How the IT industry works in Brazil: high demand, European standards and Russian salaries

Usually, if the IT industry is developed in the country, local companies willingly hire foreign engineers, especially from Russia. But there is an interesting and controversial player in the technology market – Brazil.

On the one hand, start-ups here are growing like mushrooms after rain, new Unicorns are constantly appearing, and the demand for engineers has soared that their salaries have almost doubled. On the other hand, there are no vacancies from Brazilian firms in the public space.

We spoke with Arthur Virzin, who has lived in Brazil since the age of 7, owns his own company, hires engineers himself and monitors what is happening on the market. He will tell you what is happening in Brazil with IT, how the pandemic affected the market and why hiring a foreigner for a local firm is a failure.

The main players in the Brazilian IT market: large corporations, startups and fintech companies

In general, Brazil is quite an economically developed country. By total GDP it is number 8 in the world and is ahead of most European countries. And by GDP per capita – in 80th place out of 189, and is ahead of, for example, Ukraine and a couple of other European countries.

Technology is fine here too. If we talk about foreign companies, then many giants from the United States come first of all here, and only then to Europe and Russia. Mainly because of the geography – the close time zone, it is convenient to get there. And the market as a whole is a little freer, and the audience is ready to accept innovations – 140 million use social networks, 94% of the population have a smartphone, 73% have a computer. This has been the case with Uber and many other companies, large and small. Accordingly, in Brazil, companies open their branches and gradually move the industry forward.

There are also enough own IT companies here. And since 2017, many successful unicorns have appeared here – now there are 11 of them. For comparison, there are not a single one in Russia yet. The first was 99taxi, a taxi service that predates Uber. Then there is Nubank – it is larger than Tinkoff, estimated at $ 25 billion. Most recently, in 2021, Loft, a service for buying an apartment through a platform, became unicorn.

All Brazilian unicorns on infographics

Many large local players are fintech companies and fintech startups. Such popularity of the financial sector is due to the fact that in Brazil, finances and financial flows are very strictly regulated, both for ordinary people and for companies. There are many rules, many regulations, it makes no sense to describe everything, but even simply transferring money to an account abroad is a complex and long process from a legal point of view, much more difficult than in Russia. And the observance of all these regulations and rules is ensured by fintech companies of different sizes.

By the way, the government actively supports technological development and startups. For example, the country is preparing launch national AI and expand the educational program with disciplines in Data Science

For a long time, everything here went on as usual – startups grew at the usual pace, fintech services were slowly developing, large foreign players came to the Brazilian market. And then a pandemic struck.

What happened to the IT market in Brazil due to the pandemic

In Brazil, during the pandemic, a very strict quarantine was introduced, and in some states the lockdown continues to this day. At the same time, the business was even less ready for this than in Russia – many stores simply did not have their own websites, they were not ready to accept payments online. And people were not ready to pay via the Internet – until now, far from everyone here used bank cards and preferred cash.

In order not to die, the business began to frantically go online. And in just a year, the e-commerce industry has grown by 70%. For comparison, in Russia the growth for 2020 according to various estimates amounted to about 18%. And in support of the e-commerce industry, the fintech industry has also grown to enable transactions over the Internet. Plus, against the background of such popularity, a bunch of companies have appeared that offer turnkey business digitalization – to create a website, establish sales, and ensure financial flows.

Against this background, the demand for IT engineers has grown incredibly. Now, in April 2021, almost all senior engineers have been dismantled – moreover, almost all work remotely, sit at home and work on several projects at once. There are not enough backend providers, frontend developers, data science specialists – no one at all.

Why are almost no foreign engineers hired here?

In general, Brazil has always had enough of its own engineers. There are good universities here that produce qualified programmers. Moreover, teachers from Russia and the CIS often teach there.

But with such a sharp, almost explosive growth in the market, a shortage of staff was inevitable. It would seem that it is possible to hire engineers from abroad, what is the general problem? There are two problems:

Low rate of the Brazilian real. In one US dollar – about 5.5 Brazilian reais. The currency as a whole is not very stable, in 2020 it fell by 30% – the largest drop in comparison with other countries. And Brazil cannot offer American or European salaries to foreign programmers.

Even now, with increased demand, the salary of mid-level engineers in Brazil is 15 thousand reais per month, that is, 2,600 dollars, or about 200 thousand rubles. This can be found in Russia, and even more so in Europe or the United States. Of course, super-cool specialists are ready to pay more, but they and European companies are ripped off with their hands.

Lack of a standard procedure for hiring foreigners. Europe has EU Blue card, in the United States and China, the recruitment scheme has also been worked out, and for a company to hire a foreigner is not a problem at all. Plus, there are different companies that help foreigners with the move: prepare documents, find an apartment, get comfortable on the spot.

There is nothing like that in Brazil. For a company, hiring a foreigner with a move is a terrible headache, paperwork, a bunch of bureaucratic delays and too many incomprehensible things. It will take even more time and effort than searching for a programmer in Brazil. And maybe even more than growing a smart June specialist in your company. Hiring a remote worker is a little easier, but there are obstacles here too – Brazilian employers simply do not know how to look for them, often do not know English and are not ready to pay high salaries due to the devaluation of the real.

In general, there is an opportunity to hire a foreigner, but it will be difficult for both parties. Therefore, it is usually like this, again, they only hire someone cool and unique, who cannot be found in Brazil.

Perhaps, over time, the situation will change – the real exchange rate will grow, and in Brazil there will be clear and understandable procedures for hiring a foreigner. But while an engineer from Russia, who is looking for a job in another country and is waiting for the employer to transport him, pays and formalizes everything, it is better not to look in the direction of Brazil. Only if you, of course, do not dream of living in this particular country. By the way, we have a separate article about how people live there.

The entire fintech startup ecosystem for 2020

Features of development in Brazil: less expertise in complex tasks and more focus on project work

Finally, let’s talk a little about how the development culture works in Brazil. She here fully relies on the American, that is:

  • She is focused on working in a team – everyone works together, communicates a lot, and leadership qualities are encouraged among programmers.
  • Focused on project work – on specific practical tasks and results.

At the same time, here, as well as in many other places outside of Russia, there is a rather weak mathematical base. That is, local developers are good at most practical tasks, but when it comes to complex algorithms, Russian engineers are usually ahead. This is especially noticeable at all sorts of championships and olympiads – it is not for nothing that Russian programmers take first places there so often. How important it is in work depends on the tasks of the business.

In general, the Junior Enterprises culture has existed in Brazil for a very long time. These are young companies that are open at faculties and do projects for real companies. Students work in them, but they are not paid salaries – all profits go to improve the structure and purchase equipment from Junior Enterprises itself. It turns out that before graduation, many here have experience of real work on real projects, and this is what the emphasis is on here in education. In Russia, this is developing, but so far the level of such a focus on projects and teamwork is still lower.

It may not be worth leaving for Brazil yet – but somewhere in Europe you can give up. Indeed, during the pandemic, the demand for engineers has grown all over the world. In our telegram bot @g_jobbot there are thousands of vacancies, including those with relocation. Or remotely – whichever you prefer.

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