95% of companies are building more global teams, but the global hotspots to watch are changing fast. Global hiring trends have traditionally pointed outward from North America as companies sought more expansive market, language, and time zone coverage across continents.
But, with 46% of companies choosing global hiring to fill specific skills gaps, it’s no surprise that North America is also seeing an uptick as a global hiring hotspot. The United States, Canada, and Mexico all offer highly skilled workforces, regional access, and time zone compatibility for businesses looking for overlap from the Pacific to Atlantic time zones.
For companies looking to make their next hire in one of these countries, here’s everything you need to know about compliance, structure, and cost so you can hire successfully.
Why companies are hiring in North America now
For many companies, hiring globally means trading off four things: growth needs, talent availability, cost, and skills. EORs like Multiplier remove one of the bigger constraints, the need for a local entity in every country you want to hire in. The trade-offs between markets still matter.
With nearly half of employers saying they’re hiring global talent in search of specific skills, Multiplier’s Hiring Gap Report reveals that North America is well-positioned to absorb some of this demand, especially when it comes to engineering, sales, and customer success roles.
Market entry, expansion, or coverage are often motivators for companies hiring into North America. Companies with growing customer bases in any of the three countries often look to formalize their presence.
This also allows companies to have support coverage in the region. For example, a UK-based company with a significant customer base in the Pacific time zone can support those customers more effectively with a hire based in Vancouver or Mexico City than with somebody based in London.
Broadly, companies are also building for global audiences from the outset rather than treating international expansion as a later stage milestone. Crunchbase notes that ambitious startups typically pivot to the US market, with the promise of revenue opportunities in the region. A German company that might have taken a decade to plan a North American entry is now more likely to do so on an accelerated timeline, with hiring support and account management in the region serving as a leading indicator of full market entry.
The three North American markets and what each one offers
The United States, Canada, and Mexico have varying talent and hiring landscapes that companies will want to consider carefully. What might make sense culturally or operationally might introduce nuances that companies should be aware of as they bring talent aboard.
The United States
The United States has the deepest talent pool, especially for AI, product, engineering and finance roles. It’s also the most complex in the region because of state-by-state variations and medium to high misclassification risk.
Canada
Canada also has a strong talent pool on the AI and engineering side, as well as for companies looking for multilingual support. Without the state-level patchwork of the US, Canada distinguishes itself from its southern neighbor, though rules across provinces introduce their own variances.
Mexico
Mexico is the fastest-growing EOR market in the region, with timezone alignment for US companies acting as an incentive. Be aware of high contractor misclassification risk as repeated project work is often classified as employment. The country has real depth in software engineering, design, and operations roles, especially across Monterrey, Guadalajara, and Mexico City.
Compare hiring across the United States, Canada, and Mexico
Factor | United States | Canada | Mexico |
|---|---|---|---|
Entity required to hire? | Yes (or EOR) | Yes (or EOR) | Yes (or EOR) |
EOR availability | Available. Most common path for non-US companies. | Available. Simpler compliance than the US. | Available. Fastest growing EOR market in the region. |
Contractor risk | Medium to high. IRS misclassification rules apply. | Medium. CRA rules are strict; long-term contractors often reclassified. | High. Mexico has strict employee-contractor rules. Repeated project work = employment. |
Employer costs above base salary | Varies by state: 10 to 20% (payroll tax, benefits) | Approximately 15 to 20% (CPP, EI, benefits) | Approximately 25 to 35% (IMSS, Infonavit, profit sharing) |
Time zone alignment (US ET) | Same | ET to PT overlap (full working day) | CT to PT overlap (full working day) |
Key talent strengths | AI/ML, finance, product, engineering | AI, engineering, finance, multilingual roles | Software engineering, design, operations |
Time to hire via EOR | 1 to 2 weeks (no entity needed) | 1 to 2 weeks | 1 to 2 weeks |
Why Mexico has become the nearshoring market to watch
Mexico accounts for 8% of North American hiring on the Multiplier platform, but global hiring here is picking up speed. Sitting predominantly in the Central Time Zone, Mexico-based talent can offer significant Pacific and Eastern coverage and day-to-day overlap.
Engineering talent in this region is widely recognized as exceptional, as investment and global attention continue to grow. Monterrey, Guadalajara, and Mexico City are considered talent hot spots in the country, with Guadalajara earning the nickname of Mexico’s “Silicon Valley” and Mexico City grabbing the top LATAM city spot for digital talent in 2024.
USMCA creates structural and regulatory advantages for cross-border teams. Companies with US operations can hire in Mexico for professional services and IT roles with much less visa and work permit friction. And while employer costs can run 25-35% above base salary, those base salaries are cost-efficient and remain highly competitive against US counterparts.
Why Canada is the most underrated market for global teams
Canada makes up 35% of global hiring into North America, following closely behind the United States. While sometimes overlooked in comparison to its southern neighbor, Canada has key advantages that make it an ideal entry point for companies that want a North American presence.
The first major advantage is predictability. Canadian employment law is primarily provincial, but each province’s Employment Standards Act is comprehensive and well-documented. The variation between provinces (notice periods, vacation minimums, statutory holidays) is narrower and more navigable than the patchwork of US state-level employment law.
Canada’s talent profile is world-class with strengths in engineering, AI, and finance. The workforce itself is often highly educated, diverse, and multilingual, creating strong profiles for hiring in roles at companies that have products or customer bases that span multiple markets.
Canada’s contractor misclassification risk is medium when compared to Mexico and the United States. However, risk still exists with misclassification, carrying penalties of wrongful termination claims, fines, and workers’ compensation liabilities.
Canada’s time zones map almost exactly to the US, which gives global companies servicing North American customers a clean operational footprint.
What companies get wrong about hiring compliance in North America
The first mistake companies make when hiring in North America is treating the region as if the rules are the same across borders, given how similar North American markets are in terms of geography and culture. A closer look at the employment landscape of these three countries will reveal highly important nuances to observe.
Just 8% of companies are confident that they’re managing international tax and labor laws compliantly. This means that a uniform approach across these three countries will not work and could lead to a costly mistake.
In Mexico, be aware of how you classify contract workers. Worker protection is strong, and misclassification risk is high. In the US, contractor classification has two layers. The IRS uses a common law test focused on right to control, which determines payroll tax exposure. The Department of Labor uses an economic reality test under the FLSA, which determines minimum wage and overtime exposure. A worker can pass one test and fail the other, so US contractor relationships need to clear both.. And in Canada, recognize the structural differences between it and its southern neighbor. Canada has stronger employee protections and provincial variations that global employers should navigate carefully.
Market | Common mistake | How to avoid it |
Mexico | Treating a full-time remote worker as a contractor because the work is project-based | If the person works regularly and exclusively for your company, Mexican law classifies them as an employee. Use an EOR or set up a local entity. |
United States | Paying a US-based worker as a foreign contractor via wire transfer and treating it as a contractor relationship | The IRS looks at control and economic dependence, not contract type. Get a proper contractor agreement in place or engage via EOR. |
Canada | Assuming Canadian employment law mirrors US law because both countries share a border and language | Canada has stronger employee protections, mandatory severance, and provincial variation. Each province has its own employment standards. Treat Canada as its own compliance environment. |
All three markets | Starting a hire before payroll and benefits are set up because the role is urgent | A worker who is paid late or without benefits may have a legal claim against the company even if the contract says otherwise. Sort compliance before day one. |
How to hire in North America without setting up an entity
The first question for any company hiring in North America: are you willing to set up an entity?
Setting up an entity
Setting up an entity in the US, Canada, or Mexico is a months-long process. The paperwork is just the start. You’re managing disclosures, registrations, banking, and tax setup in parallel, often with country-specific local counsel. For companies testing a market or making one or two hires, the time and cost rarely make sense. For companies that are moving fast, testing a market, or hiring one or two employees, this process can be disproportionately difficult and susceptible to compliance gaps.
Working with an EOR
Working with an EOR is the preferred path for companies who don’t have a local entity in a specific country. EORs cut through the lengthy process of setting up an entity, allowing you to hire in 1-2 weeks with legal fees, tax registration, and payroll managed by the “employer of record”. Multiplier helps companies hire in North America and simplifies compliance, regional nuance, and contractor risks so companies can focus on bringing on the talent they need to grow.
Contractor route
Nearly half of all companies that use global contractors do so to access specialized skills, and 47% cite short-term, project-based needs. Depending on the length and specifics of the engagement, working with a contractor might be the better option for your company’s plans.
Where this is heading
North America is no longer the region where companies exclusively hire from. Increasingly, it’s where they’re hiring into. Fast-growing international companies are looking for skills, market coverage, and time zone alignment, which makes talent based in Canada, the US, and Mexico more attractive than ever.
Hiring with an EOR service like Multiplier speeds up this process and prevents companies from having to spend months setting up entities. Complexities and previous barriers to entry are less daunting when you partner with an EOR that helps you manage payroll, compliance, and market-specific infrastructure.
Talk to a global hiring expert about hiring talent in North America.
FAQs
Can a non-US company hire employees in the United States without a US entity?
Yes, the most common route is through an Employer of Record, which acts as the legal employer on your behalf. This removes the need to set up a US entity.
What is the cheapest way to hire someone in Mexico legally?
An Employer of Record is the fastest and most cost-effective pathway for companies without a Mexican entity. Setting up a local entity is the alternative, but it requires higher upfront costs.
Is Canada easy to hire into as a foreign company?
Canada is considered the most straightforward of the three North American markets for global companies to navigate. Employment law is primarily provincial, but each province’s Employment Standards legislation is comprehensive and well-documented, making the compliance landscape more predictable than the state-by-state variations companies face in the US.
What is the difference between hiring a contractor and an employee in Mexico?
Mexico has strict worker classification rules. If someone works regularly and exclusively for your company, Mexican law treats them as an employee. Misclassifying an employee as a contractor exposes companies to legal and financial liability.
How long does it take to onboard a new hire in Mexico or Canada via an EOR?
With an employer of record, onboarding in both Mexico and Canada typically takes 1-2 weeks. By contrast, entity set-up can take several months.
What are the mandatory benefits companies must provide when hiring in Mexico?
Mexican law requires employers to provide IMSS social security contributions, Infonavit housing fund contributions, profit sharing, a Christmas bonus (aguinaldo) of at least 15 days' salary, and paid vacation. Under Mexico's 2023 vacaciones dignas reform, employees are entitled to a minimum of 12 days vacation in their first year, increasing by 2 days every subsequent year up to 20. These statutory costs typically add 25–35% on top of base salary.
Why are companies nearshoring to Mexico instead of other Latin American countries?
Mexico's combination of US time zone alignment, USMCA trade advantages, and a fast-growing engineering and digital talent base makes it the strongest nearshoring case in the region.
