In January 2025, President Trump issued an executive order requiring federal employees to return to in-person work. This caused several disruptions, including desk shortages, Wi-Fi issues, and even a lack of basic supplies. While the order only affects the public sector, it sure highlights the inefficiencies of traditional office environments and presents a huge opportunity for U.S. companies for hiring in the emerging regions. 

Amid these domestic challenges, U.S. companies are increasingly investing in emerging markets, such as Latin America, Eastern Europe, and Asia-Pacific, to capitalise on the benefits of remote work and access to a diverse talent pool. 

These are not just isolated moves. They're part of a broader investment shift. U.S. businesses are currently reconsidering how and where they are hiring, building teams and allocating their capital to more flexible, cross-border strategies that meet modern workforce demands. 

What drives the shift to these regions?

The shift to hiring in the emerging regions has been influenced by several factors. Looking at the numbers, 28% of the U.S. workforce was engaged in remote work as of June 2023 (U.S. Bureau of Labour Statistics). This trend shows no signs of slowing down, prompting U.S. companies to expand their search for talent beyond domestic borders. 

The shortage of skilled labor in the U.S. also emerges as a top factor in the shift. The Bureau of Labor Statistics also predicts a shortage of more than 1.2 million engineers by 2026 (Forbes). With demand for tech talent far outpacing supply, U.S. companies are turning to regions like Latin America, Eastern Europe, and Southeast Asia, where skilled professionals are abundant and often more cost-effective. 

In addition, businesses prioritise maintaining productivity while controlling costs. Hiring in these regions allows companies to work with top-quality talent without the overhead of office space, benefits, and high wages typical in the U.S. 

The benefits for the U.S. companies

One of the strongest motivators behind investing in remote teams abroad is cost efficiency. At Native Teams, we recently explored hiring trends across the U.S. and the APAC region and came up with a few interesting findings.

79% of global executives reported cost savings from flexible work models, mainly by reducing office space (IWG). The fact that 25% of Native Teams' U.S.-based clients currently hire in APAC only confirms that investing in teams in this emerging region brings the benefit of cost efficiency. 

Salaries in the region also play a role. As of mid-2024, the average annual salary for a U.S.-based remote worker was $61,178 (NEAT). While the benchmarks for the APAC region remain limited, the historically lower salary costs and the cost-optimization reported by businesses speak about the financial appeal of building distributed teams in these markets.

Tech and remote-first roles remain in top demand in this region. According to our proprietary data, the most commonly hired roles in APAC include software development (33%), project management (14%), customer success (10%), and HR and recruitment roles (10%). India leads in technical roles, the Philippines shows strength in project management, while Indonesia's talent pool is broader, with a higher share of generalist roles.

Challenges and risk factors

When we talk about the challenges of hiring in global markets, labor law compliance remains on top. Hiring in different regions means dealing with the varying employment and tax laws of these countries. 

Take paid leave policies, for example. While U.S. employers are not legally required to offer paid vacation time, countries in the EU have more stringent regulations. For instance, all EU member states are mandated to provide at least four weeks of PTO per year (exact numbers varying by country) – a standard not found in the U.S.

Termination procedures count here as well. In the U.S., employment termination is "at-will", meaning either party can terminate the relationship at any time. Contrary to this, in some countries, like India, employers must obtain permission from local authorities to terminate employment in certain cases. 

Workers' classification presents another major challenge. In the U.S., workers are classified based on the employer's control over their activities. This is not the case in regions like Eastern Europe and LATAM. In fact, some countries have laws that require certain categories of gig workers to be classified as employees, entitling them to benefits like health insurance and a pension.

The role of EOR services

The benefits for U.S. companies hiring in the emerging markets are evident – but so are the legal complexities. Starting from employment contracts, payroll, and benefits administration, ending at termination policies, even the smallest misstep can be very costly. This is one of the main reasons why U.S. employers increasingly rely on Employer of Record (EOR) services.

In simple terms, an EOR acts as the legal employer on the ground, handling contracts, payroll, taxes, benefits, and legal compliance. This enables U.S. companies to hire talent in emerging markets without opening local entities. 

The demand for the EOR model is growing fast. According to IEC Group, the EOR market is growing at a CAGR of 16.7% annually and is projected to hit $12 billion by 2030. For U.S. companies looking to invest in global talent, EORs are no longer optional – they're a strategic asset. 

Regional trends in cross-border hiring

Many U.S. companies look beyond domestic borders to access global talent, with regions like Latin America, Eastern Europe, and Southeast Asia becoming key hotspots for hiring. 

Latin America is a prime example. Besides cost-effectiveness, the region's proximity to the U.S. and the time zone alignment remain key factors for real-time collaboration.

Eastern Europe, with countries like Poland and Romania, also present an attractive option. These countries benefit from their EU membership, which ensures regulatory stability for U.S. employers. 

APAC countries also continue to draw attention. Referring to our proprietary data, tech roles dominate hiring in the region, and this trend will continue to grow, backed up by growing infrastructure and the digital-savvy workforce. 

This is just a small part of the targeted initiatives that signal a clear trend. The emerging regions aren't just talent-rich, but they are also policy-ready to accommodate remote work growth. 

The future of remote work

Even as the federal U.S. government leads the way in re-evaluating remote work, the cultural shift towards flexible work environments remains strong in the private sector. This is highly driven by cost advantages and the quality talent pools available abroad. 

Governments in emerging regions are enhancing their appeal by offering tax incentives and digital nomad visas, as well as creating regulations that support remote work. These developments signal that the future of work will remain remote-first, with U.S. companies continuing to tap into global talent despite the domestic shifts.