6 reasons for outsourcing software development to Brazil in 2024

Over the years, several IT hubs have opened up and grown exponentially to cater to world demand, and Brazil is an excellent example of that. A fantastic resource for companies looking for offshore software development is, in fact, in Brazil. Given the vast and thriving population of skilled and upcoming software developers, impressive infrastructure, low percentages of attrition, and cost-effective service rates, it is a good choice to hire overseas programmers from Brazil.

Understandably, in the early days of outsourcing, companies in the US may have exercised considerable caution when hiring developers from other countries. However, in today’s world, one can easily find out about skilled and reliable software developers in countries like Brazil, test their abilities thoroughly, and hire accordingly. Today, overseas outsourcing to Brazil means a great opportunity to work with developers in real-time, assess progress on the projects, and get the work done timely at reasonable costs, combined with excellent back-and-forth communication.

For US-based companies, choosing to hire offshore developers from Brazil is an exceptionally safe and good choice. Brazil’s IT industry has shown remarkable growth in the past few years, and investment in this sector is very high. Further, there is a time difference of only one hour between the US and Brazil’s time zones, making collaborating in real time much easier.

In this article, we will lead you through the main advantages and disadvantages of software development outsourcing to Brazil. We also covered the average monthly and yearly developer’s salary.

What to know about Brazil

• Capital: Brasilia
• Official Languages: Portuguese
• Currency: Real
• Population: 217,240,060
• Timezone: GMT-2, GMT-3, GMT-4, GMT-5
• Number of developers: 500,000+
• Average developer’s salary: $82,479 ⁽*¹⁾
• Business Climate: A4 ⁽*²⁾
• Risk Assessment: B ⁽*³⁾
• Political Stability: -0.5 ⁽*⁴⁾
• Ease of doing business: 59.1 ⁽*⁵⁾

⁽*¹⁾ according to Glassdoor, Senior Software Engineer, 7-9 years of experience.

⁽*²⁾ according to Coface. It includes the ease of running a business, the political situation in the country, and whether the legal system provides fair conditions and business protection for companies. Rating scales: A1, A2, A3, A4, B, C, D, and E.

⁽*³⁾ according to Coface. It refers to the country’s ability to transfer currency for foreign payments. Rating scales: A1, A2, A3, A4, B, C, D, and E.

⁽*⁴⁾ according to The World Bank. These statistics show the political stability and absence of violence. It ranges from -2.5 (lowest) to 2.5 (highest).

⁽*⁵⁾ according to The World Bank Doing Business 2020 report.

What companies outsource to Brazil?

The US $39.7 billion investment in the first half of 2022 and student aid such as Science Without Borders have helped encourage IT education for Brazilian engineers in Brazil and abroad. That’s why the country has a deep pool of talented developers to offer the world.

According to Global Innovation Index 2022 rankings, Brazil is the 2nd in Latin America and the Caribbean region for its innovation economy and the 54th worldwide with a score of 32.5.

#1 Growing talent pool of tech specialists in Brazil

The University of Sao Paolo is ranked 120th in the global list of best universities in 2024. Its Engineering and Technology field ranked 175th. UFRJ (Universidade Federal do Rio de Janeiro) is another university known for its phenomenal information engineering courses, ranking as the 3d best university in Latin America.

Suppose those aren’t significant indicators to show the kind of skilled talent Brazil is producing in the software development sector. In that case, US companies should know those budding Brazilian developers are groomed and coached so that their work culture is very similar to that of the US, focusing on innovation and creativity, which only helps hone the already bright and skilled talents of the industry. Thus, Brazil’s growing talent in developers ensures that US companies would surely prefer to hire software developers from Brazil.

According to Coursera Global Skill Index 2022, Brazil scored second place in Latin America as an emergent country in technology and 63 worldwide.

Source: Global Skills Report 2022

#2 Impressive IT infrastructure

The infrastructural strength of Brazil’s IT sector has been growing steadily over the years. The fact that Brazil boasted as many as 100 tech parks and 57 accelerators nationwide in the last decade should inspire a lot of confidence. Some of these tech parks are now renowned globally for the high density of research centers, massive population of developers, tech companies, and institutes, such as the Brazilian version of Silicon Valley, in Campinas, north of Sao Paolo.

Campinas is known widely for many industrial parks, TechTown, InCamp, etc. Another gem in Brazil’s IT park infrastructure is Anprotec, with almost 300 corporate bodies and over 6000 companies geared towards innovation, generating thousands of jobs for developers. There are other huge tech parks, such as São Paulo, Rio de Janeiro, Florianópolis, Recife, Porto Alegre, and Curitiba, where you can find skilled developers.

Further, the Brazilian law called ‘lei do bem’ offers tax incentives to corporations that work on technology innovation. That has encouraged further infrastructural growth, ensuring that there are many talented developers to choose from if a foreign company wants to hire. Brazil is continuously using its Science and Technology Parks (STPs) to focus on innovation in technology. Hence, it is one of the top destinations to consider if one requires offshore software development services from Brazil.

#3 Fantastic collaborative experience with software developers from Brazil

While many software developers are available easily in India and some other Asian countries, it becomes a less preferred choice for US-based companies to hire them since a significant factor that doesn’t work out is the time zone difference. A time zone difference of 10-12 hours is essential and can make collaborative projects a painful process.

However, with Brazil, that problem is practically non-existent since Brazil, and the US East Coast have a time difference of only one hour, and with the West Coast, a time difference is only four hours. If you are located in Europe, the difference between Brazil and Eastern Europe is four hours.

So when you hire overseas programmers from Brazil to work remotely with you, the experience will be close to seamless in terms of communication and keeping up with deadlines. With the time zone difference of only an hour in between, you will get quick responses from the developers, which makes working in tandem a smooth and easy task.

Moreover, the language will not present a barrier in this collaboration since speaking and communicating fluently in English is increasingly important when educating the Brazilian youth, particularly software developers, since their skill is universally in demand. Hence, apart from being skilled in coding languages, these developers will easily communicate with you without any trouble, making offshore software development in Brazil a good choice.

#4 High retention of Brazilian developers

The software developers market continues to grow more and more competitive, especially in certain developing nations like India. That often means high attrition levels and developers moving swiftly from one job or project to another, which would cause significant difficulties for a company hiring offshore developers. However, in Brazil’s case, this is a non-issue since the market is not so competitive yet, and thus you will most likely be able to enjoy working with the same developer from the start of a project to its end.  

That spells many benefits for US companies, as the technology and know-how utilized in the project stay within the project. As a result, there is no loss of time and knowledge, no communication issues because of changing developers, and no delay or hitch in project completion. An added plus of having the same developer work with you is that you also get excellent support from the same team throughout the entire project. There is no compromise in quality of work whatsoever with Brazil, so if a US-based company is looking to outsource software development from Brazil, this is another reason Brazil is high on the list of countries.

#5 Reliable and highly professional work of developers in Brazil

While Brazil still has a way to go to be considered in the same league of outsourcing as China or India, the country has made considerable progress. Brazil’s software developers are committed to sticking to timelines and making deliveries as discussed on the proper dates. They are highly reliable for US companies. To ensure complete transparency and give you total freedom when you hire remote development teams from Brazil, YouTeam gives you a choice to select the team you will be working with on the project. It would help increase the trust level between the company and the developers. That way, you can be confident that the people you choose are the right ones for professional software development outsourcing from Brazil.

#6 Reasonable cost of software development services in Brazil

Cost-wise, even with extra expenses and bonuses, outsourcing to the Brazilian software development sector would cost US companies much less than hiring US developers. The average salary for a software developer in Brazil is about BRL 336,000 (USD 61,658) a year. The average salary for a software developer in the US is as high as USD 120,168 a year, a significant difference.

Thus by choosing to hire offshore software developers from Brazil, US companies would be saving a considerable amount of money while still getting good quality work and output for their technical projects. Additionally, the overall cost of collaborating and coordinating with developers in Brazil is affordable, making it a highly viable choice to hire software developers from Brazil.

What is the average salary for a developer in Brazil?

We have analyzed a few sources to provide you with the average developer salary information. You should keep in mind a few points before going to see the rates:

• Developers’ salary depends on experience, education level, fluency in other languages, benefits, size, and economic segment of your company.
• There is a local job board research on the developer’s salary if you want to compare both global and local job boards. The data is based on 23,742 participants’ answers in 2021, so the rates grew a bit from that time. “CLT” is the monthly salary for the contractor employees without including benefits, bonuses, taxes, etc. “Terceiro” is the salary for employees who work for a company as a consultant or freelancer, not signing a contract. Their salary is a bit higher to cover the lack of benefits.
• The average salary rates also depend on location. In Fortaleza, Brasília, Rio de Janeiro, and São Paulo, salary can reach up to BRL 446,448 (USD 81,926), while in Vitória, Petrolina, and Juazeiro it is BRL 306,000 (USD 56,153).

Yearly salary rates for junior, middle, and senior software engineers in Brazil

We suggest the average base salary breakdown from Glassdoor. As the salary may vary, it can be helpful for you to know that the lowest average salary in Brazil is BRL 156,000 (USD 28,627) and the maximum average salary is BRL 449,460 (USD 82,904). 

• Early-career software engineers in Brazil make, on average, about BRL 155,319 (USD 28,997). An early-career software engineer from the US earns USD 88,137 in a year.
• The average salary in Brazil for a mid-level software engineer is BRL 306,000 (USD 56,153), while in the US, a mid-level engineer makes USD 100,210 a year.
• Experienced software engineers in Brazil averagely earn BRL 407,676 (USD 74,811), whereas in the US, it is USD 119,155.

Monthly salary rates in Brazil based on technologies

The average monthly rate for developers with different technology skills may vary a lot. In the table below, we have gathered information from Salary Explorer to analyze monthly rates in Brazil due to popular technologies. In the second column, you can find data from Talent.com and Indeed about the same developers in the US. As you can see, US engineers are significantly more expensive.

However, you should understand that the salaries mentioned in the first column do not include taxes and additional expenses you can have when hiring a developer or a freelance engineer on local job boards. It only shows the money developer earn for their job.

So, we have added the third column to show the rates of software developers from Brazil that are offered on the YouTeam platform. These numbers mean rates that you have to pay for a vetted software engineer from one of the top tech companies in Brazil.

*In the first column, you can see the basic level of Brazilian developers’ average monthly rates. These rates relate more to hiring in-house engineers in Brazil and it does not include taxes and benefits.

Hire developers from Brazil with YouTeam

Hourly salary rates to hire senior developers in Brazil

Earlier, we provided you with an overview of average salary rates in the country. If you consider hiring a senior developer, the average rates from above may mislead your expectations. You should consider that the gap between the salary rates of junior and senior developers is pretty high, so the average may be lower than actual senior developers’ rates.

In the table below, you will find the average hourly rates of senior developers based on technology. In the first column, we have provided rates from local Brazilian job boards and Talent.com. This is a base salary without benefits, taxes, and bonuses. In the second column, you may find rates of US developers hiring in-house based on Glassdoor and Indeed data. In the third column, you will find rates of Brazilian developers based on the YouTeam platform. The last ones are rates of vetted software engineers if you opt for staff augmentation service, which also provides high-quality developers but is faster and more cost-effective than in-house hiring.

Source: InfoJobs, Glassdoor, Indeed, YouTeam

What to watch out for working with Brazilian outsourcing companies?

If you are looking to hire software developers from Brazil, it is a safe and reliable choice. Still, just as outsourcing to any other country, there are a few things every company should do before actually committing and hiring developers.

• An important thing you should do is review the developer’s background and skills thoroughly. It is a good practice to ask for reviews, testimonials, and experiences which verify the reliability and overall work quality of the developer you are looking to hire. Before hiring, interact with them to tell if they will be a good fit for your project.
• Since you will be working with the developer remotely, seek and provide clarification regarding timelines, dates for completion of every phase of the project, delivery schedules, and all other logistical aspects. 
• Before outsourcing software development from Brazil, you may check if you have a technical expert on board. That person can review the tech side of the developer’s work. It would prevent wrong outputs and dangerous errors from being committed, particularly if you are looking to create an integrated project with tech and your system together.

Once you have gone through all of the above and are ready to hire the developers, these are some process-oriented points that will come into use:

• It is crucial to have a technical member on your side who can keep an eye on the technical project work the developer is involved in. If you hand this task to a non-technical person, they won’t govern the technical parts. It will result in grave mistakes and, loss of time resources, and delay of project completion. 
• Communication is vital when it comes to offshore software development from Brazil. It will help you keep track of how the remote developer team is doing the work and what kind of progress has been made. It will also help you gather whatever knowledge/information/aid your in-house team needs from them. 
• Project deadlines and timeline milestones should be met as strictly as possible, so make sure of that. If there are any unexpected delays, ensure that they are communicated quickly with both sides. 

All in all, no matter which country you are seeking software development outsourcing from, these are points you should keep in mind; otherwise, problems may emerge with any team you may work with within any country you. Moreover, there are undeniably some disadvantages to remote outsourcing as well.

What are the risks of software development outsourcing in Brazil?

Outsourcing software development to Brazil presents a unique set of advantages and challenges. While Brazil has shown itself as an attractive destination for U.S. companies seeking offshore software development services, thanks to its rising talent, quality infrastructure, and multilingual workforce, there are notable disadvantages that need consideration. Below are some of the key challenges associated with outsourcing to Brazil.

• Complex tax system. The Brazilian tax system is intricate and can be daunting for foreign corporations. It includes numerous taxable variables, such as energy consumption, making it difficult to navigate without specialized knowledge.
• Additional expenses. To cope with the complexities of the Brazilian tax system, U.S. companies often require assistance from third-party advisors, leading to extra costs.
• Complicated wage system. The wage structure in Brazil involves various components, making it complex for foreign companies to manage. This complexity, coupled with the rising costs of comprehensive resources including labor, transport, and recruitment, demands careful financial planning.
• Union-related issues. Although not as prevalent in the software development sector, union-related violence is a concern in Brazil, particularly in industries involving goods and tangible services.

You can overcome some difficulties mentioned above with the help of YouTeam. When you hire engineers on our platform, you sign a contract with a dev shop—these developers’ formal employers. That means that the outsourcing company would solve all questions related to salaries and taxes.

Where to hire software developers in Brazil?

If you made up your mind to outsource to Brazil, you may choose one of the options:

• remote contracting websites,
• traditional outsourcing,
• marketplace to hire dedicated developers.

1. Remote contracting websites

You may find some of the most popular local job-board:

• Talent.com–355 510+ job offers
• APinfo–2741+ job offers
• InfoJobs.com.br–7,965+ job offers in IT

Remember that in most cases, it is the CLT salary that shows in vacancy information. That’s why it is lower than the actual salary, count on adding 2000+ BRL. 

2. Traditional outsourcing

There are many software development companies in Brazil that you can hire. This option has its own risks, as you can’t predict the quality of delivery. You may review selected companies on Clutch.co, where you can check reviews, rates, and ratings; however, such selection may take a lot of time and you can still find an unreliable partner. 

3. Marketplace for hiring offshore software developers

Another option is to go for a platform for hiring dedicated engineers. YouTeam is the #1 solution for rapid engineering staff augmentation in the world. It leverages a network of 50,000+ vetted engineers in Europe and Latin America.

Key Takeaways

Even with so many outsourcing options, Brazil still comes out to be a very attractive, reliable, and cost-effective option for US companies considering hiring outsourced software developers. For those US-based companies thinking of hiring overseas programmers from Brazil, there are some factors they can be confident of from the start of the project to its completion.

• Talent pool: Brazil has invested highly in its software development sector and has provided many promising opportunities for students to study software engineering, leading to a vast talent pool.
• Great infrastructure: Brazil boasts of impressive infrastructure in software development, from over 74 tech parks in the country, generating thousands of employment opportunities for software developers and offering innovation possibilities at every step.
• Working in real-time: With the minimal difference in time zones, it is easy for US companies to work in collaboration with Brazil’s software developers remotely, as no wasted time in communication.
• High developer retention: Software developers in Brazil are less likely to jump from company to company, ensuring that you get to work with the same team from start to finish of a project.
• Reliable and professional: Brazil is increasingly improving its software developers’ performance quality, which means they are committed professionals who will deliver your projects timely and neatly. 
• Low comparative cost: While you will have to pay much less to outsource software development from Brazil, you still get the high quality of technical work you would expect from US developers.