If that is the case, why are dev salaries in, for example, Dublin so much higher than Berlin (€115,000 vs €86,000 if Levels.fyi is to be believed)? Both are EU capitals with excellent, well-educated workforces.
This relies on doing certain finishing work in Ireland so that all the companies IP and operations can be credited there. You need your servers there, or shadow managers to sign off sales and investments made in Germany so that the sale can be credited to Ireland. So you need to hire in Dublin specifically.
e.g. but not the totality: https://en.wikipedia.org/wiki/Leprechaun_economics
"in 2019, the IMF estimated 60 per cent of Irish foreign direct investment was "phantom"
My main point here is that you can't use it as an example for this discussion as it is a special case.
Ireland is certainly a low-tax haven for companies operating in the EU, but that isn't the sole reason there are 50,000 developer roles in the city. Your sources do not support your claim.
I bet that the total cost per employee is pretty close.
There are similar employer taxes (at somewhat lower rates, topping out at ~11% vs ~18%), but the total cost of employment in Dublin is much higher than Berlin.
Also, in Germany you have a lot of holiday (20 minimum, most companies pffer 30), 3 month notice period, 3 years parental leave (per child), pricing these in, I would always expect lower salary in Germany.
Commercial property, services, etc are far cheaper in Berlin. Hence why it's common to move start-up dev teams from Dublin to Berlin to save money. My own experience is that Berlin is significantly cheaper to employ developers in particular.
The cost is not close when you consider US tech employees who earn almost double what EU and UK employees earn. Corporate taxes in the UK have traditionally been lower than the US and UK companies don't pay for medical insurance. It's simpler and cheaper to launch a startup in the UK compared to the US.
I doubt the situation is much different between US and German or German and Irish companies. It's rare in my experience that companies can explain away salary differences by showing cost differences. Which should shock no one. Most companies seek to minimize labor costs and at best pay close to local market rates. Or even hire in foreign markets to reduce labor costs. If instead they were seeking to share profits you might see the result you're describing.
I know a company who agreed to pay €5,000/mo for an aparthotel while they find somewhere. The person came from far edges of Europe, not a specialised or very senior role at all
1) chose Dublin 2) Flew over multiple well paid engineers and paid for them to live there to train the new Dublin team.
So I think because of some of the tax strategies mentioned by others US companies choose Dublin which strongly influences the salaries paid there.
https://www.npr.org/2018/05/18/612441091/a-look-at-where-tho...
It's for two main reasons:
- Because American companies have a better sense of what the employees are worth (especially FAANG competition)
- Because Dublin COL is crazy
But outside of FAANG those salaries are not that high
Personally I’m on around €80k and senior but not in Dublin.