Work and Salary Expectations

[perry]

Many people do not realise that workers salaries in Argentina are nearly equal to the United States and are far better than many European countries. I wish to clarify this statement as to not attract the doom and gloomers. Europe is made up of over 20 countries and not all of them are as wealthy as Argentina . Hungary, Bulgaria,Portugal, Romania are part of Europe but are countries that the take home pay for jobs are in many cases lower than here.

Personal income tax on wages is lower and workers benefits are more generous than most societies. The take home pay of many people can be suprising especially for jobs like Bus drivers, Garbage collectors, porters, janitors. etc etc.

 

[jrockstar80]

And to jrockstar80 -- there are no employees being hired here for 9.000 USD a year at a professional level. It's much, much more.

why would somebody build an outsourcing company in a country where wages are only marginally cheaper than in the US? if your business model is premised on only being 2 or 3% cheaper than your competition or DIY, i don't know what to say. can a business really predict its expenses within 2-3% accuracy in any year, in any industry?

perry - what kinds of jobs here are paying what they do in the US? not anything i've applied for, or anything that my friends (gringo or local) have. i would like to have one of those jobs so i can enjoy paying 1/4 of the rent here i would in the US.

 

[SaraSara]

Local garbage truck workers take home a grand three thousand pesos a month. A private school kindergarden teacher with thirty years' experience takes home twenty-two hundred.

Surprising salaries, indeed...! "Better than in Europe"...! Amazing, how some love to pontificate but have no idea of what's really going on.

I shall now sit back and wait for this post to be censored out of existence.

 

[Guillo]

I think there's fantasy on what the other side makes on both sides of the fence (at least here, those employing people know how much they pay).
At least in local IT, I can assure you that there are really few that make 1/4 as much as an American.
For instance, I used the http://www.elsalario.com.ar page to get an average salary (I know, unscientific, but official stats are really hard to come by down here). Software developer, with 10 years experience, 6.6k per month or 80k per year (pesos).
A similar position makes 4k dollars a month in the US. (Source, http://www.worldsalaries.org/usa.shtml) That's roughly 16k pesos.

I know Argentina has a higher overhead in some costs. But I dont think it gets as high as a 300% overhead.

 

[citygirl]

Well, if the average salary for someone with 10 years experience is 6600 pesos (in hand or gross?) - then I'm definitely a good employer

And I do know (because I sign the checks) that my salary costs ARE higher here than they are in Europe. And that if inflation continues at the rate it's been, within a year or two, (esp with all the added benefit costs,) it will be as or more expensive to have employees here vs the US.

 

[Guillo]

Well, if the average salary for someone with 10 years experience is 6600 pesos (in hand or gross?) - then I'm definitely overpaying

I'd guess that's in hand, otherwise it would be a cheap position, that do exist.

Your employees making more than will probably hate me , but for what I was able to see around me, friends and contacts, mostly are around that, unless they have some very specific knowledge, experience or highly sought after specialist.
That was for an IT position, it can vary a lot depending on profession, experience, responsibilities, etc.
Also, working for a consultant firm usually nets higher salaries, with lower work stability and less perks.

And I do know (because I sign the checks) that my salary costs ARE higher here than they are in Europe.

Then something is amiss. I can see why you are distressed, because you want to make it work here, but with those numbers, it just plain doesn't make that much business sense.

 

[jb5]

Guillo, it's great that you're open to seeing the employers position.

Employers see AR as a country with a smart workforce, and more creative than what is the norm in Asia. It's also a better time zone for coordinating with the US. So it's worth their while to try to set up shop there even though profit margins will be slimmer than they'd be in other competing countries.

When they do their research they are most often looking at the BS inflation statistics the government publishes. To attract foreign investment, AR positions itself as having a very affordable workforce and low overhead. As we all know, that becomes less true everyday.

So companies look at models that sound reasonable and set up shop. The come to like their employees and want to take care of them. Their models should have some leeway, one year of
crazy inflation requiring big raises shouldn't kill the business. But the second and third year most probably will.

So it becomes a bad situation for all. The employees don't understand the realities the employer is facing. The employers in most cases would really like to give them more money but can't.

Now add to that the fact that this is presently happening during a global economic crisis. People in the US and most countries feel lucky to just have a job these days, no one is getting mad and leaving if they don't get a raise. Salaries are actually going down in many sectors. It's very typical now for unemployed people to get considerably lower salaries when they find a new job.

So this attitude in AR is out of sync with the rest of the world. Inflation, tax and government issues have already made the country a no go for foreign investment in general and that's getting worse.

You've seen a number of people just on this site saying they've stopped doing business there or are considering doing so.

So I'm here is Silicon Valley and I'd like to bring lots of high paying jobs to AR, but should I? Your government sends delegations here to tell me I should. They offer big tax incentives. They paint a very different picture than is painted here. And they are right to seek new technology companies, it will give the country many great paying jobs if the companies do well there and give AR a much better role in the global economy.

Local companies can't create enough jobs to keep AR healthy. Then what? There are fewer jobs and salaries go down as they have all over.

So how do employers and employees get on the same page before there's a bigger economic crisis than there already is?

 

[perry]

Local garbage truck workers take home a grand three thousand pesos a month. A private school kindergarden teacher with thirty years' experience takes home twenty-two hundred.

Surprising salaries, indeed...! "Better than in Europe"...! Amazing, how some love to pontificate but have no idea of what's really going on.

I shall now sit back and wait for this post to be censored out of existence.

Your sarcasm about your society never ceases . I do not know anyone who earns 2200 pesos per month for teaching fulltime .This is not the award wages and certainly if you take into consideration the bonuses by law wages are fair by international standards. We all know that porters get high wages that is equivalent to international standards for relatively easy work.

I also like to stress that Europe with 47 distrint countries has many poor nations where the minimum wage is lower than Argentina and unemployment is much higher . I suggest that you visit parts of Southern Europe and Eastern Europe and you will find Argentina much richer in all senses.

 

[Davidglen77]

Ok so after comment #137 I will chime in on this issue. When I first opened my shop 2 years ago I had an employee who said he needed $3,500 pesos per month to cover his expenses, rent, car, cell phone, etc. I told him that I could not pay him that salary as I was opening a new business and in addition to the $3,000 pesos I would be paying about $700 additional in social security taxes. I offered him $2,000 plus $100 in free merchandise and a possibility of a bonus if the shop does well based on sales. He wasn't happy with this but since he was unemployed for over a year prior to me hiring him and he was 32 years old, no college degree, and a resume that showed he had never lasted more than 1. 5 years in prior jobs, he accepted it. I was reluctant to hire him, but I did as a favor to a friend of a friend. He was an okay worker, he came in every day to work on time, didn't steal, but otherwise he had a very bad attitude and would get offended if I would ask him a question or ask him to follow a procedure that I had put in place. The first month I paid him his $2,000, $100 pesos in free merchandise and a $500 bonus. When I gave it to him I barely got a thank you and for a few days after the silent treatment. The next month I paid him his $2,000 plus $100 in free merchandise and a $565 bonus and once again got the same reaction. He would light cigarettes inside of the store an then walk outside with them even after I told him probably 20 times there is no smoking or lighting cigarettes in the store, customers who would buy a small item for 1 or 2 pesos wouldn't get a thank you and he would call them cheap when they left, and rarely followed instructions. He would also many times talk about how cheap some employers in Argentina and that is why the employees steal. He also would constantly chew gum, snap bubbles and whistle the entire day. So come the 3rd month I decided that I didn't want to deal with him anymore and I let him go. I paid him his final salary, vacation days, proportional aguinaldo, etc, and said thanks to him for everything. He didn't seem too upset but said that I owe him another month's salary. I told him that the accountant calculated his final pay according to the labor law (he was paid completely in blanco), so any questions he had he could call the accountant. I never heard from him again of course. So here you have a person that is NOT very employable, I give him a chance to work, even if it's not the salary he needs / wants and I get treated like crap. I don't have a car, or a $1,000 cell phone like he did either and I don't have gola sneakers, of course he did. I recently ran into him and he's working at a restaurant, night shift, but told me he was unemployed for a year prior.
So that was my first experience having an Argentine employee, not a good one. I had been a manager of a team of 17 people in the USA and while not everyone was perfect, I never experienced a sense of "entitlement" like I did here from this guy, and he was "recommended" by people I know.
When I first came here I worked at a US based company with an operations center here. While some of the people did work hard and were nice, the majority spent the entire day, talking on the phone, sending text messages to who knows, constantly stepping outside to smoke and incessantly complaining about their salary and asking everybody how much they were earning.
So from my past experience there is a cultural problem here with a sense of entitlement. And many of them need to educate themselves as to what the cost of owning and running a business are. For example, my family owned a business for the entire time I was growing up and until I was a young adult. It was a clothing manufacturing business. Our gross monthly income was about $100,000 dollars. After paying the rent, salaries, taxes, buying supplies, electric, water, and the myriad of other expenses we had a take home salary of about $8,000 per month. So maybe in a big multinational company where there are huge profits there is room for all of this salary mongering but in the small companies or retail shops that people set up here, there simply isn't room for any sustainable growth if people keep demanding such high salary increases. These are facts based on reality, it's time to understand them or eventually become long term unemployed.

 

[Guillo]

Guillo, it's great that you're open to seeing the employers position.

All I did was point out how the worker feel. Both you and jared were totally blind to the other side, even insulting me, because I was just pointing you the obvious. And I just talked about reality, things I had gone through, employers I knew, companies I've seen here. I don't assume to know the reality of the US market, or Singapore, but I do know a bit about the Argentinian one, specially from the worker side.

When they do their research they are most often looking at the BS inflation statistics the government publishes. To attract foreign investment, AR positions itself as having a very affordable workforce and low overhead. As we all know, that becomes less true everyday.

I'm sorry to tell you its your responsibility to do your proper research. You cant expect the workers to absorb the differences between your business model and reality.

So companies look at models that sound reasonable and set up shop. The come to like their employees and want to take care of them. Their models should have some leeway, one year of
crazy inflation requiring big raises shouldn't kill the business. But the second and third year most probably will.

Inflation in Argentina shouldn't surprise anyone. You are going to make that big of an investment without looking at past numbers? Read independent analysis?
Beware of "El cuento del tío"!

Now add to that the fact that this is presently happening during a global economic crisis. People in the US and most countries feel lucky to just have a job these days, no one is getting mad and leaving if they don't get a raise. Salaries are actually going down in many sectors. It's very typical now for unemployed people to get considerably lower salaries when they find a new job.

You keep trying to apply global conditions to local workforce living in local conditions, paid with local salaries. It doesn't make any sense.

If you decide to set up shop somewhere, you should be ready to handle it, both the good (cheaper labor) and the bad (inflation and worker rights) because otherwise you will fail.

There were times when the US was having a great economic time, and Argentina was waaaaaaay down (say, 2001/2002). The other way around.
At that time, you wouldn't have applied the US conditions to here. You would have tried to make the best out of the oportunity. That's probably when a bunch of companies jumped into the country, to make a nice profit off the exchange rate.

So this attitude in AR is out of sync with the rest of the world. Inflation, tax and government issues have already made the country a no go for foreign investment in general and that's getting worse.

That's why its called local conditions, they are local!. You cant expect the world to change as you walk though it. The fact that the US is in recession means nothing to me, and probably will mean nothing for your local workers, specially when they go buy food.

So I'm here is Silicon Valley and I'd like to bring lots of high paying jobs to AR, but should I? Your government sends delegations here to tell me I should. They offer big tax incentives. They paint a very different picture than is painted here. And they are right to seek new technology companies, it will give the country many great paying jobs if the companies do well there and give AR a much better role in the global economy.

If you are expecting to have the same conditions that in the US, but at a much lower price, I'm sorry to tell you it will be a waste of money. If you cannot handle inflation, you will fail. If you dont respect local labor laws, you will also fail.
You can complain all you want about things being different to the US, but that's the main reason why it might be cheaper to operate from here.

I'm not expecting charity from my employeer. You should expect it from your employees.

Local companies can't create enough jobs to keep AR healthy. Then what? There are fewer jobs and salaries go down as they have all over.

You cant ignore the culture of people in a company, much less in a whole country. You can decide that the unionized-worker, "socialist" model sucks and must go, but don't count on it happening anytime soon. Workers wont accept to be stripped of their rights.

So how do employers and employees get on the same page before there's a bigger economic crisis than there already is?

No silver bullet.
The same postures you saw here (the worker trying to defend their interests, and the employer trying to defend theirs) are going to show up no matter what.

And stop dreaming that the worker goal will be to grow your business, because that will just not happen, in the same way that yours is not to make all your employees rich.
On the other hand, both of us will be totally ok with those things happening as a side effect of our respective goals.