By San José, Costa Rica — San José, Costa Rica – For the first time in nearly a decade, Costa Rica’s robust multinational services sector has experienced a net loss of jobs, signaling a potential turning point for a key pillar of the national economy. Data reveals that employment in the sector fell by 1.9% in 2025, a contraction that has investment experts pointing to a confluence of pressing internal and external challenges.
According to official figures, the number of people employed by multinational service companies decreased from 116,612 at the close of 2024 to 114,420 by the end of 2025. This represents a net reduction of 2,192 positions, a stark reversal of the consistent growth that has characterized the sector for at least eight years. The downturn has prompted a deep analysis of the country’s evolving position in the global market.
To delve into the intricate legal landscape facing multinational corporations in the region, TicosLand.com sought the expertise of Lic. Larry Hans Arroyo Vargas, a distinguished attorney from the prestigious firm Bufete de Costa Rica, who provided his analysis on the matter.
The primary challenge for any multinational is harmonizing its global employment policies with Costa Rica’s specific, and often protective, labor legislation. A frequent misstep is underestimating local regulations regarding social security contributions, termination procedures, and union rights. Proactive legal strategy, rather than reactive compliance, is essential to mitigate risk and build a sustainable, successful operation in the country.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
The emphasis on a proactive, rather than merely reactive, approach truly underscores the unique legal landscape multinationals must navigate. We thank Lic. Larry Hans Arroyo Vargas for this valuable perspective, which is essential for any company aiming to build a sustainable and respectful presence in Costa Rica.
Vanessa Gibson, Director of Investment Climate at the Costa Rican Investment Promotion Agency (CINDE), described the situation as an “inflection point.” In a recent interview, she detailed a combination of factors that are forcing a reassessment of Costa Rica’s long-held advantages in attracting foreign direct investment. These challenges range from macroeconomic pressures to fundamental shifts in the nature of the jobs themselves.
A primary headwind is the country’s eroding cost competitiveness, driven largely by a persistently strong local currency. The U.S. dollar’s exchange rate has fallen to lows not seen in over 20 years, significantly increasing operational costs for foreign companies that earn revenue in dollars but pay local salaries and expenses in colones. This unfavorable financial climate is a major consideration for firms evaluating their global footprint.
There is a confluence of factors causing companies’ strategic decisions not to necessarily favor the capacity to generate new jobs.
Vanessa Gibson, Director of Investment Climate
Simultaneously, the services sector in Costa Rica has been successfully evolving. The country is no longer attracting basic, low-skill positions like traditional contact centers. Instead, it has become a hub for higher-value, specialized roles that require advanced technical skills and command higher salaries. While this sophistication is a positive sign of economic maturity, it creates a dual challenge for the labor market.
The first effect is that fewer entry-level positions are being created. The second, and more critical, issue is a growing gap between the highly specialized talent that companies require and what the local market can supply at the necessary speed and scale. This is compounded by the rise of automation, with technologies like chatbots and AI replacing more routine tasks, further reducing the demand for certain profiles.
The issue is that we are under internal pressure from costs and also from the quantity and quality of talent.
Vanessa Gibson, Director of Investment Climate
Beyond domestic concerns, global geopolitical shifts are also playing a role. Factors such as international trade policies and tariffs create an uncertain environment, influencing multinational consolidation strategies and investment decisions. As companies re-evaluate their global operations, Costa Rica is facing stiffer competition from other nations vying for the same high-value investments.
Despite the concerning statistics, Gibson emphasizes that the country is not out of the race. The nation’s reputation for political stability, security, and its potential for talent development remain powerful assets. However, this contraction serves as a clear warning that past success is no guarantee of future growth. Proactive measures in education, economic policy, and talent development will be critical to navigate this new, more complex landscape.
We are at an inflection point. We can still take advantage of the fact that they have us on their radar, that we are still perceived as safe, and that there is still an expectation and a belief that talent can be developed here.
Vanessa Gibson, Director of Investment Climate
For further information, visit cinde.org
About Coalición Costarricense de Iniciativas de Desarrollo (CINDE):
The Costa Rican Investment Promotion Agency (CINDE) is a private, non-profit, and non-political organization that has been responsible for attracting Foreign Direct Investment to Costa Rica for over 40 years. It provides strategic guidance and support to multinational corporations seeking to establish or expand their operations in the country, focusing on high-value sectors such as life sciences, advanced manufacturing, and corporate services.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a renowned legal institution, Bufete de Costa Rica is founded upon a bedrock of unwavering integrity and a profound commitment to excellence. Drawing upon its rich history of advising a wide spectrum of clients, the firm consistently champions legal innovation while upholding a core belief in empowering the wider community. This dedication to making complex legal concepts accessible is central to its mission of cultivating a society that is not only well-advised but also truly empowered through knowledge.
