Once an employee gets enough training and is valuable enough for the company, my minimum wage is 1200 pesos weekly. (I'm from Mexico). It's not a huge change, but almost any employee reach that salary within a year in my company. (The minimum wage in mexico is about 402 pesos weekly)
Remember how they say that you can feed someone in Africa with just 1USD per day (356USD a year?). Well, you've got plenty of countries that are halfway between these places and USA, and a lot more than you'd guess.
Argentina looks to be about twice as expensive for a bed, for a tourist, so I don't know if $10 is doable for three months — there might be restrictions on foreigners renting, for example.
A great deal would be considered poor but US/EU standards, and live in rather poor zones, lack internet access, natural gas or running water (eg: my grandparents have water pumps to get underground waters at home, because that's their only choice).
Several millon people (literally) work in Buenos Aires City, but don't live in the city, and have 1-2 hour trips (one-way trip) to work every day.
If you want to stay in a large city, in a relatively safe area, you'd need trice that sum.
Bonus point: USDs can be traded for ~13ARS in many non-official locations (while the official price is ~9ARS).
I get that it is lower, I'm a little surprised that it could be accordingly lower. I mean Mexico and the US must be pretty much the same market in terms of food, energy, water prices etc. Half I could understand, one tenth for crossing a border with lots of trade going both ways... it's more than I expected.
Paid vacations are paid with something called "prima vacacional" basically you earn 25% more the week you are on vacations.
On december there is another bonus called "aguinaldo" paid by law. Basically I pay three weeks of wage because christmas.
All my employees have full health care benefits, and access to Infonavit. Infonavit is a housing government dependency (housing loans)
All of my employees have house, full health care benefits, car, and free university for their sons.
Very few people can say that on the US. So basically I believe we are better than the US.
Curious about the house-loan thing: how long does it take to pay for a house with that wage? Can you buy a house with 4k or 8k USD a year in household income, and own that house after ~25 years in Mexico? (As 8k*25 ~ 200k -- I suppose that's not entirely unreasonable. You might be able to get a one-room apartment for that price in Norway, so assuming 50% of the income is spent on housing, and considerably lower cost for housing... not as far fetched as I initially thought).
the house is 3 bedrooms, kitchen, and garden, a fairly decent one...
most of my employees have houses valued around 290k, the main reason is because their wives doesnt work and they can pull just one infonavit loan.
290k houses are really small, about 80m^2 for what I know. but well, is a brand new house after all.
STPS have a lot of instances, another one is called "Conciliacion y arbitraje", where workers can go and sue you, its basicalle a government dependency made to protect employees. Most of your paper work like resignations, and fired people must be filed against conciliación y arbitraje.
Unions are very strong too.
Anyway, the main problem with Mexico is that most companies are informal (they dont pay taxes), and of course, they dont offer benefits to employees.
It's been a real problem for the country for years, but if you have followed the news, two years ago a lot of reforms have passed namely reforma hacendaria, reforma del trabajo, reforma energetica and well, a lot more.
Basically the government is cornering informal bussinesses in order to make them pay taxes. it's a very difficult time for the country because as you can imagine, being formal and paying taxes is very expensive, and a lot of the news you read about the crisis in Mexico is because of the problems informal bussinesses are having to turn to formal ones. (Oil price is another factor, but well, bad luck for the current president).
As a simple fact, if an employee earns 1000 pesos with me (the money he sees), i pay aroung 700 pesos in taxes, from infonavit (housing plan), imss (healthcare), afore (retirement fund), isn (impuesto sobre nomina), and all the benefits.
It's very expensive to have employees, but I'm happy to see them and to believe their sons have better opportunities than them.
Damn, I love my country.
Thank you. I was mostly curious wrt the housing market :-) Also nice to see some details from the labour market of course!
> As a simple fact, if an employee earns 1000 pesos with me (the money he sees), i pay aroung 700 pesos in taxes, from infonavit (housing plan), imss (healthcare), afore (retirement fund), isn (impuesto sobre nomina), and all the benefits.
Hm, you mean the employee doesn't pay any taxes on that 1000? In other words the total tax rate is ~41%? Or is the corporate tax on salaries ~41%? For comparison, here in Norway, for a given monthly salary X, the employer pays an additional 12% towards holiday pay, and 7.9% in taxes from that total. The employee pays tax on X, usually ~36%. And then there's an additional VAT on goods and services of 25% (12.5% on food).
So given your example of 1000 in take-home pay, X would be 1000/0.64 = 1562, of which 1000+1562 * 0.12 (as vacation pay "tax free" or rather "pre-taxed") = 1188 go to the employee (or rather a pay out of 1000 10 months, "half-tax" for December, and 11000 * 0.12=1320 for the vacation month (give or take, with 5 weeks vacation, the pay for the month with 3 work weeks is subtracted... it's a little complicated).
The employer would pay taxes on 1188 * 0.079~94. So the total taxes on the monthly take home pay of 1000 would be 94+562=656 -- before considering money spent on VAT out of the 1000. But do not that Norway has a progressive income tax, variable tax on other income etc -- so this isn't the entire picture.
So it sounds rather comparable, if I understood you correctly. We also have free health care, school system (primary through college).
[ed: To add: the employer would also have some expenses for insuring the employee in case of job related injury etc, but I can't imagine that is very high on top of the 7.9% -- I'm not actually an employer, so I'm not sure.]
In Mexico is very expensive to lay off people, if you lay off somebody without a reason is called "Despido injustificado" and you're mandated by law to pay 3 months of wage. Also, if the subject has been on your company for a while, you have to pay about 20 days per year worked at your company.
Laying off somebody with about 20 years working for you, is paying about a year of wage as compensation. Mandated by law.