Average Salary in Cabo Verde (Cape Verde)

1. Average Wages

The average salary in Cabo Verde (Cape Verde) provides a glimpse into the economic situation of this island nation. As a small country with a developing economy, Cabo Verde's average income levels are reflective of its size and economic activities which are largely centered around services, tourism, and remittances from emigrants. It is important to note that data about wages can vary significantly depending on the source and the specific year in reference.

As of recent reports, the average salary in Cabo Verde stands at a modest level when compared to more developed countries. The average monthly salary hovers around CVE 15,000 to CVE 20,000. This figure, however, masks the variance across different sectors, urban and rural areas, and between skilled and unskilled labor. Several factors contribute to these disparities, which will be discussed in subsequent sections.

Due to a limited industrial base, many professionals in Cabo Verde find employment in the service sector, particularly in businesses related to tourism and government services. The average monthly salary in these sectors may be slightly higher than industries such as agriculture, which is still a significant part of the economy, especially in rural areas, but tends to offer lower wages.

While the country has made considerable progress in reducing poverty and improving living standards, these improvements are not uniformly felt across different groups and regions within the country. Understanding the average salary in Cabo Verde is essential to comprehending the broader economic context which includes high unemployment rates among youth, the challenges associated with small island developing states, and the reliance on external economic factors such as tourism and foreign direct investment.

The urban centers, particularly the capital city Praia, tend to offer higher wages compared to rural areas. This is due in part to the concentration of government institutions, international organizations, and higher education facilities that are located in the capital. Information technology, finance, and other specialist roles typically offer some of the higher average monthly salaries in the country.

It is also worth mentioning that the average salary in Cabo Verde is influenced by the level of education and experience. Like in many other nations, individuals with higher education and more experience tend to command higher wages. This reflects the importance of investing in education and professional development for individuals seeking to improve their employment prospects and earning potential in Cape Verde’s job market.

2. Factors that Influence Salaries

The salaries in Cabo Verde are influenced by a variety of factors, which contribute to the differences in income levels across different sectors and demographics. Understanding these factors provides valuable insights into the labor market and economic conditions in Cabo Verde.

  • Economic Sector: The sector of employment is a primary factor influencing wages. The tourism industry, which is a significant contributor to the economy, often offers higher wages relative to agriculture or fishing sectors. Additionally, government and finance services tend to pay more than the retail and domestic work sectors.
  • Education Level: As is the case globally, individuals with higher education levels in Cabo Verde typically earn higher salaries. A workforce with tertiary education or specialized training can command higher wages due to the skills and knowledge they bring to their roles.
  • Geographical Location: Wages in urban areas, particularly in the capital city of Praia, tend to be higher than in rural regions. This discrepancy is driven by the concentration of higher-paying industries, better infrastructure, and access to markets that urban zones offer.
  • Professional Experience: Work experience plays a crucial role in determining salary levels. Experienced professionals generally have higher earning potential compared to entry-level workers.
  • Foreign Investment: The presence of foreign companies and investment can influence salary structures, often providing higher wages than local businesses due to international standards and funding capacities.
  • Government Policy: Minimum wage laws, taxation, and other regulations imposed by the government can affect take-home pay and overall compensation packages available to workers.
  • Supply and Demand: Labor market dynamics, such as the supply of and demand for certain skills, also influence salaries in Cabo Verde. Occupations in high demand but with a limited supply of qualified personnel can lead to higher wages.
  • Gender: Unfortunately, gender can still play a role in determining salary levels, with women often facing a wage gap when compared to their male counterparts.
  • Informal Economy: A significant portion of the workforce in Cabo Verde operates within the informal sector, where wages are not regulated and can be significantly lower than formal employment.
  • Labor Unions: The presence and strength of labor unions can influence wage negotiations and result in higher pay for workers within unionized sectors.
  • Cost of Living: Regional differences in the cost of living can influence how wages are set, as employers may need to offer higher salaries in areas where the cost of living is more expensive to attract and retain talent.

These factors collectively shape the wage landscape in Cabo Verde and contribute to the diverse earning experiences of workers throughout the nation. Policymakers and economists often analyze these elements to develop strategies for economic growth and labor market improvements.

3. Minimal Wages (monthly and hourly)

In Cabo Verde, the minimum wage is crucial for establishing baseline earnings and ensuring a minimum standard of living for workers in various sectors. It is determined by the government and is periodically adjusted to reflect the cost of living and economic conditions of the country.

The monthly minimum wage in Cabo Verde is formally established under the Labour Code. As of the latest updates, the national minimum wage was set at CVE 13,000 per month. This applies to both public and private sector workers regardless of their occupation or industry.

When considering the hourly minimum wage, it's important to take into account the standard working hours in the country. The typical workweek in Cabo Verde is 44 hours, spread over 5.5 days. By dividing the monthly minimum wage by the total number of working hours in a month, one can calculate an approximate hourly rate. Based on a 44-hour workweek, the hourly minimum wage would be around CVE 68.8. This figure is useful for part-time workers and those who are paid on an hourly basis, as well as for comparison with minimum wage standards in other countries.

It's important to note that compliance with the minimum wage legislation is monitored by the Inspectorate General of Labor, which ensures that employers adhere to these statutory requirements. However, not all workers benefit from this regulation as a considerable segment of the Cabo Verdean labor force operates in the informal sector where such regulations are more challenging to enforce.

  • Monthly Minimum Wage: CVE 13,000
  • Approximate Hourly Wage: CVE 68.8 (based on a 44-hour workweek)

Adjustments to the minimum wage are often the subject of public debate, with labor unions advocating for increases to match the rising cost of living and inflation, while business owners and employers assess the potential impact on competitiveness and employment levels.

4. Gender Wage Gap

In Cabo Verde, as in many other countries worldwide, a gender wage gap exists, reflecting the difference in average earnings between men and women. This gap can be attributed to a variety of social, economic, and cultural factors that influence women's participation in the labor market and their access to equal pay for equal work.

Several factors contribute to the gender wage gap in Cabo Verde:

  • Occupational Segregation: Women and men tend to be concentrated in different sectors and occupations. Traditionally, women have been more likely to work in lower-paying roles and sectors such as domestic work, retail, or certain service industries, while men are more represented in higher-paying technical and managerial positions.
  • Education and Training: Although this is changing over time, historically, women have had less access to education and vocational training, which affects their job opportunities and earning potential.
  • Work Experience: Women often experience interruptions in their careers due to family responsibilities such as childbearing and caregiving tasks, which can impact their career progression and lifetime earnings.
  • Part-time Work: Women are more likely to work in part-time positions, which typically offer lower hourly wages and fewer benefits than full-time jobs.
  • Negotiation and Promotion: Societal norms and gender biases may affect women's willingness or ability to negotiate salaries and pursue promotions aggressively, resulting in slower wage growth over time.

The government of Cabo Verde has taken steps to address the gender wage gap through legislation and policy initiatives aimed at promoting gender equality in the workplace. These include laws that mandate equal pay for equal work and policies that support women's entrepreneurship and participation in high-level corporate and political roles.

Statistics on the actual disparity in wages between genders in Cabo Verde vary, but it is commonly acknowledged that women, on average, earn less than men. Efforts to collect comprehensive data and analyze the gender wage gap are ongoing, with the goal of better understanding the scope of the issue and developing targeted interventions to close the gap.

Despite these efforts, closing the gender wage gap remains a challenge and is part of an ongoing dialogue among policymakers, business leaders, and civil society organizations committed to achieving gender parity in the labor market of Cabo Verde.

5. Highest Paying Occupations

In Cabo Verde, as in many countries, certain occupations tend to offer higher salaries than others. These occupations often require specific skills, higher levels of education, or significant work experience. Below is a list of some of the highest paying occupations in Cabo Verde:

  • Medical Doctors and Healthcare Professionals: With the need for skilled healthcare services, medical doctors, specialists, and healthcare professionals often command high salaries. This includes various positions from general practitioners to surgeons and medical consultants.
  • Corporate Executives and Management: Senior positions within large companies or industries pay well. This includes roles like Chief Executive Officers, Managing Directors, and other high-level management professionals who are responsible for the strategic direction and financial success of their organizations.
  • Finance and Banking Experts: Professionals with expertise in finance, banking, and economics, such as investment bankers, financial analysts, and risk managers, are well-compensated due to the complexity of their work and the impact it has on businesses.
  • Engineering and Technical Specialists: Engineers specializing in fields like telecommunications, civil engineering, or environmental engineering are in demand and are often offered competitive salaries.
  • Information Technology Professionals: As technology continues to advance, IT professionals, including software developers, systems analysts, and cybersecurity experts, are essential and thus earn higher wages.
  • Tourism and Hospitality Managers: Given the importance of tourism to the Cabo Verdean economy, experienced professionals in hospitality management, especially those working in high-end hotels or resorts, tend to receive substantial compensation.
  • Educators and Academic Professionals: University professors, researchers, and high-ranking academic administrators typically have high earning potential due to the qualifications required and the significance of their roles in education and research.
  • Legal Professionals: Lawyers, especially those with specialties in corporate law, international law, or contractual law, are highly sought after and are usually well paid.
  • Maritime and Air Transport Operators: Professions involving the operation of ships or aircraft, such as pilots and maritime engineers, offer salaries that reflect the specialized nature of the work and its critical role in connecting the archipelago nation.
  • Government Officials and Diplomats: High-ranking government officials and diplomats often receive considerable remuneration for their service, especially when it involves international representation and complex governance matters.

The salaries for these occupations can vary based on factors such as the size of the company or institution, level of responsibility, years of experience, and current market demand for the specific skill set. Additionally, some of these professionals may receive benefits and bonuses that increase their overall compensation package.

6. Annual Average Wage Growth

The annual average wage growth in Cabo Verde reflects the economic development and inflation rates that influence the overall earnings of the workforce. Wage growth is an important indicator of the health of the economy, as it can affect consumer spending, investment, and general living standards.

Historically, the wage growth rate in Cabo Verde has been modest. It has closely followed trends in economic growth, fluctuating in response to various internal and external economic pressures. Some years have seen stronger wage growth due to factors such as substantial foreign investment, increases in tourism, or growth in key sectors like services and construction.

Several factors contribute to the annual average wage growth in Cabo Verde:

  • Economic Performance: The overall performance of the nation's economy significantly impacts wage growth. In years when the gross domestic product (GDP) grows, wages are likely to increase as well.
  • Inflation: Inflation can erode the real earning power of salaries, and thus, nominal wage increases may not always translate into actual improvements in living standards. The government and employers often use inflation rates as a benchmark for salary adjustments.
  • Government Fiscal Policy: Government policies relating to taxation and public sector wages can directly influence wage growth. For instance, wage freezes or increments in the public sector can set a precedent for the private sector.
  • Labor Market Dynamics: The supply and demand for labor, particularly for skilled labor, can drive wage changes. A shortage in certain professions may lead to increased wages in those fields.
  • International Remittances: The flow of remittances from Cabo Verdean emigrants abroad can indirectly affect wage levels by altering household income and spending patterns.
  • Private Sector Growth: The expansion of private enterprises, especially those in competitive and export-oriented industries, can contribute to wage increases as they strive to attract and retain talent.
  • Productivity: Increases in worker productivity can lead to higher wages, as more efficient workers generate more value for their employers. This productivity-wage linkage is crucial for sustained wage growth.
  • Collective Bargaining: The strength and effectiveness of collective bargaining processes can influence wage trends. Successful negotiations between unions and employers can result in across-the-board wage hikes.

It should be noted that the increase of average wages does not always uniformly impact all employees or sectors. Discrepancies may persist due to sector-specific conditions, individual company performances, and the varying success of negotiations in different parts of the labor market.

The exact figures for annual average wage growth in Cabo Verde vary from year to year, but examining trends over a period provides an understanding of the long-term movements in compensation for labor within the country.

7. Compensation Costs (per hour worked)

Compensation costs in Cabo Verde are a critical component of the labor market, as they determine how much employers spend on labor for each hour worked. These costs are reflective of not only the wages or salaries that employees receive but also encompass a range of other employment-related expenses.

Key elements that make up compensation costs per hour worked include:

  • Wages and Salaries: The direct monetary payment received by employees for their labor is the most significant part of compensation costs.
  • Social Security Contributions: Employers are required to make mandatory social security contributions on behalf of their employees, which cover retirement benefits, healthcare, and other social services.
  • Additional Benefits: Other benefits may include allowances for transportation, meals, housing, and education, which are often provided in certain sectors or for specific job roles.
  • Bonuses and Incentives: Performance bonuses, year-end bonuses, and other incentive payments also contribute to the overall compensation cost. These may be provided based on individual or company performance.
  • Leave Entitlements: Costs associated with vacation leave, sick leave, and maternity/paternity leave must also be factored into compensation costs as they are part of the total employment benefits package.
  • Training and Development: Investment in employee training and professional development can be considered part of compensation, as it enhances an employee's skill set and productivity.
  • Legally Mandated Benefits: There are certain legally mandated benefits that employers must provide, as stipulated by Cabo Verdean labor laws, which add to compensation costs.
  • Insurance and Retirement Plans: While not mandatory, some employers offer health insurance, life insurance, and private retirement plans as part of a comprehensive compensation package.

Understanding the structure of compensation costs is important for businesses when setting budgets and for policymakers considering labor market regulations. Additionally, these costs impact the competitiveness of Cabo Verde's labor force in the regional and global markets.

The average compensation cost per hour worked in Cabo Verde can vary significantly across different industries, company sizes, and levels of employee experience and education. Industries with higher skill requirements, such as finance or telecommunications, may generally bear higher compensation costs compared to sectors like agriculture or retail.

Compared to more developed countries, the compensation costs per hour worked in Cabo Verde are relatively low. This can be advantageous in attracting foreign investment as investors often seek regions with lower labor costs to reduce overall expenses. On the other hand, lower compensation rates can also reflect the limited industrial base and the challenges in offering competitive wages due to economic constraints.

Employers balance compensation costs with the need to attract and retain skilled workers, while employees look for fair wages and benefits. As Cabo Verde continues to develop, tracking changes in compensation costs will help illustrate the evolving nature of its labor market and economic progress.

8. Comparison with Other Countries

When looking at Cabo Verde's salary levels, it is informative to compare them with those in other countries to gain a global perspective on its place in the international labor market. The table below provides an overview of average monthly salaries in select countries for comparative analysis:

Country Average Monthly Salary (USD)
Cabo Verde ~250 - 330
Portugal ~1,250
Senegal ~260
Brazil ~640
South Africa ~1,190
United States ~3,714
China ~1,150

Note that these figures are approximate and can fluctuate based on exchange rates, data sources, and time of reporting. They provide a basic outline to contextualize the salary levels in Cabo Verde within a broader spectrum.

As can be seen from the table, Cabo Verde's average monthly salary is lower than many other nations, especially when compared to more developed ones like the United States or even emerging economies such as China and South Africa. It is, however, comparable to nearby West African countries, such as Senegal, which shares some socio-economic characteristics with Cabo Verde.

Salaries in countries like Portugal, which has historical ties to Cabo Verde, are significantly higher. This disparity can partly explain the flow of remittances from the Cabo Verdean diaspora in countries with higher income levels. These remittances play a crucial role in the domestic economy of Cabo Verde, contributing to household incomes and national GDP.

In comparison with other island nations with limited natural resources, Cabo Verde's salaries are often in line with general trends, where remoteness and reliance on imports can impact cost structures and consequently, wage levels. However, some island nations with significant tourism sectors or advantageous taxation laws, such as the Bahamas or Malta, may have higher average salaries due to those economic boosts.

Comparing Cabo Verde to other countries highlights the challenges faced by smaller economies in raising wage levels. Factors such as economic diversification, education, investment in technology, and integration into global markets are pivotal in determining how Cabo Verde's wage levels may evolve in comparison to other countries in the future.