Nearshoring vs. Local Hiring in Israel: What’s More Strategic for Scaling?
- SGF Global
- May 21
- 2 min read
In Israel’s competitive and high-growth business ecosystem, building a strong team can make or break your expansion. Whether you're a global company scaling into the region or a fast-growing Israeli startup, the hiring question comes quickly: Do you build locally, or do you nearshore your team?
Both approaches have clear advantages. But as companies in Israel grapple with talent shortages, rising salaries, and time-to-hire delays, it’s essential to understand when local hiring is worth the investment, and when nearshoring is the smarter strategic move.
The Case for Local Hiring
Israel boasts one of the most skilled and innovative workforces in the world. Hiring locally means being part of the country’s unique startup DNA and tapping into a talent pool with global experience and deep domain expertise.
Benefits of local hiring:
🌐 Access to top-tier tech talent, especially in fields like AI, cybersecurity, and medtech
🤝 Stronger collaboration and company culture through in-person interaction
📍 Proximity to Israeli customers, partners, and investors
💼 Government incentives for local job creation and R&D
But there are limitations. Salaries are high, demand outweighs supply, and recruiting for certain roles can take months. For many companies, scalability becomes the bottleneck.
When Nearshoring Becomes the Smarter Strategy
Nearshoring involves building teams in neighboring or nearby regions, such as Eastern Europe, the Balkans, or even parts of the Middle East, where costs are lower, and time zones are compatible.
This strategy gives Israeli companies the flexibility to scale rapidly without sacrificing communication, quality, or delivery speed.
Nearshoring vs. Local Hiring: A Strategic Comparison
Factor | Local Hiring in Israel | Nearshoring from Nearby Regions |
Time to Hire | Slower, competitive market | Faster, larger talent pools |
Salary Costs | High | 30–60% lower on average |
Timezone Compatibility | Perfect | 1–3 hour difference (excellent) |
Cultural Fit | Excellent for Israeli market | Strong, especially in EU-based teams |
Compliance Complexity | Requires full local infrastructure | Simplified via EOR or BPO |
Scalability | Limited by local supply | Flexible and rapid team growth |
Use Both, Intelligently
The smartest companies in Israel aren’t choosing either or, they’re combining both approaches. A hybrid hiring strategy might include:
Local senior leadership, product, and business development
Nearshore teams handling QA, support, or full development squads
EOR or BPO partners managing compliance, payroll, and team logistics abroad
This blended model maximizes talent reach, balances costs, and keeps operations agile.
For companies scaling in or from Israel, hiring strategy is not just a budget question, it’s a growth infrastructure decision. Local talent brings knowledge, proximity, and cultural resonance. Nearshoring offers elasticity, cost control, and the speed needed to stay competitive.
At SGF Global, we help you design and implement the right talent model, local, nearshore, or both, backed by compliance, infrastructure, and global reach.
