Or rather why Europe pays so bad.
I wonder whats the reason behind many american companies being able to pay 200-400kusd a year while its hard to get past 100k usd in the richer countries of Europe (Germany, Scandinavia, UK, etc.). A junior in USA gets more than a senior in Europe. And after 10 years the american may get 2-4x the salary of the european counterpart. In contrast life in USA is often even cheaper.
- Are european companies greedy?
- Are european companies less competitive?
- Are the high taxes and equality in Europe pushing companies to not try harder to reward talent while USA rewards the high performers as they can see the benefits it brings?
You’re right. But half this conversation is a bunch of people using random US stereotypes and downvoting anyone who says otherwise. Cost of living is fairly irrelevant when you’ve got an extra $200k/year post-tax to play with. And any company paying that much will give you really nice benefits including fully coverage health insurance and possibly a on-call concierge to help if you have any issues. Being poor in the US is really miserable but I also know people who can’t see a doctor in Europe due to waiting lists (or their GP blocking it) and lack of money for private insurance. Neither case matters if you’re an engineer. And France has the same rate of homelessness as California so neither has a happy community on average.
Each country has its own things that are better and worse. At the end of the day US companies pay more before taxes than european ones do for the same job. And when american companies come to Europe they also pay more.
I think the discussion of welfare, taxes, etc. is another talk which is independent of this post which id about before taxes salaries for the same type of jobs.
In the US I can quit a job with 0 days notice. I can also be fired from a job with 0 days notice and no severance.
That makes the job market significantly more fluid. If there is demand for a specific job compensation will go up quickly as there is no artificial buffer on people switching jobs for better pay. Supply and demand is very sensitive to small shifts in either. Companies are also not afraid of paying this compensation since worst case they’ll just do some layoffs.
If a US company has some employees in Europe then they still have a benefit from all this so they can pay more than a purely European company. If they need to cut costs they can fire the expensive US employees first and then adjust the Europe comp more slowly. If they need to grow quickly they can do so in the US and then slowly shift to Europe.
edit: The profit margins of US tech companies are also massive as they have relatively little regulation, taxes or bureaucracy. Goggle makes $2 MILLION/employee/year. So no risk of not making record profits by paying an extra $200k.