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Comment by serpix | Hacker News Reader

These numbers are close to double that of Europe. Only self employed consultants get near the bottom edge of those incomes.

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Salaries in the US are pre-payroll taxes, post in EU. Also not included in US salaries: daycare, healthcare, college savings.

Is see this trope all the time, but it’s an illusion. Compare apples to apples.

Edit: Payroll tax != income tax. Most people aren’t even aware the employer is paying this. It’s the light blue bar in the chart in this article: https://en.wikipedia.org/wiki/Payroll_tax

No, these are double or more than pre-tax London salaries. I'm not sure about continetal Europe, but the convention in the UK is to report pre-tax salaries.

Healthcare is complicated. Most cushy tech jobs in the US come with the premiums included. But in the US there is always a significant risk of large and unpredictable medical expenses. (Especially when you consider that there's no guarantee that you'll keep your job!) That one is difficult to put figures on.

I don't personally care about daycare and college savings as I'm not planning to have kids.

> I don't personally care about daycare and college savings as I'm not planning to have kids

Right. But you ARE going to get old and sick and someone else’s children are going to take care of you. You probably want them educated and doing stupid mistakes because they’re overworked.

More people to to college in the US than in the UK.

While that was the case, it doesn't seem to be anymore (for instance see the age cohorts here: https://en.wikipedia.org/wiki/List_of_countries_by_tertiary_... ). Two year non-degree courses also seem to be much more common in the US than elsewhere, which skews things a bit.

Fair enough. It's not a big gap.

Employer's NI is 13.8%, so multiply a normal 'pre-tax' salary by 1.16. Then again, the Americans are presumably getting health insurance so it'd be a wash.

I have a sense that Americans are just better at negotiating (taught to do it, and actually do it) than Brits. Anecdotally I know a whole bunch of people who could be earning a lot more (not only in software), but they have this sort of meekness that leads them to believe whatever number the other party says is what they have to take.

Individually that may not make up all of the difference, but collectively it probably does (e.g. the market depressing effect if most people don't bother).

Honestly it hurts to say but the prevalence of tall-poppy syndrome, deference to your boss, etc. is horrific for salaries in at least Ireland, and maybe Europe as a whole. When I left my last job we found out I was paid quite a bit better than my colleagues (who were just as good) and all I had done was... push a tiny bit. They hadn't.

Other things like "always be interviewing even if you like your job" and stuff like that get the odd look of disapproval, even though it's pretty obvious you will do your best negotiations when you have the strongest position, which means already having a job you like.

>so multiply a normal 'pre-tax' salary by 1.16

I don't follow the logic of this. The amount of your quoted salary that you get to keep (for a typical SE salary) is going to be somewhat higher in the US than in the UK. (Not massively higher - Americans often inaccurately apply the stereotype of high tax Europe to the UK.) Whether the deductions are for employee or employer taxes is moot from a financial point of view.

If someone says "I earn 50K" in the UK then they mean that's their salary after employer NI but before income tax and employee NI. The cost to the employer (in straight cash terms, not including related stuff like a desk, computer, etc etc) is more than that figure.

It's not fully pre-tax, but we call it pre-tax, just pointing that out.

Ok, but that doesn't seem to have anything to do with US/UK pay disparities. US pay also doesn't include all the taxes and other expenses being paid by the employer in relation the the employee. E.g., the employer's portion of the health insurance premiums won't be included.

> but the convention in the UK is to report pre-tax salaries.

This isn't 100% true, you never see the employers side of national insurance for example.

But do you see something equivalent withheld from your paycheck in the US? Not that I noticed, when I was working there.

I don't know, I've never worked in the US. OP seems to imply you do?

I have before. I'm confused why people are bringing up employer NI if there isn't some kind of similar deduction that comes directly out of employee paychecks in the US. Otherwise, who cares that your employer pays some tax for everyone that they employ?

I’ve never seen European salaries quoted post tax. In which countries is this true?

Not income tax, payroll tax, the tax the employer pays for having employees. Most people are not even aware of this existing. It the one marked “Employer” in this table:

https://en.wikipedia.org/wiki/Payroll_tax

Its not a tax in Europe, but usually the companies share of social insurance. That is why the word payroll tax is confusing to us Europeans :-)

In Germany the company share of social insurance is another ~20% on top of the employees pre-tax salary.

It is not nearly enough to explain the wage disparity between SF/US and European salaries.

Exactly. 20% ON TOP of your salary. It’s baked in to the US salary. Sure, it doesn’t account for the whole delta but it’s not nothing.

It's fairly cold comfort to know that your employer is paying some taxes associated with your position that don't come out of your notional pre-tax salary.

What most people are interested in is how much of their pay is take-home pay. In the US, the take-home fraction of your pay will typically be somewhat higher. It's certainly not the case that software engineers in the US are getting bigger notional salaries but then paying a larger fraction in paycheck deductions than their European counterparts.

So e.g. in Denmark, Employer pays no tax for an employee, but still the salaries are nowhere near US.

Erm not sure what your talking about those us salaries don't have the employer side taxes either.

Afaik, in Italy, Spain, France and Netherlands, the convention is largely to talk about salaries post-tax. In UK it’s pre-tax.

I live in Spain and have only ever seen pre-tax numbers discussed. Certainly in professional jobs.

By tax, I mean income tax. I've only ever seen "salario bruto" in my contracts, in job adverts etc.

I'm Spanish and can corroborate this. Maybe sometimes with friends and family you'll talk about neto but otherwise everywhere else it's bruto.

TIL. Germany is also always pre-tax.

But software engineer jobs will nearly always include employer provided health insurance.

Not up to speed on the specifics, but don’t the insurances always have $x000 copayments?

My copays are virtually 0.

At the hospital where my child was born in Ireland there was a sign on the wall apologizing for the fact that if you didn't have your insurance card or medical card (public insurance basically) and you went to the emergency room they would have to charge you....

one hundred euro.

My mom was amused when I texted her the photo, in a sad way.

Software engineers have access to higher quality insurance plans. My current plan I pay mostly in the $10-$30 range per visit. I've had better plans than that. When at the last company, I was hospitalized for 2 weeks and my plan had $0 copay.

No.

These numbers are much higher than most of the US as well.

They're mostly representative of Seattle, NYC, and the San Francisco Bay Area. Also note that housing prices in these regions are astronomical, particularly the Bay Area. Even a relatively small house can cost millions.

A decent sized flat will set you back millions of pounds in many neighbourhoods in London; salaries are nowhere near these numbers.

I have colleagues who work in the London office and make similar numbers. Depends on the company.

That's largely a result of a property bubble, and is restricted to sale prices; _rents_ in London are much lower than in SF, say.

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