Offshore Outsourcing: Annual Median and Average Wage Comparison by Country

Rising inflation, talent shortages, and margin pressure are forcing businesses worldwide to rethink how they build teams and deliver. More companies are outsourcing to cut costs and gain a competitive edge through faster hiring, extended coverage, and access to specialized skills.
Offshore outsourcing remains one of the most strategic levers for businesses seeking to reduce costs, scale faster, and access global talent. But understanding what you pay and why is essential to making the right move.

In this article, we break down real-world wage data, explain the total cost of offshore hiring, and answer key questions about outsourcing effectively.

What is the difference between median wage and average wage?

When evaluating the cost-effectiveness of offshore outsourcing, looking at median wages rather than averages gives you a more accurate and actionable view of the labor market.

Here’s how they differ from each other:

• Median wage represents the middle point; half of workers earn below it, and half earn above.
• Average wage, by contrast, can be distorted by a small number of very high or low earners, which often leads to unrealistic salary expectations.

This matters especially in emerging offshore markets, where income disparities can be wide. Relying solely on averages may cause you to underpay (and miss out on quality talent) or overpay (and erode your cost advantage).

Why consider median wages for offshore outsourcing?

Median wage insights give you the clarity to do just that. By focusing on median wage data, your business gains three advantages:

• Accurate budgeting: You get a realistic benchmark for what a well-qualified, mid-level candidate expects, not the extremes. This helps you set competitive offers without overcommitting.
• Stronger talent retention: Offering fair, market-aligned pay leads to higher engagement and lower turnover, especially important when building long-term offshore teams.
• More reliable workforce planning: Median wage data helps you forecast salary growth and scale teams sustainably, ensuring your outsourcing strategy stays aligned with your cost and capability goals.

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Further reading

Demystifying Outsourcing: Staff Augmentation, BPO, EOR, & More Explained

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What do offshore outsourcing costs include?

Offshore labor delivers significant savings compared to hiring locally, but salary is just one part of the equation. To make informed decisions, you need to understand the full cost of outsourcing.

Here’s what your total cost analysis should include:

• Base salary: This is the core compensation paid to offshore staff. It varies by role, skill level, and location, and typically accounts for the largest portion of the total cost.
• Government-mandated benefits: Most countries require employers to provide statutory benefits such as:
  • Healthcare
  • Retirement contributions
  • Paid leaves
  • Insurance 

These are non-negotiable and should be factored into your financial planning.

• Management or service fees (when using a BPO or Employer of Record): If you engage an outsourcing provider, expect a monthly service fee that covers:
  • Recruitment 
  • HR support
  • Payroll
  • Compliance
  • Performance management
  • Local administration 

This structure simplifies offshore hiring while ensuring legal and operational compliance.

• Equipment and technology: Depending on your setup, you may need to provide:
  • Peripherals (laptops, monitors, headsets, etc.)
  • Licensed software
  • Internet stipends
  • IT support 

This ensures offshore staff have the tools to deliver at the same standard as your onshore teams.

• Training and onboarding: Effective onboarding aligns offshore talent with your systems, culture, and processes. Some providers bundle this into their services, while others may offer it as a separate cost.

Despite these additional components, the key is visibility: understanding what you’re paying for and how each element supports performance, compliance, and team integration.

Annual and average median wage comparison by country

Here’s a snapshot of estimated median annual outsourcing costs (in USD) for professional-level roles across key offshore destinations, including the Philippines, India, Vietnam, Colombia, Malaysia, and Argentina.

Country	Median annual wage (USD)1	Average Annual Salary (USD)1	Key talent highlights	English Proficiency (EPI Score)2
India	$3,840.00 – $4,068.00	$4,186.00 – $11,450.00	Most cost-effective for IT, software development, and support roles	Low (490)
The Philippines	$4,416.00 – $4,750.00	$9,099.69.00 – $9,545.76.00	Strong in customer support, virtual assistance, and back-office roles	High (570)
Vietnam	$7,200.00	$3,600.00 – $9,000.00	Ideal for software development, IT, and engineering	Low (498)
Colombia	$11,228.00 – $12,082.25	$9,390.79 – $12,893.57	Nearshore option for tech and creative services in North America	Low (485)
Argentina	$4,445.00 – $6,600.00	$5,696.93	Skilled in software development, engineering, and design at lower rates than Western markets	High (562)
Malaysia	$8,190.00 – $8,640.00	$9,764.03 – $17,439.00	Ideal for IT, finance, and professional services with a diverse talent pool	High (566)

¹Note: The salary data presented in this report is based on various sources and may not be directly comparable due to differences in data collection and calculation methods. The USD conversions are based on the exchange rates at the time of data publication.

²Source: EF English Proficiency Index (2024)

Table 1. Median and average annual outsourcing costs and language capabilities across key offshore markets.

Vietnam

When evaluating outsourcing costs in Vietnam, it’s important to note that salary data varies widely depending on the source and methodology. The average annual salary can differ significantly, but the median figure sits around USD 7,200. This cost-efficiency makes Vietnam an attractive offshore destination for certain functions.

Malaysia

Outsourcing costs in Malaysia tend to be higher than in neighbouring Southeast Asian countries. The country reports relatively strong median and average salary levels, reflecting a mature and competitive labour market that can justify the premium for higher-skill roles.

India

India remains one of the most cost-effective outsourcing destinations globally. Outsourcing costs in India range from USD 4,186 to USD 11,450 annually, depending on job type and industry. Median salaries fall between USD 3,840 and USD 4,068, with affordability driven by a large, diverse workforce and strong technical talent.

The Philippines

In the Philippines, the median annual salary is approximately USD 4,500. The average, however, is more than double this figure, suggesting a considerable wage gap. While still highly cost-effective, understanding the salary spread is critical for managing outsourcing costs in the Philippines effectively.

Argentina

Outsourcing costs in Argentina are significantly influenced by macroeconomic instability. Salaries fluctuate frequently due to high inflation and currency volatility. While talent is available at competitive rates, businesses must account for financial unpredictability in cost planning.

Colombia

Among the countries analysed, outsourcing costs in Colombia are the highest in terms of both median and average salaries. However, the country also offers access to a well-educated workforce, making it a viable option for higher-value roles that justify the investment.

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Further reading

Best Countries for Offshore Outsourcing in 2025

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Building the right offshore team at the right cost

Understanding offshore wages and the true cost of outsourcing is key to making smarter, more calculated hiring decisions. When you base your workforce planning on accurate market insights, not assumptions, you scale faster, control costs more effectively, and tap into high-quality talent across global markets.

Speak to our team to explore the right outsourcing model for your business and see how offshore talent can drive growth without compromising performance.

About Outsourced

Outsourced connects businesses with the top 1% of talent from the Philippines, Colombia, India, Vietnam, Malaysia, and Argentina. With more than a decade of experience, we support over 300 global clients by building scalable offshore teams that drive performance and sustainable growth. 

Our workforce of 1,000+ professionals, backed by 100+ dedicated support staff, delivers tailored outsourcing solutions across IT, software development, engineering, digital design, marketing, finance, administration, and back-office operations. We blend cost efficiency with consistent quality to meet the evolving needs of modern businesses.

Discover how Outsourced can enhance your operational capabilities and set new standards of excellence for your business at https://outsourced.co/.