Americas Regional Overview – Total Workforce Index™

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Americas Overview

Many would argue that workforce strategies in the Americas are more stable and mature than in some areas of Europe and Asia. Expansion of Managed Service Provider (MSP) and Recruitment Process Outsourcing (RPO) programs into Canada in addition to multiple markets in South and Central America is becoming more commonplace. However, this supposed “stable maturity” can be a dangerous assumption.

More often, micro-market changes have had as great an impact on local hiring practice as major legislative changes. In Canada, provincial law requires modified processes on a regular basis. In the U.S., there are now state- and city-level regulations for overtime, wages, paid leave and health care to consider. In South and Central America, shifts in organized labor, foreign workforce policy, statutory requirements and sourcing needs are increasing in complexity.

These are just a few examples that underscore the need for informed side-by-side views of each market. Whether looking regionally or globally, organizations must consider every element of local workforce dynamics.

Jamiel Saliba

Vice President and General Manager TAPFIN Global

Top 5 Markets in the Americas Region

The top five markets in the Americas region encompass a variety of regulatory factors and productivity impacting metrics such as the availability of skilled talent and cost considerations. The United States, Canada and Chile perform the best when each of the four categories are combined. For the United States and Canada, this is due in part to minimal regulatory impact and a well-established, mature workforce.

Complete Rankings for the Americas Region

The chart below shows the regional ranking of each market in the Americas region as well as its global ranking. These rankings take into account the total workforce in each market, and the resulting rank is determined when each of the four categories is evenly weighted.

Americas Regional Rankings

Chile is considered an emerging market with heavier regulatory tax burdens yet ranks second in Cost Efficiency and tenth in Productivity. Uruguay and Mexico round out the top five markets in the Americas. Uruguay may be a slightly more mature workforce than Chile, however it ranks 16th in the Regulatory category and also performs well with regards to Cost Efficiency and Productivity, securing the fourth position ahead of more cost-effective but now more heavily-regulated Mexico.

Regional Insights

The average monthly wage in the Americas region is $1,058.00, lower than the average APAC region monthly wage, but the vast majority of markets in the Americas fall beneath this benchmark. Venezuela has the highest average monthly wage in the region but scores the lowest across three of the four Total Workforce Index categories, resulting in the lowest ranking overall. The United States and Canada feature higher average monthly wages than the remaining markets in the Americas region due to having the most mature workforces and also some of the most highly educated, skilled and English proficient  workers.

Manufacturing wages are indicative of the sustainability of skilled talent from both a sourcing and retention standpoint specific to each market. Where the desired skills are readily available, and workers are willing to accept lower wages, the average wage for that market will decrease over time as evidenced in Mexico, Brazil and Bolivia. However, where the availability of skilled workers is limited within the manufacturing industry and job seekers are less likely to accept positions with low wages, the average manufacturing wage is higher than the regional average in markets like Chile, Argentina and the U.S. territory of Puerto Rico.

Both Puerto Rico and Argentina have experienced financial hardships over the past year. Puerto Rico has the benefit however of being a territory of the United States which allows for its citizens, unhappy with the local infrastructure and declining manufacturing industry, to migrate to the U.S. and become a resident of any state. Consequently, the emerging workforce there is leaving the workforce market and further damaging the ability of Puerto Rico to compete with more mature markets with high volumes of young talent.

Aggregated Employment Tax Ranges average 18% across the Americas region. Brazil has the highest in the region with 40.2% Employer Taxes and 24.9% Profit Taxes, followed by Costa Rica at 32.7% Employer Tax and 19.2% Profit Tax. These and other factors are reducing the competitiveness of both markets in the Regulatory and Productivity categories and impacting their ranking overall. However, Puerto Rico still manages to hold a position in the top 10 for the region, despite the higher tax burdens, based on higher cost efficiencies and lower regulatory impact.

For more information, interactive charts and to download the full Total Workforce Index™ visit the Total Workforce Index™ microsite from the link below.

Total Workforce Index™