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Comment by tut-urut-utut | Hacker News Reader

Without reading the article (site is down) my expectation is that the data will show significantly lower salaries in Europe than in the USA.

One of the explanations is that there are almost no genuine software development companies in Europe. Software jobs there are mostly internal (enterprise) software development or customization, and not software product or service development.

Being a cost centre instead of a profit centre has its effect on salaries, and is hard to overcome. If you are not satisfied with your enterprise developer role in the USA, you go to FAANG or one of the numerous startups. In Europe, you go, where? In another company that is not different from previous one.

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"..there are almost no genuine software development companies in Europe. Software jobs there are mostly internal (enterprise) software development or customization, and not software product or service development."

So my career for the past 14 years has been a dream? Of course there are software product companies in Europe.

I can name any number of them for example in the really small (population wise) Helsinki area. Just to name a small subset: Supercell, Rovio, Remedy Games, Napa (ship design), Rightware (automotive UI:s), Basemark (AI and mobile graphics), F-Secure, Aiven...

Then there are hardware businesses that are deeply linked with software. Nokia (Networks, not phones...) being the most prominent of them, but new comers as well - IQM (Quantum computers), Varjo (VR headsets), Iceye (satellites)...

Then there are the subsidiaries of global companies developing software - NVidia, Trimble, Huawei (handsets), Amazon (robotics), QT, Electronic Arts, Unity...

This is not an exhaustive list but just a small subset out of the cuff. If I can name this bunch just from my local capital area in Finland I can only extrapolate that the Zoo of software companies in Europe is, in fact, quite large.

There are just not any Google of Facebook scale unicorns (except local subsidiaries of them course).

Yes, the Supercell HQ across the road from where I live must be a mirage ;)

I'd point out two things:

While the valley definitely skews the high end in America, it employs a fraction of the total developers in the US. There's the other 90% of the country that doesn't live in the valley that works in those very same "corporate development" jobs that are in Europe. You don't think companies like Walmart, State Farm, Allstate, Epic*, Target, Best Buy, UHG, Dell*, IBM* etc. etc. employ boatloads of developers all outside of the bay area? They should similarly bring down the average pay.

It's also unfair to say Europe doesn't have development jobs... heck SAP is the third largest software producer in the world and they're based in Europe. SuSE is still headquartered there. I have no doubt there are plenty of startups there as well.

*for accuracy - Epic, IBM, and Dell are all at least partially software companies but employ a ton of people outside of the bay area

I do consulting work for those kinds of clients, and we’re having a hard time hiring engineers with a few years experience below $150k. Previous talent shortages were primarily for that top 10% of developer talent / salary, but this one feels different because grunt-level unsexy corporate IT technologists are also in short supply.

It’s interesting how ever within the US, there seem to be worlds of difference.

> grunt-level unsexy corporate IT technologists are also in short supply

This describes my work experience, and I don’t think I could even get six figures, or would barely break that.

Yeah, the difference is that your average corporation is sitting on a 10% net margin and tech product companies are sitting on a 35% net margin. Product companies are bidding for the best talent among eachother. Corporate IT simply cannot afford to compete with them on salary because their margins don’t support it.

I think we’re going to see a real bifurcation of the economy along these margin lines, where the “haves” and “have nots” are determined by the industry and company you work in.

> I think we’re going to see a real bifurcation of the economy along these margin lines, where the “haves” and “have nots” are determined by the industry and company you work in.

More interesting to me is how difficult it seems to be to move between these, and I imagine it will only et worse.

Epic pays pretty well. I've seen senior developers getting 350k plus total comp, so it's not horrible.

> no genuine software development companies in Europe. Software jobs there are mostly internal (enterprise) software development or customization, and not software product or service development

There are plenty of companies who make software product(s) as their main/only line of revenue in Europe. What there isn't, however, is FAANG style companies that are huge, very high profile companies (there are big technology companies, e.g. SAP, but none that I can think of that are so consumer-facing as FAANG).

> In Europe, you go, where? In another company that is not different from previous one.

Yeah, this simply isn't the case. Different companies are different to work for.

I'm from a small European city of around ~100k people. I think we produce a decent number of successful startups for our size despite having access to only a small fraction of the capital compared to Silicon Valley startups. However their fate is to be eaten by the big fish, so if you take a walk around industrial areas you'll see offices for IBM, Oracle, Cisco, Fidelity etc. not realising that they were formerly successful startups and think that there are no "genuine software development" companies in town.

> you go to FAANG or one of the numerous startups. In Europe, you go where?

* In startups.

* In FAANG offices (they have offices in Europe).

* In other software development companies which are neither of the above, but are still numerous in Europe.

To say Software development in Europe is mostly internal enterprise software development is blatantly wrong. I'm in no way saying the job market and domain topology is the same, because it definitely isn't, but this is an incredibly inaccurate take about the software market in Europe.

Another explanation is that EU is not a large cohesive economy like the US. In the US, startups target a potential userbase of 300M+. In the EU, a startup typically only targets a single country with a fraction of the population. Seems obvious that the potential profitability of a piece of software correlates with the population of its market. And only natural that developer salaries correlate with the potential profitability of the software that they make.

Although EU businesses know this and target the US/International market.

I have similar expectation, but note:

1. Many of the FAANG have presence in Europe

2. There's a lot of fintech in Europe

> In Europe, you go, where?

Same place? All of FAANG and beyond has offices in Europe.

with lower salaries, and they are trying to justify it by the “lower cost of living”, which is not actually lower. The only the exception is Switzerland - FAANG salaries here aren't lower, because this country has so legendary cost of living ;)

Based on reported data from levels.fyi, senior SWE salaries in the US go up to $600k whereas in Switzerland they max out at around $400k.

If looking at averages, there’s about a $50k difference.

There might be more data for levels.fyi in the US than EU.

600k$ is 480k EUR. I know SEs in Germany doing more than 400k EUR at FAANG.

I wondered about reporting biases, which makes sense - I suppose levels.fyi is more popular in the US. Thanks for sharing that data!

That is a lot for Germany, can I ask what companies are they work at specifically?

FAANG

The US has higher cost of living if you factor in the many externalities like lack of usable public transit, mass shootings, the opioid epidemic on the streets, and many other US disasters impacting the cost of getting an equivalent quality of life.

Some of that is subjective, but as a non-American who has worked in a number of countries, the Bay Area ranks pretty fucking high.

I believe numbers more :)

I'm guessing the size of their presence in Europe in total is way way smaller than in SV alone (not to mention entire US).

This is just not true.

There are plenty of product companies in Europe. To give just a few examples: Spotify, Deliveroo, Blablacar, BackMarket

> In Europe, you go, where?

I don't know where you go if it's about the type of work you do. If it's about compensation, you go freelance. You can double your income or lower your work load. Your future is less secure, but who here really believes that developers will no longer be in high demand within the next 10 years?

I don’t really think that’s true. Most US tech companies have branches in Europe nowadays

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