Average salary /

Average Salary in Bangladesh

Average Salary in Bangladesh

1. Average wages

The average salary in Bangladesh has seen a gradual uptick over the past few years due to economic growth, industrial expansion, and government policy reforms aimed at developing various sectors. While the country is still considered as having one of the lower income levels internationally, improvements in the garment sector, which is one of the largest industries, and remittances from Bangladeshis abroad have somewhat boosted average incomes.

An insight into the average monthly salary reveals that there is a substantial disparity across different sectors and regions. According to recent statistics, the average monthly salary for individuals working in urban areas, especially in Dhaka, the capital city, is significantly higher than that in rural areas. The discrepancy is attributed to the concentration of multinational companies and prime businesses within metropolitan areas. On the other hand, rural workers often engage in agriculture, which yields lower earnings compared to urban employment. Despite these disparities, the average monthly salary overall reflects the progress in the nation’s economy and its labor market conditions.

The average salary in Bangladesh can vary widely depending on the industry and job role. For example, employees in the Information Technology sector or those possessing specialized skills in engineering or finance may command higher salaries. Conversely, unskilled laborers and workers in the informal sector typically earn much less than the average. It’s important to note that a considerable portion of the Bangladeshi workforce is employed in the informal sector, which often escapes official salary records, thus potentially skewing the actual average wage figures.

The average monthly salary in Bangladesh is estimated to be around 26,000 Bangladeshi taka (BDT) (as of February 2024). This translates to roughly $245 USD based on current exchange rates. Here’s a breakdown of some key points:

  • National Average: It’s important to remember this is a national average, and salaries can vary significantly:

    • Location: Salaries tend to be higher in urban areas like Dhaka compared to rural areas.
    • Industry: Sectors like finance, technology, and pharmaceuticals typically offer higher salaries than agriculture or low-skilled labor.
    • Experience and Skills: Employees with more experience and specialized skills can command higher salaries.

  • Salary Range: Ranges reported vary depending on the source. Some sources suggest a range of 9,139 BDT to 32,984 BDT (including bonuses), while others mention a wider range based on age groups.

  • Cost of Living: The cost of living in Bangladesh is generally lower compared to many Western countries. This means that 26,000 BDT can provide a decent standard of living for many people, although it depends on individual circumstances and location.

Furthermore, an understanding of the average salary also requires an analysis of living costs in the country. While nominal wages might appear low by Western standards, the cost of living in Bangladesh is comparatively less, which allows for a different assessment of what 'average’ entails. This factor should be considered when evaluating the significance of the average salary figures presented.

The average monthly salary encompasses not only the base wage but also other forms of compensation including bonuses, overtime pay, and allowances. These additional benefits can contribute significantly to the take-home pay of Bangladeshi workers, particularly during festival periods like Eid, when bonuses are customarily distributed.

As Bangladesh continues to develop economically and push towards becoming a middle-income country, the average salary within the nation is expected to rise, along with improvements in labor laws and wage policies. Nevertheless, average salaries remain an important indicator of the economic health of the country and the well-being of its workforce.

2. Factors that Influence Salaries

Several factors contribute to determining the salary levels in Bangladesh. These variables can significantly impact the amount of money individuals earn, which is reflected in the wide-ranging salary scales across different sectors and job roles. Here are some key factors that influence salaries in Bangladesh:

  • Educational Background: As with many countries, employees with higher educational qualifications tend to receive better pay. Specialized degrees, professional certifications, and advanced training usually translate to higher earning potential in the Bangladeshi job market.
  • Industry: Certain industries offer higher salaries due to their economic viability and demand for skilled labor. For example, the IT, finance, and garment industries often provide above-average wages, while agriculture and manual labor jobs may offer lower compensation.
  • Experience and Skill Level: Experience is a significant determinant of salary. Individuals with extensive experience or highly specialized skills are likely to earn more than entry-level workers or those with generalized abilities. This holds true especially for managerial and technical positions that require a high level of expertise.
  • Location: Geographic location within Bangladesh plays an essential role in salary differences. Urban areas, such as Dhaka and Chittagong, which host a large number of international and local businesses, typically offer higher salaries compared to rural regions where the cost of living is lower, but so are income levels.
  • Public vs. Private Sector: There tends to be a disparity between salaries in the public and private sectors, with the private sector often offering competitive wages to attract and retain talent. However, public sector jobs might come with additional benefits such as job security and pensions.
  • Gender: Although it is an issue that is being addressed progressively, there is still a gender wage gap in Bangladesh, with women generally earning less than men for equivalent work. This gap is influenced by societal norms, gender discrimination, and other related factors.
  • Supply and Demand for Labor: The principles of supply and demand also govern the labor market. In fields where there is a shortage of skilled labor, employers may offer higher salaries to attract the necessary talent. Conversely, in markets where there is an excess supply of workers, wages may stagnate or even decline.
  • Government Policies and Legislation: Minimum wage laws, taxation policies, and other regulatory measures implemented by the government can influence salary ranges. Also, incentives or subsidies in certain industries can lead to higher pay scales for jobs within those sectors.
  • Economic Conditions: Broader economic conditions, including inflation rates, economic growth or recession, and foreign investment levels, will have overarching effects on salary structures. During times of economic prosperity, salaries are more likely to increase, whereas during downturns, wage growth may slow or freeze.
  • Company Size and Profitability: Larger, more profitable companies generally have the resources to offer higher salaries and better benefits than smaller businesses. The financial health of an employer can directly impact the salaries of its employees.

Understanding the interplay of these factors can provide deeper insights into the dynamics of salary determination in Bangladesh. It’s important for both employers and employees to be aware of these elements to negotiate fair compensation and maintain a competitive edge in the job market.

3. Minimal Wages (monthly and hourly)

The concept of a minimum wage is crucial in ensuring a baseline level of income for workers in a country. In Bangladesh, the minimum wages are set by the government and are often specific to industries and types of jobs. The most well-known benchmark for the minimum wage in Bangladesh is seen in the garment industry, which is one of the largest employers in the country.

As of the latest updates:

  • The national minimum wage for garment workers in Bangladesh has been set at 8,000 Bangladeshi Taka (BDT) per month. This came into effect in December 2018 following discussions between government panels, labor representatives, and employers.
  • In terms of an hourly wage, calculating based on standard working hours (typically 48 hours per week), the minimum hourly wage for a garment worker would be approximately 38.46 BDT, considering a 4-week month. It is important to highlight that hourly wage calculations can vary due to overtime and differing definitions of full-time work hours.
  • Other sectors have different minimum wage structures, which are decided upon by separate wage boards. For instance, the minimum wage in the leather manufacturing sector might differ from that in the agriculture sector.
  • The implementation of minimum wages is more stringent in formal sectors, while in informal sectors, adherence to minimum wages is less consistent and more difficult to enforce.
  • It’s also noteworthy that minimum wage figures do not always align with living wage estimates, which consider the cost to maintain a decent standard of living. Workers earning the minimum wage may still struggle with the cost of living, particularly in urban areas.

Minimum wage rates are subject to change, as they are periodically reviewed and adjusted by the government in consultation with various stakeholders. These revisions intend to reflect changes in the cost of living, inflation, and other economic factors. Due to this, workers and employers should ensure they are updated with the latest wage standards.

Despite having these minimum wage standards in place, enforcement remains a challenge, especially in the vast informal economy of Bangladesh where undocumented employment is common, making it difficult to guarantee that all workers receive at least the minimum wage.

4. Gender Wage Gap

In Bangladesh, as in many other countries, the gender wage gap is an issue that reflects societal norms and economic inequalities between genders. While progress has been made with regards to women’s participation in the workforce, significant disparities in earnings between men and women persist.

According to various studies and reports, women in Bangladesh earn less than men for comparable jobs and work hours. Several factors contribute to this gender wage gap:

  • Societal and Cultural Factors: Societal attitudes towards gender roles often limit the professional opportunities available to women. Traditional expectations may discourage women from pursuing careers in higher-paid industries or positions of leadership.
  • Labor Market Segmentation: Women tend to be over-represented in sectors that are lower-paying, such as domestic work, agriculture, and certain manufacturing jobs. Conversely, they are underrepresented in higher-paying industries like technology and engineering.
  • Education and Training: While educational attainment for women in Bangladesh has improved, there remains a gap in access to education and vocational training between genders, which can impact earning potential.
  • Work Experience: Women often experience interruptions in their careers due to childcare and other family responsibilities, affecting their work experience and limiting wage growth over time.
  • Discrimination: Direct discrimination in hiring, promotion, and pay-setting practices can result in women receiving lower salaries than their male counterparts.
  • Negotiation and Representation: Women may have less experience or feel less comfortable negotiating salaries, and they may be underrepresented in labor unions and other bodies that could advocate for higher wages on their behalf.

Addressing the gender wage gap requires a multi-faceted approach, involving policy changes, education, workplace equality initiatives, and cultural shifts. The government of Bangladesh has taken steps towards this by implementing laws and regulations designed to promote gender equality in the workplace. However, enforcement and societal change are critical to closing the wage gap effectively.

It’s also important to note that women’s entrepreneurship is on the rise in Bangladesh, which may pave the way for increased financial independence and more equitable income levels. Nonetheless, as of now, the gender wage gap remains a significant challenge that requires continuous effort and commitment from all sectors of society to bridge.

5. Highest Paying Occupations

In Bangladesh, as with any other country, certain occupations offer higher salaries due to the nature of the job, level of expertise required, and economic impact. Below is a list of some of the highest paying occupations in Bangladesh:

  • Medical Professionals: Specialists such as cardiologists, neurologists, and oncologists command high salaries due to the extensive education and experience required in their fields. Surgeons, in particular, are among the highest paid in the healthcare sector.
  • Aerospace Engineers: This field requires highly specialized knowledge in designing, testing, and contributing to the development of aircraft and spacecraft, which is rewarded with substantial compensation.
  • Bank Managers: Banking is a lucrative sector in Bangladesh, and individuals at the managerial level often receive generous salaries along with bonuses and benefits.
  • IT and Software Engineers: With the IT sector booming globally, proficient software engineers, especially those with expertise in emerging technologies like AI, machine learning, and blockchain, are in high demand and receive competitive salaries.
  • Telecommunication Engineers: As the telecom industry continues to expand, engineers in this field who manage and develop new communications systems are well-compensated for their skills.
  • Construction Manager: The growing infrastructure development in Bangladesh has led to a higher demand for skilled construction managers who oversee large projects and assure their successful completion.
  • Pharmaceuticals Industry Professionals: Individuals working in pharmaceuticals, particularly in research and development or as executives in pharmaceutical companies, earn high wages.
  • University Professors: Senior academics with tenure at well-established universities are among the top earners, reflecting their level of expertise and the value of education.
  • Legal Professionals: Experienced lawyers, particularly those specializing in corporate law or working for large firms, command high fees and salaries.
  • Ship Captains: Given Bangladesh’s location and access to navigable waters, ship captains with significant experience can earn substantial pay.

These professions typically require higher educational qualifications, years of experience, and specialized skills. Many of them also carry significant responsibility and influence, which further justifies the higher payroll. As Bangladesh continues to develop economically, the demand for these high-skill occupations is expected to grow, potentially leading to even higher salaries for these positions in the future.

6. Annual Average Wage Growth

The wage growth in Bangladesh has shown an uptrend over the years, primarily fueled by economic development, increased foreign investment, and government initiatives focused on enhancing workers’ skills and productivity. Periodically, wages in various sectors are reviewed to keep up with inflation and the rising cost of living, addressing the needs of the country’s growing economy.

Several factors contribute to the annual average wage growth in Bangladesh:

  • Inflation: To ensure that the purchasing power of employees does not decline, regular adjustments to wages are made in line with inflation rates. This adjustment is essential for maintaining the standard of living for workers across the nation.
  • Economic Performance: A robust economy often leads to better business performance and higher profits, which can translate into wage increases as companies have more resources to allocate towards salaries.
  • Government Policies: Initiatives launched by the government, such as wage board recommendations for minimum wage revisions and strategies aimed at economic upliftment, play a pivotal role in driving wage growth.
  • International Investment: As Bangladesh continues to attract international investors, particularly in the manufacturing and technology sectors, higher investments lead to job creation and the potential for salary hikes to draw in skilled labor.
  • Productivity Improvements: Increases in worker productivity, often through better education, training, and technological advancements, justify higher wages as workers are able to contribute more value to their employers.
  • Labor Market Dynamics: The balance between demand and supply of labor affects wage levels. Shortages in skilled labor can lead to wage increases as companies compete to hire the best talent.
  • Remittances: The inflow of remittances from Bangladeshis working abroad contributes to the overall economic situation and indirectly impacts wage levels within the country.
  • Industrial Growth: The growth rates in key industries such as the garment sector, construction, and pharmaceuticals influence the pay scales within these industries, sometimes leading to wage increments.

It’s important to note that wage growth rates can vary significantly across different regions and sectors. Urban areas, like Dhaka and Chittagong, where industry and services are concentrated, typically see faster wage growth than rural areas. Moreover, skilled and high-demand occupations often experience higher wage growth compared to unskilled or low-demand jobs.

Statistically, Bangladesh has experienced moderate wage growth over the past decade. According to reports, there has been a trend of single-digit annual percentage increases in average wages. These gradual increases reflect a balancing act between preserving economic competitiveness for export-oriented industries and ensuring that the workforce is fairly compensated.

As the country progresses, ongoing enhancements in infrastructure, education, and industry diversification are likely to foster an environment conducive to continuous wage growth. However, ensuring that wage growth translates into improved living standards for all segments of the population requires comprehensive economic policies and effective implementation strategies.

7. Compensation Costs (per hours worked)

Compensation costs per hour worked provide an important metric for understanding the labor cost incurred by employers and the value of work performed by employees. This cost includes not only direct wages or salaries but also encompasses various non-wage components such as employer contributions to social security, pensions, and other benefits.

In Bangladesh, compensation costs are influenced by several factors:

  • Sectoral Differences: Some sectors have higher compensation costs due to the nature of work, necessary skills, and associated risks. For example, manufacturing, including the garment industry, may have lower hourly compensation costs compared to the financial sector or IT services.
  • Regulatory Environment: Legal requirements such as minimum wage laws, mandatory bonuses, and other labor regulations directly impact compensation costs for employers.
  • Mandatory Benefits: Employers in Bangladesh are required to provide certain benefits, which might include festival bonuses, overtime pay, and contributions to funds like gratuity and provident funds. These benefits are factored into the overall compensation cost.
  • Informal Sector: A substantial part of the Bangladeshi workforce is employed in the informal sector, where compensation costs are challenging to measure accurately since many informal workers do not receive formal benefits or consistent wages.
  • Regional Variations: Compensation costs can vary by region within Bangladesh. Urban areas, especially industrial or business hubs, generally have higher labor costs than rural areas due to a higher cost of living and greater competition for skilled workers.
  • Workforce Composition: The level of skilled versus unskilled labor and the number of full-time versus part-time workers can affect average compensation costs. A higher proportion of skilled workers, who command higher wages and benefits, will increase overall compensation expenses for employers.

The structure of compensation in Bangladesh allows for significant variation across different job roles and industries. Non-wage compensation often depends on the size and profitability of the company, as larger businesses may be able to offer better benefit packages compared to smaller enterprises.

To provide a concrete example, while there are no universal statistics on exact hourly compensation costs across all sectors in Bangladesh, certain industries such as the garment sector may indicate lower costs due to the high supply of labor and competitive global market pressures. As of the most recent data, the hourly compensation cost in this sector, including wages, overtime, and bonuses, could be estimated to be around the equivalent of a few U.S. dollars, though this would not necessarily include indirect costs such as employee insurance or health care benefits.

It’s imperative to recognize that while keeping compensation costs low can enhance a country’s competitive edge in labor-intensive industries, it is equally important to ensure fair wages and benefits to maintain a productive, motivated, and healthy workforce. The challenge for Bangladesh lies in finding the optimum balance between these two objectives.

8. Comparison with Other Countries

When comparing the average salary of Bangladesh with those of other countries, it is essential to consider a variety of economic, social, and industrial factors which can create vast differences in wage levels internationally. Below is a comparative analysis that reflects how Bangladesh stands in the global economic landscape concerning average wages.

Developed countries, such as the United States, Canada, and nations in Western Europe, generally boast higher average salaries than those found in Bangladesh. This disparity stems from multiple factors including higher living costs, more advanced economies, higher productivity, and stronger currency values. In these countries, workers can often afford a higher standard of living, even though the cost of living may be substantially more than in Bangladesh.

Conversely, when compared to some of its regional neighbors in South Asia, such as Nepal or Pakistan, Bangladesh’s average salary may be found to be competitive. However, countries like India may have a wider range of salaries due to its larger economy and more diverse industrial sectors including a booming tech industry, which can afford to pay its employees higher wages on average.

In comparison to Southeast Asian countries, Bangladesh’s average salary is lower than that of nations like Malaysia or Thailand but may be comparable to countries such as Cambodia or Myanmar, especially within specific sectors like the garment industry.

Bangladesh’s strategic focus on garment manufacturing has allowed it to become a leader in this industry globally, but the associated wages are still lower compared to similar roles in countries like China or Vietnam, where the cost of living and production has risen in recent years, leading to higher average salaries.

Below is a simplified comparative table demonstrating the average monthly salary (in US dollars) in different countries for a clearer perspective. Please note that these figures are approximate and can fluctuate based on currency exchange rates, economic changes, and updates in wage policies:

Country Average Monthly Salary (USD)
Bangladesh 150*
India 420*
Pakistan 160*
Nepal 130*
China 950*
Vietnam 180*
Thailand 650*
Malaysia 900*
United States 3,500*
Canada 2,700*

*These figures are estimations and subject to change.

The data illustrate that while there is a marked difference between the average salaries in Bangladesh and those in developed countries, the difference between Bangladesh and other developing nations may be less pronounced.

It’s important to understand that these comparisons are broad and may not take into account the nuanced differences between various sectors within each country. Cost of living, purchasing power parity (PPP), and local economic conditions are also critical in assessing the real value of wages earned by individuals in their respective countries.

As Bangladesh continues its journey towards economic development, salary levels are projected to improve, driven by increased foreign investment, industrial growth, and enhanced skills among the workforce. Tracking global salary trends will remain an essential factor in setting competitive and fair compensation practices for Bangladeshi workers going forward.