Showing posts with label Salaries. Show all posts
Showing posts with label Salaries. Show all posts

Thursday, June 23, 2022

US Tech Firm Gives Remote Employees in Pakistan 150% Raise

American tech firm Edge has boosted the minimum salary of its Pakistan-based remote employees to Rs. 200,000 (about US$1,000) a month, a 150% increase. The firm's 190 employees work from home for the firm headquartered in Sacramento, California . “We are aware of the global economic downturn and its impact on our people, especially in Pakistan. More than ever, we understand our responsibility towards our people and the need to invest in them,” said its Pakistani-American Founder and CEO Iffi Wahla. “I sincerely hope this decision starts a momentum for wage increases in the country. Our mission is to democratize fair wages and access to work across the globe.”

Edge was founded in 2020 and operates in the insurance, health, and retail sectors.  It provides global remote employees to North American companies. A total of 320 employees are a part of the company which has offices in the United States, Pakistan, and Peru. Edge plans to expand to seven more countries by the end of this year and 150 countries by 2024.

Salaries of Pakistanis hired for remote work by foreign employers are among the world's fastest rising, according to the "State of Global Hiring  Report 2021" produced by San Francisco based Deel. The company provides employment and payroll services for companies hiring international employees and contractors online. Hiring for work from remote locations has taken off since the start of the COVID19 pandemic. The pandemic and recent advances in communications technology are helping globalize the labor market for talent, creating new opportunities for people in developing nations to work remotely at higher wages for global companies. 

Rising Salaries of Global Hires. Source: Deel 


Salaries rose the fastest for international online hires in Mexico (57%), followed by Canada (38%), Pakistan (27%), and Argentina (21%).  Salaries for global hires from India rose 8%, Philippines 7% and Russia 4%.   Philippines, India and Pakistan are the top three countries in Asia Pacific region where people were hired through Deel. 


Top 3 Source Countries of Employees. Source: Deel


Deel has over 250 legal, accounting, mobility, and tax experts as partners. The company allows any business to create, sign and send compliant localized contracts and pay teams in more than 120 currencies with just a click, according to its latest report on global hiring. It allows contract employees to withdraw a percentage of or their entire paychecks in cryptocurrency—Bitcoin, Ethereum, Solana, Dash, and USDC.

Deel report did not disclose the exact salaries paid in Pakistan after the 27% pay hike. However, a global survey conducted by Payoneer in 2019, showed that Pakistani women freelancers were earning $22 an hour, 10% more than the $20 an hour earned by men. While Pakistani male freelancers earnings are at par with global average, Pakistani female earnings are higher than the global average for freelancers. Digital gig economy is not only helping women earn more than men but it is also reducing barriers to women's labor force participation in the country. The survey also concludes that having a university degree does not help you earn more in the growing gig economy. The survey was conducted in 2015.

Freelancers Hourly Rate by Gender. Source: Payoneer


An average Pakistani freelancer working 34 hours a week at $20 an hour earns $34,000 a year, or nearly 6 million Pakistani rupees a year, a small fortune for a young Pakistani. This is one of the upsides of the online global labor marketplace for skilled young men and women in developing nations like Pakistan. Sometimes freelancing experience leads to tech startups in Pakistan. Year 2021 was a banner year for tech startups in Pakistan. 

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Friday, March 24, 2017

H1B Visa Abuse: What Do Software Engineers Earn in India and Pakistan?

A segment of CBS 60 Minutes, top rated American newsmagazine on television, has recently brought sharp focus on H1B visa abuse. It alleges that the H1B visas are being misused by Indian body shops to bring low-cost Indian software engineers to the United States to replace higher-paid American workers.

H1B Visa Abuse:

The visa category was originally intended to help fill gaps in the high-tech workforce with highly skilled employees from abroad in situations where there aren’t enough Americans. Instead, it has given rise to body shops that bring in workers from overseas, mainly from India, to replace higher-paid American workers.

Recent examples of the firing of American IT workers and their replacement by Indian workers at UC San Francisco and Walt Disney and Co have received a lot of media attention. What has particularly incensed the American public is the practice of forcing the American workers to train their replacements.

Labor Cost Savings:

A loophole in H-1B legislation that US companies are taking advantage of allows them to outsource jobs to Indian body shops without even looking for Americans, if those jobs pay approximately $60,000 or higher. Similar jobs in Silicon Valley pay an average of $110,000 a year.

The average salary of a software engineer ($110,000) in Silicon Valley is about 20X more than the average salaries in India ($6,875) and Pakistan ($4,770), according to Glassdoor.

Source: Glassdoor


Indians Gaming H1-B System:

 Indian body shops are masters of gaming the H1-B system.  Most of India's IT exports to the United States are made up of wages of H1B workers brought to the United States by a handful of Indian body shops like Cognizant, Tata Consulting Services (TCS) and Infosys.  In 2014, 86% of the H1B visas for tech workers were granted to Indians, according to available data.

Excluding the Indian H1B workers' pay,  India's IT exports drop to about one-twentieth of the the amount reported by the Indian government as IT exports, according to a 2005 study by US General Accounting Office (GAO).

The Indian body shops like Cognizant, TCS and Infosys that rely on the H1B visa program in the US are "the shining star" of the Indian economy, and the country's largest export, according to an Indian-American professor Ron Hira who is a strong critic of the abuses of H1B program. By complaining, the Indian government and firms that rely on the program are trying to "build up a firewall so that no other reforms can come through and constrain the program in any way."

Average Salaries of Software Engineers in Major Cities Source: qz.com


Indian Code Coolies:

H1B workers brought in by Indian body shops are described variously as "code coolies" or "H1B slaves". Some call them "indentured servants", like the ones from India who replaced slave labor after the British empire abolished slavery.

“’Indentured servants’ is a pretty accurate term because in many cases that’s exactly what’s going on,” said Phillip Griego of San Jose’s Phillip J. Griego and Associates. Over the years, Griego and his law partner, Robert Nuddleman have represented several H-1B workers in lawsuits against body shops.

Trump's Pledge:

Along with cracking down on illegal immigration, a key campaign promise of President Trump has been to create lots of American jobs for American workers.  “You’ve heard me say the words, and I’ll repeat them, right now: Buy American and Hire American. It’s not just a motto, it’s a pledge. It’s a pledge to the working people of this country. The era of economic surrender for the United States is over -- it's over,” Trump said at Michigan earlier this week.

Right after the CBS 60 Minutes segment on H1-B visa, Senator Chuck Grassley tweeted: "If u just saw CBS 60minutes abt ripoff H1B visa program is replacing AmWorkers u shld know my/Durbin bill will correct this injustice."

There are reports that new legislation is being offered to change the H1-B program. Among the key provisions of this new proposed legislation are cutting the number of visa by 50% and doubling the minimum salary of H1B workers from $60,000 to $120,000.

Summary:

The abuse of H1B visas to replace American workers and depress wages is drawing both legislative and executive attention under the Trump administration. High profile cases like the firing of American workers at UC San Francisco and Disney and their replacement by Indian workers has energized the support for cracking down on abuse.


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