After company formation in Mexico, you will need to find employees. However, this is not always easy for a new entrant to the jurisdiction, meaning you should seek specialist advice. A good recruiter in Mexico will have expert knowledge of the local market and an established recruitment network to tap into, so should be able to find strong candidates quickly. If hiring in Mexico interests you, the following article offers an overview of the market and advice on the key sectors to investigate.
Key takeaways
| Key sectors in Mexico | Key sectors in Mexico include: Tech developers Heavy industry e-commerce Fintech Customer support |
| Steps to hiring in Mexico | A local advisor can help you with: Job adverts Networking CV assessment Interviewing Contract writing Onboarding |
| Legality of PEO in Mexico | Yes it is legal to hire employees through a PEO in Mexico. |
| Minimum wage in Mexico | The current minimum wage as of January 2025 is MXN$278.80 (Approx. USD$13.50) per day. In the Free Zone of the Northern Border, the minimum wage is MXN$419.88 pesos (Approx. USD$20) per day. |
| Employer contributions in Mexico | According to employment law in Mexico, employers must contribute to the social security fund equivalent to 26% of an employee’s salary, while a contribution equal to 5.15% must be made to the pension fund. An additional contribution equal to 5% of an employee’s salary is also made to the National Housing Fund. |
What sectors are best for hiring in Mexico?
From Monterrey to Porto Alegre, remote working has created technology and innovation hubs across LATAM, and beyond the capitals of its countries. The fintech sector proliferated after the pandemic, as a great number of Mexicans started to
According to articles listed on Bloomberg online, there are three key cities that are home to a significant number of startups: 232 in Mexico City, 46 in Monterrey, and 36 in Guadalajara (commonly referred to as the Mexican Silicon Valley). The biggest global IT companies also have offices located in Monterrey. Hiring tech talent in Mexico is getting easier nowadays.
Coursera Global Skills report 2022 mentions that in México – technology skills proficiency levels are up. With more than 600 technology companies in Guadalajara, skilled workers do not lack job opportunities. The good news for employers is that skill levels are rising.
What are the advantages of hiring tech talent in Mexico?
- Hiring tech talent in Mexico is not too costly because Mexican outsourcing offers competitive labor rates;
- The ability to work in real-time and in proximity with companies in Canada and the US due to similar time zones;
- The technological market in Mexico has recently developed; the country sees modernization as cultivating a skilled I.T. workforce who can work remotely and bring home foreign currency;
- Hiring developers in Mexico makes sense when you know that the government recently invested in stable internet connections to strengthen the capacity of remote workers;
- There are similar cultural backgrounds between US and Mexican nationals;
- Mexico and America have trade agreements that protect intellectual property and companies can share software development information freely with remote developers in Mexico.
How much it costs to hire people in Mexico
The cost of hiring in Mexico is less than it would be in richer nations, yet workers are often well qualified and skilled. With significant investment in education over a number of years, the Mexico now has a surfeit of graduates in the labor market that it cannot provide local jobs for. This means that the labor market in Mexico is relatively competitive for an incoming prospective employer.
The minimum wage in Mexico is MXN$278.80 (Approx. USD$13.50) per day. In the Free Zone of the Northern Border, the minimum wage is MXN$419.88 pesos (Approx. USD$20) per day. However, this is not necessarily the rate that you should be offering.
In top sectors that require qualified and skilled workers, you will need to offer at least market standard rate. A local hiring expert in Mexico will be invaluable in making sure that you are not overpaying or offering unattractive rates that make it hard to recruit quality talent.
| According to employment law in Mexico, employers must contribute to the social security fund equivalent to 26% of an employee’s salary, while a contribution equal to 5.15% must be made to the pension fund. An additional contribution equal to 5% of an employee’s salary is also made to the National Housing Fund. |
Two options for hiring: establish a company or PEO
When entering the market and hiring in Mexico, there are essentially two options available to investors and entrepreneurs. The most common way of doing so is through full company formation to establish a presence in the jurisdiction. However, this may take time and effort, meaning that it is worth considering another option as well, using a Professional Employer Organization (PEO).
PEO: fast and agile
A Professional Employer Organization (PEO), also known as a ‘Registered Employer’ or ‘Employer of Record’, is an organization that provides and supports companies with their human resources functions, from the early stages of recruitment to the payment of taxes and benefits. PEOs undertake the fundamental and time-consuming tasks of human resources teams, allowing companies to focus on the growth and success of their business.
The services of a PEO are particularly useful when businesses seek to hire a local workforce but do not wish to establish a local legal entity. Simply put, a PEO makes it easy to hire staff in Mexico through an outsourced provider. It means you can enter the market and start hiring quickly, without having to commit to full entry until you are sure that it is what you want to do. It is worth noting that regionally there is beginning to be more regulation and PEO in Mexico may not be viable in the future.
The long-term option: direct hiring
This is the gold standard of hiring in Mexico, as it will give you full control over your employees as well as being sure that you will be compliant for the long term. It also gives you a higher status with potential job applicants, who will see you as a more secure long-term employer.
Before you start hiring employees in Mexico, you will first need to get a sense of the legal, financial and cultural lay of the land. Things such as how to sort out the red tape associated with incorporation and how to manage payroll, for example. With a permanent legal presence in Mexico, you will be fully liable for compliance with local law.
A local expert will help when hiring in Mexico, as they will have an extensive network of qualified professionals for top jobs as well as a good idea of the local labor market. They will be able to advise on the best rates to offer and what type of profile you should be targeting. With anti-discrimination legislation important in Mexico, especially for top jobs, they can make sure you are making a fair offer which complies with local law.
After placing adverts and receiving applications, you will want to move towards interviewing potential candidates. This should be done by both a team manager and HR representative at minimum, to make sure that everything is watertight in legal terms. You may want to include other people into the process in order to make a better assessment of the candidate.
It is entirely possible that you may wish to have a second interview, possibly involving other team members as discussed above. It is also common in the region and when hiring in Mexico to provide candidates with an aptitude task to be completed. This usually takes the form of a dummy task that simulates the type of job that will be done in the future and confirm that they possess the skills cited on their CV.
Contracts, too, will be important. A local advisor will be up to speed on what you can and cannot offer. Bear in mind that you will have to follow all the rules established by Mexico. In Mexico, this means making sure that any fixed term contracts do not misclassify workers.
Finally, your local advisor will be able to help you with the stages of both the hiring and onboarding process. They will make sure that you comply with standard requirements such as compulsory medical checks and make sure that any probation period is within the boundaries of those established by the labor law in Mexico. This is generally two months.
Labor laws and regulations in Mexico
Before making a move into the jurisdiction, it’s important for companies to understand the labor rights and responsibilities of both employers and employees in Mexico. What follows are a few things that foreign business owners should know about when it comes to the local work culture:
- Work hours – The standard workday in Mexico is eight hours, with the standard workweek up to 48 hours.
- Public holidays – There are 9 public holidays in Mexico each year.
- Vacation time – Workers in Mexico are eligible for at least 12 days of vacation annually. Women are entitled to 12 weeks’ maternity leave.
- Contract types – There are essentially two types of contract in Mexico, indefinite employment and fixed-term employment
What should recruiters know before hiring tech talent in Mexico/hiring developers in Mexico?
- Have a hiring strategy before approaching candidates;
- Identify competitor’s companies and discover what type of talent is already hired in a particular IT job;
- If hiring for English speaker companies, always focus on recruiting candidates with minimum B2 or C1 English proficiency;
- Define the type of contract and work modality;
- Always negotiate NET salaries – Mexicans don’t want to know how many taxes they pay, they just want to be sure of how much net they will get in their accounts;
- Before hiring tech talent in Mexico, choose the city or destination where employees will work diligently even if they will be fully remote workers;
- Know the territory where you will recruit and the local professional associations and platforms;
- Use different platforms to source candidates and avoid recruiting from platforms where everybody is recruiting;
- If interviewing by video call, turn on the video and request candidates to also do so, it is the only opportunity you will have when recruiting virtually and it is important to see the appearance of the candidate and determine if the person looks professional.
FAQs on hiring talent in Mexico
Based on our extensive experience these are the common questions we receive from clients when looking to hire in Mexico.
1. Why hire talent in Mexico?
Hiring in Mexico offers access to a large talent pool that is located in the same time zone as the North American market, is culturally similar, and is more economical. The combination allows a company to complement an existing North American based team or to establish an independent Nearshoring center within the region.
2. Can I hire top talent in Mexico?
Yes, you can hire top talent in Mexico, often at more competitive prices than in your local market.
3. What is the level of English for professionals in Mexico?
The level of English in Mexico may not be the highest, but in key white collar sectors it is much better. University graduates are expected to complete English language proficiency to at least an intermediate level. If hiring for English speaker companies, always focus on recruiting candidates with minimum B2 or C1 English proficiency;
4. Which cities are best are best for horing talent in Mexico?
According to articles listed on Bloomberg online, there are three key cities that are home to a significant number of startups: 232 in Mexico City, 46 in Monterrey, and 36 in Guadalajara (commonly referred to as the Mexican Silicon Valley). The biggest global IT companies also have offices located in Monterrey.
Biz Latin Hub can help you with hiring talent in Mexico
At Biz Latin Hub, we offer a comprehensive range of market entry and back-office solutions across Latin America and the Caribbean.
With offices in key cities across the region, along with trusted partners in other markets, our extensive reach makes us well-suited to support cross-border operations and multi-jurisdiction market entries.
As well as knowledge about hiring in Mexico, our portfolio of services includes hiring & PEO accounting & taxation, company formation, bank account opening, and corporate legal services.
Contact us today to find out more about how we can assist you in finding top talent or otherwise doing business in Latin America and the Caribbean.
If this article on tips for hiring in Mexico was of interest to you, check out the rest of our coverage of the region. Or read about our team and expert authors.
