Lower income tax.
Lower corporate tax.
Eliminate onerous labour laws.
Eliminate unnecessary regulation.
Improve English education.
Raise public sector tech salaries.
Stronger accounting and capital market regulations.
Stronger contract laws.
https://hn.algolia.com/?dateRange=all&page=0&prefix=true&sor...
Why would that increase gross salaries?
> Lower corporate tax
Why would that increase gross salaries? Corperations pay the minimum they can for the product they get
> Eliminate unnecessary regulation
Well the UK has just created a ton, so that's unlikely to happen, but what specific regulation, and how does it keep wages low?
> Improve English education
They should try that in the States first
> Raise public sector tech salaries
That doesn't really mesh with lowering taxes
> Stronger accounting and capital market regulations
Seems the opposite to elimintating regulations
> Stronger contract laws.
In what specific way?
As for regulation, [1] suggests EU employment regulations for performance can require documented performance improvement plans before firing an employee is permitted. This basically makes early stage startups untenable, as you can’t easily remove employees that are incompatible with the company’s goal. For example, if you suddenly pivot you can’t just let go of an entire product line’s employees in a week. A recent example of this happening that made it to the HN front page is Gumtree laying off most of their employees a few years back. The trade off is obviously employment stability for employees, but in a hot labor market like software engineering there is not much downside to decreased stability.
Ultimately startups provide competition for big tech and drive up salaries, since if big tech doesn’t pay high enough people will flock to startups that will eat the big tech company’s lunch. That ecosystem doesn’t exist in Europe at least partially because of high income taxes and burdensome labor regulations.
[1]: https://www.saplaw.co.uk/brexit-articles/669-dismissing-an-e...
Income taxes for a $500k/year person in Arkansas is $196k
Income taxes for a $500k/year person in the UK $220k - but that includes healthcare
Why isn't Arkansas the centre of the development world? Does skipping healthcare and increasing your takehome pay by 3% really make a difference?
sources:
Healthcare costs for FAANG and other big tech employees (such as those that would be making $500k) are on the order of $2000/year or less. The company I currently work for covers all health insurance costs for me and I can choose to enroll dependents at a small cost per month. Again, adding high healthcare costs here for an engineer making $500k is unrealistic.
[1]: https://www.crfb.org/blogs/us-highest-taxed-nation-world
An company in the UK spending $500k a year on an engineer will get the employee about $250k a year
An company in California spending $200k a year on an engineer will get the employee about $147k a year
An company in the UK spending $200k a year on an engineer (gross salary £130k plus £17k employer NI) will get the employee about $107k a year
Its not taxes that keep the salaries "down" in the UK
Your own numbers show taxes are absolutely one cause of lower salaries in the U.K., although certainly I don’t claim they’re the only cause.
This may quite likely have the opposite effect. Corporate tax is auf on earnings. If corporate tax is high, the push to generate higher earnings is decreased - a large chunk would end up in the tax authorities pockets. Paying your employees more this hurts less since part of the delta is paid from taxes.