The key challenges facing expat professionals in LatAm in 2024

Despite being satisfied with remuneration packages, professionals moving to Latin America for work face ‘quality of life’ challenges beyond the workplace. This is according to a new report by Mauve and Latin American PR company LatAm Intersect.

The survey interviewed 600 expatriate professionals working in three Latin American countries. 200 in Brazil, 200 in Colombia, and 200 in Mexico. Researchers conducted the survey in May and June of 2024.

The report is titled Planismo. This is a reference to the Uruguayan art movement of the same name. It refers to the ‘flattening’ of traditional boundaries, resulting in the intersection of different planes.

In this context, Planismo refers to the breaking down of boundaries and increasing interconnectedness of today’s working world. This is as a result of the rise in global mobility.

As the report explains: “This new era allows for increased innovation and flexibility, particularly in the ‘nearshoring’ Latin American corporate landscape.”

Latin America has become a hub for technology.

The region's large, educated workforce, favourable governmental policies, and successful start-ups have driven this tech boom. This was further fuelled by a COVID-era move towards digital banking and online transactions.

Now, Latin America is a popular location for foreign companies, especially those from the U.S. and Canada, to do business. This is also known as 'nearshoring'. As a result, a growing number of expats call Latin America home.

What’s working for expats in LatAm?

Across the board, expats in Latin America are positive about quality of life and remuneration in their current countries.

Quality of life

The data shows that nearly two-thirds of expatriates think their current lifestyle is ‘better’ or ‘much better’ than in their home country.

Remuneration

Two-thirds of the people surveyed say their current expat salary and benefits are 'better' or 'much better' than before. Expats based in Mexico are the most satisfied with their current salary/benefits. Three-quarters of respondents based in Mexico said their current salary/benefits was ‘much better’ or ‘better.'

What are the challenges?

The report shows a clear gap between what professionals expect and what companies provide during relocation.

The report notes that, according to a recent study by Cigna, 89% of expatriates globally suffer from stress. The same study revealed that over half required more mental health support and prefer greater work-life balance. Just 30% reported having access to these requirements.

Meanwhile, Planismo reveals that just 17.2% of respondents are considering staying in their current country of residence permanently.

The report identified two main areas in which expats in Latin America are struggling.

Tackling bureaucracy

Companies seem to be getting salaries and benefits right. However, professionals are not receiving the same support with tackling local bureaucracy and paperwork.

Ninety percent of respondents were 'not at all aware' of the local tax rules and processes in their new country before moving. One-in-ten (9.2%) respondents felt that they were comfortable and productive ‘immediately’. This is further evidence of the acclimatisation ‘gap’.

Over one-in-ten (11.6%) expatriates surveyed communicated general concerns about their family’s security within their new country. Respondents reported feeling uncertain about whether their family members would be able to remain with them, due to uncertainty around visa renewals.

More than four times as many women than men moved abroad because their ‘partner or relative obtained a position abroad'. As a result, this uncertainty disproportionately impacts women.

The report notes that the Bulletin of the Centre for Research and Interdisciplinary Study backs up these findings. According to the Bulletin: ‘Various studies have found that between sixteen and forty percent of all expatriate managers who are given foreign assignments end these assignments early due to their poor performance or their inability to adjust to the foreign environment and as much as 50% of those who do not return early function at a low level of effectiveness.’

These figures show that employers need to provide enhanced support for expatriate staff. This support will help expat workers to feel comfortable and reach their potential. In turn, this will improve chances of a successful and prolonged relocation that benefits both employer and worker.

Fitting in and making friends

Moving to a new country brings the challenge of adjusting to a different culture. It also means making new social connections. 31.3% of respondents say that they struggled with ‘understanding and adapting to the local culture at work.' 29.7% found ‘making friends’ challenging.

More than 50% of people from the US and Canada said that making friends is the biggest challenge when starting a career abroad. The reports states that this spotlights a cultural aspect to the problem. This is something companies should consider when expanding to new territories.

The reports references a recent article from the University of Cambridge’s Advanced Online website highlighted similar findings. It identified the four most common challenges for new expats. These challenges were dealing with culture shock, anxiety related to professional performance, managing workplace relationships, and overcoming cultural differences in communication styles.

Respondents in Brazil reported taking the longest time to feel at ease and start being productive at work. Just 43.4% said they felt settled either ‘immediately’ or after ‘one to three months.’ This is compared to 83.7% of respondents in Colombia and 96% of respondents in Mexico.

The expats surveyed shared worries about not meeting local standards or job requirements in their new workplaces. In fact, over 10% of expat employees in Latin America report taking a year or more to feel fully productive in their new working environments.

How Mauve can help

Is your business seeking to expand into Latin America? Whether you wish to move expat staff to LatAm, establish a local entity, or hire talent in-country, Mauve can help. Our team of experts has almost three decades of experience in global mobility. We can help you to navigate the often-complex landscape of global employment.

Armed with expert local knowledge, Mauve Group will guide your business through every step of the process. We can advise and support with global visa and immigration routes, entity set-up, employment and tax compliance, salary benchmarking, and much more.

Established in 1996, Mauve has operated Latin America for almost 25 years. Mauve has recently responded to growing opportunity in LatAm by expanding its regional LatAm team. It has reinforced its presence in key markets, and relaunched its services to support inbound and outbound expansion across LatAm.

Mauve’s creative solutions have helped organisations to succeed in more than 150 countries worldwide, across over 70 sectors. Mauve Group’s bespoke service packages ensure that clients and workers alike benefit from mitigated risks, reduced costs, and rapid timescales as they embark on their new global venture.