The Uplifting Power of $500: Living With Decent Pay in the Philippines
For people living in major economies, a $500 monthly salary may not sound sustainable, but you’d be surprised how far this amount can go in the Philippines.
How to Compare Salaries Between Countries?
There are many reasons why outsourcing grew into a giant industry in the Philippines, and one of them – perhaps the top among all reasons – is the huge pay and the wide range of benefits that go with working for an outsourcing company.
Today, the average salary in the Philippine outsourcing industry is $500 a month, which is about $200 more than the minimum wage. It might not sound a lot, but for Filipinos who dream of a better life, it is enough to have a decent lifestyle.
To understand how important $500 a month is for Filipinos, we must first understand how the Philippine living wage compares to other countries. Information from World Data Info shows the average salary in the Philippines ranks 54th among 69 countries around the globe.
Even in the Philippines, where the minimum wage is around $309, the average salary of a person working in the business process outsourcing industry is almost at par with the pay of licensed professionals, the reason why many people apply for outsourced work.
The outsourcing industry currently employs 1.2 million people, a major source of livelihood among Filipinos. The Philippine government considers outsourcing as one of its “primary legs,” contributing at least $25 billion to the country’s economy.
A majority of BPO firms have been located in business districts around the capital Manila. But as the industry expanded, a lot of companies have started to establish a presence in other major business districts outside the metro, making it more accessible to people.
Breaking Down the $500 Income
In a 2018 report, the Philippine government’s economic development agency said a family of five needs an aggregate income of at least $805 to live above the poverty line. This is based on the assumption that at least two members of the household are employed.
Clearly, if a couple working in a BPO firm is earning $500, they can live decently, compared to other families with low-income providers. But the government estimate applies to a family of five, which means the providers are mostly tenured workers earning above the average salary grade.
The $500 pay, meanwhile, applies to a younger set of BPO workers, perhaps in their early to mid-20s, who may have been just starting their careers in the industry. Given this, the calculation of expenses may vary.
But let us take a look at a couple of examples: First, a BPO worker in his or her early 20s still living with the family because unlike in other countries, it is common for Filipinos to stay with their parents even after graduation until they are stable enough financially to live on their own.
A non-renting BPO worker earning $500 a month would only have to contribute a portion of his or her income to the family. At least $155 monthly would be enough to cover his or her share for food, electricity, and internet. There is still enough budget to avail at least three streaming subscription channels.
If he lives at least 10 kilometres away from the office, mass transportation can be as cheap as $27 a month, still leaving room for other personal expenses like gym, weekly fast-food or mid-range dining, and even opting for private taxi services when traffic gets messy.
Even with all those expenses, he or she can still save $181 a month, enough if the person is saving for a vacation, may it be local or abroad. The savings could also be a good start if the person is looking to live alone and rent later on.
Things are different, however, if an employee is renting. The cost of renting a decent studio unit in major cities alone will eat a large chunk of the $500 income. A Filipino renting in Metro Manila would have to budget wisely in order to pay for rent, food, and utilities.
There is still room in the budget for gym fees, mid-range dining, at least one streaming subscription, and at least a movie in the cinemas in a month. With all those expenses, he or she can still save at least $26 a month, which is enough money for a year-end trip with family and friends.
The best part here is that with all the opportunities in the BPO industry, it will not take long before he or she earns more than the $500 average. Promotion can lead to better pay, as even team leaders in call centres in Manila earn $750 or more, depending on the company.
Making a Difference in the Lives of Filipinos
The $500 monthly income in the BPO sector is just an estimated average. Because of the tight competition in the Philippines, a lot of companies are offering higher salary and benefits packages to get the best talent available.
The average pay may also depend on the functions needed by a company. For example, the income for high-value roles, such as software developers and certified public accountants, could be a little bit higher because of the specific skills involved.
Beyond the $500 monthly income and a whole package of benefits, the opportunity to grow, upskill, and learn from global business leaders are just some of the factors why Filipinos prefer a career path in the outsourcing industry.
If you are curious why Filipinos always strive to do an amazing job in their roles, it is because they value the opportunities given to them by their employers. No work is taken for granted in the Philippines and their work in the outsourcing industry speaks for their performance.
On the flip side, when you outsource to the Philippines, you don’t just get quality talent and huge cost savings. They may be the primary reasons why you have partnered with an outsourcing provider in Manila. But beyond that, you also give your employees the means to uplift their lives.
Emapta is an Australian-owned and managed knowledge-based staffing platform operating across the Philippines, Singapore, Sri Lanka, Malaysia, and Vietnam. We provide customisable BPO and KPO solutions to suit the specific requirements of our clients. With over a decade of experience in the industry, we also have access to a wide range of licensed legal professionals that can help any law firm thrive and stay competitive.
