With the gap between the number of tech positions and the available tech talent, many companies are struggling to hire enough qualified people. Over half of IT managers have openings they can't fill, and three-fourths say their teams don't have enough tech talent. Accordingly, the price of hiring U.S.-based tech talent is rising.
The shortage of workers and the increasing demand due to the digital-first transition and the Fourth Industrial Revolution have created a perfect storm for tech teams in all industries. One solution companies are implementing to deal with this crisis is offshoring their software development teams. Although this can be an effective method for filling empty positions, it does come with challenges. These challenges are particularly intense when you hire from southern and eastern Asian countries, where the time zone and cultural differences can cause significant communication obstacles.
However, nearshoring software development to closer countries such as the Dominican Republic can provide the same advantages without the hassles. When you're trying to maximize cost efficiency and skill while minimizing communication barriers, the Dominican Republic has a lot to offer.
Advantages of Nearshoring Software Development to the Dominican Republic
High Overlap with US Time Zones
In today's agile development environment, it's critical to prioritize ease of communication between individual team members as well as different departments. If your team members are located in wildly disparate time zones, communication can be your biggest challenge, slowing your progress to a crawl.
Fortunately, this isn't an issue when you hire software developers from the Dominican Republic. Since it's only one hour ahead of the east coast, you'll be able to engage in real-time collaboration on your projects. Instead of someone having to get up in the middle of the night for a call or wait until the next day to have an issue addressed, all of your team members can talk to each other and work out problems right away. Given the iterative nature of software development and the urgency of being first to market, this advantage alone is enough to make hiring from the Dominican Republic a smart choice.
In addition to being able to communicate in real-time, you'll also be able to understand your team members. The Dominican Republic is ranked fifth in Latin American countries on the English Proficiency Index. English is a priority in Dominican Republic schools, with some schools offering an English immersion program where students spend four hours per day learning in English.
Because it's a popular tourist destination, workers in the Dominican Republic frequently deal with native English speakers. Proficiency in English is especially prized among software developers, so they're more likely to be proficient than the general population. Though Spanish is the official language of the Dominican Republic, it's also the second most commonly spoken language in the U.S. with over 42,000,000 speakers. Hence, communication with Dominican software developers should be fairly effortless.
Another feature that will help developers from the Dominican Republic seamlessly integrate into your team is the cultural similarity. People in the Dominican Republic are warm and friendly. As in the U.S., direct eye contact is a sign of respect and trustworthiness. The family is the basis of societal stability. The Dominican constitution provides for freedom of religion, but over 90% of the population is Christian.
The work culture is also similar to that in the U.S. Punctuality is valued and there is a traditional hierarchy in companies. Dominicans are straightforward communicators, so you don't have to worry about interpreting a hidden social meaning when discussing business.
Perhaps the biggest advantage of nearshoring software development is the cost savings. The cost of hiring Dominican developers is much lower than the cost of hiring U.S.-based developers, but there are also significant cost savings over traditional offshoring as well. Traveling to a destination as close to the U.S. as the Dominican Republic is markedly less expensive than traveling to Asian countries.
Even if you never plan to travel to the Dominican Republic, you'll also see cost savings due to the ease of communication and doing business. You'll be less likely to have expensive slowdowns that can occur when you have team members working in opposite time zones.
Finally, hiring a remote team is much less expensive than hiring an on-site team. You won't have all of the costs associated with renting, buying, or maintaining office space.
As for the salaries of Dominican developers mentioned above, you'll pay less for developers of equal quality because of the reduced cost of living in the Dominican Republic. In the next section, we'll cover exactly what you can expect to pay for Dominican developers.
The Cost of Hiring Dominican Software Developers
On average the cost of living in the Dominican Republic is about 31% cheaper than living in the U.S. It's even cheaper when you factor in the cost of necessities versus the cost of discretionary purchases. Housing costs are almost 60% less, and groceries cost 40% less.
The average salary for a Dominican software developer is a little over $2700 per month, much less than the $9200 per month the average U.S. software developer makes. This will vary based on experience and skills, which we'll break down below.
Average Yearly Salary Rates for Dominican Software Developers
Naturally, you can expect to pay more for developers with more experience. Junior level developers will need a lot of direction and supervision, so they make the least. Senior developers can often head up teams and mentor junior and mid-level developers, so they're more highly compensated.
Junior salary rate
The average yearly salary for a junior developer ranges from around $7300 to almost $8000. An American junior software developer will make, on average, almost $80,000.
Mid-level salary rate
A mid-level developer will earn an average yearly salary of $13,000 per year. This is much less than the $87,559 you'll pay a U.S.-based mid-level developer.
Senior salary rate
You can expect to pay around $20,952 yearly for a senior Dominican developer. Senior American developers, on the other hand, earn around $130,000 per year.
Average Salary Rates by Tech Skills
In general, there isn't a significant difference in what you'll pay Dominican developers based on tech skills that are equally valuable. As is true globally, you can expect to pay more for tech stacks that are more in demand. You'll pay about 20% more for a full-stack developer than for a front-end developer, for instance.
Average Hourly Rates to Outsource to Dominican Senior Engineers
Since the average salary of a software developer in the Dominican Republic is based on an average 40 hour week, you can expect to pay around $7 per hour to outsource software development. By contrast, a developer in the U.S. earns an average of $42 for hourly work.
Challenges When Outsourcing Software Development to the Dominican Republic
Despite the many benefits of outsourcing software development to the Dominican Republic, there are also some challenges that have to be overcome. If you aren't accustomed to doing business in the Dominican Republic, you'll have trouble connecting with local talent, managing your payroll, and staying in compliance with local labor laws.
Difficult for Foreign Companies to Navigate Local Talent Markets
Unless you're fluent in Spanish and know the job-seeking practices that are common in the Dominican Republic, you may not be effective in posting job ads and finding the best tech talent for your needs. Advertising for workers in the wrong marketplace can waste a tremendous amount of time and resources. Hiring new talent is expensive under the best of circumstances since you have to devote man-hours and money to sifting through resumes and vetting candidates for skill proficiency.
Trying to go through that process in an unfamiliar language and culture is even more expensive and overwhelming. You may end up wasting weeks or months before you realize that you're not even advertising in the right place.
Unfamiliar Labor Laws and Taxes
Hiring in a foreign country also adds layers of complexity to tax and labor law compliance. Not only do you have to follow the laws of the U.S., but you also have to follow the Dominican laws. The labor laws of the Dominican Republic protect the employee's rights and are generally pro-worker. Some of these protections are similar to those in the U.S. while others are significantly different.
Some key differences between labor laws in the U.S. and those in the Dominican Republic include:
- Dominican employees are entitled to a 13th salary (an additional month of pay) that must be paid by December 20th of each year.
- Equal pay is guaranteed for equal work.
- There are several different minimum wage levels, each depending on the sector and size of the company.
The good news is that the Dominican Republic is very welcoming to foreign businesses. Unlike in many European countries, you don't have to set up a foreign entity to hire in the Dominican Republic. However, you do have to establish a local address to register with the Commercial Registry and the National Registry of Contributions. Once you are registered, you're treated the same as any local business, which means you have the same rights and obligations.
While many companies try to avoid the hassles of managing employees by hiring independent contractors, there are many risks associated with this practice. For a complete understanding of the problems you could face, consult with a local labor and tax law expert.
Revelo: Source, Hire, and Onboard Dominican Developers With Ease
If you're ready to expand your team into the Dominican Republic, but you don't want to be burdened with vetting candidates and managing payroll in a foreign country, Revelo can help. Revelo is a tech talent platform that facilitates hiring vetting candidates from Latin America. We prescreen all of our applicants, so you don't have to waste time and resources finding developers with the skills you need.
Once you've found the perfect addition to your team, Revelo handles managing your payroll and benefits. You're free to focus on your growing your business instead of complying with Dominican labor and tax laws. We have experts in all aspects of vetting, hiring, and managing software developers from the Dominican Republic. Check out our website for more information about our services.
Where to Find and Hire Dominican Software Engineers
The Dominican Republic boasts some of the most beautiful landscapes and views in the world. Although it's not yet known as a tech hub, the situation is quickly changing as the country invests in its technology infrastructure and education. Education is affordable in the Dominican Republic, and connectivity to the internet is widely available, even in public transport vans. The tech talent pool is growing.
When you're ready to hire Dominican developers, here are some of the best places to look:
Dominican Republic Job Boards
As in the U.S., job boards are a viable option for posting your openings. The biggest advantage to using job boards is also the biggest disadvantage: You will probably get a lot of responses. While you may find a gem, you will have to hunt for it. You'll need to sort through all of the candidates and implement a vetting system to weed out those who aren't qualified. Then you'll have to devote considerable time to interviewing the qualified applicants to determine if they're a good fit for your team.
Computrabajo is a job board that allows you to post your position for free. Job seekers can search for jobs by location or category and send their resumes. You can then sort through them to take the next steps in the hiring process.
Buscojobs is another job board that's widely used. You can post an opening or browse resumes that job seekers have posted.
Another option for finding Dominican developers is to use freelance sites such as Upwork. Upwork allows freelancers from all over the globe to bid on jobs and post their services. You can register and then post a description of the type of service or job you need. You can use the location filter in the advanced filters section to find contractors from specific countries.
A freelancer website is a great place to find a developer for a limited project. If you're looking for someone long-term, it can also be a good way to make contact and evaluate their performance before you commit.
Talent marketplaces can cut down on the work involved in hiring tech talent. Because they're pre-vetted and trained before you hire them, you can eliminate the most time-consuming and difficult parts of hiring. Marketplaces provide a way for talented applicants to rise to the top of the pile and ensure a seamless screening process.
Many busy hiring managers prefer using talent marketplaces because they handle most of the moving parts involved with finding and managing new hires. Because you know every applicant you look at is qualified, much of the work is done for you.
If you're interested in using a talent marketplace to hire developers from the Dominican Republic, look into Revelo. Our tech talent platform includes Dominican developers who are skilled in all of the latest in-demand languages and stacks, including Ruby, Python, C++, Go, and more.
Revelo makes the entire process risk-free since you can try out candidates for 14 days without any obligation. We know that while tech skills are a must, it's also important to find people who mesh well with your team. You can use your trial period to evaluate a candidate's soft skills and make sure they will bring value to your organization.
Outsourcing software development to the Dominican Republic can offer your company a lot of benefits. Dominican developers cost much less to hire than U.S. developers and are equally skilled. Additionally, they're located in a time zone that makes communication much easier than it is with Asian countries. Combined with the cultural similarity, you'll find it easy to integrate software developers from the Dominican Republic into your existing team.
However, along with the benefits, outsourcing to the Dominican Republic has some challenges as well. It can be difficult to navigate foreign labor regulations and tax laws. Managing payroll in a different currency can also be an obstacle. You'll need specialized help to make sure you're in compliance with both U.S. and Dominican laws since the penalties for non-compliance can be stiff.
Working with a talent marketplace such as Revelo can help you take advantage of the benefits of outsourcing to the Dominican Republic while avoiding the risks. Our platform can help you reduce the costs associated with recruiting, onboarding, and managing your Dominican hires. Revelo handles your payroll, contracts, taxes, and onboarding, leaving you free to focus on expanding your business and getting to market faster. We take the guesswork out of hiring tech talent and expedite the entire process of growing your workforce.
Reach out today to find out how we can support your company's growth and success by helping you find the best tech talent from the Dominican Republic or other Latin American countries.