Few commercial resources are more critical than human capital, so it’s important to get your recruitment right when doing business in El Salvador. For companies in need of a limited or temporary workforce, hiring a reliable employer of record (EOR) in El Salvador can be the best option for finding your ideal team members.
An EOR — also known as a professional employer organization (PEO) — hires staff on your behalf, meaning you can get a local workforce as quickly as the right personnel can be found, wthout having to go through the process of starting a business in El Salvador.
El Salvador saw a 75 percent increase in foreign direct investment (FDI) between 2018 and 2019, which rose from $410 millon to $720 million (USD). That marked a notable uptick on FDI levels that had remained consistent for the previous five years.
The country has also seen exponential growth in gross national income (GNI) — a mark of the general level of prosperity among the population — which rose 42 percent between 2010 and 2019, from $2,800 to $4,000 (USD).
If you are looking to do business in the Central American nation, and think hiring a reliable EOR in El Salvador could be the most suitable option, read on to understand more about what en EOR is and what advantages they can offer.
What is an EOR?
An EOR is a company that can seek out and hire staff on your behalf in a jurisdiction where your company does not have a legal presence, providing you with staff without the need to enter the lengthier and more costly processes of incorporating a company, forming a branch, or registering a subsidiary.
The EOR will be able to hire and fire staff based on your specifications and parameters, as well as managing all financial matters related to their employment.
In some cases, the EOR will also offer further commercial or market-entry support, such as legal and accounting services, or tax advice. Where that EOR has an international presence, it will also be able to assist in expansions into more new markets.
For companies from English-speaking countries that are seeking to invest in Latin America and the Caribbean, a good EOR will also be able to provide you with all legal documentation in English, as well as the offical language of the country you are seeking to do business in.
4 reasons to work with an EOR in El Salvador
Hiring an EOR in El Salvador offers your company a number of major benefits, which include but are not limited to:
- No company formation required: expanding into a new market is an exciting — albeit time-consuming and risky — endeavor. If your initial expansion is of a limited size, or if you only intend to develop commercial activities in the country on a shorter term basis, the administrative process of forming a company and establishing your legal presence can be time consuming. Hiring staff through en EOR will take only as long as the recruitment process. In the case of workers with a relatively straightforward profile, that means days rather than weeks or months.
- Cost management: hiring an EOR also involves less of a financial outlay than company formation, or branch or subsiduary registration. While the staff you hire may come at an elevated cost compared to direct hires, the money saved on establishing a legal entity means that, depending on the nature of your activity, using an EOR could be the soundest financial option for your company
- Lower hiring risk: using a reliable EOR with experience in your new market means tapping into an established recruitment network with expert knowledge of that market. That not only means that you can leave the EOR to seek out your ideal staff, knowing they have the experience and resources to get it right. But it also means you can access a pool of knowledge regarding the local job market to better understand what human capital resources are available.
- Less of a commitment to the market: hiring staff through an EOR means that your financial commitment to entering the market is more limited. It is therefore a good way to get a better sense of the market before forming a company or otherwise deepending your commitment. It also means that market withdrawal is a quick and straightforward process, should you ever decide on such a move.
Biz Latin Hub can be your EOR in El Salvador.
Hiring the right staff can be one of the hardest parts of setting up a business, and even more so when in an unfamiliar location. It makes sense to seek out the assistance of a reliable partner that can help you in your efforts. At Biz Latin Hub, our multilingual teams of legal, accounting, and back-office specialists is available to assist you in your commercial ventures in Latin America and the Caribbean.
Learn more about our team and expert authors.