LATAM Outsourcing Alternatives: Where to Find The Best IT And Software Development Talent

Latin America has long been a go-to region for outsourcing, especially for businesses in the United States.

With the LATAM IT outsourcing market projected to reach $19.54 billion by 2025, the region offers convenient time zones and an expectation of competitive rates.

However, businesses often discover that actual costs exceed expectations due to high agency markups and operational inefficiencies.

While LATAM outsourcing has its advantages, businesses often face challenges that impact project stability, long-term efficiency, and cost savings.

High attrition rates, inconsistent talent pools, and hidden fees in agency-based models make it difficult to maintain predictable budgets and operational efficiency.

For businesses looking for better workforce stability, stronger security, and more reliable pricing, alternative outsourcing destinations like Eastern Europe, Asia, and hybrid models provide solutions that reduce risk and improve long-term value.

In this article, we’ll uncover the challenges of LATAM outsourcing and explore the best alternatives for companies looking for reliable long-term partnerships.

The Challenges of Outsourcing in LATAM

While Latin America has built a strong reputation as a nearshore outsourcing hub, businesses often encounter challenges that impact cost savings, project stability, and long-term efficiency.

These challenges can range from high employee turnover to hidden costs and operational risks that make outsourcing in LATAM less predictable than expected.

Here’s a closer look at some of the key obstacles businesses face when outsourcing to LATAM.

1. High Employee Turnover & Retention Issues

LATAM has a rapidly growing IT sector, but with that comes strong competition for skilled developers. Many professionals frequently switch jobs for better salaries, career growth, or international opportunities, leading to retention challenges for businesses outsourcing in the region.

When key team members leave mid-project, companies face rising recruitment costs, slower development timelines, and disruptions in knowledge continuity. These factors can make outsourcing in LATAM less cost-effective than expected, especially for businesses managing long-term development cycles.

Retention trends vary by country, and while some LATAM outsourcing firms offer structured career development programs to keep talent engaged, companies that rely on stability and deep institutional knowledge may find it harder to maintain consistency in their outsourced teams.

2. Hidden Costs & Security Risks

Outsourcing to LATAM is often seen as a cost-effective option, but hidden expenses and security concerns can erode these savings. 

Agency markups in LATAM often range from 50% or more, meaning the developer you think you’re paying for is not the developer you’re actually getting.

The difference between the value of the developer and the price paid to the agency leads to unexpected costs without the expected quality.

Security is another concern. Background verification can be inconsistent, as some LATAM countries lack centralized screening systems, making it difficult to confirm employment history or identify security risks. For industries handling sensitive data, financial transactions, or intellectual property, this raises significant compliance challenges.

Legal protections also vary widely. Data security laws and enforcement levels differ by country, making it difficult to navigate contracts, protect intellectual property, or resolve disputes efficiently.

For companies prioritizing compliance, data security, and predictable legal frameworks, outsourcing to regions with stronger regulatory environments may be a more reliable long-term investment.

3. Language & Communication Barriers

Communication is key to any successful outsourcing partnership, and English proficiency in LATAM varies widely by country. While Argentina ranks 30th globally in English proficiency, Brazil and Colombia rank much lower, making it harder for businesses to find developers with strong English skills.

For companies that require seamless collaboration across engineering teams, product managers, and stakeholders, language barriers can lead to misalignment, slower execution, and increased time spent on clarification.

Even when developers speak English, differences in communication styles—a more indirect, relationship-driven approach in LATAM versus a direct, task-focused style in the US and Europe—can create inefficiencies, particularly in fast-paced agile environments.

Businesses seeking clear, efficient collaboration with minimal language barriers may find Eastern Europe or select regions in Asia better suited due to higher English proficiency and stronger cultural alignment with Western business practices.

The Best LATAM Outsourcing Alternatives

For businesses seeking greater stability, stronger security, and top-tier engineering talent, several outsourcing destinations offer compelling advantages over LATAM. 

For companies exploring alternatives to LATAM outsourcing, Eastern Europe, Asia, and hybrid outsourcing models provide stronger workforce stability, lower risk, and more cost-effective long-term value. Businesses specifically searching for ‘LATAM outsourcing alternatives’ often discover that Eastern Europe provides a better balance between quality and price.

Each alternative comes with its own strengths.

Eastern Europe is well known for its highly skilled engineers and strong legal protections, while Asia offers a massive talent pool at lower rates.

Hybrid outsourcing models provide a balanced approach, combining cost savings with better long-term retention and operational oversight.

Key Factors When Choosing an Outsourcing Alternative

Outsourcing success depends on more than just cost—it requires high-quality talent, workforce stability, legal protections, and effective communication. While LATAM offers proximity to the U.S., high turnover, inconsistent security, and language barriers often outweigh the benefits.

5 factors companies should consider when choosing an outsourcing partner include…

1. Talent and Specialization
2. Retention and Workforce Stability
3. Cost vs. Long-Term Value
4. Security and Compliance
5. Communication and Time Zones

Eastern Europe: The Premium Alternative for High-Quality Engineering

Businesses evaluating LATAM vs. Eastern Europe often turn to countries like Poland, Ukraine, and Romania, where developers provide a higher level of technical expertise, stronger security compliance, and better retention.

Unlike LATAM agencies that often prioritize volume over quality, Eastern European firms focus on building long-term client partnerships with dedicated teams.

These countries have a long history of excelling in fields like AI, cybersecurity, and fintech, making them a strategic choice for businesses requiring highly skilled developers.

Employee retention rates in Eastern Europe tend to be significantly higher than in LATAM, with companies like Euvic reporting a 92% retention rate among their developers. Lower turnover means businesses can maintain continuity in their teams, reducing the disruption and additional costs associated with frequent rehiring.

English proficiency is another key advantage of this region. Developers in Poland and Romania generally have a much higher level of fluency compared to those in many LATAM countries. This makes real-time collaboration smoother and reduces the risk of miscommunication in fast-paced development environments.

Security and compliance are also much stronger in Eastern Europe. Countries in this region operate under well-defined legal systems, making it easier to verify background checks, protect intellectual property, and enforce contracts. Businesses handling sensitive customer data or working in regulated industries such as finance and healthcare often find Eastern Europe to be a safer and more reliable outsourcing option.

Rates for Eastern European developers typically range from $35 to $60 per hour, reflecting the high level of expertise, workforce stability, and project reliability that businesses gain in return.

The benefits of lower turnover, stronger security, and higher quality work often offset the difference. For businesses prioritizing long-term projects and specialized engineering expertise, Eastern Europe presents a valuable alternative.

Asia: The Low-Cost, High-Volume Alternative

For companies focused on reducing costs while scaling operations quickly, Asia remains a strong contender. Countries like India, the Philippines, Vietnam, and Malaysia have some of the largest IT workforces in the world, providing businesses with access to millions of highly skilled developers.

The primary advantage of outsourcing to Asia is cost. Hourly rates for developers in this region range from $10 to $25, making it one of the most affordable outsourcing destinations. This price advantage allows businesses to scale operations rapidly, especially for large-scale development, customer support, and back-office functions.

However, there are challenges to consider. Time zone differences can make real-time collaboration difficult, especially for companies based in North America. While English proficiency is high in countries like the Philippines and improving in India, some Asian countries still present language barriers that can impact communication and workflow efficiency.

Retention rates in Asia can also be unpredictable. In markets like India, frequent job-hopping means companies must invest more in onboarding and training to maintain stability in their teams. Businesses that require long-term consistency may need to implement strong retention strategies to mitigate this issue.

Despite these challenges, Asia remains a strong option for businesses that need to scale quickly while keeping costs low. The region is particularly well-suited for companies that can manage remote teams effectively and structure workflows to accommodate time zone differences.

Nearshore & Hybrid Outsourcing Models

For businesses that require a balance between cost, real-time collaboration, and operational stability, hybrid outsourcing provides an effective alternative to LATAM. A hybrid model combines multiple outsourcing regions to optimize costs while ensuring security and team efficiency.

One option is nearshoring to Eastern Europe instead of LATAM. Many businesses find that Eastern Europe offers better retention, stronger security, and higher English proficiency while still maintaining reasonable development costs. This approach provides a more stable workforce and reduces the risks associated with high turnover in LATAM.

Another approach is a hybrid outsourcing model that blends nearshore and offshore teams. A common setup includes a US-based leadership team working with developers in Eastern Europe and quality assurance (QA) teams in Asia. This structure allows businesses to take advantage of cost-effective development while keeping security-sensitive tasks in a more regulated region.

Some companies are also moving away from agency-based outsourcing in favor of direct outsourcing partnerships. Many LATAM agencies operate with high markups, making outsourcing more expensive than anticipated. By working with direct outsourcing firms, businesses can benefit from transparent pricing, direct developer contracts, and greater accountability.

Euvic Inc.: The Best Alternative to LATAM Outsourcing

For companies looking for high-quality engineering, workforce stability, and cost efficiency, Euvic provides a proven alternative to LATAM outsourcing.

With 6,000+ highly skilled Polish developers, a 92% retention rate, and deep expertise in AI, fintech, and enterprise solutions, Euvic offers a strong, reliable outsourcing partnership without the hidden costs of agencies.

Unlike many LATAM agencies that act as intermediaries, Eastern European outsourcing firms, such as Euvic, provide direct access to highly skilled engineers without the inflated costs.

Euvic delivers:

• Dedicated development teams with long-term stability
• Transparent pricing with no hidden fees
• U.S.-based leadership for seamless project management
• GDPR-compliant security and legal protections

Poland is one of the world’s top outsourcing destinations, combining technical excellence, workforce reliability, and clear communication—a combination that’s difficult to find elsewhere.

If you’re ready to move beyond the challenges of LATAM outsourcing, book a consultation with Euvic today. Get top-tier engineering talent, long-term team stability, and a smarter outsourcing solution for your business.