How much should you be making in IT?

According to a salary survey by Computerworld, entry level programmers should be making US$ 65,000 a year. That’s approximately PhP 3.5 million annually or PhP 300,000 per month.

Contractors/consultants on average get about US$ 85,000 a year or PhP 4.68 million annually or about PHP 400,000 per month.

Now compare that with compensation rates for IT-related jobs here in the Philippines, and you can stop wondering about the rising trend in offshored operations.

Even technicians get US$ 50,000 a year in the US. Do the math. That’s 15 to 20 times the average salary (at the higher end) of technicians here in Manila.

Of course, there’s the issue of quality. But the very nature of information and communications technology levels the playing field. In terms of technical skills, tech workers in developing countries are as good as their counterparts in the developed world (or even better?).

There’s a pretty interesting discussion over at DIGG (where the story is quite hot)–people are discussing tech qualifications like certifications and experience, particularly on which has more weight when it comes to the compensation game.

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  • AnP

    pero you can’t compare compensation given to IT professionals in the US and those in the Philippines, whether they have the same qualification/certification or not. The issue of “cost of living” also affects “compensation” levels.

    So the next time comparison in sweldos are made, comparisons in rent, cost of gas/lunch should also be part of the equation.

    In the perfect world, everything is fair. Everyone is equal. But the fact is there are first world countries where people earn more but they pay more for basic neccesities AND then there are developing countries where everything is cheaper and, of course, salaries are less.

  • Yes, AnP. That’s a given. Sige, let me try to work my magic in deflating the figures to arrive at a more consistent comparison. Chances are, though, our western counterparts are still at an advantage.

    And it’s likely that with a higher cost of living, the quality of living is higher also. So there are other advantages in non-monetary terms.

    Hmm … this can be a good thesis/dissertation topic. I’m pretty sure many have done such a comparison, but perhaps not specifically with tech-labor related topics.

  • Sad. I remember being constrained by company owners to pay programmers 14K a month.

  • here’s what you do, live here but work for a company abroad 🙂 $$$

  • Given cost-of-living, IMHO, compensation in the Philippines is still low compared to other countries, the US at least. All factors considered, a 6-digit PHP compensation will still buy you less compared to a 4-digit income in the US.

    I live in Singapore where the ratio of cost of living versus compensation versus tax is very high and yet I can save more compared to my former .ph employer.

  • Well, there is a lot of difference working here in the US and in the Philippines. Programmers here have houses, nice cars and can afford the luxuries in life. In the Philippines it would be hard to earn much. The one earning more are the corporations that outsource projects there. Cost wise, it is cheaper to contract projects there merely of the fact that labor cost less compared here. However due to constricted market and intense competition, product differentiation is so important. You have to change the rules of the game to get ahead of others.

  • Kim

    sana more employers will take better care of their IT employees…

    Kalovski, I agree, we have to be a step ahead of our peers and even our co-workers… just to secure a highpaying job, and to solidify your reputation in the job market.

  • Here we go with the economic jargon. According to the Economist‘s Big Mac Index (BMI) (website, wikipedia), which is an informal proxy for purchasing power parity (PPP), for June of 2005, a Big Mac in the US costs US$ 3.07 and in the Philippines, an equivalent of US$ 1.47, meaning the Philippine Peso, at the standing exchange rate of about PhP 55 to US$ 1, is undervalued against the dollar by 52%.

    So we take the minimum IT salary of US$ 50,000 per year, divide by 3.06, then multiply with 1.47. We get about US$ 24,000 per year, or about PhP 1.32 million annually or PhP 110,000 per month.

    Hence even with a rough comparison of purchasing power, our US counterparts are earning ten times more than we are.

    And of course, we can add the nice houses, cars, healthcare, and the works. Your run-of-the mill IT worker here in the Philippines can usually only dream of such benefits.

  • :(.. now that i know!

    i should be working 10 times worse than the counterparts…

  • AnP

    J. Angelo: And there you go! The exact reason why many professionals (not just in IT) leave Pinas.

    I did that food price comparison before; compared the price of Starbucks here in Germany to Pinas’. Ang mahal dyan!!!

  • AnP

    Oh yea, you have to factor in taxes, too.

  • AnP

    Andre Marcello-Tanner: or work for a Multination company in Pinas. I did that for a couple of years (shortly before I was offered a job in our German office) and man, was I really living it up back there. Pinas gastos but with salary comparable to those in the first world. Unfortunately, those kind of jobs are a few and far between.

  • Speaking of which, I am looking for an entry-level programming job (just an unofficial grad) here in the Philippines and it’s a bit hard to look for one (outsourcing companies?) especially here in Pinas. I think I need work (as programmer) as soon as I can find one. Seeing how this works, I am even thinking of going abroad, but I don’t have the money to begin with. 🙁

  • Oh yeah. Taxes. That slashes your income by 50% right? LOL 😀 😀

    But at least you get to see the fruit of your taxes, with meaningful government projects and citizen benefits.

    Here?

    Hmm …

  • AnP

    J. Angelo: just about. The first time I received my salary sheet here, I got depressed! You are right, at least we see where our taxes are going. Social/Medical care are reliable. Hayyy… kahit na, our main goal is to still mvoe back to Pinas in 5 years. hehe.

  • @AnP:

    Ok lang. I’d rather earn multi millions and pay millions in taxes than earn a few thousand bucks tax-free. 🙂

  • Just a thought: Expenses/Income also varies by state. Depending on location, some entry level programmers will be compensated (a lot) less than that. Also, salaries can be higher for hires with more experience. Most of my batchmates are probably within the 30-45k range. Although one person in my class landed a 75k job for a (top) Fortune 500 company. He interned with them though.

  • Saan ba yang $65T entry level na yan? NY? Here in San Diego and LA County, Manager of IT na yan. Still, di ka pa rin makakabili ng bahay na malapit sa work mo dahil hindi kasya ang sahod mo to pay for the mortgage, car, insurance and GAS!

  • @Mhan,

    Life’s really more expensive there in San Diego, right? 🙂

  • 100% you’re right Angelo. And if you’ll take a look at Craiglist.org San Diego posting of computer jobs and services, there are calls for fellow IT’s not to accept jobs that offers below $15/hr. Pero marami pa ring $10/hr lang starting dahil sa dami ng applicants at kukunting trabaho. If you are renting a 2BR apartment which is $1000 average cost here, man, you need two jobs to meet both ends!

  • Here’s the psychology of the IT industry … year 2000 was when IT really boomed, most high school grads here in U.S. geared up and entered studies in various technical schools that granted educational loans to them. Here in U.S., companies find it sufficient enough to hire tech grads rather than bachelor degree holders to keep their system going. Then the dot.com bust dramatically hit the economy and there’s a huge surplus of unemployed ITs. Now, those unfortunate IT professionals are still paying up their educational loans. Another piece of the puzzle is, 90% of job IT outsourcing is in India, causing unemployment.

  • Raphael C. Linsangan

    Godliness with contentment is great gain.. That is what the Bible says.. No matter how much you make if you learn to budget, save and be content, as well as invest wisely, no matter where you are, you can make it.

    The US offers bigger salaries but the cost of living is terribly high. If we learn to be prudent with our “big salaries” we’d be doing better.

  • super_piyok

    hayy.. lahat po kayo tama, like me im IT Specialist hir… almost 4 company i supported for der systems and network infrastructure but my salary is almost 13k… im so dissappointed.. guys…

  • roland

    I’ve worked in US, NZ, and now in Canada (also a few months in Malaysia)… compared with my salary in the Philippines (I was getting contractor rates, about the same salary as a manager in a middle size company), I compare my incomes in these countries as to how much I am able to save in the bank per month. Philippine based pay has a bit more advantage since I don’t have to pay for rent or utilities (since I live with my relatives, and I would probably won’t be able to afford to move out)… For all three countries (US, NZ, Canada), I am earning roughly the same amounts but in the respective currency (50K+/yr) and in the Philippines I was averaging from 20 to 35K/month…

    In NZ, I was probably saving around NZ$500 a month (after bills, 2nd hand cheap 11 yr old car, cheap bulky TV, no cable)… In the US, well depends on the state, when I was in NJ, we were saving around $500 to 800 a month, but when we move to Indiana, we were saving $1000 to 1200 a month (brand new car, not much appliances coz we move around a lot, latest gadgets)… Here in Canada, we’re back to saving around $500 to 700 a month (2nd hand 3 yr old car, new appliances, some gadgets)…

    Compare this to when I was in the Philippines, I was probably saving Php10K a month, but I wasn’t paying any bills, no cars, gadgets, etc…

    Which would I prefer? I’m married and have kids, would Php30 to 40k a month suffice?
    Naturally I’d go for the salary I can get abroad!

  • roland

    It really boils down to supply and demand… if you are a SAP professional, you’d probably have more salary than a VB professional (more so abroad)… SAP people in the Philippines probably earn at minimum Php 50K/month upwards… while a lowly VB person averages Php 10 to 30K/month… Translate this to US earnings, the same SAP person would earn $80/yr to 100K, while a VB person would probably be $30/yr to 50K

    Evidently, if you want the Phils. to catch up with the salaries of those abroad, the company you work for should also be earning same amounts as their counterparts abroad… (with customers paying the same amounts abroad, etc…)

    All boils down to the power of the peso though… If you have a 100 items worth Php100 and you want to earn money by selling it, you’d probably sell it for Php110 with a mark up to 10 pesos… hence if you sell a hundred of these, you’d get Php1000 profit… Now if you are in the US, most stores here markup items at about 40% to 50% so this same 100 peso ($2) item would be sold for $4 to 5 dollars (so about $2 or 3 dollar profit)… sell 100 of these then you earn a profit of $300 (Php15,000)…

    Now you’re wondering why american IT workers earn more than Pinoy IT workers?

  • Good inputs. This also ties up with my thoughts on developer budgets and benefits from software companies.

  • There are presently, TOO MANY UNEMPLOYED computer technicians in the USA. This information is based on my own research, conducted on August 2006 (MirandaSoft News, Seattle, WA USA).

    As the war in Iraq continues, Unemployment in the USA is increasing. In fact, Microsoft Corporation has been laying off people, every month. Boeing does the same thing. Adobe and Real Networks, also in Seattle, are not as severe.

    I started MirandaSoft in 1992 in the USA. Nearly all of the life of MirandaSoft in USA, I was the only employee and I did computer repair work. There were months and years I made a lot of money, and there were months and years I did not make money. I had to deal with Unemployed Clients, Inflation, High taxation, attending computer conferences.

    Now, since I am in Philippines, NO EMPLOYER in Philippines can pay me for what I am worth. It’s impossible. I work MirandaSoft on a 24-hour rotating schedule, and I work until the task at hand, are completed.

    My Business in Philippines is called, MirandaSoft Computer Repair Shop, per what DTI would allow to be registerd. The URL for my business is http://www.MirandaSoft.net. I had this domain name since 1999. Prior to 1999, I had MirandaSoft.com.

    On my Website, my business calling cards, and on the sign outside my home, I am advertising my business. Computer Professional since 1992, A+ Certified since 1998. Etc.

    Anyways, I hope to see you all soon.

    Marcos

  • Francis

    to survive in the IT industry and to be at the top you should not be stagnant and let yourself joined in the band wagon. for me its a matter of self confidence, proper planning, lots of diskarte, and luck. I manage to multiply my earning 10x in 3 years as a programmer.my starting salary was 8k way back 2003 for a printing company. After 4 months, i resigned and 9 months later, I got another programmer job for 13k on the same year. I got a raise of 5K after my regularization (6 mos after) so my earning is more than 2x in 1 year and 3 months. Now after more than a year on that company, i realized that im not moving forward and most of my office mates are leaving for a higher salary. So i decided to resign and accepted an offer for another company on the same month i resigned. The salary was just 21K but because of the opportunity for growth and learning , I accepted the offer. After a year again, and having equiped my self with more experience in project management, development, and testing, in .NET i resigned again and accepted an offer for a consulting firm for 35K. (last april 2006) From here after about 3 years, i manage to quadruple my earnings by hoping from different IT companies for salary and training. Now on the course of my employment, I met different people and co programmers on different companies i got deployed, and have learned a lot from them. Now here’s the luck part..during my employment on the consulting firm where I deployed at PLDT, i met a team mate who is working as an offshore developer part time for clients abroad through the internet. He is earning at leat $12/hr asside from his regular job at 45k/month. He gave me the site, applied for jobs and horray! I got my first client at $7/hr! I applied for more jobs and luckilly I got my second client for $10/hr, my third…and so on..Now, I am working fulltime as an offshore developer since october after my ex officemate did the same last sept where he manage to get as much as 80K/month tax free and working at home! Now Im earning as much as he did and if everything goes well i can pull off as much as $2500/month working at the comforts of my home. Considering Im only working at home and my only expenses are electricity, internet, water, and everyday meal at home, this is more than enough for me to save which makes me think im equal to those who are living in the US working as an IT professional.

  • Congrats to you Francis and Marcos, and keep the stories coming!

  • Gary

    How much should you be making in IT?

    In my opinion, it all depends where you are working and your present skills.

    LOCATION.

    In USA of course, if someone is working in an entry level IT job will be around $30 to 40 K – that is with usually university degree (CS, Math or EE). With the cost of living and taxes and if that person is living alone – there is nothing much left at the end of the month – that is a FACT. ($800 for rent, $400 for car+ins+gas+maint, $350 for food, $150 for clothing and entertainment, $150 for cell+internet+cable+phone, $450 for student loan – assuming a $30,000 loan, dont forget the credit card and health care insurance).

    So we cannot compare what would that be in Pesos equivalent in the Philippines, dollar for dollar – that is just PURE IGNORANCE.

    So if someone makes $40 grand in US that doesnt mean …. P2.5 million in salary for Philippines counterpart.

    Personally, I dont live and work in US of A. Thank God.

    SKILLS:

    IT a level playing field?

    Yes and No.

    It depends on the actual skills. Technical skills, analytical skills, creative thinking skills and soft skills such as interpersonal and communication and most specially – work ethics.

    Java is java, .NET is .NET where ever go in the world. But it takes a discipline to turn business problems into a code and a working final solution.

    With so many computer graduates from the Philippines and over 3 million Filipinos in USA where are those skills? How many technology business created or published academic papers or technical book publications in IT made by Philippines computer graduates. Considering there are more than a million Filipinos live around Silicon Valley.

    Just attend specific IT conferences and conventions, how many faces are Filipinos – rare.

    How many major open source projects out there where there are Filipino volunteers – almost zip, nada, zilch.

    In major technology companies such as Microsoft, Google, Yahoo, Oracle, CA etc – sure there are Filipinos, but mostly in administration or some programmers but rare if ever some break out from that to make a difference.

    It has been more than 15 years now since AMA, STI, La Salle have been sending so-called computer science graduates to US of A. Where are they now?

    Check the computer section of local bookstore of how many authors are Philippine graduates. – or check Google Scholar for academic papers submitted.

    Yes, there are few but its more an exception rather than a rule.

    To someone who lives in US and in IT field, just check your local specific IT trade association – check the monthly meetings – how many Filipino faces that attends or volunteers – check any major library of a university or city – any Filipino faces?

    So in IT skill ARE NOT really a leveling field – it also the attitude, the mindset, the creativity, the willingness to take risk (entrepreneurial), the proper academic training (math and sciences), to think outside the box.

    Just my two cents

    Gary

  • Interesting point. Some time ago we had some discussions in PLUG (Philippine Linux Users Group) on why there are few Pinoy contributions to open source. One thing stood out was, it’s because if Pinoys in the Philippines had talent and spare time, they won’t write open source. They would freelance or take another job.

    Now if you’re saying that Pinoys in the US aren’t entrepreneurial… I wonder why that is the case?

    Maybe the Pinoys in the US also need to survive and do something else besides write open source and do academic things?

    Or maybe the skills that the universities and IT schools are really just “vocational” and aren’t enough to build new products and services with?

  • jolens

    Hey Francis! Could you send me this site you were talking about in your entry last Dec 1? Thanks.

  • halo mga kababayan. IT dito sa US, o ang mga field na related dito, kinikita sa area ko (SF Bay area) mga $50k sa isang taon para sa baguhan na walang experience. trabaho ko po dito web developer, kinikita ko mas mataas kaysa average pero kaunti lang. mga 1/3 napupunta sa buwis, ang iba, sa renta, padala sa anak at ang iba, savings. 22 pa lang edad ko nung nagsimula ako, halos isang taon na ako nagtatrabaho. habol ko sa trabaho ko ay experience at hindi pera. tumataas ang sweldo pag mas mahaba ang working experience.

    eto ang nakakatuwa tungkol sa IT. di mo kelangan ng degree, ang habol ng employers mo ay ang iyong kaalaman at kung gaano ka kagaling sa larangan na ito. isa kong katrabaho, isa sya sa pinakamagaling sa kumpanya pero 18 pa lang sya. di ako pinakamagaling, marami akong binagsak sa UP. pero dahil sa kayod, nakarating rin ako sa aking pupuntahan. nagsimula ako sa department store at hindi ko gusto ang trabaho na iyon. sinikap ko maghanap ng matinong trabaho. at dahil sa pasensya at tiyaga, naabot ko rin ang aking pangarap sa buhay. maraming sakripisyo ang kelangan kung may nais kang abutin. marami nga pera dito, pero marami rin akong pinakawalan dahil kinuha ko ang opportunidad dito. kayo na mag husga kung saan mas maganda magtrabaho.

    tungkol sa pagiging entrepreneurial, di mo kelangan ang IT para dun. depende na sa abilidad mo at diskarte mo. hindi ganun kadali makapagsimula ng business dito gawa na kelangan mo ng pondo, permit at magandang credit history. kung wala kang credit history, walang magpapahiram sayo ng pera.

  • Warning to anyone that doesn’t want to get ripped off by this guy. Marcos Miranda is a CROOK. He hacks his own customers and uses extortion in order to force them to pay him for repairs. He sabotages his clients in order to get them to pay him big bucks. He’s a rip off artist that spent time in Prison in California and fled to the Philippines to escape a pretty hefty prison sentence, This guy should be locked and sentenced to hang for being a complete IDIOT… You shouldn’t hack the people that pay you Marcos.

  • Chris

    Hi gents. The fact that I can hire people for lower salaries are part of how how developing countries become “first world” countries. India is well on it’s way, maybe Philippines is next.

    You also have to look at the IT manager’s perspective: I can hire people in the states for western salaries why would I hire them in another country.

  • Jen

    Hi Francis,

    I also do job hopping for salary and growth. Do you mind if you share what company do you get to work from home?

  • kiramatali shah

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  • Vinnie Greenhoward

    Give the dog to someone with some common sense and compassion. You evidently have neither.

  • Elicia Yarzabal

    Where did you bought your t-shirt dude? really cool tutorials by the way!

  • Excuse me if I’m posting this in the wrong area, but does anybody at this site know where I could find infomation on a company in the United states advertising an IT sales employment? The business is LTJ Management, LLC located at 900 Congress Ave., Suite L-150, Austin, TX 78701 (512) 895-9500. I’m transferring to the US soon and any help would be appreciated. Thank you.

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