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Ask HN: Why do companies outside the US pay so much less?

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Re: Ask HN: Why do companies outside the US pay so much less?

#111

Post by MrDosu »

ThePhysicist wrote: post #37

A part of the gap can be explained by the way that work is organized in the US compared to Europe. Let's compare e.g. Germany and the USA: https://data.oecd.org/germany.htm https://data.oecd.org/united-states.htm If you scroll down to the Economic indicators, you will see that on average people in the US work around 1.700 hours a year, whereas people in Germany (and many other European countries) work only 1.400 hour…

In Germany you also have to account that your employer by law has to pay into your non employment and retirement funds. This is about 21% of gross income on top. If you make 100k, your employer pays out 121k. They also have to pay half of your health insurance (also not counted in gross income numbers).

Re: Ask HN: Why do companies outside the US pay so much less?

#112

Post by MrDosu »

sremani wrote: post #77
sigi45 wrote: post #55

I don't really care how much someone in USA earns. As a software engineere in germany you are earning good money. There are no killings in cities, affordable health care, high quality living standards, university costs 150$ for 6 month, no donald trump, 30 days real holiday (i take them, everyone does, every year), seldom over hours, parental leave. Btw. IT is more than google, apple, facebook and twitter. And no we…

>> university costs 150$ for 6 month. This is not a German miracle, its simple demographics, most of the Germans are in their productive years of 40s and 50s and their population in teens and 20s is tiny, so their investments are low even though at per-capita level they look tremendous. This is the reason why Germany's hope is automation. They are demographically not in a great place. of course, this will come home t…

Interesting trivia:

If you are from a foreign country and come to Germany to study in the universities, you also pay only that amount. There is a lot of diversity here nation wise in the universities. Education is considered a human right.

Re: Ask HN: Why do companies outside the US pay so much less?

#114

Post by tropo »

tedmiston wrote: post #93

Five things: 1. We are taxed on income heavily in the US. 2. Insurance is expensive here. 3. In the hubs, rent is very expensive. Take-home pay after considering these three things is a lot less than you might think. And also: 4. Generalizing the salary of positions across the whole US is misleading. An average engineering job in the midwest or outside of a hub can pay half the salary of SF or NYC. 5. It really depen…

Income tax varies quite a bit, and you have lots of control over it.

You can completely avoid state income tax: Texas, Florida, New Hampshire, Alaska...

You can chop down the federal income tax quite a bit. For example, you could have a dozen kids. For most software developers, that eliminates the income tax.

So, there you go. Zero income tax.

Re: Ask HN: Why do companies outside the US pay so much less?

#115

Post by developer2 »

kat wrote: post #22

As someone with Canadian and American work experience, I think US wages are higher because there is more capital in the States. Both Canada and the States struggle to find qualified software devs. The companies that can afford to pay more, get their pick of devs out of a very small pool, so the wages increase. However, in Canada, the companies won't/can't pay as much, so the devs end up making less, or moving south.…

Nearly every single development-based office in Eastern Canada (particularly Toronto, Ottawa, and Montreal), is based here solely to benefit from saving millions on their bottom line. I have worked for multiple American companies (usually based out of New York) who have all of their developers located in Eastern Canada, and it all comes down to this one reason.

They all make their income in the U.S.; all revenue is made in USD. They discover that the most senior positions in Eastern Canada pay $80-90k CAD per year, with $45-60k CAD being made by juniors. These companies take advantage of our economy to pay on average well below $50k USD per developer.

It has nothing to do with cost of living. It's entirely based on the currency exchange. They also gain back a huge percentage of their employees' salaries by lying through their teeth to government-backed programs, meaning they actually pay < $30-40k/year USD per developer. It's actually disgusting. The executives at these companies are laughing all the way to the bank.

Re: Ask HN: Why do companies outside the US pay so much less?

#116

Post by astrange »

tehlike wrote: post #85
sigi45 wrote: post #55

I don't really care how much someone in USA earns. As a software engineere in germany you are earning good money. There are no killings in cities, affordable health care, high quality living standards, university costs 150$ for 6 month, no donald trump, 30 days real holiday (i take them, everyone does, every year), seldom over hours, parental leave. Btw. IT is more than google, apple, facebook and twitter. And no we…

Devil's advocate: US economy, startups, and so on are stronger than that of Europe's.

Do we know which % of US states are doing better than Europe? I'm sure it's not all of them.

(I think we should measure virtue by carbon footprint/chance of horrible death/crime/etc and not by GDP.)

Re: Ask HN: Why do companies outside the US pay so much less?

#117

Post by aplummer »

synicalx wrote: post #110
luan42 wrote: post #108

Earlier quoted context omitted.

That is just not true. Look at the numbers, and not on your feeling you get from the news. For I stance start with the number of bullets fired by police!

The statement was "There are no killings in cities", which is clearly not true - there ARE killings in cities. There are probably less overall than in America, but I really don't care enough to check.

"Probably"! The gun death rate is just over 10x higher in the US per capita (10/100000) v (1/100000), it's a massive difference.

Re: Ask HN: Why do companies outside the US pay so much less?

#118

Post by astrange »

thehardsphere wrote: post #30

A possibly flawed analogy follows: Hollywood is the biggest city in the world for acting, followed by New York, and maybe Vancouver is in third place. I'm pretty sure people working as actors in any of those three cities are going to be paid more than actors working elsewhere, because there's greater demand in Hollywood/NYC/Vancouver than there is Omaha, Nebraska. The biggest cities for software are San Francisco, Bo…

There's also video game industry, which produces software, and traditionally the only kind of software normal people enjoy using to the point of getting emulators for.

It's a little more distributed: http://www.gameindustrycareerguide.com/best-cities-for-video...

I'm surprised SF comes up so much still. Isn't the rent an existential threat to the industry?

Re: Ask HN: Why do companies outside the US pay so much less?

#120

Post by bgia »

MrDosu wrote: post #111
ThePhysicist wrote: post #37

A part of the gap can be explained by the way that work is organized in the US compared to Europe. Let's compare e.g. Germany and the USA: https://data.oecd.org/germany.htm https://data.oecd.org/united-states.htm If you scroll down to the Economic indicators, you will see that on average people in the US work around 1.700 hours a year, whereas people in Germany (and many other European countries) work only 1.400 hour…

In Germany you also have to account that your employer by law has to pay into your non employment and retirement funds. This is about 21% of gross income on top. If you make 100k, your employer pays out 121k. They also have to pay half of your health insurance (also not counted in gross income numbers).

Employers in the US do the same thing. On top of your salary they pay ~7% for your retirement (social security, the public retirement), then taxes for your unemployment and a bunch of state taxes, and if you work in tech they pay for your health insurance (the one at my previous employer was $600/month). Usually they will also match money you'll put into your private retirement account. That's usually another $7-9k in good tech companies. I.e. When you're paid $100k in the US in tech, your employer pays at least $120k as well. So that doesn't explain the difference at all.
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