Thinking of hiring, outsourcing or growing your business in India? This guide will give you a complete breakdown of the average salary in India -- and so much more.
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When outsourcing work, you want to find a balance of top talent and affordability. One country that commonly crops up in such discussions is India. It’s well-known that the average salary in India is lower than in most Western countries, and yet, there’s excellent IT infrastructure in place making it a good option for cherry-picking talent to fill vacant roles.
In this guide we’ll crunch the numbers, assessing the average salary in India across a variety of factors including gender, city, and education level. We’ll also take a look at the top industries that commonly outsource to India, such as business process outsourcing (BPO), IT services, and software development.
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First, to gain a deeper understanding of the figures in play, let’s take a look at how Indian currency, the Indian rupee, fares against other currencies. The al ansari exchange rate for Indian rupees is an accurate conversion rate site for the Indian and other currencies.
If you were to send money to India from the UK, USA, or Europe, here’s how much the recipient would receive in rupees:
The general consensus is that the average salary in India is around ₹32,840 per month ($426 USD), with some reports reporting figures slightly above or below this figure. But as a guide, it is the best salary figure to use. The yearly salary works out at around ₹394,080 ($5,115 USD). To give you a clear idea of what that translates to in American, English, and European currencies, here’s the average salary in the euro, USD, and pounds sterling:
As you can tell, the salary, when converted, is barely enough to make a living in most Western countries. Yet, due to the lower cost of living in India, it’s more than enough to get by. For example, it’s estimated that someone living alone would pay ₹24,033 ($314 USD) in living costs in India.
The salary range will of course vary from job to job, so to give you a ballpark idea, we’ll take a look at a few examples.
One of the most lucrative professions in India is data scientist, which can yield a yearly salary of ₹793,400 ($10,395 USD) a year, double the average salary. At the other end of the scale, one of the lowest paying positions, that of a waiter, pays around ₹197,400 ($2,586 USD) a year, significantly less than the average salary.
The average hourly wage in India is around ₹96 per hour ($1.26 USD). This will of course vary from profession to profession, though.
For example, a web developer who makes on average ₹20,000 ($262 USD) per month will make around ₹160 ($2.08) per hour assuming they work an eight-hour work day, and clock-in five days a week.
Meanwhile, someone who works in real estate, earning around ₹60,000 ($780 USD)per month will make close to ₹375 (4.87 USD) per hour. Finally, a flight attendant, who earns ₹30,000 ($390 USD) per month would earn ₹187.50 ($2.43 USD) for every hour worked.
It’s universally accepted that skills and qualifications count for a lot in the world of work, and more often than not, lead to higher rates of pay. India is no exception.
From the data, it’s clear that those with doctorates and Masters have a much higher probability of earning more than ₹1 million per year than those without a similar level of education.
Unfortunately, the pay gap between genders in India is better described as a chasm. Gender equality regarding pay is far from a reality in the country, and this is reflected in the salaries. In the World Economic Forum 2021 report, India ranks 140th out of 156 countries. This ranking suggests significant disparity of pay between genders.
In a 2018 report, it was suggested that this disparity could be as high as 19% in some sectors such as the financial industry.
Here’s a list of five major cities in India, spanning various regions, and the average salary for each:
As you can see, Bangalore has one of the highest average salary rates, even higher than the capital. Ludhiana and Jaipur have some of the lowest average salaries, in line with the national average salary.
Deferred incentives, such as stock options, are commonly used in India in an attempt to retain the company’s top talent. This has become more commonplace in recent years as companies have found it increasingly difficult to hold onto its best employees.
Long-term incentives like these encourage employees to stay on with the company longer. Another approach has been to appeal to the sense of instant gratification with upfront pay, to convince talent that the company is worth sticking around for.
The issue of high employee churn rates appears to mostly impact technology and financial sectors, as more and more companies from the US and Western countries poach top talent through outsourcing.
A 2021 report from Kearney points out that India is one of the most popular digital hubs. The country has experienced a surge in popularity of start-ups in recent years and received a lot of outside investment, particularly in the industries of media tech, energy tech, and retail tech. The evidence is clear: India is investing heavily in digital services, and continues to be a popular choice for outsourcing which has a knock-on impact on employee retention for tech companies based in India.
According to Glassdoor, a website that aggregates employee reviews and ratings of previous jobs, here are some average salary ranges across a range of professions:
Customer service manager is one of the lowest paid professions, on average, while software engineer is one of the highest paid professions. It’s reasonable to deduce from this information that the professions earning the most money in India are generally in the tech industry. The salary of a web developer in India is around ₹20,000 ($260 USD) a month whereas that of a software engineer is ₹50,000/mo ($650 USD).
The Economic Times recently reported that there will be an average salary increment of around 9.3% in 2022. The high-tech sector will receive the largest increase, at 9.9%, while the retail sector salaries will go up by around 9.5%.
This average salary increment is thought to be a result of recovering from the pandemic, as companies begin to get back on their feet and normal business resumes. The rate of 9.3% is the highest in the Asia Pacific region, too. While employee retention will continue to be an issue as countries such as the US look to pry away top talent, the overall raise in salary is undoubtedly a significant boon for Indian employees.
Minimum wage in India remains at an all-time high of ₹178 per day ($2.31 USD)for the third consecutive year. In 2012, the minimum wage was as low as ₹115 per day ($1.49 USD), but in 2018 it rose to ₹176 per day ($2.28 USD) and then in 2019 reached the figure that it is today: ₹178 per day.
In comparison, here are some minimum wage figures for other countries (bear in mind that not all countries measure minimum wage using the same time period):
Of course, the minimum wage of each country reflects various factors such as cost of living and the national GDP, so it’s impossible to draw a direct comparison. Each figure is also given in the country’s currency.
The United Nations drew up a report in 2021 that set out to assess the current state of the global economy, factoring in financial data from countries all over the world. This report detailed information pertaining to salaries, but also indicated what category each country resided in regarding its financial situation.
For example, India falls within the ‘lower-middle income’ bracket based on salary information. The other categories were ‘high income’, ‘upper-middle income’, and ‘low-income’, so that means India is one of the countries with the lowest rates of pay. For the sake of comparison, the UK, USA, and many European countries fall into the ‘high income’ bracket, whereas countries such as Sudan and Madagascar made up the ‘low-income’ bracket.
India’s real GDP is growing at a rate of 5.6% this year, though this is down from 7% in 2021. However, the upward trend suggests that in future the average salary will rise, and we’ve already seen that there is an average salary increment of 9.9% which verifies this positive trend.
What does this mean in concrete terms?
Well, here are average salary figures for countries in different continents that span the various income categories laid out in the report:
The data shows that countries that fall into the ‘high income’ bracket have higher average salaries than those that don’t.
While India is one of the most popular outsourcing countries, it’s not the only one. So, it’s important to have an understanding of how the average salary in India compares to other popular outsourcing countries, so you can choose wisely.
The table below shows you the average salary in the top outsourcing countries compared with the average salary in India.
Taking on board all the facts and figures we’ve compiled in this guide, it should come as no surprise to learn that India is on many countries’ list for outsourcing work. The country has invested heavily in digital infrastructure, ranks highly as a digital hub in various tech industries, and is considered a ‘lower-middle income’ country.
As such, countries in the ‘high income’ bracket can essentially cherry-pick top talent from India and add skilled workers to their remote workforce. While nearshore outsourcing is popular these days, due to a lack of time difference and similar cultures, India still ranks highly as one of the best low-cost countries for outsourcing.
As we saw from the Kearney global services Index, Asia, and India specifically, produces a lot of tech-savvy talent. Where India beats out other Asian countries is in terms of cost, skills, and business knowledge. As such, it’s an attractive option for outsourcing.
But what are the top 3 industries that rely most heavily on India’s workforce for outsourcing?
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IT infrastructure in India is sound, so it makes sense that many companies would look to the country for skilled IT workers. Indian top IT companies include Tata Consultancy Service (TCS), Infosys, and Mindtree ltd.
India has long been considered a hub for IT experts, which means the talent pool to draw from is vast. The English proficiency is also a huge benefit to companies looking to outsource work, as it minimizes the risk of misunderstandings.
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Due to the heavy investment in digital infrastructure, it makes sense that there are many software and web developers emerging from India.
The growing talent pool is one of the biggest factors for companies outsourcing software development to India. With an English-speaking workforce that offers a cost-effective proposition compared to other countries, India is in pole position to take on software-related tasks and complete them successfully.
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Business process outsourcing (BPO) refers to the outsourcing of various business-related tasks such as research and development and data analysis. BPO is a fast-growing information technology enabled service (ITES), concerned with everything from risk mitigation to cost analysis.
Outsourcing BPO tasks to India has become popular in recent years due to the skilled, yet affordable workforce. Tapping into a well-trained English-speaking workforce without going over budget is attractive to a lot of companies.
If you’re convinced that outsourcing to India could be the key to unlocking new levels of productivity in your business, some form of employee monitoring software could help make the transition as smooth as possible.
When you bring new employees into the fold, from another country, it’s nigh-on impossible to track productivity without the right tools. Time tracking software allows you to monitor performance using the reliable metric of time. With activity tracking software you can add to your employee roster without taking away what makes your business tick.
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India is one of the world’s fastest growing economies. It’s brimming with exceptional talent, drive and ambition. This makes it an ideal location for finding and recruiting skilled workers to grow your business, whatever field you are in.
Having identified India as the best source for the outsourced talent your company needs, use the information in this guide to hire in a way that’s effective for your business and fairly compensates the skilled Indian talent you bring on board.
And, remember, Insightful can help simplify managing your outsourced team by effectively managing their workloads, optimizing workflows, tracking time, and more. Find out how easy Insightful makes it to manage outsourced teams with a free 14-day trial.
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