Addressing Your Logistics Labor Shortage by Nearshoring to Colombia
Third-party logistics (3PL) companies, Non-Vessel Operating Common Carriers (NVOCC) and Freight Forwarders in the United States face a critical shortage of qualified workers from the warehouse floor to the C-Suite. In the face of this talent gap, the U.S. Bureau of Labor Statistics has projected 7% growth in logistics jobs through 2026. Labor costs are soaring for shippers and service providers as industry professionals demand higher salaries and annual raises.
Many logistics stakeholders once outsourced backend functions to Asia to benefit from the cheaper labor, but the time zone differences, culture conflicts, physical distance, and ongoing trade war between the United States and China has eliminated many opportunities for cost savings in that region of the world. This has caused many logistics professionals to seek more affordable outsourcing options by nearshoring operations closer to home.
The Top Labor Benefits When Nearshoring to Colombia
Colombia has consistently climbed the rankings as a hotspot to outsource a variety of processes ranging from software development to back-office logistics functions like documentation, auditing, lead generation, inside sales, invoicing, and more. Many American 3PLs and other supply chain stakeholders have found substantial cost savings and other benefits by nearshoring some of these tasks to Colombia.
The Colombian labor market offers many significant benefits for American companies, such as:
- An Educated Workforce
Many public and private Colombian universities partner with U.S.-based educational institutions and thousands of students attend American universities each year. These students largely return to Colombia after completing their education, providing a highly educated, bilingual pool of workers that American companies can hire from.
- Affordable Labor
Even though Colombia offers a highly educated workforce, overall labor costs compared to the United States may be reduced by as much as 30% to 60% for American companies nearshoring to Colombia. This level of pay provides a good quality of life for workers based on the local Colombian economy while still offering substantial savings for U.S.-based employers.
- Reduced Turnover
American companies tend to offer higher wages, better benefits, and more job security than many Colombian employers. In return, employees prefer working for American employers and tend to stay long-term in their positions.
- Shared Time Zones
Companies who outsource to Asia often struggle to connect with their contractors or employees because of the vast time difference. For example, the time difference between the U.S. East Coast and India is 9 hours and 30 minutes, leaving little overlap in regular working hours between the two countries. Colombian companies operate in a similar time zones to American companies, which drastically improves communication and operational efficiency.
- Medellin: The New Silicon Valley
The Colombian city of Medellin has often been referred to in recent years as “The Silicon Valley of Latin America.” This community’s booming tech culture, reliable public transportation, and business-friendly environment make it an ideal locale for nearshoring.
- Similar Cultures
The Colombian business culture is largely modeled after American business structures. This facilitates similar work days, work ethics, and easy interactions between nearshoring partners in Colombia and the United States.
Nearshoring Logistics Operations with Linkoast
Linkoast is an American company with operation centers in Medellin, Colombia. With more than 15 years of experience providing nearshoring services to freight forwarders, 3PLs, and NVOCCs, we have been a pioneer in Colombian nearshoring.
We can help you hire and train a staff that works solely for your company at a simple flat rate per employee. With no lengthy contracts or legal liabilities for our customers, we can help drive significant savings in logistics operations without the hassles involved with setting up international operations on your own.
If you’re interested in discovering the benefits a highly trained Colombian staff can offer to your logistics operation, please contact us through our website.