Human Capital Nicaragua

One of our country’s greatest assets is its people. Nicaragua's population is very young; in fact 77 percent of the total population (an estimated 6.03 million in 2013) is under the age of 39. The country’s labor force is made up of 2.9 million people, and it is known to be flexible and highly productive, with good working habits and the ability to learn quickly.

The department of Managua holds the main economic activities, and has a total population of 1.4 million; of which over 27 percent range in age from 20 to 34 years. There are other important departments, their population and distance from Managua are:

The country has a rich pool of available bilingual professionals trained abroad. There is also a broad base of workers for labor-intensive industries.

"There is an ample pool of well-educated, computer-literate young individuals with university degrees in Nicaragua. They are eager to find jobs that provide them with the opportunity to compete worldwide."
- Álvaro Montealegre, Inversiones Almori (BPO Service Provider)

Because of its low attrition rates, a fast learning curve and low absenteeism, the Nicaraguan labor force is quickly becoming recognized as one of the most competitive and productive in the region.

The 2012 Labor Market Risk, published by the Economist Intelligence Unit, places Nicaragua as the country with the second lowest labor market risk in the region. The report measures various indicators such as: union strength, labor disputes, wage restrictions and hiring and firing restrictions.

The Nicaraguan Government firmly believes that education is the foundation of a country’s economic development, and has thus allocated a significant amount of the national budget to invest in primary, secondary and higher education. Education expenditures, including public Universities, amount to approximately 5.4 percent of the GDP.

As a result of an illiteracy campaign called “Yes, I can” launched by the government in 2007, Nicaragua reached a 96.7 percent literacy rate. In August of 2009, Nicaragua was declared “a country free of illiteracy” by UNESCO (United Nations Education, Science, and Culture Organization) for having an illiteracy rate of less than 4 percent. In 2011, the reported literacy rate for population between ages of 15 and 65 is 98.7 percent.

The Nicaraguan education system includes quality technical training to meet the immediate and long-term needs of the labor force.

55 universities with over 134,000 students enrolled
1 U.S. accredited English Language University
5 universities with bilingual programs;
5 Bilingual secondary schools
More than 30 English Language Institutes
64 technological institutes servicing more than 148,500 students in the areas of:
- electronics
- computer systems and sciences
- agroforestry
- construction
- trade-related services

INCAE, the prestigious Nicaraguan Harvard-affiliated regional business school ranked as number one in Latin America, is located in Managua and offers a pool of individuals with world class managerial skills.

INATEC, the National Technological Institute, provides technical training that can be tailored to meet specific business needs.

Although Spanish is the official language in Nicaragua, English has become increasingly popular. For historical reasons, there is a lot of cultural affinity with the United States and the country has experienced a “reverse brain drain” phenomenon, whereby a group of individuals who emigrated in the past return to Nicaragua, bringing with them proficiency of the English language and international experience in business.

A recently study made by PRONicaragua in 2012, about the number of people registered in English courses in the main language institutes of the country, shows that the interest of nicaraguans of having English as second language is growing. The results show that in 2011, more than 12,700 students registered in an English course and 42 percent of them graduated with excellent domain. The study included 14 language centers which 70 percent of them offer specialized courses such as: technical vocabulary for the Tourism and Outsourcing industry, as well as preparation for TOEFEL, SAT, GRE and GMAT.

A job fair organized by PRONicaragua to evaluate the English-speaking population named “Employment Machine” which was a two day event during August of 2010 held in Galerias Santo Domingo mall and the American University campus (UAM, for its acronym in Spanish). This effort was organized jointly with a Fortune 100 company in order to assess the skills and English proficiency of the labor force in Nicaragua. Almost 500 young bilingual individuals attended this activity, whose slogan was "Get ready for a change in your life", demonstrating the excellence of the English-speaking human resources in Nicaragua.

Out of the 463 participants, 356 individuals (77 percent) met English requirements needed by the company, each person was submitted to a series of tests which included a 35 question multiple choice online tests, a conversation style oral test and a 17 line predetermined subject essay.

Labor conditions in Nicaragua are governed by eight international conventions ratified by the International Labor Organization (ILO) and the set of laws referred to in the Labor Code. The Nicaraguan Labor Code establishes the employer-employee relationship, with or without a written contract.

Day shift: Work undertaken between six in the morning and eight at night is considered a day shift. Regular day shift hours are eight working hours daily for a 48-hour work week. Additional work must be compensated as overtime.
Night shifts: Work undertaken between 8 at night and 6 in the morning of the following day is considered a night shift. Regular night shift hours are seven working hours daily for a 42-hour work week. Additional work must be compensated as overtime.
Combined day-night shifts: A combined work shift is 7.5 hours per day for a 45-hour work week. Additional work must be compensated as overtime.

Overtime: Work outside the regular working hours is considered overtime. According to the Labor Code, overtime is paid double the amount stipulated for regular working hours. A maximum of three hours beyond regular hours may be worked, and must not exceed a total of nine hours per week.
Christmas bonus: At the end of each calendar year the employee is entitled to an additional month’s salary (bonus). If the worker does not have a year of continued labor, the 13th month is calculated proportional to the months worked. Payment is due on the first ten days of the month of December.
Severance: Severance pay is equivalent to a month per year worked up to the third year and twenty days per year up to the sixth year. Under no circumstances will the total exceed the amount earned in five months.

INATEC: National Technological Institute. Employers must pay the equivalent of 2 percent of the employee’s monthly salary. This fund is available for training workers from the contributing company.

INSS: National Social Security Institute. All employers have an obligation to pay 16 percent of the employee’s monthly salary to the National Social Security Institute.

Vacations and public holidays: All workers have the right to 15 days of vacation, fully paid, for every six months of uninterrupted labor for the same employer. There are ten national holidays and an additional local holiday in Managua. These are compulsory holidays and must be paid to the employee. An employee working holidays must be compensated as working overtime.

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