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Nearshore Software Development Rates

Written by 
David Jackson
,
CEO
Nearshore Software Development Rates
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Nearshore software development outsourcing is becoming increasingly popular amongst companies in the United States, as it provides access to a large talent pool of skilled developers at approximately 50% of the cost of hiring domestically. But what should you expect to pay when hiring nearshore software developers?

Table of contents

That depends on three primary factors:

  1. Technical abilities and seniority of the developer.
  2. English proficiency.
  3. Location.

Technical Ability

As is the case with all developers regardless of geography, the primary factor driving the cost of nearshore software developers is level of experience and technical abilities. Generally speaking, developers fall into one of four levels that roughly correlate with years of experience: 

  • Junior software developer - 0-2 years
  • Mid-level software developers - 3-5 years
  • Senior software developers - 5-10 years
  • Software architect - 10+ years

Entire books have been written on properly defining the roles, responsibilities, and capabilities of developers at each of these stages, but we’ll try to keep it brief by providing a simple description. If you want to read more, check out FullStack’s career paths document.

Junior Nearshore Software Developer

A Junior Software Engineer (JSE) is a hardworking individual with the ability to develop software in one or more areas of focus. A JSE is capable of taking a specified task describing a software behavior and executing that task independently. They demonstrate ownership of assigned tasks, ensuring that they produce a successful result in improving an application. 

Mid-level Nearshore Software Developer 

A Mid-Level Software Engineer (MSE) is a dedicated individual with the ability to develop software across the full stack in one or more areas of focus. A MSE is capable of taking a specified epic describing a software feature and executing that epic independently. They demonstrate ownership of assigned epics, ensuring that they produce a successful result in providing value to a project stakeholder.

Senior Nearshore Software Developer

A Senior Software Engineer (SSE) is an experienced individual with the ability to develop software across the full stack in two or more areas of focus. A SSE is capable of taking on a specified software project and executing that project independently. They demonstrate ownership of assigned projects, ensuring that they produce a successful result in providing value to project stakeholders.

Architect, Nearshore Software Developer 

A Software Architect (SA) is a highly-experienced individual with the ability to develop software across the full stack in a variety of focus areas. An SA is capable of designing and engineering a complex software system. They demonstrate ownership of multiple projects, ensuring that the teams they support are successful in all aspects of their projects, including functionality, performance, security, and value delivery.

Nearshore Software Developer Hourly Rates Years of Experience Typical Hourly Rate
Junior 0-2 $40
Mid-level 2-5 $50
Senior 5-10 $60
Architect 10+ $70

English Proficiency

Poor communication is a leading cause of failed software projects. Software is extremely complex, so it's imperative that everyone involved — stakeholders, product owners, designers, developers, project managers, quality assurance, and users — be able to properly communicate with one another and agree on what will be built. Because of this, nearshore software developers who speak English fluently typically can demand a premium to developers who may have equal technical skills but don't speak English. So expect English abilities to influence the final price that you pay. 

Location

Geographic location can affect the hourly rates of nearshore software developers in two ways. First is the time zone. Countries like Mexico, Costa Rica, and Colombia, which line up exactly with USA business hours, tend to demand a premium over countries like Brazil, which are five hours ahead of the west coast of the USA. 

You can learn more about the advantages and disadvantages of engaging with Latin American development teams in this article.

Second is cost of living. Certain Latin American countries have a much higher cost of living than others, so nearshore software developers in these more expensive countries tend to charge more than developers in countries with a lower cost of living. 

Here's how Numbeo breaks down the cost of living in Latin American countries on its scale of 21 (lowest cost of living) to 91 (highest cost of living). 

Rank Country Cost of Living Index
1 Colombia 29.02
2 Paraguay 30.34
3 Mexico 30.93
4 Brazil 30.99
5 Argentina 31.18
6 Bolivia 36.02
7 Peru 37.64
8 Ecuador 40.62
9 Dominican Republic 41.76
10 Honduras 42.73
11 Nicaragua 43.7
12 Cuba 43.85
13 Guatemala 44.23
14 El Salvador 44.96
15 Chile 45.43
16 Uruguay 46.66
17 Suriname 47.95
18 Belize 53.08
19 Costa Rica 54.2
20 Panama 55.02


Nearshore software developer hourly rates 

Taking all of these factors into consideration, here are the average hourly rates for nearshore software developers: 

  • $40 an hour for Junior Nearshore Software Developers
  • $50 an hour for Mid-level Nearshore Software Developers 
  • $60 an hour for Senior Nearshore Software Developers 
  • $70 an hour for Srchitect Nearshore Software Developers

But these numbers may fall by 25% or more depending on the location and English proficiency of the developer. 

Engaging with a nearshore software development company is a great way to improve efficiency and innovation within your organization. There are many factors that influence pricing, and it’s important that you get the right type of consultancy for your project. If you're ready to boost your projects, get in touch with one of our experts.

David Jackson
Written by
David Jackson
David Jackson

As the CEO of FullStack Labs, my primary responsibility is for the management of the company. I manage and directly contribute to many different departments within the company, including recruiting and hiring, marketing and sales, bookkeeping and accounting, tax and legal, and general operations. I take a hands on approach to management, meaning I prefer to roll up my sleeves and work directly on projects, instead of managing through meetings, policy, and bureaucracy. Prior to FullStack Labs, I was Vice President of Sales and Partner at CAE, where we built an industry-leading marketplace for buying and selling used capital equipment. I graduated Summa Cum Laude from the California State University Sacramento with a degree in Business Administration.

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