As a German myself: Why would you not invest? Infrastructure, state of mind?
I'd really love to see more high-tech companies invest here, after we've managed to kill the solar companies... :-/
I'd really love to see more high-tech companies invest here, after we've managed to kill the solar companies... :-/
In Silicon Valley, you can find a dozen 600k$ engineers relatively quickly to scale up a random startup.
In Germany... the salaries these people would be making would be < 100k$ because they are engineers, not managers. For some reason the only way to slightly increase your salary in Germany is to become a manager, but good luck with scaling up a start up by hiring 12 managers that don't have anybody to manage.
This disparity in the valuation of top engineers cause many to emigrate, and once you are in the US, it is impossible to financially justify taking a 5x pay cut to go back to Germany. (You can justify it "non-financially", but these other justifications would need to offset the 500k$ yearly that you are leaving behind).
So... finding top talent in Germany is hard. If you were to find them, hiring them would be 2x more expensive than in the US. Which makes a good that's very expensive, twice as expensive.
This is one of the many reasons why the startup scene in Germany is poor. Nobody wants to be the engineer that actually builds the stuff, everybody wants to be a "manager".
It turns out that many of the engineers that get to build the stuff become excellent managers once the company grows because they know it inside out.
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TL;DR: if you are a tech company that needs top engineering talent to grow a super high tech facility up, you can't find enough talent there, and the one you find is twice as expensive as somewhere else.
As others have mentioned, the price of talent is insignificant for TSMC compared to the price of their machinery, so they can afford the 2x increased costs, but the lack of talent is harder to offset.
Why don't you pay 600k$ gross then, they get 300k$ net, and thus 3x what they'd get otherwise in Germany, but don't have to move to the US? Seems like a feasible strategy to me.
The top talent is in the US, Taiwan, etc. designing the 3nm plants, operating the 5nm plants, doing research, etc.
Why would a 600k$/year engineer relocate from the US to Germany for a 300k$ salary pay cut ?
I've always made more money at my next job than the previous one.
If a company wants me to leave my life here behind and move 15000km, they better offer me more, like 700k$ or 800k$. In Germany, that would cost the company 1.6 million $ yearly.
But they need the ability to "level up" (by working with already existing high tech). And then they leave for the US anyway heh.
For example, Bosch has a research campus in california to try to achieve this.
The problem is, that after being 2 years in the US "becoming top talent", you now have the option of staying there making $$$ or coming back to germany.
Even companies like Bosch that invest a lot of money in these types of systems, have huge problems making competitive offers for the people that consider going back.
Also you assume they are a) happy to stay in the US b) have no immigration issues to deal with c) don't have a crazy CoL on SV that eats most of that 500k...
Yes, it's not a clear-cut move, but not too bad neither. Salary is not everything.
We're already down a notch. People tend to assume $1 = 1€ in this thread.
There are lots of ways to pay fewer taxes in the US when holding stocks. Plus you have 401k, backdoor Roth, etc. retirement saving plans that are non-existent in Germany.
Mega backdoor Roth is an even bigger thing:
I know people who emigrated to the USA decades ago, and now send their children to German colleges because those are practically tuition free for EU citizens (you need to pay rent tho). If you want to move back more early on, you can use your savings from your time in the USA to get the bulk cost of buying a house in one of the regions with good tech jobs like Munich out of the way. Then you can live a great life in Germany even with the limited German tech salaries.
Note that I'm not saying that you shouldn't go to the the USA in the first place. In fact, I'm still strongly considering it myself. But the less healthy, young, single, and childless you are, the more advantages does Germany have for you.
Working with people that are much smarter than you generally makes you better at your work.
So from that point of view, going to the places where the concentration of super smart people is the "highest" makes sense.
You'd have to be in a niche where there's only a few teams world wide that are any good, and the US one is the one that's hiring.
Its like comparing a top German tech university with MIT, Stanford, or Berkeley.
Sure the German tech universities are really good, but from the set of people I know with offers from MIT or Stanford, none of them rejected them, because they were a huge boon for their careers.
The impact is pretty much the same with tech in SV.
> so there's no reason to take the job insecurity and parental leave hit for that alone.
Parental leave is usually _orders of magnitude better_ in SV than Germany.
All SV employers I know offer you 4-6 months of fully-paid parental leave, and allow you to take more months, but unpaid. If your salary is 600k$, your paid parental leave is ~300k$.
In Germany you get max 1800 EUR netto / month of Elterngeld. If you take it for 14 months, that's 25000 EUR. Somebody making 5000 EUR netto/month (e.g. 120k$ brutto), and deciding to stay at home, looses 3200 EUR netto per month. Most of the people I know making slightly over 100k$ in Germany with kids went back to work as soon as possible (women in less than 3 months... which is nuts), because they have bills to foot (mortage, etc.).
They can run your company steady-state, but they are not going to build anything internationally competitive.
Why do you think you need people who don't care about having a life outside the workplace to build something competitive?
Can you really tell me with a straight face that Germany has 25% of the success examples that the US tech industry has?
IT isn't a fair comparison, no country in the world can compete with FAANG right now, that's hardly Germany's fault. And still, there's SAP and Deutsche Telekom. Telekom has 50% of Google's revenue. Sure, the market cap is another story, but still.
Most of the companies you listed were founded before 1950. That's not at odds with my thesis -- these engineers can continue to drive an already-successful business but will not be able to start something genuinely new.
For the record, yes they're the sort of engineers I'd want to hire. If we're making broad assumptions about a country's workforce, I'd want a happy, well-rested workforce that's not held hostage by their company's health insurance plan.
You say that as if valuing your free time is a sort of moral weakness in an employee.
If a German startup has a nice idea and start working towards it with 4 ppl 30h/week each, at say 50k$/year/employee, a US startup:
- has access to most VC funds
- the German startup might have proven that there is money there, which helps getting VC funds
- has access to (0) a lot of (1) top and (2) absurdly hard-working talent that will put as much time as necessary for the startup to out-compete everybody else,
- has access to an ecosystems of startups around that might help them,
- has access to better way to compensate these employers, like almost tax-free equity, etc.
- has access to better ways to cash out, IPO, SPACs, etc.
Once these startups outcompete and survive the competition, then and only then they can and do switch to 35h/week, etc.
Some of my friends from MSc. in Germany work there at startup incubators. They have 50k$/year salaries for 40-50h/week, and B2B startups get funded for 2 years, die, and they just move to the next one.
Most of them are trying to switch to bigger German companies like car manufacturers to get a 35h/week job that's higher paid, and are pretty burned out of the life of attempting to build stuff that ends up in nothing because they get outcompeted by the US, China, etc. every single time.
This type of international competition didn't exist 100 years ago at this level, and many DAX companies are that old. AFAICT the youngest company in the DAX is delivery hero which is 10 years old. The most valued company is SAP which is 40 years old.
Compare that with the 30 most valued companies in the S&P500....
That's a good question.
In the US, if you are founding a startup with 4 people, while all 4 are "employees", you are way closer to "self-employed" than to "9-4 employee at Siemens", and the startup more than handsomly compensates the employees with equity, to actually make it so: "you are working as an employee for a company that you own a big chunk of".
In Germany, it does not make financial sense to give a sizable chunk of the company to your employees. Many companies offer equity, or equity purchase plans, but as a "minor" perk, and not as the main part of the compensation.
OTOH, how long do you think self-employed people work in Germany? I know some that work 15 hours per day 7 days per week, and the system is perfectly fine with that.
So good question indeed.
My opinion is that Germany values with respect to "work" are incoherent and unsustainable.
Incoherent because Germany is fine with self-employed people working themselves to death for a miserable salary (most post man and DHL sub-sub-sub-sub contractors in Germany), the system itself keeps them miserable, while simultaneously preventing salaried employees to make the decision of how much do they want to work, and giving any freedom to their employers to appropriately compensate employees that perform better. The goal seems to be to squash the outperforming outliers, to try to broaden the average.
That's unsustainable, because cash cows (BMW, VW, Daimler, Siemens, Bosch, ....) come and go, but Germany can't generate them anymore. To the point that the German government essentially has to "co-conspire" with its cash cows (e.g. Diesel Scandal, etc.) to avoid any risks of them dying. The German people complain about the cash cows doing lots of lobbying, having lots of power, etc. but the reason this is the case is because, like the Germans call it, they are "of crucial relevance for the system".
Personally I regret not leaving Germany earlier, it's much harder once you have kids.
None of my PhD colleagues (from my and other top3 tech universities) is still in Germany, they are all in the US, except one which is now a Prof in the UK.
Most of my BSc and MSc colleagues are still in Germany, some spreaded out through europe, and few to the US.
Its pretty hard to some of us actually have work-related conversations with old friends still in Germany. They always ask about the salaries in the US, and guess something "absurd" like "you are probably making more than 200k$, 250k$?", to which the only thing you can actually say is "yes" kind of in shame, because making >500k$/year is "absurd"/"beyond imagination" by German standards.
We have all worked in Germany in industry before moving to the US (both internships, but also between MSc. and PhD, or briefly after the PhD), and there is just no comparison about the quality-level of the work and intellectual-growth in the US and Germany.
In my German employer, our 15 ppl team was 2 PhDs, and many MSc, all from different skill levels, doing a good job, etc.
In my US employer, our 50 ppl team has > 40 PhDs, couple of Stanford / MIT / Berkley / .. ex-Professors, pretty much all of them infinitely smarter than me, all giving me feedback, punching holes through my work, discovering my flaws, and teaching them to me, etc.
The difference in the amount of stuff you learn per day of work, the quality standards, etc. between both employers is abysmal.
And nobody wants to fund a startup run by engineers. Double whammy
Yes, to quickly ramp up, you would have to pay more than teh average market salary, but as you pointed out, engineering positions are not as highly paid in Germany as in the silicon valley. There is nothing preventing you from paying good salaries though.
Europe has a great supply of electronic engineers and physicists. The only challenge would be that currently a lot of semiconductor investments happen in Europe, but these investments don't happen because Europe is such a bad place to invest in. Including a great supply of engineers.
I'm baffled at some of the answers.
Paying somebody 600k$ does not make that person a good engineer.
You could pick an undergrad, offer them 600k$, and they could take the job, but that won't make them top talent.
No company out there paying their engineers 600k$ is going to give an engineer 600k$ if they are not worth each $ of those 600k$.
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It's not about finding engineers that are willing to have a 600k$ salary (who wouldn't if someone offers it to you?), but about attracting the best of the best engineers of a particular field, many of which already do have that salary. Why should they move to Germany?
Also: wherever they build their new fab, if it is outside of Taiwan, they probably have attract the engineers to move there, which place would be better suited at the moment?
But that's exactly what is happening. People are paid these insane salaries because they're either born American or got a green card. Do you think the 20 something hired at $200k+ in the Silicon Valley are worth 5 times the seniors devs at $40k in Thailand, Spain, Poland? The only difference between a 5 digits salary engineer and a 6 digits salary engineer is a green card.
Not really. Lots of people from everywhere in the World apply to Google for US (and German) positions. Most of them don't get the job. Google has offices everywhere in the world. If they want to hire you, they just hire you in your local country, and after 1 year you can transfer to the US without a green card.
> Do you think the 20 something hired at $200k+ in the Silicon Valley are worth 5 times the seniors devs at $40k in Thailand, Spain, Poland?
A 20 something hired by Google in Germany also makes 200k$. (160k EUR). For Google, these 20 something programming-competition winners and phds are worth more than most senior devs doing management with no programming, or cruft apps, etc.
Not all of these 20 something will end up making 600k at google though. But in Google they have the chance to develop into that.
But environment groups are saying that ground water levels have been decreasing for years and the factory would demand too much from the water network.
So who is in the right here?
http://allsinkscherman.blogspot.com/2013/02/berlin-water-pip...
It’s not that the relevant laws are a secret and used to club you over the head once you nicely settled in and set up everything to your own advantage
Basically, Germany built Chinas solar industry, let our own die.
Of course nowadays there is again political hypocrisy mounting around the need for shorter transport routes, domestic independence, more capacity, etc. But even so, measures to prop up European solar manufacturers are very weak, import duties have been lifted and China's production has now become too strong to oppose. So there is a little useless promising before an election, then silence.
[0] https://www.handelsblatt.com/unternehmen/industrie/studie-zu...
see also https://news.ycombinator.com/item?id=27942010#27943382
For example: http://cdn.statcdn.com/Infographic/images/normal/17307.jpeg
Also, they've made some seemingly stupid decisions such as closing nuclear power plants. And I'm not a fan of their climate change policy, they should push for a worldwide carbon tax instead of forcing EVs.
Making electricity more expensive, leading to A/C being expensive, leading to beer being sold unrefrigerated, leading to a general cognitive decline.
Butterfly effect :D
Also, Germany pushing for a worldwide carbon tax? That's neat, but I doubt it would cause more than a yawn in Washington, Beijing, or Delhi.