Before we look at how to best work with a headhunter in Panama, we need to ensure that we have a common understanding of what a headhunter is.
A headhunter will undertake an ACTIVE search and will aim to seek out the exact person to fill your vacancy, whereas a recruitment firm will often take a more PASSIVE approach and tend to be less focused on a singular role.
So, in short, if you are contracting a headhunter in Panama it is because you are looking for a provider to actively search within the market using online platforms, personal and professional networks and databases to find the person that perfectly meets your requirements.
With that said, prior to engaging with a headhunter in Panama, you’ll need to ensure that you are ready for the process, as you will be expected to provide key information about the position and what you expect from both the headhunter and also the presented candidates.
Required information will vary between headhunters in Panama, but at a minimum, you will need to provide the following information:
- A detailed position description outlining the responsibilities and tasks.
- Provide a clear explanation of the key hiring criteria, both essential and desirable.
- Provide a detailed explanation of the value proposition of working with your company.
Tip: Have the above information prepared before contacting a headhunter to ensure that you are getting value for money and taking the most out of the hiring process in Panama.
So what are the key business sectors in Panama?
According to UNCTAD’s World Investment Report 2021 (pdf), Panama is the Central American country that receives the highest Foreign Direct Investment (FDI). Moreover, despite the economic fallout from the COVID-19 pandemic, mergers and acquisitions increased to USD 4.8 billion on the continent.
The most popular business sectors to invest in Panama are:
- Financial and business services
- Distribution agencies
- Real estate
- Software development and sales companies
- Wholesale and retail businesses
- Import and export services in free trade zones
Other attractive factors for investing in the country are low taxes, such as a corporate rate of 25%, a Value Added Tax (VAT) of 7% and a 0% VAT on the real estate sector; plus a high-quality banking sector providing beneficial reasons to open a company bank account in Panama.
Lastly, when it comes to finding human talent, Panama offers one of the most alluring markets in Central America. According to the QS World University Ranking, published in 2022, two of the six best universities in the region are located in the country.
This reflects the number of qualified workers available, as well as the educational level of the country. With this in mind, an expert local headhunter in Panama is ideal to guide you through a successful recruiting process.
So, when is it best to work with a headhunter in Panama?
You should consider working with a headhunter in Panama when looking for senior positions that will have a disproportionate effect on your business if you don’t get the very best talent, if the specific skill set is difficult to find or if it´s very sought-after. In these cases by working with a headhunter in Panama you will be able to leverage various mediums to ensure that you get the very best candidates in the market.
Some instances in which we would recommend using a headhunter in Panama:
- When hiring IT / Tech professionals such as Scrum Masters, Data Engineers, BI Data Analysts, Software Engineer, Network Engineer, Database Administrator, Software Developer, Front End Developer, Back End Developer, Full Stack Developer, QA Analyst, Systems Administrator, SalesForce Developers, SalesForce Architects, Integration Developers.
- When hiring for Non-Governmental Organisations for positions such as Project Managers, Program Managers, Monitoring & Evaluation Professionals, Project Directors, Country Directors.
- When hiring for Executive positions such as Country Managers, Country Directors, Sales Directors or Project Managers
According to research from La Universidad del Istmo, 6 out of ten top in-demand jobs in 2022 in Panama are related to IT. The full list is as follows:
- Artificial Intelligence and Machine Learning Specialist
- Data Scientist or Engineer
- Health Professional
- Full Stack Developer
- Supply Chain Manager
- Cloud Systems Architect
- Cybersecurity Specialist
- Growth Hacker or Growth Marketing Specialist
- Digital Content Creator
- Customer Experience Manager or Experience Manager
The above clearly illustrates the competition that exists when finding IT professions in Panama and the need to engage a professional headhunter to secure the very best talent in these sectors. With the difficulty in finding talent in traditional markets such as the United States, we are seeing more and more international companies coming to Panama to do so.
Furthermore, according to Quality Leadership University, three out of five careers with the best job opportunities in Panama are related to IT. The complete list is the following:
- Computing and systems
- Web development
- Software Developer
For the above, hiring a headhunter in Panama will be a worthwhile decision when trying to find highly desired professionals.
So how does a headhunter charge in Panama?
Charging models vary between headhunters in the country, but normally you will be charged an initial engagement fee and the remainder is to be paid upon success, which is signified by the starting date of the employee. Often the total cost of the service will be a multiple of the base salary of the employee, or a minimum fee per placement.
What problems may you face using headhunters in Panama?
Headhunters traditionally offer search solutions to find talent; however, once found they cannot provide a hiring solution. Meaning unless you already have a legal entity established locally in the country, your only option will be to hire the person through a service contract.
With this type of contract arrangement, you will be contracting a service and not an employee, hence you cannot mandate working hours, location or how the work is completed. It is strongly advised against to provide a company email or company equipment when using this type of engagement structure.
Tip: We often see cases like the above. The problem is that engaging a contractor with this type of contract and treating them like an employee may expose the hiring company to potential fines, sanctions or legal issues under local employment laws.
So, what is the solution when hiring in Panama?
The best alternative is to work with a headhunter in Panama that can undertake both the search and also provide hiring options, which could include either Entity Setup or Support. They will support you to incorporate and maintain a local legal entity, which you can use to hire the employee, or they can also provide Employer of Record (EOR) services in Panama, where they will hire the person on your behalf through their local entity.
At Biz Latin Hub we support our clients through providing integrated solutions, that include headhunting, and then also support with establishing a local entity or by providing Employer of Record Services. At the Biz Latin Hub Group we bring together both the headhunting and hiring solutions to ensure that we provide an end-to-end solution for our clients.
Contact us today and find the support you need in sourcing top talent, or learning how to do business in the Latin American region.