Nearshoring is a strategic business practice where a company can outsource tasks to a neighboring country rather than half way across the globe. Nearshoring offers considerable advantages for both the employer and employees. Employers can look at savings in terms of cost and time over traditional offshoring. Employees can look at a favorable immigration system as compared to USA.
What is Nearshoring?
Nearshoring can readily be described as working with a strategic partner in gerographic proximity of USA to offshore certain processes. Typically the nearshoring partner is within the same timezone and can facilitate employee movement back and forth on a temporary basis to allow for in person knowledge transfers.
How does Nearshoring benefit you?
Nearshoring achieves cost savings two ways – directly and indirectly.
The US immigration system has been stifling legal immigration to USA for skilled workers with bureaucratic delays and red-tape which causes unnecessary burden on the employers and employees to process paperwork every few years which costs anywhere from USD 5-10k. Any change in the employee’s designation/address/roles requires an application again which is another USD 5-10k expense. Any change in the employer’s structure requires the same filing incurring the same cost. This is per employee. Then there are costs for the Employment based Permanent Residency applications which can go up to USD 20k. With the multicultural workforce omnipresent in USA, especially in the technology sector, most companies have employees in a myriad of visa statuses e.g. H1B, L1B, L1A, EADs etc. Nearshoring to a country like Canada with a trusted business partner allows the employer to be rid of these expenses yet be able to retain the existing, trained, highly skilled talent within the same timezone and allow them to achieve the permanent status in a country with similar cultural values as the USA. Such visa cost savings are direct.
The whole process of obtaining said visas by the employer is cumbersome at least if not inhibitive. There are extremely skilled candidates that cannot be hired because of them being on visas since it requires additional cost. This prolongs the recruitment process causing the positions to stay open for a longer time, preventing strategic initiatives from being launched for the lack of skilled manpower.
Nearshoring also grants predictability to both the employer and employee. The employee can expect certain permanency in their stay in the country and spread roots being aware of that fact. This has a positive impact on the employees mental health as ancillary issues caused by visa delays is not weighing them down, increasing their productivity at work.
Factors impacting Nearshoring
Several factors influence a company’s decision to add nearshoring as a practice to its business strategy.
- Industry that the company is involved in
- Geographic proximity to the company headquarters.
- Lower labor and operational costs
- Easy mobility for existing team members
- Cultural compatibility
- Favorable time zone
- Access to modern infrastructure and technology
- Political stability
- Favorable business environment
- Access to new markets and customer bases
- Ability to scale operations
Canada checks all those boxes and by entering into a mutual agreement with TechMBS, our Canada based locations can provide a base for a USA based company to expand and also benefit from the lower costs and ease of navigating the immigration system.
