Nicaragua Labor Costs

The fact is Nicaraguans are paid very little by most standards and there are extremely high un- and under-employment problems. It is a country of haves and have nots with a small wealthy class and a large poor population. For example, a fair salary for full housekeeper (6 days a week) is under $100 per month. A professional in a call center with excellent English and customer service skills makes somewhere around $500 per month.

Clearly, in order to raise the standard of living for its people, Nicaragua will need to work toward better wage parity with its neighbors. Among the reasons why wages are so low is an inadequate education system which results in a workforce with minimal skills. In the low-wage/low-skill employment sectors, they have attracted textile manufacturers, call centers, and tourism businesses to employ many people but because of the education and other problems, they will have a hard time attracting high-skill (i.e. high-tech), high-wage businesses. (Other challenges preventing improvements include lack of healthcare and family-planning options for the poor.)

With Isleta El Espino, we will enjoy the very affordable hotel staff labor costs (and construction labor costs) with salaries ranging from $100 to $800 per month but we will also face challenges in finding and training people who can undertake the range of responsibilities from housekeeping, to maintenance, to management. However, if we stay at the higher end of the salary expectations for any given position, we can attract the best staff available and help to increase the standard of living for a small segment of the Nicaraguan economy.

Here’s a list of positions and salaries we are expecting for operating the island.

Salaries and Wages  Monthly  Annual
General Manager  $          800.00  $        9,600.00
Assistant Manager / Accounting Support  $          600.00  $        7,200.00
Chef  $          250.00  $        3,000.00
Cook  $          140.00  $        1,680.00
Kitchen Helper  $          100.00  $        1,200.00
Server  $          120.00  $        1,440.00
Housekeeper  $          120.00  $        1,440.00
Night Watchman  $          150.00  $        1,800.00
Gardener / Watchman  $          120.00  $        1,440.00
Extra Housekeeper / Helper (p/t)  $            60.00  $          720.00
Salary Subtotal  $        2,610.00  $      31,320.00
State Required and Other Benefits*  $          1,200.60  $      14,407.20
Staff Meals  $          300.00  $        3,600.00
Total Payroll and Staff Expenses  $        4,110.60  $      49,327.20

* 46% of salary (extra month, severance, health coverage, holidays, pension, etc. – Source: http://vianica.com/go/specials/20-doing-business-in-nicaragua.html)

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