Key Takeaways
- Offshore hiring is cheaper but often comes with time-zone and retention challenges.
- Nearshore hiring offers better overlap but is becoming less cost-effective.
- Africa combines both: offshore-level savings with nearshore-style collaboration.
- Senior developers in Africa typically cost $20k–$45k per year, up to 70% less than in the US/UK.
- Companies that succeed in Africa hire in small pods, give clear structure, and use partners like Betternship to manage compliance and payroll.
Why Offshoring vs Nearshoring Matters in 2025
For many companies, the question is no longer should we hire remotely? But where should we build our remote team?
Visa restrictions, salary inflation, and a global shortage of senior talent mean that hiring locally in the US, UK, or Europe is often out of reach. The average senior engineer in San Francisco or London now earns between $180k and $250k a year, before benefits, equity, or taxes.
For startups and even mid-sized firms, those numbers simply don’t add up.
That’s where offshoring and nearshoring come in. Both strategies help businesses reduce costs and access larger talent pools, but they carry different advantages and risks.
And now, Africa has become the third option: combining the affordability of offshore with the time-zone compatibility of nearshore.
Offshoring vs Nearshoring: What Do They Actually Mean?
- Offshoring means hiring employees or contractors in distant countries, usually thousands of miles away, primarily for cost efficiency.
India and Southeast Asia have been traditional offshore destinations, with Africa now emerging strongly in this space.
- Nearshoring refers to hiring in geographically closer regions with more convenient time zones and cultural similarities.
For example, US companies often hire in Mexico, Brazil, or Colombia, while European companies look to Poland, Romania, or Ukraine.
At first glance, the choice looks simple: offshore is cheaper, nearshore is closer. But companies today weigh more than distance. They look at:
- Total cost of hiring (salary, benefits, overheads).
- Retention and turnover in each market.
- Ease of compliance across borders.
- Cultural and language alignment with existing teams.
These aren’t just HR questions, they’re strategic decisions that directly affect a company’s runway and growth.
Offshore vs Nearshore Costs in 2025
Compensation is often the first filter when comparing offshore and nearshore options. But salary data tells only part of the story.
| Region | Average Annual Cost (Senior Engineer, 2025) | Trends to Watch |
| United States / UK | $180k–$250k | Costs remain at record highs, limiting early-stage hiring |
| Eastern Europe / Latin America (Nearshore) | $70k–$110k | Salaries rising 20–30% since 2022; shrinking cost gap with Europe |
| Africa (Offshore with nearshore overlap) | $20k–$45k | Affordable, with steady growth in mid- and senior-level talent |
Why this matters:
- Hiring five engineers in Lagos or Nairobi can cost the same as hiring one in New York or London.
- Salaries in Eastern Europe and Latin America are increasing quickly, eroding the financial advantage of nearshoring.
- Africa still offers significant savings without forcing companies to compromise on skills or work-hour alignment.
And beyond salary, companies factor in benefits, training, compliance, and replacement costs. In regions with high attrition, the true cost of hiring can be far higher than the initial salary.
Africa’s Role in the Offshore vs Nearshore Conversation
Until recently, the offshore vs nearshore decision was framed around India or Southeast Asia on one side and Latin America or Eastern Europe on the other. Africa rarely entered the discussion. That’s changing fast.
Africa is becoming a third model:
- Cost savings like traditional offshore markets.
- Time-zone compatibility like nearshore regions.
- Lower churn rates compared to India and Latin America.
For example, a European company hiring in Nigeria or Ghana gets full-day overlap at salaries far lower than Eastern Europe.
A US company hiring in Kenya or South Africa gains 3–6 hours of overlap, with flexibility for adjusted shifts.
Africa blends the best of both worlds, offering an affordable yet collaborative option.
How Africa Compares on Cost, Retention, and Time Zones
When choosing where to build a team, businesses usually ask three questions:
How much will it cost? Will the team stay? Can we work well together?
- Costs: $20k–$45k for senior engineers in Africa, 60–70% lower than in the US/UK and still half the cost of many nearshore hubs.
- Retention: African professionals often value long-term stability with global employers. Nearshore markets, in contrast, can see attrition rates of 30–40% as talent moves to US/EU contracts.
- Time zones: Africa overlaps fully with Europe and partially with the US, making collaboration smoother than with Asia-based offshore teams.
Key point: Africa avoids the old trade-off of “cheap but far” versus “close but expensive.”
Why Nearshoring Alone Is No Longer Enough
Nearshore hiring was once marketed as the safe middle ground. But in 2025, it comes with challenges:
- Rising salaries: Engineers in Eastern Europe and Latin America now command $80k–$100k per year, closing the gap with Europe.
- High turnover: Nearshore developers often switch jobs quickly for better-paying opportunities.
- Regional risks: Eastern Europe continues to face instability, while Latin America struggles with inflation and currency swings.
For companies that want predictable costs and reliable retention, nearshore no longer guarantees stability. Africa fills that gap, offering affordability with alignment.
Choosing Between Offshore, Nearshore, and Africa
Every company has different priorities. Here’s a simple way to think about it:
- Choose Nearshore if: You need full-day overlap and budget is less of a concern. Example: customer support teams.
- Choose Offshore if: You only care about cost and can work mostly asynchronously. Example: large-scale IT services.
- Choose Africa if: You want cost savings and a strong overlap. Example: scaling product teams in Europe or North America.
In short:
- Nearshore = Synchronization.
- Offshore = Cost savings.
- Africa = Both.
How to Build a Remote Tech Team in Africa
Hiring in Africa is straightforward if you use the right approach. Here’s how to set it up for success:
- Decide what roles you need. Be clear on whether you need developers, testers, or support staff.
- Hire in small groups. Teams of 2–3 people work better than lone hires.
- Look for stability, not just skills. African professionals often seek long-term roles; this is a big advantage if you plan for growth.
- Sort out contracts and payments. Use a partner like Betternship to handle compliance and payroll smoothly.
- Onboard with structure. Provide clear tools, processes, and communication channels.
- Grow step by step. Start small, then scale as needed. Keep a pipeline of vetted candidates ready.
- Offer growth paths. Show your team how they can progress and reward them for milestones; it boosts retention.
In Conclusion
Building a team in Africa isn’t just about saving money. Done right, it gives companies affordable, reliable, and loyal teams that grow with them.
Africa offers the hybrid benefits of offshore and nearshore hiring, without the trade-offs.
At Betternship, we help companies set this up from day one: from role definition and vetting to contracts, payroll, and onboarding.
That way, you can focus on growth while we handle the complexity of global hiring.
Get Started Today!