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Comment by weebull | Hacker News Reader

If labour relations are a problem in American then there's no way they are expanding into Europe.

TSMC is already expanding in the EU, specifically in Dresden, Germany. Because EU skilled labor is much cheaper than US skilled labor and in some aspects US unions are more powerful than unions in EU. That's why the EU is already full of semi fabs and other kinds of factories.

Worker's rights are not an issue when labor is 30% of what they would have to pay in the US for the same skill/talent. US skilled workers don't have it any worse than EU skilled workers, often way better. This isn't flipping burgers at McD's where you have no bargaining power and need unions and labor regulations to protect you.

And you need a lot of skilled people to operate a heavily automated semi fab: PLC programmers, opticians, physicists, material scientists, contractors, HVAC, electricians, plumbers, construction workers, Q/A, etc and irrespectable of workers rights, all those have much lower bargaining power for high wages in the EU than in the US, due to market supply/demand.

Otherwise there would be no investments in the EU and nobody would be making stuff here at all.

30%? You think they pay 30 percent US wages?

You might be thinking of two very different things - in the US wages are higher but social benefits that employers pay for are lower. In the EU you might pay a lot more per worker than his wage since you pay much higher taxes.

A friend of mine is a phd post-doc in the EU doing some fancy research I don't comprehend with lasers that has applications in the semi industry. He's paid about 40k Euros. His peers form the US he meets at conferences working in the same field make upwards of six figures, over 3 times as much, for the same work. So yes, I'd say my math was about right on the money.

If you wanna hire skilled workers in the US it'll cost you 2-3x more than in EU, taxes and all included.

Healthcare being outrageously expensive in the US and being borne largely by employers doesn’t seem to help either. Ironically, I see it as a negative for the employees as well since it forces them to be dependent on their employer in the event of a medical situation.

Which is more expensive for an employer? US healthcare or EU workers' rights that include 25+ paid vacation days, unlimited paid sick leave, difficult to fire, etc while American workers don't, but get bigger wages instead?

I don't know the exact answer, but what I'm trying to say is that there's no free lunch for employers in either location, but I'm pretty sure they do their homework on this and they know the exact answer when they decided to open up shop somewhere.

If I had to guess, I’d keep my finger down on US healthcare because it’s just so expensive. When you don’t pay your employees that much, sick time isn’t as expensive either, and US workers in the actual industries we’re talking about tend to get at least decent treatment (for the time being at least); it’s the wage-slave, burger-flippers and laborers we’ve deemed as truly disposable.

Sure, but we're not talking about burger flippers at McDs here.

Those definitely cost more and have better working conditions in the UE than the US, but that's OK for McD, because the burgers flipped in the EU by the costlier workforce don't get exported worldwide, but get consumed locally and therefore all this is reflected in local prices for local consumers which have no competition from imports from abroad.

But when we talk about skilled workforce for the semi industry and the products being fungible and exported worldwide, the equation can start to flip.

Another fair point, but I would think the semi industry (at least the segment that TSMC plays in) would be about the most advanced, least fungible good in the history of the world; they can literally only be made by that company. It’s somewhat akin to commercial airliners - despite Boeing occasionally forgetting to fasten the doors to the fuselage, they have no shortage of orders because there are only two companies that can build these planes, with I think much of the assembly done in the US or EU. Essentially these things sit at the very apex of the world’s current manufacturing capability.

>at least the segment that TSMC plays in) would be about the most advanced, least fungible good in the history of the world; they can literally only be made by that company

Not really. The margins Nvidia earns designing their chips are far higher than what TSMC earn fibbing them. TSMC actually has coemption. Samsung are only one node behind which is just enough to drive price competition down. Meanwhile Nvidia has no competition. You wanna be where Nvidia is, not where TSMC is.

OF course, this might change in the future either way.

Not negating your anecdotal evidence but this is not even a fair comparison. Is 40k post-tax? Where does your friend in the EU live? Germany? Or Italy? Dresden or Torino? Where do his US peers live? Arizona? Or LA? Worlds of difference. Is it 3 figures but below $150k? Also, salary is _not_ the only cost of having an employee. In the US actual employee costs vary between 1.5x and 2x salary. What is the equivalent in the EU?

The average salary for public researchers in France (only PhDs) is 47 k€ per year. Most PhDs end up in public research, as the private research sector is very small.

This is gross salary, on which you need to deduce social contributions (social security, retirement, unemployment insurance, and others) and usually reduces by 20% the gross salary. Then you get to pay income taxes in this net salary, which is around 10% of the net salary.

Note that sick leave is not paid by the employer, but by social security (the employer can complement). Social security here is the public healthcare and retirement system.

I am a software developer, I've relocated from US to France within the same company, and was paid 3 times less in the same role. As the private sector has extra contributions before gross pay, I estimate the employer cost is around 2 to 2.5 times lower in my case in France than in the US.

It is now also easier to fire people in France (probable the same in other EU countries) due to recent changes in employment law.

Each EU country is going to have a slightly different pay structure, but that gives you some comparison basis.

So overall I think the 2-3x ratio in skilled worker cost in EU vs US is a good estimate.

Depends on the EU country. Phd students earn more than 40k during their studies in NL, and a starter salary for a phd is 80k or so. Add the social security contributions on top, it's closer to 100k Euros for the employer.

40k would be high for Greece ir Portugal though. I guess it's the same for US, depends where you are

no way in hell a postdoc in the US is making 6 figures. Postdoc salaries are typically 40-60k

Over the past 10 years the us dollar has gained in strength a lot compared to other countries. Perhaps if we want to bring this stuff back into the country the currency needs to be devalued. I assume it will be naturally devalued over time, even compared to other countries, considering the national debt.

The more worker’s rights the less work?

Sectoral bargaining agreements are less problematic wage-wise than employer unions.

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