer foreign markets. Excited to see what’s possible for you? Share your needs with Alcor, and we’ll take care of the rest!