Jorge AndradeAs the demand for IT and global services continues to surge, companies are being pressured to compete in a challenging battle for talent and operational efficiency to survive in a fierce and always-changing market. The concept of nearshoring has emerged as an attractive alternative to offshoring. Mexico, in particular, has kept its prominence in the top 3 as a preferred IT global provider, according to Gartner. Owing to its geographical proximity to the United States, cultural compatibility and a burgeoning tech ecosystem.
While tier-1 cities in Mexico like Guadalajara, Monterrey and Mexico City have traditionally dominated the Mexican tech landscape, a new contender has emerged on the horizon: Aguascalientes.
Situated strategically in the heart of Mexico, Aguascalientes boasts a unique proposition and is rapidly solidifying its status as an emerging hub for foreign investment in technology and global services. In the article, we will explore the state’s strengths and challenges.
An Abundant and Educated Talent Pool
Aguascalientes stands as a thriving hub of skilled professionals, drawing strength from a talent pool nurtured by its educational institutions. Its appeal is underpinned by a strategic focus on education, fostering a continuous flow of tech-savvy graduates each year.
With a total population of 1.425 million and an employed count of 638,855, Aguascalientes possesses a substantial human resource reservoir. Remarkably, 101,719 individuals within this population are available for work, as confirmed by Mexico National Statistics Institute 2022 data. In terms of education, the city hosts a network of 64 higher education institutions, collectively enrolling 61,426 students exclusively in bachelor’s degree programs, without accounting for postgraduate studies.
Aguascalientes leads higher education institutions that offer technical careers. Roughly 31.7% of the 19,209 enrolled students focus on STEM fields. The realm of IT-related education thrives, with 3,615 students enrolled in IT-related degree programs during the 2021-2022 academic year. This endeavor culminated in 667 graduates from the same cohort, supported by data from the Aguascalientes Education Institute and the National Association of Universities and Higher Education Institutions.
Aguascalientes shines particularly in its direct alignment with the tech industry, offering 12 universities and 22 college majors focused on IT sciences. This encompassing selection includes Computer Sciences, Software Development, Artificial Intelligence, Telecommunications, Microprocessors and Robotics Engineering.
In 2019, INEGI highlighted Aguascalientes’ remarkable contribution to the ICT workforce. Holding an above-average share similar to tier-1 destinations like Jalisco or Mexico City, it contributes 1.2% of the entire country’s ICT workforce (9,024 individuals). This number continues to rise due to a surge in graduates and migration.
The state has managed to foster a pipeline through which talent flows constantly between universities and businesses, a fact recognized and appreciated by company executives.
“In the state of Aguascalientes, a substantial number of universities nurture and produce a noteworthy pool of talent,” stated Pablo Márquez, former CEO for Mexico and Colombia at Capgemini, in a quote for the book The Amazing Sunlight. “Moreover, from a geographical perspective, Aguascalientes is surrounded by neighboring states that also cultivate skilled professionals. Many of these talents collaborate with us in our center located in the state.”
“In Aguascalientes, we did not have a hard time finding qualified personnel,” said Ina Seterbakken, Plant Manager at Continental Aguascalientes, for the same publication. “I was pleasantly surprised by the interaction between business people, universities, and the government, which is something that greatly facilitated the arrival of a plant like this one.”
Aguascalientes excels in creating a fertile ground for technological advancement. The city boasts the highest count of Public Research and Development Centers and offers a robust array of postgraduate programs in Computer Software and Data Science. This ecosystem is further enriched by a network of code schools and bootcamps in collaboration with esteemed brands such as Google, Devf, Tecnolochicas, Codelledge and Edge Hub.
However, like many regions in Mexico, the state faces challenges in English language proficiency, as most college graduates possess intermediate levels only. Responding proactively, the state has established three bilingual public universities with English language exchange programs collaborating with US institutions. Additionally, the state has launched “The Bilingual Giant,” a pioneering program that aims to make students achieve B1 English proficiency by the end of basic education. This program establishes free Language Centers in all 11 municipalities, fostering opportunities for teacher development and impacting over 17,000 students. The private sector also plays a pivotal role; Digitalhype, a local IT company, has launched an English program for Senior Programmers and plans to sponsor 100 individuals initially.
Competitive Costs and a Stable Workforce
Aguascalientes distinguishes itself with a unique blend of talent advantages. Unlike tier-1 cities, it offers less cutthroat competition for skilled professionals. The city’s alluring quality of life and exceptional security profile have attracted talent from neighboring regions. This distinct convergence ensures a steady stream of capable experts, reinforcing Aguascalientes’ access to its abundant and skilled talent pool.
“What we have found in Aguascalientes is a group of highly professional individuals with experience, technical expertise, and also a human touch that greatly appeals to American clients,” commented Guillermo Ortega, President of Operations in Mexico at Improving. “They possess strong communication skills, team formation abilities, and a collaborative work ethos.”
Aguascalientes also maintains its wage advantages when compared to the cost of living in tier-1 cities. It is 36% cheaper, according to Expatistan.com, a website designed for expats to compare city costs. Hireline, a reputable Mexican job board, reports a national annual average wage of US$21,324 USD for IT-related roles in 2022. Proficiency in a second language enhances earning potential, potentially increasing up to 3.9 times compared to non-bilingual individuals. Benefits packages and taxes could add another 30% to base wages. However, this overall cost structure remains appealing when contrasted with the average wages in US tier-2 cities or Mexico’s tier-1 cities.
Average wages on popular IT job positions:
| JOB POSITIONS | ANNUAL WAGES (AVERAGE) |
| Support Agent | US$10,584 |
| Business Analyst | US$24,720 |
| QA Engineer | US$28,200 |
| Software Engineer | US$35,280 |
Source: Hireline, 2022
Labor stability and minimal turnover also tip the scales in favor of Aguascalientes. The region has maintained an impressive record of over 50 years without strikes according to the Mexico Ministry of Labor and Social Welfare. With an unemployment rate of 4.0% (INEGI, 2022) and the highest proportion of formal salaried workers (77.4%), companies can tap into a stable, committed workforce. This amalgamation of factors fortifies Aguascalientes as an optimal destination for talent acquisition, nurturing, and retention.
Exceptional Connectivity
Located in proximity to key cities such as Monterrey, Queretaro, Guadalajara and Mexico City, Aguascalientes boasts outstanding connectivity via an extensive network of highways, railways and an international airport. This advantageous positioning facilitates seamless collaboration with clients, partners and industry stakeholders, elevating its allure as a premier investment destination.
Aguascalientes International Airport offers direct flights to major US and Mexican cities including Chicago, Dallas, Houston and Los Angeles, enhancing both domestic and international accessibility.
According to the State Digital Development Index published by Centro Mexico Digital, the state stands out as a top leader in internet connectivity. With mobile network coverage at 96.4% and fixed broadband coverage at 80.6%, the city has established a strong digital foundation. Fixed broadband download speed stands at 22 Mbps, and mobile broadband download speed at 30.2 Mbps, further solidifying its digital prowess.
Despite these achievements, there remain challenges in affordability, as only 61% of households truly have internet access. Addressing this gap, the government has embarked on a significant initiative, investing US$156 million in new infrastructure projects, underscoring its commitment to fostering comprehensive digital inclusion.
An Investment Magnet
Over the last decade, Aguascalientes achieved the highest economic growth among all entities, boasting an average annual rate of 4.6%, according to the economic observatory Mexico ¿Cómo Vamos?.
The state also excels in competitiveness, obtaining first place in the Nearshore Value Index for IT/Software Development Category announced in 2023, securing the 6th spot in the Mexican Institute for Competitiveness (IMCO’s 2022). Aguascalientes’ public finances have an AAA (mex) rating from Fitch Ratings and mxAA+ from Standard & Poor’s in 2022, Aguascalientes draws significant attention, attracting a remarkable US$11,257 million in Foreign Direct Investment (FDI) between 1999 and 2022, a testament to its investment appeal. Only between 2017 and Q32021, Aguascalientes Economic Development Department reported US$4,138.1 million of FDI.
Aguascalientes’ growth engines lie in promising sectors such as aerospace, aeronautics, electronics, information technologies, biomedical, agribusiness and clean energy.
The local environment is vibrant and robust, with initiatives like Innovatia IT Cluster and MX TI bringing together over 75 local tech companies. These encompass firms with capacities to provide global services, such as Digitalhype, Bitmore, Bozz and Maindsoft in software develoment, Borealix in Cybersecurity, and Purpuraa in Data Science.
“Aguascalientes has provided us a platform of business, talent, incentives and safety to grow as local entrepreneurs in the tech sector competing in the global market,” commented Clemente González, Founder and CEO of Digitalhype.
Aguascalientes’ excellence transcends the economic realm, excelling in security, social progress, and sustainable development. Leading the nation, it holds the top position for the Cyberpolice ranking, according to State Digital Development Index. It secured the second position in the social progress index in 2021, as per Mexico ¿Cómo Vamos?, and ranked third in Sustainable Environmental Management for 2022, according to IMCO. Additionally, it ranks third nationwide in terms of the highest social perception of security.
Success Stories
In Aguascalientes, a seasoned ecosystem has garnered the trust of industry leaders such as Capgemini, Semtech and Improving, underscoring the region’s ability to cultivate thriving partnerships and deliver impressive success stories.
Ab InBev’s shared services center in Aguascalientes has redefined operational excellence. Leveraging innovation, technology and a skilled talent pool, it has transformed financial processes, HR services and procurement operations.
Capgemini’s in-state delivery center stands as a dynamic hub for Global Services and IT solutions. The center offers a wide array of solutions, including application development, testing and support. Leveraging Aguascalientes’ skilled workforce and strategic location, Capgemini is enhancing its global delivery capabilities while contributing to the city’s growing tech ecosystem with several training programs.
Semtech’s design center is a crucible of local innovation. Specializing in semiconductor design and development, this center harnesses the city’s skilled engineers to create advanced solutions for its LoRA IoT technology.
Improving’s delivery center in Aguascalientes is a nucleus of innovation for several of its customers across North America. With a focus on software development and digital solutions, the center harnesses the city’s tech-savvy talent pool to deliver cutting-edge applications and services.
Texas Instruments’ local presence since the 1980s has propelled the region’s tech landscape. Its facility specializes in manufacturing semiconductor components and chips, contributing significantly to Mexico’s electronics industry. With a commitment to innovation, Texas Instruments has also embedded software development teams in the state.
More Than a Contender
As tech companies consider their investment options, Aguascalientes offers a distinct proposition, it has the potential to rival the tier-1 cities in Mexico. This state offers a strategic blend of skilled talent, cost-effectiveness and exceptional quality of life, creating a compelling narrative for growth.
Aguascalientes isn’t just a contender, but a hub for foreign investment in technology and global services. With success stories already etched into its fabric, the stage is set for more achievements and partnerships.
Now is the time to seize the chance to invest in Aguascalientes and be a part of its remarkable growth story.
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