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The national average salary in Colombia

The national average salary in Colombia

Columbia ranks as the fourth largest economy in Latin America[1]. It is one of the countries in the world that have recovered remarkably from the COVID-19 pandemic crisis. 

In fact, its gross domestic product (GDP) is projected to grow by 6% this year and 2.1% in 2023. Businesses are the main driver of this recovery due to progressive employment in the country. 

As a result, Columbia is one of the top outsourcing destinations as it offers extensive expertise in the Business Process Outsourcing (BPO) industry. 

In this article, find out the average salary in Colombia,  its difference from other countries, and the factors that affect its rate. 

The national average salary in Colombia

How much does a Colombian worker make? 

Colombia has achieved economic and social progress in recent years. This was possible because of the highly-skilled workforce the country has. 

As a matter of fact, the national average salary in Colombia is 4,690,000 COP (1,059.83 USD) per month. 

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The average rates in the country are generally the baseline of how much Colombian workers typically earn, and it varies due to different factors. 

According to Salary Explorer, a Columbian worker typically earns 4,690,000 COP (1,060.43 USD) per month. The lowest average salary in the country is 1,190,000 COP (269.07 USD), while the highest average salary is 20,900,000 COP ( 4,725.60 USD).

In Bogota, the center of the economic and industrial sector, the city’s average salary is 5,420,000 COP (1,224.68 USD) per month.

Factors that affect the average salary in Colombia 

Recent statistics indicate that Columbian wages are on the rise. Columbian gross pay may include allowances and benefits, which are subject to income tax and other mandatory deductions.

On the other hand, employers may be required to pay state tax to:

Now, let’s look at the factors that affect the salaries in Columbia:

Cost of living 

Since Columbia’s cost of living is significantly low, more and more expats are attracted to settle in the country. 

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LivingCost.org ranked Columbia 158th of the best places to live, making it 1.7 times less expensive than the world average.

In most cases, major cities such as Bogota and Medellin are much more expensive than smaller cities. 

Below are the average prices for accommodation in Columbia. 

 

                                          Accommodation (rent per month in Columbia) 
Average monthly living expenses for a family of four (excluding rent)5,633,958.99 COP (1,271.48 USD)
Average monthly living expenses for a single expat (including rent)1,622,416.60 COP (366.17 USD)
One bedroom apartment in the city 1, 700,000 COP (383.81 USD)
One bedroom apartment outside the city1,050,00 COP (237.08 USD)  

 

Columbia is a great value for expats who want to live either temporarily or permanently. The cost of utilities is low, and public transportations are cheap.

Roles and expertise 

Salaries in Colombia may vary depending on the roles and expertise of an employee. The country has a thriving IT sector, thus, professions in this field attract good salaries. 

Here’s a list of the different salaries of the popular professions in Colombia:

                    Job Title                  Average Salary 
Accountant6,980,000 COP
Financial Manager 9,050,000 COP
Pilot8,130,000 COP
Customer Service Manager 6,530,000 COP
Chief Executive Officer10,200,000 COP
Dentist10,800,000 COP
Information Technology Manager 7,520,000 COP
Software Engineer 4,680,000 COP
Web Developer 4,140,000 COP
Attorney8,750,000 COP
University Teacher 6,610,000 COP

            *Salary Explorer

Employees with 3 to 5 years of experience typically earn 35% more than the junior position level. With ten years of experience, they can earn another 20% and another 12% for employees with more than 15 years of experience. 

Factors that affect the average salary in Colombia

Educational background  

In Colombia, a worker with a bachelor’s degree will most likely earn a better basic salary than secondary school graduates. 

Here is the breakdown of salary comparison based on the education level. 

Education levelApproximate earnings (percentage) 
Certificate or diploma holders17%
Bachelor’s degree holders24%
Post-graduate degree holders29%
Ph.D. scholars23% 

 

Columbia has an 11.3% unemployment rate as of June 2022. Thus, a person with higher educational attainment has a better chance of getting a job than someone without one. 

Industry 

The annual salary growth in the country depends on the working industry. Sectors such as telecommunications, construction, and mining give their employees much higher salaries.

Listed below are the annual pay rise percentage figures depending on the sector: 

              Industry Percentage of annual pay rise
Healthcare                 8%
Information Technology                  6%
Education                5%
Energy                 4%
Construction                 3%
Banking                 2%
Travel                 1%

 

Salary Explorer has also reported that a Columbian employee can get a pay rise of around 17% for every 19 months on average. In contrast, the world average is around 3% every 16 months. 

Gender 

Regardless of the industry, Colombian men workers typically earn 12% more than their female counterparts. 

More specifically, men workers earn 4,900,000 COP (1,104.93 USD), while the female workers earn 4,600,000 COP (1,037.28 USD). 

Location 

Cities like Bogota and Medellin are some of the business hubs in Colombia. 25% of Columbian GDP is driven by Bogota’s foreign trade and accounts. 

Here is the average salary in major Colombian regions:

 

City Average Salary
Barranquilla57,961,400 COP (13,069.57 USD)
Bogota65,041,800 COP (14,666.70 USD)
Bucaramanga54,840,400 COP (12,366.32 USD)
Cartagena57,479,000 COP (12,961.31 USD)
Cucuta56,998,400 COP (12,852.94 USD)  
Ibague56,158,300 COP (12,660.34 USD) 
Medellin64,439,700 COP (14,527.30 USD)
Soacha56,041,700 COP (12,634.05 USD)
Soledad56,998,400 COP (12,849.73 USD)
Villavicencio54,840,400 COP (12,363.23  USD)

 

Colombian wage fare vs other countries 

According to Statista, Columbia ranked top 5 among the Latin American countries based on monthly minimum wages.  

While Chile ranked at the top, Colombia is much higher than its neighboring countries Peru, Brazil, Venezuela, and Argentina. 

In 2022, the minimum wage in the country rose by 10.07%, reaching an all-time high of one million Colombian pesos per month, equivalent to 262.54 USD. 

The following is the comparison of the average salary in Colombia to other outsourcing countries and their markets.

Outsourcing destination/market   Average salary
Colombia US$1,059.83
South Korea US$2,082.97
United KingdomUS$2,416.00
United States US$3,534.00
PhilippinesUS$308.00
India US$438
South AfricaUS$1,594.26
AustraliaUS$3,333.00
GermanyUS$2,689.00
SingaporeUS$3,516

 

Why you should outsource to Colombia? 

Colombia is classified as an upper middle-income economy country and one of the largest economies in Latin America. The country has been an outsourcing destination for IT sector services in the past few years. 

Columbia’s business process outsourcing industry[2] offers a lot of benefits for businesses, such as the following:

Cost-effectiveness

Colombia offers high-quality services at a lower cost. Clients overseas outsource software developers, which are less expensive in the US. 

A pool of IT talent

The country has more than 5,000 tech companies, and it has been dubbed as Latin America’s Silicon Valley.

Foreign firms outsource to Columbia to aid their IT operations. Students who graduate from IT-related programs mostly provide outstanding programming skills. 

Companies outsource their software development projects in the country because of the offered skills, minimized language barrier, and same time zone. 

Business-friendly economy

The World Bank has ranked Columbia as the third best business environment in South America.

The Colombian government has implemented economic measures to attract foreign investors. This way, more global businesses will be attracted to enter the country. 

With its rising tech industry, clients can outsource to Columbia to utilize outsourcing services to their business advantage. 

All that said, Colombia has great potential for outsourcing and nearshoring destinations, specifically in tech companies. From cost-effectiveness to the country’s economic growth, Colombia is an ideal destination for businesses that want to fully maximize their profitability. 

Article References:

[1] Latin America. Campo, J. and Sarmiento, V. (2013). THE RELATIONSHIP BETWEEN ENERGY CONSUMPTION AND GDP: EVIDENCE FROM A PANEL OF 10 LATIN AMERICAN COUNTRIES. Latin American journal of economics, [online] 50(2), pp.233–255. ‌

[2] business process outsourcing. Lacity, M.C., Solomon, S., Yan, A. and Willcocks, L.P. (2011). Business Process Outsourcing Studies: A Critical Review and Research Directions. Journal of Information Technology, 26(4), pp.221–258. 

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