The Current State of Technology in Mexico

Tech outsourcing team delivering business process outsourcing in Mexico

The state of technology in Mexico has been driven in the last 30 years by its geographical position. Its location makes it a strategic player and a principal recipient of investment from the most powerful economy in the world.

While technological adoption among the largest companies in the country has been almost parallel to the most advanced economies, the penetration of the Internet and mobile devices places Mexico in a privileged position in the context of the Latin American region.

Level of technology in Mexico

According to the Ministry of Economy, Mexico has become the fourth largest exporter of IT outsourcing services worldwide. In addition, it has been classified as the sixth-best destination for outsourcing services and contact and call centers.

In the last ten years, the IT sector has grown at an average annual rate of 11.2%, higher than the growth of the national GDP. This is due to the boost in exports, which registered an average annual growth rate of 42.8% in the period under consideration.

Business consultant reviewing intellectual property compliance for nearshore IT outsourcing

Technology in Mexico: Investments

Between 2006 and 2011, investments in the IT sector through projects supported by the Prosoft Fund (Program for the Development of the Software Industry and Innovation) went from 78 million dollars to nearly 115 million dollars.

While precise figures for IT investment in Mexico over the past five years remain scarce, the overall trend shows sustained growth and a clear rise in large-scale projects. Notably, several major players have announced or launched significant initiatives:

  • Amazon Web Services (AWS): In 2024, AWS committed over $5 billion to establish a cloud infrastructure region in Querรฉtaro. This long-term investment supports growing demand for cloud services across Latin America.

  • Foxconn: Partnering with Nvidia, Foxconn has begun developing a semiconductor manufacturing facility in Mexico. Although full details are still emerging, the project signals Mexicoโ€™s growing role in advanced tech manufacturing.

  • Microsoft: After investing $1.1 billion in 2020 to support cloud services and training, Microsoft committed another $1.3 billion in 2024 to boost AI infrastructure and expand digital skills across Mexico.

Presently, the IT sector employs nearly 600,000 people and registered an average annual employment growth of 11% between 2002 and 2011. The Mexican government estimates that the information technology services market amounted to more than 2.15 billion dollars in 2022, representing 18.4% growth compared to 2021. 

Mexico is the second most important market in Latin America, only after Brazil, in terms of market value.

Cost competitiveness

In terms of operating costs, according to information from the Mexican Ministry of Economy, in the information technology sector, Mexico compares with levels similar to those of China and India. However, technology in Mexico is more competitive than in other countries in Asia, Europe, and North America. Mexico is the most competitive country in the American continent for software design and video game production activities.

For example, compared to the United States, Mexico is 39% cheaper in ‘Digital Entertainment Development,’ 38% in ‘Software Design’, and 60% in ‘Support Services,’ according to KPMGโ€™s Guide to International Business Location Costs 2012 Edition.

It’s important to note that while the specific percentages may have evolved over time, Mexico continues to be recognized for its cost-effective environment for IT and support services, making it an attractive destination for companies seeking to expand their operations.

Team lead coordinating tasks with a nearshore development team via virtual meeting

Challenges and critical points 

As mentioned above, the country’s geolocation allows it to integrate almost naturally into the supply chains of various industries in the United States, such as electronics, automotive, aerospace, and information.

On the other hand, this subordination as a supplier of parts and components and affordable talent has created challenges for developing its own technology. An example is software, one of the fields where Mexico could have stood out since the 1980s. Unfortunately, even today, there is a need to promote public policies that bet on talent development in this area, promoted by the Mexican Government and articulated by the private sector, with the participation of higher education institutions and venture capital.

In addition to the need to service large global suppliers, Mexico must pursue more policies and incentives at the local level to flourish and produce a high degree of patentable innovation for the creation of competitive advantages.

What is the impact of technology in Mexico?

As stated at the beginning of this post, the Information Technology and Telecommunications market in Mexico is highly concentrated in large organizations. The budget of the 1,500 largest companies in the country represents 63% and 37% of Mexican organizations, according to the Top 1500 study carried out annually by the research firm Select. SMEs, meanwhile, contribute 52% to GDP and generate 72% of employment in the country, according to figures published in 2017.

However, according to a Zoho study, only 6% of the 4.8 million small and medium-sized companies use information technology, which represents a disadvantage in competitiveness since large companies are six times more productive, on average, thanks to advanced IT applications and automated systems.

This creates an opportunity for IT support services to help close the digital gap for small and medium businesses. Companies seeking IT outsourcing services can benefit from Mexicoโ€™s growing infrastructure and talent pool.

Public policies in the current state of technology in Mexico

Main centers of technology in Mexico

  • Technological Institute of Monterrey (ITESM)

  • National Institute of Astrophysics, Optics and Electronics (INAOE)

  • Anahuac University Mexico South

  • Tecnolรณgico de Monterrey Campus Mexico City

  • Cinvestav โ€“ Center for Research and Advanced Studies of the IPN

  • Metropolitan Autonomous University (UAM)

  • National Polytechnic Institute (IPN)

  • Autonomous University of the State of Morelos ( UAEMor )

  • Monterrey Institute of Technology and Higher Studies (ITESM)

Primary technological industries in the country

The primary technological industries in Mexico include Information and Communication Technologies (ICT), Electronic Equipment Manufacturing, Automotive, Biotechnology, Telecommunications, Aerospace Industry, Smart Factory, Agriculture 4.0, Robotics and Automation, Software Development, and Biopharmaceuticals. These industries use innovative technology in Mexico to improve the products and services offered to businesses and consumers in the global marketplace.

Intugo IT specialists collaborating on a client project remotely

IT market growth 

In 2022, annual growth reached 6.2%. Furthermore, revenue in the IT services market is expected to grow at a steady annual rate of 5.4% from 2025 to 2029, according to data from Statista.

Digitization and Internet Access

The 2021 edition of the Network Readiness Index places Mexico in 59th place among the countries with the greatest digitization out of the 130 countries evaluated. Among those with an upper-middle income, Mexico ranks 11th and eighth in the Americas. For its part, the Statista research department estimated that approximately 98.6 million people in Mexico had access to the Internet, representing an increase of around 16 million compared to registered users in 2021.

It is forecast that by 2026, around 118.2 million Mexicans will have access to the network. Most of them surf the web of networks through a smartphone.

Shared tech operation service of Intugo in Mexico

However, progress toward digital inclusion could be faster. According to the OECD, the Government of Mexico must continue integrating digital tools and approaches that allow the current state of technology  to become more agile, open, and responsive.

Among the main findings of the study The 2018 Digital Government Scan of Mexico, related to sustainability and continuity challenges, include digital inclusion, a single portal for all public administration procedures, political leadership and support in terms of the digital transformation strategy, and a coherent policy in implementation, based on a reference framework that facilitates collaboration, coordination, and support for effective implementation throughout the different areas and levels of government.

Final Thoughts

Mexico’s growth in IT and digital infrastructure is a product of both global demand and local strengths. With strong cost competitiveness, a growing workforce, and tech-driven sectors, the country has become a leading destination for IT outsourcing services.

For companies looking to optimize operations, Mexico offers opportunities in IT service desk outsourcing, cloud infrastructure, and outsourced IT services for small business.

Considering IT service outsourcing in Mexico? Intugo helps businesses build their own remote teams, with full control and tailored support.

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