Tech companies look to Mexico for new talent

It’s been kind of a tough six months for the tech industry in the United States.

Just last month, Meta announced another round of 10,000 job cuts after 11,000 at the end of the year.

Google, Microsoft, Twitter and dozens more companies that aren’t household names have all laid off workers en masse, as the pandemic hiring spree ran into rising interest rates and changing consumer behavior.

But just south of the border, in Tijuana, Mexico, the information technology industry is still heating up.

It’s a phenomenon sometimes called “nearshoring” — like offshoring — where jobs move abroad but not halfway around the world.

“There is this extreme need for engineers in the U.S,. and right now, they are not meeting that demand,” said Omar Parra, engineering director with ITJuana.

ITJuana connects American firms with Mexican talent. It mostly works with San Diego-based biotech companies that are looking for an extra set of IT workers.

ITJuana workers collaborate with their American counterparts; they are part of the same team, Parra said.

“It’s not like we just get assigned projects and send them back,” he said. “We create teams around their own organization, so we totally adapt to what they already have.”

Those teams include engineers, managers, site directors and developers well-versed in multiple coding languages. They also speak English and Spanish.

There are 20,000 tech workers in Tijuana, and 35,000 in Baja California, according to a white paper by the industry group Nearshore Americas.

Despite the layoffs in the U.S., Mexican workers continue to be in high demand, said Fernando Torres, who works for Softtek, the largest IT nearshoring company in Mexico.

“Right now we are entering into a sort of boom that has to do with the layoffs happening in the United States,” he said.

Part of what makes Mexican talent so appealing is that Mexico produces a lot of engineers who get paid in pesos instead of dollars.

Tijuana has 35 public and private universities, and 14,000 students enrolled in engineering programs.

Torres said this boom isn’t isolated to tech companies. Industries like banking, transportation, retail and tourism are all looking for IT talent, Torres added.

David Fishman is seeing the same thing. He’s the CEO of the recruiting firm Sparrow Co.

“We had so much work that we couldn’t keep up with it,” he said.

The pandemic’s disruption to supply chains forced companies to think outside the box — and for a lot of them, that meant Mexico, he said.

“Companies woke up,” he said. “Not just the big multinationals, but the smaller ones, the $50 million to $100 million companies. Everybody was going to Mexico.”

Related links: More insight from Meghan McCarty Carino

The Big Tech layoffs cost many workers more than their jobs. On “Marketplace Tech,” we covered how employees’ identities can be affected by the layoffs.

When tech companies announce these layoffs, they often have the same refrain: “We overhired.”

Many of the layoffs at tech companies in the U.S. aren’t really affecting the technical workers, so jobs in recruiting and human resources have been particularly hard hit.

So it’s not as if engineers and software developers with specialized tech skills are necessarily having a tough time in the job market.

In fact, a recent report from the trade group CompTIA showed openings for tech jobs in the U.S. remained near an all-time high as recently as March.