What Does An Average Indian Earn?

Geoff asked me a question that became a very long comment, so I am turning it into another blog post...

Geoff said...
Medical care sounds pretty cheap, if somewhat sketchy. Maybe I should give up this rat race and pull a rickshaw in Delhi. I got a $75 copay just for an MRI!

What can I expect to earn per year as an ... average Indian?

Okay, first a disclaimer - these are my impressions and not any report based on the due diligence of statistical review.

The average pay is hard to quantify because so much money stays off the tax rolls. The range of pay for people working in multinational companies is a factor of at least 2 compared to Indian companies. Many people freelance and work more than one job if they can find it. Any money they can get in cash is under reported.

Rickshaw wallas and cab drivers pay a rental fee for the rickshaw/cab and keep everything they earn after expenses. In Kolkata, the daily rental for a cab was 500 rupees, plus petrol, etc. That's why a lot of them want to become chauffeurs - one client, much higher pay, especially if they speak English. In Kolkata, the cost (to me) for a car/driver was between 25K and 30K/month. Here, the average charge for the same service with a semi-English speaking driver seems to be around 40K and is typically closer to 60K in the expat world.

Domestic staff prefer to work for expats because they pay a LOT more. For example, a family of five living in the Salt Lake section of Kolkata paid their maid 500 rupees/month with no benefits to work seven days a week. My maid in Kolkata was paid 3,000 to run a household of two. She spoke only Bengali, worked six days a week and was provided with vacations. Here in Gurgaon, my English-speaking housekeeper makes 7,000 salary, 1,000/month for transportation, 2,500/quarter for uniforms, full medical and takes a week off every couple of months. She works six days/week, and hired two women to do floors, wash dishes and clothes. She pays for their salaries out of hers because she said there was too much work. Now she cooks and does the food shopping and supervises the other women. Previously, she worked for one family who paid her 16,000/month with all the accompanying benefits. She'll be heading to London to visit them in the summer. I hope she comes back.

The other thing is that a lot of folks have more than one income. Using my housekeeper as an example, I know for a fact that she works with another expat in the same building because we hired her together. We both pay half her salary, and split her benefits, so she makes a minimum of 16,000/month. I believe she also manages a few other households - at least one other...

Now, looking back at the internet companies I worked for here, linkers had a starting salary of 7,000/month. The security guard at the telecom tower I visited last week in Rajasthan makes 12,000/month. Management level pay is even wider ranging. I had two managers with the same backgrounds - one was paid 1.1 lakh/month (110,000 Rupees) and the other 40,000. No reason given. All I know is that one came from Bangalore and the other Kolkata. Both came from successful dotcoms. Their original salaries were just as inconsistent.

The lack of parity really caused a problem. This situation occurs frequently and HR groups don't have any concerns. Salary ranges for the same job, i.e., linking, spanned 7,000/month to 26,000/month in one company I worked for. Some staff shared with me their attitude of "why should I work hard when I know someone else is getting paid three times more and only brings in 6 links for the entire month? I bring in three times that and get paid a third of what he does." I couldn't have agreed more and couldn't respond adequately. I implemented incentive programs so that higher performing linkers could make more money just to reduce this problem and provide a way to increase overall performance. Only one of the staff actually earned any money, but it made him visible and provided him with access to jobs with more responsibility. The worst example of salary inconsistency was the two Spanish translators at one company I worked for. The woman was a full-time professional who had worked at the company for a couple of years before I joined. She was making 5,000/month for 50-hour work weeks. I hired a part-time Spanish student (still in college) and I found out later he was making 9,000/month for 9 hours work a week! I'm still shocked at this. I tried to fix the situation but my boss refused to allow me to even discuss salaries. When she quit to work in Bangalore, she never looked back. As soon as she got her offer letter, she left the same day...

So what is the average salary? Have no idea. Because there is still subsistence farming and itinerant workers (especially in construction), low end salaries are a few dollars a month. Executives are paid like they are everywhere - sometimes too much for what they contribute. (Not me!) Bottom end executives in Indian companies make at least Rupees 100,000/month (USD $2,000), typically much more. The range goes all the way up to standard American executive packages, translated into Rupees.

Teachers here have the same problem. If you speak English, your salary would be higher because you can teach in an English speaking school. There are local language schools, Hindi schools and English. There are also Embassy schools for other languages. Typical salaries for teaching staff in the International schools (from what I've heard) is between Rupees 10,000 and 30,000/month. I could be wrong - this is just hearsay.

As an expat, I can't think of my salary in American terms otherwise I would become very depressed. I make less than half what I made in the States, but it's a very good living for this country. Even so, my expenses are very high - after paying for rent, private school, chauffeur, housekeeper, restaurants, western foods, books, travel, satellite TV, broadband internet, air conditioning, etc., I'm broke by the end of the month. I pay a premium for my lifestyle. Having a zero balance in my bank account at the end of the month is a grave concern and something I need to address ASAP.

I hope that helps answer the question. :-)

Later, peeps.