Average Salary in Mongolia

1. Average Wages

The average salary in Mongolia has been subject to fluctuations over the years, influenced by various economic factors such as the country’s reliance on mining and agriculture. As of the latest reported figures, the average salary in Mongolia is reflective of the nation’s developing economy status. When discussing the average monthly salary, it’s important to note that there is a considerable difference between urban and rural earnings due to the concentration of economic activities and employment opportunities in cities.

In Ulaanbaatar, the capital city where a majority of the businesses and government offices are located, the average salary is typically higher than in other regions. According to recent statistics, the average monthly salary in Ulaanbaatar is significantly above the national average. Employees working in the capital can expect to earn a median monthly income that is indicative of the economic hub’s more lucrative job market. Outside the capital, in more rural areas, the average salary drops, reflecting the lower cost of living and the economic reliance on agriculture and herding, which traditionally yield lower incomes.

The average salary in Mongolia also varies greatly across different sectors. The booming mining sector, for example, tends to offer higher wages than others due to the technical expertise required and the global demand for minerals. Conversely, public service and education sectors often experience lower average salaries, although these positions might include additional benefits not calculated in the gross salary. It is essential for individuals looking to work in Mongolia to consider the vast disparities in income across different industries and geographic locations.

A recent report shows Mongolian workers are earning more than before. The average monthly salary is around 2 million tugriks (MNT), which is roughly $436 (as of March 20, 2024). There’s a bit of a gender gap though, with men typically making more (2.3 million MNT) than women (1.7 million MNT).

Mongolian employees are typically paid on a monthly basis, and thus, the average monthly salary serves as a key indicator for economic stability and consumer purchasing power in the country. To understand this better, one must also look at the factors that influence these salaries, which range from the level of education and experience to economic sector and market demand.

2. Factors that Influence Salaries

Several factors play a critical role in determining the salaries of individuals working in Mongolia. These include:

• Economic Sector: Salaries vary widely depending on the sector. For example, employees in the mining industry tend to earn higher wages due to the profitability and demands of the sector, while those in education or social services may earn less.
• Education Level: As is the case globally, higher educational attainment can lead to better-paying jobs. In Mongolia, positions that require advanced degrees, particularly in fields such as engineering, finance, and healthcare, often command higher wages.
• Professional Experience: Experienced professionals typically earn more than their entry-level or less experienced counterparts. Industries value the expertise and stability that seasoned workers bring to a role.
• Geographic Location: There is a significant urban-rural divide in Mongolia, with a majority of higher-paying jobs located in Ulaanbaatar, the capital city. Rural areas have lower average salaries, correlating with the cost of living and local economic activities.
• Supply and Demand: Salaries are influenced by the dynamics of job availability versus the number of qualified candidates. Jobs in high demand but with a limited supply of qualified personnel can drive wages up, while oversaturated job markets may do the opposite.
• Inflation: The rate of inflation can affect purchasing power, and consequently, employers may adjust salaries to match the rising cost of living to retain their workforce.
• Government Policies: Legislation regarding wage standards, taxation, and labor rights can impact take-home pay and overall compensation packages.
• Unionization and Collective Bargaining: In industries where workers are unionized, collective bargaining agreements can lead to higher wages and better employment terms.
• Foreign Investment: The level of foreign investment, especially in key industries like mining, can lead to salary increases due to technology transfer and higher productivity rates.
• Company Size and Profitability: Larger or more profitable companies may offer higher salaries and more comprehensive benefit packages than smaller firms or those with slimmer profit margins.

Understanding these factors is essential for both employers setting pay scales and employees negotiating their salaries. They also help explain the disparities and variances in income observed not just across different sectors and regions, but within them as well.

3. Minimal Wages (monthly and hourly)

In Mongolia, the minimum wage is determined by government policies and is subject to periodic review and adjustment. The minimum wage is the lowest legal salary that an employer can pay an employee and it serves as a safety net to protect workers from unduly low pay. It is important to distinguish between the monthly minimum wage for salaried workers and the hourly wage for those who are compensated by the hour.

• Monthly Minimum Wage: As of the most recent update, the monthly minimum wage in Mongolia has been set at 420,000 Mongolian tögrög (MNT). This is meant to cover full-time employment, which generally consists of a standard working week.
• Hourly Minimum Wage: For those who are paid by the hour, the minimum wage translates to a specific amount per hour of work. This rate takes into account the total number of standard working hours in a month. Considering the current monthly minimum wage and a standard workweek of 40 hours, this would equate to an hourly rate of approximately 2,625 MNT.

It’s important to note that the minimum wage figures are gross amounts before any taxes or social security contributions are deducted. The minimum wage is also a topic of discussion among policymakers, labor organizations, and employers, as it influences the cost of living, employment rates, and overall economic health.

The government periodically assesses the appropriateness of the minimum wage levels against economic indicators such as inflation, productivity, and economic growth. Employers in Mongolia are legally obligated to abide by the minimum wage standards, and failure to do so can result in penalties.

While the minimum wage provides a baseline for earnings, many employees, especially those in specialized or professional roles, earn above this threshold. Moreover, some regions and sectors may have their own additional wage guidelines due to collective bargaining agreements or higher costs of living. Nevertheless, the minimum wage plays a critical role in the lives of many Mongolian workers, particularly those in lower-paying jobs or industries.

4. Gender Wage Gap

In Mongolia, as in many countries around the world, there exists a gender wage gap – a disparity between the earnings of men and women. Various factors contribute to this earnings difference, including employment patterns, career interruptions, educational background, occupational segregation, and social norms. According to recent statistics from Mongolia’s National Statistical Office, women’s average earnings are lower than those of men.

Several key points regarding the gender wage gap in Mongolia are:

• Occupational Segregation: Men and women often work in different sectors and job types, with traditionally male-dominated fields, such as mining, paying more than those where women are more prevalent, such as service sectors and education.
• Employment Patterns: Women are more likely than men to engage in part-time work or take career breaks to care for family members, which can impact their overall lifetime earnings and advancement opportunities.
• Educational Attainment: Mongolian women often achieve higher levels of education compared to men, but this does not always translate into higher earnings, reflecting a broader global pattern of educational gains not fully offsetting the wage gap.
• Labor Force Participation: Although the labor force participation rate for Mongolian women is relatively high, many women are concentrated in sectors that offer lower wages and fewer benefits.
• Legislation and Policy: While Mongolia has made strides in establishing legal frameworks promoting gender equality in the workplace, there remains a need for effective implementation and cultural shifts to ensure equal pay for equal work.
• Social Norms and Expectations: Traditional gender roles continue to influence career choices and earning potential, with women often expected to prioritize family responsibilities over professional advancement.

To address the gender wage gap, Mongolian policymakers and advocacy groups are working on strategies to improve women’s access to higher-paying jobs, support for women in leadership positions, equal pay for equal work policies, and ensuring that legislation protects against discrimination in the workplace. These efforts aim to create a fairer labor market and advance economic equality between genders. However, achieving wage parity remains a complex challenge that will likely require a multifaceted approach over an extended period.

5. Highest Paying Occupations

In Mongolia, like in many other countries, the highest paying occupations are typically found in areas of the economy that require specialized skills, advanced education, or significant experience. Additionally, industries with a high level of investment and international presence tend to offer higher salaries.

Some of the highest paying occupations in Mongolia include:

• Mining Engineers and Geologists: Due to Mongolia’s rich mineral resources, professionals in the mining industry, particularly those with expertise in engineering and geology, command high salaries.
• Banking and Financial Services Executives: As Mongolia’s financial sector grows, there is an increased demand for experienced executives and professionals who can manage operations and strategic financial planning.
• Healthcare Professionals: Doctors, especially specialists such as surgeons, cardiologists, and radiologists, are among the highest earners in Mongolia, reflecting the need for skilled medical care.
• IT and Technology Experts: With the global rise of technology, IT professionals, including software developers, systems analysts, and cybersecurity experts, find themselves in high demand.
• Construction Managers: Construction and infrastructure development projects often offer lucrative positions for experienced managers and engineers.
• Legal Professionals: Lawyers, especially those specializing in corporate law, intellectual property, or international trade, earn high wages due to the complexity and importance of legal expertise in business matters.
• Executives of Multinational Corporations: Senior-level managers and executives at multinational companies typically receive high compensation packages, which may include bonuses and other benefits on top of their salaries.
• Business Consultants: Skilled consultants who can provide advice on financial management, organizational development, and market strategy are well compensated for their insights and guidance.
• Aviation Professionals: Pilots and aviation engineers, given the critical and specialized nature of their work, have high earning potential.
• Academic Professionals: While not traditionally among the highest paid, experienced academics, particularly in research-oriented and technical disciplines, can achieve high earnings.

It is important to note that these occupations often require not only formal education but also significant practical experience. Additionally, fluency in foreign languages, particularly English, is a valuable asset that can increase earning potential as it opens up opportunities in international markets and environments.

While these occupations represent the upper echelon of wage earners in Mongolia, the actual salary can vary depending on several factors, such as the size of the company, the individual’s level of experience, and current market conditions.

6. Annual Average Wage Growth

The annual average wage growth in Mongolia reflects the changing economic landscape and the impact of various external and internal forces. Wage growth is a crucial indicator of economic health, providing insights into the ability of Mongolian workers to cope with cost of living increases and signaling the overall direction of the country’s labor market.

• Inflation: Inflation has a direct impact on wage growth, as salaries must often be adjusted to maintain purchasing power. Historical wage growth in Mongolia has sometimes struggled to keep pace with inflation, leaving real wage growth more modest than nominal figures might suggest.
• Economic Performance: Mongolia’s economic growth rate influences wage growth, with periods of high economic performance typically correlating with faster wage increases. The mining sector, in particular, can significantly affect the economy due to its large share in exports.
• Legislative Changes: Government minimum wage hikes and other legislative actions directly influence average wage growth. Policy decisions intended to improve living standards often result in obligatory wage adjustments across the employment spectrum.
• Labor Market Dynamics: Fluctuations in demand for labor, unemployment rates, and the balance between available jobs and job seekers contribute to wage changes. When the labor market is tight, employers may raise wages to attract or retain talent.
• Foreign Investment: An increase in foreign direct investment can stimulate wage growth as multinational companies tend to offer competitive salaries, especially for skilled labor.
• Sector-Specific Trends: Individual sectors may experience different wage growth rates due to sector-specific factors such as technological advancements, global commodity prices, or regulatory changes.

In recent years, Mongolia has experienced both rises and challenges in its annual average wage growth. Depending on the global and local economic conditions, such as commodity cycles impacting the mining sector or fiscal policies affecting investment, wage growth rates can vary substantially from year to year.

To foster sustainable wage growth, the government and private sector initiatives often focus on enhancing productivity, diversifying the economy, improving the quality of education, and attracting high-value industries. These efforts aim to create a resilient economy capable of providing consistent and equitable wage growth for Mongolian workers.

7. Compensation Costs (per hours worked)

Compensation costs per hour worked is a measure that takes into account not only the hourly wage of employees but also additional labor costs borne by employers. These costs can include social security contributions, taxes, and any other mandatory or voluntary benefits employers provide. In Mongolia, just like in other countries, these additional costs can significantly impact the total expense for employers when compensating their workers for each hour worked.

Key components of compensation costs in Mongolia include:

• Wages and Salaries: The direct monetary compensation paid to employees for the work performed during a specific period.
• Social Security Contributions: In Mongolia, employers are required to contribute to the social insurance fund, which includes pension, health insurance, and other social welfare benefits.
• Taxes and Duties: Various employment taxes and duties must be paid by employers, which can include payroll taxes and other government-imposed levies related to employment.
• Vacation and Holiday Pay: Employers often factor the cost of vacation, holiday, and other leave entitlements into the overall compensation costs.
• Bonuses and Incentives: Many employers offer additional financial incentives, such as performance bonuses or year-end bonuses, which contribute to the overall compensation cost.
• Non-Monetary Benefits: Other forms of compensation can include non-monetary benefits like housing allowances, transportation subsidies, or meal vouchers.
• Overhead Costs: Indirect costs associated with maintaining an employee, such as workspace, equipment, training, and administration, can also be considered part of compensation costs but are not as easily quantified on a per-hour basis.

The exact compensation costs per hour worked can vary widely between industries, company sizes, and individual agreements. Employers must carefully consider these costs when making hiring decisions, setting wages, and managing budgets since they impact both competitiveness and profitability.

For a comprehensive understanding of labor costs in Mongolia, it is important to analyze not only the average hourly wage but also the associated additional costs that employers incur. These figures provide valuable insights for both domestic and international businesses considering operations in Mongolia. Moreover, understanding the full scope of compensation costs is crucial for policymakers when they assess the impact of labor regulations and the competitive landscape of the country’s labor market.

8. Comparison with Other Countries

When comparing the average salary in Mongolia to those of other countries, several factors need to be considered, such as the cost of living, economic development stage, and overall productivity. Here is a brief comparison between Mongolia and various countries based on different income categories:

• Comparison with Neighboring Countries: Mongolia’s average wages are generally lower compared to its more developed neighbors such as China and Russia, where industrialization and economic diversification have led to higher average incomes.
• Comparison with High-Income Countries: Countries with high-income economies such as the United States, Germany, or Japan have significantly higher average salaries than Mongolia. These differences can be attributed to advanced technology, higher education levels, and stronger service sectors in these nations.
• Comparison with Developing Countries: When compared with other developing countries, particularly within Asia or Africa, Mongolia’s average salary might be comparable or slightly higher, reflecting its natural resource wealth and smaller population.
• Comparison with Former Soviet Republics: As a former satellite state of the Soviet Union, Mongolia shares historical and economic ties with other former Soviet republics. While some of these countries have similar wage levels, others, particularly those with rich natural resources like Kazakhstan, often boast higher average wages.

To illustrate the differences more clearly, the following table provides a comparative look at the average monthly salaries in a selection of countries across different regions and economic stages

Country	Average Monthly Salary (USD)	Cost of Living Index*
Mongolia	1,500	105
China	1,800	110
Russia	2,300	100
United States	3,500	100
Germany	4,000	115
Japan	3,200	108
Kazakhstan	1,200	95

This table only provides a generalized view, and the figures should be updated with current data for accuracy. Furthermore, these comparisons do not always reflect the purchasing power parity (PPP), which considers the relative cost of local goods and services. For a full assessment, the average salary must be evaluated in conjunction with the living expenses to understand the real value of earnings in Mongolia compared to other countries.

Finally, it’s important to note that salary comparisons across countries are complicated due to different taxation systems, social security contributions, and other deductions that affect net take-home pay. These factors, along with currency exchange rates, need to be taken into account for a comprehensive comparison of international salaries.