Outsourcing Software Development to Bolivia: Why You Should Hire Bolivian Developers

Outsourcing Software Development to Bolivia: Why You Should Hire Bolivian Developers

August 24, 2022
Reх Huхford
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Learn why more US companies are choosing Bolivia to outsource their software development and the advantages of hiring Bolivian developers.

Although Bolivia entered software development a bit later than its surrounding countries, it has nonetheless made its mark as an established hub of software developers in the region.

Its current government has been spending extensively on tech and software development projects, fueling the growth of the tech sector in the country. At the same time, local companies have recognized the global scope for software development and are racing to keep up.

The core selling points that make outsourcing software development to Bolivia a lucrative decision are cost-effective services, cultural similarity with the US, and English proficiency. Therefore, it’s about time US companies consider nearshoring software development to Bolivia to hire competent professionals at a fraction of the cost they’d have to pay US talent.

Below, we take a look at the profitability and ease of outsourcing software development to Bolivia.

Advantages of Outsourcing Software Development to Bolivia

US companies that outsource software development to Bolivia can benefit in multiple ways. For starters, the country’s work culture and time zone are extremely compatible with the US. What's more, there’s a surge in tech development and education in the country that's facilitating progress in the software development space.

Here are some benefits of outsourcing software development to Bolivia:

Adjacent Time Zone to the United States

One of the most notable downsides of hiring a remote team is the difference in time zones. Along with making collaboration a pain, different time zones can also mess up deadlines.

However, the good part about hiring software developers from Bolivia is that Bolivian time is just 1 hour ahead of US Eastern Standard Time. Due to essentially similar time zones, your in-house and remote teams can collaborate effectively on projects.

The benefits of working in the same time zone include:

  • Swift Communication: While it’s profitable to hire developers from Asia, the seven to ten-hour time difference can make it almost impossible for your remote workers to collaborate with the in-house team. Meanwhile, the Bolivian time zone allows all of your workers to follow the same workday routine.
  • Cost Reduction: Companies that work with remote employees in different time zones often have to bridge the communication gap by purchasing subscriptions for third-party tools that record meetings. But if you’re working in the same time zone, you can scale back costs by conducting meetings at a time that's comfortable for everyone.
  • Saved Time: Another benefit of working in the same time zone is that it saves you time. Suppose you hold a meeting today in US Standard Time, but it’s nighttime where your remote employees live. The next morning, someone will have to recap the meeting for them. Depending on the number of employees you have, this could be quite time-consuming. Meanwhile, when you hire software developers from Bolivia, the time zone allows them to be actively present.

English Ability

For remote employees to work with US talent, it’s important for them to be proficient in English. Bolivia ranks second among 20 Latin American countries in terms of English proficiency. The country ranks 41st on the English Proficiency Index.

Statista also reports that with 2.77 points, Bolivia showed the highest jump in English proficiency between 2017 and 2018 in Latin America. The increase in English proficiency is mainly due to the government’s policy to incorporate trilingual education in schools. As per this decision, English is now mandatory in all private sector and public schools in the country.

Often, remote workers find it difficult to understand and pronounce US English. However, English speakers in Bolivia are quite skilled at understanding and communicating in the standard US-style English. In fact, English is widely used in the software development sector in Bolivia since the local talent works predominantly with international clients.

At the same time, many US companies have partnered with software houses in Bolivia. Due to this, US colloquialisms have seeped into Bolivia’s professional market.

Geographical Proximity

Bolivia is also geographically close to the United States, making it possible for hiring managers and executives to travel to the country for more demanding and human resource-intensive business processes.

It takes approximately nine hours to travel to Bolivia from the United States by air.

Advanced STEM Education

The Bolivian government is aware of the increasing influence and need of technology talent in the world. Thus, they are focusing on mainstreaming STEM education in the country.

Two major cities in Bolivia, namely La Paz and Cochabamba, are particularly well-known for being STEM education hubs. While Cochabamba has 13 universities, Le Paz is home to 8.

In the past few years, both cities have produced over 300 engineers annually. The growth of STEM education in Bolivia is such that the country is expected to produce nearly 500 engineers every year.

The inclination of students towards STEM education is also due to the boom in the software development space. Since the IT industry is growing, there’s a heightened demand for software developers too.

Therefore, more and more students are enrolling in tech and software engineering courses at the university level. Moreover, the government is supporting these graduates through scholarships and other incentives, encouraging them to enter the IT space with confidence.

Growing Tech Infrastructure

The Electronic Government and ICT Agency reports that there are over 200 software development companies in Bolivia. Together, these companies bring in about $30 million every year. Meanwhile, freelance software engineers in the country also contribute to this by earning up to $20 million per year. Most of this revenue is generated from the US.

As mentioned earlier, La Paz and Cochabamba are spearheading the growth of IT in the country. In fact, the government recently announced that Cochabamba is the ‘’tech citadel’’ in Bolivia. The government has also recently poured money into the country’s official IT headquarter, thus fostering development opportunities.

Since Bolivia is focusing extensively on the IT space, it’s likely that there will be more fresh graduates every coming year. US companies can leverage this by nearshoring software development to Bolivia at considerably lower costs.

Cultural Compatibility

Having a uniform work culture is important for all organizations regardless of their size. A positive culture that every employee understands and relates to drives engagement in the company, improves performance, boosts productivity, and fosters employee satisfaction.

Since Bolivian software developers work with many US companies, investors, and clients, they’re familiar with the work culture in the US. Thus, when you hire these professionals, they can easily blend in with your company’s culture.

This helps boost everyone’s morale, making it possible and easy to work together as a team even when working remotely.

Cost Savings

While all other factors are equally beneficial, the major reason US companies outsource software development to Bolivia is to lower costs. The salaries for software developers in the US are much higher than those in Bolivia, although you get access to the same level of talent and professional expertise.

However, when you hire employees from Bolivia, you can pay them according to the country’s cost of living rather than that of the US. Plus, if you’re hiring independent contractors from Bolivia, you don’t have to offer additional benefits like paid leaves and transport costs.

Together, these factors help you save a substantial amount of money through remote hiring.

Cost of Hiring Bolivian Software Developers

Speaking of saving money, let’s take a look at what you’d have to pay if you hire software developers from Bolivia.

Average Yearly Salary Rates for Bolivian Developers

On average, software developers in Bolivia earn BOB 6,150 per month, which equates to BOB 73,800 per year. Converted to USD, this is $10,720 per year. When compared to software developers in the US, this is quite low.

According to US News, the median salary of a software developer in the US was $110,140 in 2020. The top 25% of the software development talent earned $140,470 a year, while the lowest 25% made $84,020.

If you compare the lowest-paid US talent with the average-paid Bolivian software developer, you'll find that the latter is cheaper to hire.

Junior Salary Rate

Glassdoor reports that the junior salary rate in Bolivia is BOB 3,000 per month. That’s only $435. Meanwhile, US junior software developers earn $5,600 per month. So it's evident that companies can save thousands of dollars by outsourcing software development to Bolivia rather than hiring local talent.

Mid-Level Salary Rate

A mid-level software engineer earns around BOB 6,000 per month, which is equal to $870. Meanwhile, a US mid-level software engineer makes around $8,100 a month.

Senior Salary Rate

Senior software engineers in Bolivia can earn up to BOB 12,000 a month, which is equal to $1,740. On the other hand, top US software engineers make a whopping $11,600 per month.

Average Monthly Salary Rates by Tech Skills

The monthly salaries of software developers in Bolivia also differ based on their tech skills. As evident from the difference in salaries mentioned above, junior developers get paid much less.

Meanwhile, software developers with advanced or niche skills can earn up to BOB 13,000 a month.

According to the salaries reported on Glassdoor, there isn’t much difference in the salary rate based on location. Instead, the difference in salaries is dependent on the company a professional is working for.

For instance, Jalasoft pays around BOB 5,800 to software developers, with salaries ranging from BOB 3,000 to BOB 9,000. Meanwhile, Assuresoft pays BOB 9,000 to BOB 13,000 per month on average to its employees.

Average Hourly Rates To Outsource to Bolivian Senior Developers

If you’re hiring developers for a 40-hour workweek, your employees will work a total of 2080 hours or 52 weeks in a year. Based on this, the hourly rate for hiring senior developers in Bolivia is BOB 69 or $10.02.

Meanwhile, the hourly rate you’ll have to pay a US senior software developer is around $67. As you can see, it’s almost six times more expensive to employ US software developers as compared to Bolivian talent.

Cons of Nearshoring Software Development to Bolivia

Although outsourcing software development to Bolivia can be cheaper and more practical, it has a few downsides too.

Hard for Foreign Companies To Reach Local Talent

As a foreign company, it can be hard for you to reach local talent. In most cities, fresh talent is already recruited at local companies.

Even when available, reaching this talent can be tricky since these professionals often aren't present on online job boards or recruitment platforms.

Navigating Local Labor Laws and Payroll

A major issue in nearshoring software development to Bolivia is getting on board with the payroll and local labor laws. The country has complex taxation and employment regulations that make it difficult for foreign companies to manage everything seamlessly.

For instance, you have to make sure you’re classifying your employees correctly. Bolivian labor laws clearly distinguish between independent contractors and full-time employees. Thus, when you’re hiring local talent, you need to make sure you’re offering them the benefits they are entitled to by the country’s law.

If you misclassify your employees, you may end up with legal problems that could have easily been avoided if you had used a platform that manages everything for you. That’s where Revelo comes in.

Revelo: Source, Hire, Manage, and Pay Bolivian Developers in One Platform

Revelo is a talent platform for companies that want to build or grow their remote teams. It’s a single platform where you can do everything from sourcing to hiring and paying Bolivian developers.

Since Revelo has a pool of pre-vetted talent from countries that fall in the same time zone as the US, companies are spoiled for choice when it comes to hiring remote software developers.

After sourcing and hiring software developers, you can also efficiently manage your employees and payroll in the same easy-to-use platform. It’s as simple as it gets.

Where To Find and Hire Bolivian Software Engineers

As mentioned above, finding and hiring Bolivian software engineers can be a bit difficult, especially as a foreign company with no legal entity in the country. However, here are a few places where you’ll have luck finding the right talent for your company.

Tech Hubs in Bolivia

Compared to all other cities in the country, these three top the charts for tech talent.

La Paz

La Paz is the highest administrative capital in the whole world, resting on a plateau nearly 3,500m above sea level. But the city’s physical elevation isn’t the only well-known thing about it.

La Paz is also known for being one of the tech headquarters in the country. If you want to build a team of remote software developers in Bolivia, La Paz is where you start looking.

Santa Cruz

While it’s popular for being a widely visited tourist spot, Santa Cruz is also a hub of tech talent in the country. Thorough institutions, such as Hub Santa Cruz, prepare tens of software developers every year that are ready for employment.

Cochabamba

Cochabamba is named ‘’The Garden City’’ due to its spring-like weather year-round. But more than that, the city is home to 13 universities, most of which have STEM degrees and courses.

Whether you’re looking for fresh graduates or seasoned talent, you’ll find software developers with all your desired skills in Cochabamba.

Bolivian Job Boards

Most local employers in Bolivia use job boards to find talent. Foreign companies can also use the following job boards to find talent with their desired skills and expertise.

All three of these job boards allow you to categorize the jobs by region and skills.

Talent Marketplaces

Companies that don’t want to spend a lot of time and money on vetting potential employees should use talent marketplaces where pre-vetted talent is readily available for hire.

Revelo

Revelo is the one-stop for all your software development remote hiring needs. You can easily find Bolivian software development talent on the platform with your required skills and niche expertise. Once you have gotten your remote employees onboarded, you can also manage their payroll through the same platform.

The best part is that Revelo offers a risk-free 14-day trial that you can use to get in touch with your first Bolivian employee. Sign up today.

Key Takeaways

  • Outsourcing software development to Bolivia can be very beneficial for US companies due to the following reasons: low cost of hiring, English proficiency of Bolivian software development talent, advancement in tech infrastructure, increasing tech education in the country, and similar time zones with the US.
  • When hiring tech talent from Bolivia, you should look for professionals in Cochabamba and La Paz since these are the tech headquarters of the country.
  • If you don’t want to look for talent on job boards, or you're having trouble finding fresh graduates, find pre-vetted talent on talent marketplaces — such as Revelo — where you can manage, hire, and pay employees.
  • When nearshoring software development to Bolivia, make sure you’re compliant with the payroll and taxation regulations in the country. You can either work with a local lawyer or make yourself extensively familiar with the labor laws of Bolivia.


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Reх Huхford

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