The minimum wage in El Salvador in 2021.

By Eddie Galdamez
Monday, November 23rd, 2020
Minimum wage in el salvador

The minimum wage in El Salvador is $304.17 a month for the commerce and service sector; $299.30 for the manufacturing and textile sector; $227.22 for coffee and sugar field workers; and 202.82 for the agriculture and cotton sector.

Minimum wage in El Salvador by individual sectors.

Industry Monthly Yearly
Commerce and services $304.17 $3,650.04
Textile and manufacturing $299.30 $3,591.60
Sugar and coffee field workers $227.22 $2,726.64
Agriculture and cotton workers $202.82 2,433.84

El Salvador’s minimum wage or legal minimum wage for formal businesses is divided into the four sectors; two for the city sector and two for the countryside or rural areas.

Commerce and services sector wages.

The commerce and services sector employs a large percentage of the Salvadoran population; it includes call centers, hotels, secretarial work, bank tellers, and many others. Some of these jobs have extra benefits, such as bonuses and overtime. However, they might also have unique requirements, such as being bilingual and having a college degree.

Textile and manufacturing sector wages.

The manufacturing and textile sector is another of the top industries in El Salvador. This area includes the production of items such as shirts, pants, shoes, and many others. A large number of what this sector produces is exported to the United States, Canada, and Europe.

Sugar and coffee field workers.

The sugar and coffee sectors in El Salvador are so large that they have their own minimum wage. El Salvador is a top producer of coffee beans and sugar cane, which require a large number of workers.

Agriculture and cotton field workers.

The agriculture and cotton sector employs a large percentage of the Salvadoran population. An issue with the agriculture sector is that most of these businesses work unofficially. Therefore, many people get paid less than the minimum wage assigned to this sector.

Minimum wage in El Salvador

El Salvador wages in the informal sector.

El Salvador’s informal sector does not have a minimum wage. Therefore, workers in this sector get paid whatever the employers feel is correct for the work being done.

El Salvador has laws protecting workers, so they get paid at least the minimum wage. However, an issue arises when it comes to enforcing these laws in the informal sector.

The country has a large number of businesses that operate informally. Therefore, keeping accurate records of information such as how much they pay their employees or how many days or hours they work is challenging to do.

Most of the businesses that operate informally are in the agricultural sector. Also, small businesses that sell goods and services in smaller towns are known for conducting businesses informally. One thing is for sure, El Salvador’s minimum wage is even lower in the informal sector.

Increasing the minimum wage in El Salvador.

Increasing the minimum wage in the country is not an easy thing to do. Obviously, workers want an increase that covers at least the essential cost of living in El Salvador. However, businesses oppose a large increment as it would reduce their profit margin.

Article 144 of the Salvadoran labor laws say the following.

Every worker, including the home workers, has the right to earn a minimum wage that sufficiently covers the common needs of their home, in the material, moral and cultural order, which will be set periodically.
Source: Report.

The current minimum wage is not enough to cover the essential cost of living in El Salvador. The last minimum wage increase was done in 2018 by the Salvador Sanchez Ceren administration.

2018 minimum wage increase.

Industry From to $ %
Commerce $251 $304 $52 21%
Services $246 $304 $55 23%
Textile and manufacturing $210 $299 $88 23%
Coffee field workers $171 $227 $56 33%
Sugar field workers $109 $227 $118 108%
Cotton workers $98 $202 $104 105%
Agriculture workers $118 $202 $84 72%

How often is the minimum wage in El Salvador reviewed?

According to the country’s Labor Code, El Salvador’s minimum wage is to be evaluated every three years; this is done to verify the possibility of whether it is feasible to make any increase.

The analysis looks at the overall economic aspect of the country, the economy, inflation, cost of essential items, and business environment.

In any case, the analysis is done in a group that includes 2 representatives from the labor sector, 2 from the employer sector, and 3 from the government. After the review, they decide if an increase is necessary and recommend it to congress.

When is El Salvador’s minimum wage set to be reviewed again?

The group reviewed the minimum wage towards the end of 2019; however, no agreement was reached. The sectors involved did not meet in 2020 to discuss the situation and discuss the possibility of a new increase.

El Salvador’s minimum wage will remain the same in 2021 as no agreement was reached in 2020. If an increase is approved in 2021, it will not take effect until the following year, 2022.

In 2020, neither president Nayib Bukele nor the Legislative Assembly did anything regarding the minimum wage issue. The country’s economy was shut down in early March as a precaution to fight COVID-19. Since then, the economy was reopened, but businesses are still feeling the effects.

El Salvador's minimum wage in 2020

The minimum wage in El Salvador compared to other countries in Central America.

The following is the minimum wage in all the Central American countries, keep in mind that some of these numbers might not be accurate to the penny for the following reasons.

To begin with, there is the exchange rate. To make an accurate calculation, I took the minimum wage paid on each countries currencies and exchanged to US dollars. I am using today’s exchange rate to set an amount; but, exchange rates fluctuate daily.

Furthermore, most countries have different minimum wages for different sectors, just like El Salvador. For the purposes of comparison, I am using the highest minimum wage a person could get paid in each nation.

Country Local Currency $ Per month $ Per year
Guatemala Quetzal, 2,825 $368 $4,427
El Salvador US $304 $304 $3,650
Honduras Lempira, 8450 $340 $4,085
Nicaragua Córdoba, 7,133 $211 $2,537
Costa Rica CR Pesos, 320,618 $558 $6,702
Panama US $345 $345 $4,140
If any of these numbers are not accurate, please let me know at, [email protected] and I will make the proper corrections.
El Salvador minimum wage
Photo by: PMenjivarD

How many days per week do you work in El Salvador?

The standard workweek for most Salvadorans is 5 1/2 days. It usually begins on Monday and ends on Saturday at noon. In the informal sector, it is normal for employees to work six days per week or even seven.

How many hours per day do you work in El Salvador?

Each employer has its own schedule and set of hours that the employee is supposed to work. Also, they have to pay overtime if it goes over the established amount of hours.

Coming up with a specific number of hours in the informal sector is complicated. Most of these employers expect workers to stay until the job is done.

El Salvador’s minimum wage is not enough for Salvadorans.

A big reason why El Salvador has a poverty problem and that a lot of its citizens look for opportunities elsewhere is the minimum wage issue.

The minimum wage in El Salvador is too low, it does not allow employees to live a regular life or to increase the standards of living of their families. Besides, it does not come close too cover the cost of living in El Salvador.

The hope is that in 2021, the politicians and the government take a look at the minimum wage in El Salvador and do something about increasing it.

Living in El Salvador