Dear Europe, please wake up
klinger.io
klinger.io
If you look at cost-relative (PPP) & per-capita numbers, the EU economy has been growing at a very similar or faster rate than the US for decades.
https://statisticstimes.com/economy/united-states-vs-eu-econ... has a good introduction to the top-line numbers. https://www.bruegel.org/analysis/european-unions-remarkable-... has a more detailed analysis.
The raw GDP differences come in very large part from exchange rate fluctuations and increasing costs & population in the US, not a meaningful increase in what the average American can buy with their earnings. PPP adjusts for these.
In terms of "how much <basket of normal purchases> can people buy" numbers, the EU is closer to the US today than it has ever been.
(That said, I fully agree with the post's conclusion regardless: a simple unified way to create an EU business & a universal language base would be a huge boost)
> US folks love talking about how hard they work. And honestly with service workers and blue collars I believe it. But not in tech.
Might be true for an established rest and vest company or position like sales or marketing, but the article seems to be wanting EU to be easier for startups. Not a single startup has that culture, especially when you’re building it from the ground up. You’re most definitely working 1.5-2x the hours as a regular job when it comes to starting a company and making it successful, even as an employee.
> Americans love their hero-arcs so much that people manage to spin anything into a “coming from nothing story” – even if they got their first investments from their uncle and worked for free in the “garage” of their parents multi-million-dollar house in Palo Alto.
Even now, the price tags distort our perceptions. I've heard some venture capitalists say that most of their investments would go for salaries that would be turned over to the real estate world.
Move to a suburb of Birmingham or Manchester, an hour outside of the city (just as SV was from SF, and then there will be plenty of room for teenagers to build things in garages.
It's always a bit of a frustration running into constant comparisons, managers who want to emulate processes, and such when "Hey, you know what, we're not them... and we're doing well being ourselves." Not that you immediately dismiss new ideas because they seem to be from there, but don't just adopt them arbitrarily or operate like them too.
I have a sneaky suspicion that "most" of the American tech industry is NOT at all like SF / valley tech world.
How can two people with exactly the same output (say two doctors working a shift with similar number of patience) lead one to be 20 times more productive because one bills $400 per hour and the other makes that number in a week (such as in say Turkey).
That's a 40x difference in productivity.
Stereotypes are just stupid and lazy thinking.
(Some) Europeans work more hours, but less efficiently
Go to a supermarket in Germany, see how quick a cashier rings your order. (yes self-checkout does exist)
And this is not only a North/South (or West) divide. Germans have their way of wasting "work energy" in some micro-bureaucracies in one way or another (and still they are more efficient than the average worker)
Some other southern countries will waste more time doing some things while in some other areas they will be the fastest/least-bs players around.
> But Americans definitely love talking about how hard they work; way more than we do.
Can't disagree with this.
American software developers have a tendency toward more ambitious and therefore risky solutions to problems, which have a higher variance in outcomes. European software development seems to gravitate toward what is seen as the safe conservative solution always. You may find yourself working more hours to deal with the risks that materialize as an American but sometimes that ambition pays off and you make a significant leap forward, and I suspect there is a higher sense of satisfaction with this result when it pans out. Particularly in the west coast tech cities, tolerance for both the risk of ambitious approaches and dealing with the consequences is dialed up anomalously high, that is just the water you swim in.
With the higher risk tolerance, both cultural and what the business allows, comes a requirement to be willing to work extra hours when needed for when it blows up in your face. This is sporadic, most days they don't work any harder than Europeans. Many Americans value the freedom to take ambitious risks more than they hate the downsides of that risk-taking.
The hero arc story is true and has to do with large Protestant population.
i was referring to this btw: America" (which btw is a continent, not a country)
A notable exception, and where much of the disagreement comes from is Spanish. I generally try to follow the convention of the language I'm speaking.
North America is a continent. America is absolutely a country. What do you mean?
The Eastern and Central European countries have always felt much more dynamic and open to work hard.
There's a reason why the countries on the lefthand side of the graph provided are also the ones with some of the better innovation industries in Europe.
There is still much work to be done in the CEE, but I'd be fairly confident that they'll become truly developed first world countries in the next 10-15 years, and some already have such as Czechia.
Andreas is exactly right imo - his points about simplifying incorporation (there's a reason why CH does so well) and normalizing English (there's a reason why every developing Asian country from India to Vietnam to China is pushing English fluency, and lots of the CEE countries) will help.
German, French, and British government officials are the worst to deal with imo - they will bend over the barrel for local conglomerates but ignore domestic challengers. Datadog could have been a fully French company, but the French ecosystem stifled them.
Also, ime - Western Europeans seem to idolize Finance, Law, Management, and Civil Service careers more than innovation or entrepreneurship, unlike their CEE (Germany and Austria excluded) peers.
Yet as soon as they try to take advantage of their position (via e.g. tax breaks) they'll get punished (eg 15% corporate tax rate, what happened to Ireland, Cyprus). Not being a single economy truly prevents competition for capital. So old money stays put where it is , new money is not allowed.
Their salaries are no where near those of Western Europe or the US, and not because of lack of ability but rather more macroeconomic issues in the regions. But a lot of technology solutions utilized by the world quietly get built out of there.
>German, French, and British government officials are the worst to deal with imo
I would dread dealing with my countries government anything if I have time pressure. The result could be anything. In Western Europe I know that things will be done even if slow (ish).
Let's be honest, most techies do that from India to Israel to Poland to US.
That said, Eastern Europeans are fine with occasionally partaking in crunchtime.
Meanwhile, when I dealt with our Western European sales and engineering teams they would all ignore messages even if a Tier 1 critical customer's shit hit the fan.
WLB is critical, but there are occasional exceptions that need to be made.
Why should I pay the same amount that I would in Eastern Europe, Israel, or India for someone who won't help firefight.
If you do provide critical infrastructure and people will die, it's also not my problem, because there will be a law requiring you to hire an SRE and a regulator to fine you to hell for not doing a good job too.
Being a founder is your 24h job and you made a gamble to make big money in a capitalistic game. I didn't, I'm fine with making 5 liters of borscht on weekend and eating it through most of the week. It's not even WLB, it's not what I have signed up in this life.
Btw, I'm in the cybersecurity space, so a Tier 1 escalation generally means nation state attack or business stopping attack on a customer.
> You did it to yourself and should not expect people on salary to bear the cost of your wrong decisions.
Plenty of escalations are due to bugs. It's good to operate on a blameless model, but if I followed your model I'd gladly put the blame on engineers like you if the cause was found to be a dependency issue or a misconfiguration issue.
Ofc, in the real world peers and I operate on a blameless model. Shit happens, but we need to fix our mistakes asap if they are made.
Ah yes, the "work hard and the boss will notice" meme.
I have zero incentive to work hard.
1. My salary is mostly tied to the market as a whole and particular company's performance, personal performance is the smallest bit of the equation.
2. Changing a variable from true to false on the personal request of someone very important will give me far more visibility than spending nights doing some work that only one other person is vaguely aware of, even if that work is super important. And visibility means chances for promotion.
3. Most companies are inherently undemocratic and employees have no input on decision making, therefore why would they care.
4. Most companies have proven that they're not afraid of screwing over their employees given the opportunity, so why wouldn't it work the other way around too.
5. In most cases, the reward for completing work early is more work. The punishment for being lazy is having free time.
I'm sorry but that's the corporate reality. I'd love to be a part of a team that works hard together to achieve great things, but that's not how the world works.
Being able to come to the office three hours late and leave two hours early without anyone complaining loud enough to get me fired is a much bigger job perk than Pizza Fridays.
Is that still true of China? Several top universities have removed English tests from their graduation requirements afaik.
Another major factor that makes the US more competitive is our different approach to intellectual property law that favors competition in comparison to the EU equivalents. Another big thing is less the Delaware effect that he attributes US simplicity to and more the existence of uniform model laws that transformed state business law through the 20th century. Then you have the fact that almost all (except parts of trademark) of the relevant IP laws to large scale enterprises are exclusively federal laws. This is not the case in the EU despite all the normalizing treaties. The EU does not and cannot perform the same role that the federal government does.
I have a better proposal: incorporate the European states as self-governing US territories under the supervision of the federal government. They could have some carve-outs and immunities using an administrative structure similar to that of Native American law. This would also resolve the NATO controversies by just absorbing all of the individual ex-EU member state country militaries under the DoD. It would also eliminate a lot of the weird Article V ambiguity by just making it all American territory.
Is GP joking I hope?
Let me put in another way. Can the EU solve the standardization issue and still keep the nice things you mention? I don't think they are related (at least I don't see a tight link)
I should have added the context for my earlier comment. I was merely reacting to the parent's proposal "..incorporate the European states as self-governing US territories under the supervision of the federal government. And absorb NATO into DoD.." It has lot more long-term repercussions than merely standardizing the standards !! I assume he was n't serious and probably just a clickbait comment to bring attention to the issue.
Lets talk pay, US tech workers, lets just say Sr SWE and up, and lets look at SF as the author uses this as a focal point. Salary is roughly $300-400k a year(in SF FANGish company), in Europe or England its about half of that, and maybe even less. I know as I have family I married into that points out this fact, the best workers all go over to the US and make large salaries over there at US tech giants.
Lets talk about taxes, especially in the northern European countries taxes are extremely high when you get into professional wage bands, ie. above 120-200K euros(50% tax rates in some countries compared to 37% top US tax rate) and capital gains which is a huge issue as some employees get a majority of their income through this - 30% cap gains tax rate and above for a decent amount of western/northern EU countries, compared to 20% top tax rates for US.
Lastly lets talk about employees, you hire someone and they don't work. In Europe you cannot just term them and give them a severance package of a few weeks. In France you are not allowed to even layoff employees unless you are close to bankruptcy(I think this was changed a few years back). But in general it is very hard to fire employees who are underperforming in the EU.
All of these facts really highlight why alot of top talent and founders from the EU come over to the US to make money and start companies. I am not saying one way is right or wrong but just want to pint out the points that both ICs/managers and founders have all told me(I am US based).
Or Switzerland and the UK?
And yet nobody would move there to find a job, not even from Italy, Greece or Portugal.
Their salaries are simply too low and the ROI in terms of quality of life it's not remotely comparable.
There's over one million Romanians in Italy, making them the largest foreign community in Italy.
In EU the share of ICT workers is pretty much homogeneous among the different countries.
It's their salary that varies a lot (but not as wildly as in the US)
It's much easier to get a decent wage for a Romanian in Italy than for a Romanian tech worker in Romania
It's the reason why a lot of Italians go to live abroad as well.
Italy has a population of ~58m but an ICT service population of ~500k [0].
Romania has a population of 19m but an ICT service population of ~200k [1]
And this masks the large Romanian tech diaspora in Germany, the UK, and ofc a portion in Italy.
So the question is, why are so few Italians work in tech in comparison to a much poorer country?
> It's much easier to get a decent wage for a Romanian in Italy than for a Romanian tech worker in Romania
Just using levels.fyi (which imo is skewed) Romanian dev salaries are higher [2] than Italian ones [3] and as a former hiring manager for one of those MNCs Europeans keep trying to apply to, I can attest that salaries for the 50th percentile and above are comparable across Europe, which ofc means CEE based tech employees end up having less of an incentive to move out West (excluding UK and Switzerland) when factoring CoL.
There's a reason Big Tech employers like Amazon have a major developer presence in Tier 2 Romanian cities like Cluj or Iasi and not Tier 1 Italian cities like Milan or Rome.
[0] - https://www.statista.com/statistics/419569/number-of-employe...
[1] - https://www.statista.com/statistics/419587/number-of-employe...
[2] - https://www.levels.fyi/t/software-engineer/locations/romania
[3] - https://www.levels.fyi/t/software-engineer/locations/italy
> Romania has a population of 19m but an ICT service population of ~200k [1]
Yeah and in Italy around ~9% of the population was not born in Italy (mostly coming from non EU/ poorer countries with no tech skill whatsoever, not a judgement, just a fact) while in Romania is basically 0%
So, as I've said, ICT workers are pretty much 10% everywhere in EU
You're putting your biases in your stats. We're also not taking into account many other factors such as the type of jobs we are referring to
Many countries have lots of tech workers doing mechanical turk kind of work (not saying it's true for Romania, just a data point that is missing here)
Moreover, hiring managers of course prefer to pay less than to pay more in absolute, regardless of the buying power
If I had to live with a Romanian salary in Italy, I would be in the lower tier while now I am in the top 10%, but of course tech workers have better salaries on average everywhere in Europe,so they are less incentivized to move especially coming from poorer countries, where their more than average salary would immediately become normal or less than average abroad. To get a better salary in Europe I should move to Netherlands or Ireland and work for some US Company. Not even UK is competitive in my case, all things considered, including the lifestyle I am used to.
Last, but not least. Amazon employes ~20 thousand people in Italy and of course has a strong presence in Milan (I worked for them in Milan) while it's only about 3.5k in Romania.
9% is low in three ways: lower than most western european countries, lower than many countries with a thriving IT industry and, finally, low enough that it wouldn't change the overall numbers too much
Same question as before:
where are you taking your stats?
Foreign born population in Italy is around 10% of the total, it is similar to similar countries in a similar position: France, Greece, Portugal.
We also do not count naturalized foreign-born and children born here, while other countries do.
But you're still missing the point: those millions of foreign born living in Italy have little to none tech literacy.
I have used the 9% measure because I assume that the remaining 1% are people who have some tech literacy.
In Germany there are (officially) 700 thousand Italians, unofficially it's 2 times that. They count in Germany as foreign born, but are highly educated immigrants, while immigration in Italy, given its geographical position, is mostly lower/no education immigrants.
> lower than many countries with a thriving IT industry
replace many with some. For example in UK officially 12.7% by the latest census data of 2011 of the population is foreign born, except they often times count as foreign born people born outside of the UK and their direct descendants. Which mostly is people from the former colonies. But also 6% of the total (or 50% of that 12% are people from the EU)
The foreign-born will include some people who are born abroad to UK citizen parents. However, it is usually still the preferred definition when using data on the migrant population, and especially change in the population over time.
Moreover, data on non-UK citizens also include many UK-born children of migrants who have themselves never migrated.
At the time of the UK census conducted in April 2001, 8.3 per cent of the country's population were foreign-born. This was substantially less than that of major immigration countries such as Australia (23 per cent), Canada (19.3 per cent) and the USA (12.3 per cent)
Wasn't UK already a tech hub in 2001? Am I wrong?
Last but not least, according to Statista Romanian annual average salary is around 20,000 (19,139) Euro while in Italy is 31,500 Euro.
The FAANGs and the capital gains are real but for a minority of us. If you're single and under 30 the Bay Area is a top destination for sure. You won't be that person forever though.
It’s really hard to imagine a scenario where someone is reaching 50+, can’t find a job due to ageism, and has anyone but themselves to blame. I have friends who don’t own property in SF, rented their whole lives, and haven’t accumulated millions in NW. They only have themselves to blame because they kept trying to do their own startups. They had 7 figure comp when they were at established tech companies but would keep leaving to start their own thing. They could easily be close to retirement but they’re gonna be working past 65 at the pace they’re going now.
The only thing they regret is that none of their startups they founded have made them rich.
Of course, this is not true.
What is true is when you hire somebody, they are on a trial period of 3-4 months that can be renewed once. After the trial period is done, you need a cause to fire them.
That's not true either. In California, you will also pay state income tax, most likely at 9.3% marginal rate - but possibly not too different in actual rate because the California thresholds are low. To continue the comparison, you'll need to consider which part of health insurance is or is not included (none in the US.) Etc. In the end, the marginal tax rates are pretty close. Meaning, shockingly high in California.
And if you do come here for work, consider also exit tax. If you are successful, you will fall under exit tax if you ever want to leave.
(Assuming I did my spreadsheet right. I'm not a CPA, and definitely not yours!)
This is not true! If a newly hired employee does not work, then you can fire them immediately.
as for firing employees, many tech workers are not employees but contractors, conditions about the job are set by the company in the begining ... also what I noticed that US workers can and will quit on the spot if they decided so ... the othe side of the coin with EU employees is that they won't and can't do this ... the employer can rely on this ... if they are given notice and fired, they will responsibly continue working for the law mandated X months, so that the employer has time to replace them, and they will train their replacement and do proper handover ... at least from what i've seen, americans in tech once they learn they are being let go, they drop everything and are gone
the EU way isn't that one-sided towards the employee, it has implications both ways ... and if you don't like the protections and stability, just get the person on contract instead, which many smaller startups do, as they don't want to be locked into their decisions too much
Exporting the manufacturing of to china is currently seen by many as a mistake (especially deindustrialization in regards to military hardware).
I highly doubt service jobs will be exported, especially considering the many different languages and the fragmentation of those languages.
Generative AI may help with the export or deprecation of service jobs.
Right now Eastern Europe due to bilingualism is a Hub for this: Poland, Czechia, Romania, Albania.
India will become appealing when most European business jargons will be english first. Already happens in Software dev, Marketing, Product design, even Legal / compliance, etc...
Western Europe is a great place to live, raise a family, and retire.
None of the tech hub countries are even remotely comparable to Europe in this sense.
If there are people in Europe who want to work in a high growth industry that desperately, they can move to USA or China.
Europe was a lot poorer in the 80's. China today has a higher GDP-per-capita then the EU did in the 80's. India has a higher GDP-per-capita than the EU had in the 70's.
If you have a decent political culture, you don't need a lot of money to avoid the worst kinds of poverty.
The accumulated wealth is long gone.
I've worked for an American tech company (and had a really good time doing so!) and visited the country. I can honestly say I'm immeasurably happier with my quality of life here in Europe.
Why stagnate now? Why not the economy of the 60s? 70s? 80s?
Today life is significantly better than back then. If Europe stagnates even more then we will still be in the same place in a few decades as we are now.
Because I'm European, and I'd like more money and a richer lifestyle.
> Western Europe is a great place to live, raise a family, and retire.
The average new-build home in my country (the UK) is about 850sqft. That's not flats, that's homes.
> If there are people in Europe who want to work in a high growth industry that desperately, they can move to USA
Do you know how tricky it is to move to the US as a skilled worker, and how much luck is involved?
I think the biggest suggestion is that the EU should standardize their legislation for creating and keeping a company. That (I think, but I'd love to hear arguments against it) shouldn't involve or be correlated with becoming more crappy capitalism like the USA (less working rights, weird health industry, etc)
The article also does not mention the huge difference in compensation for technology talent between the US and Europe. As long as that gap exists, top European talent will continue leaking across the Atlantic.
This isn't a single lever that can be pulled independently. You need highly fluid labor markets that force companies to pay competitive efficiency wages (i.e. fewer/weaker/no unions), competitive and innovative companies, lower regulation and government bureaucratic interference, ambitious and career focused labor force, etc. etc.
It's a chicken-and-egg problem that, at its root, stems from culture (IMHO).
Poles and Czechs get paid relative peanuts compared to West Europeans, yet have fairly startup industries compared to France or Germany.
Same with further afield in India or China.
- Free market is crippled by EU economical politics. Basically, EU is trying to implement centrally planned economics and fund many useless things by grants. About half of grants (in my country) going to ideology driven nonprofit segment. Many EU citizens are very angry about wasting our money. Also, our government is not able to provide cheap energy. It has historically lowest trust since 90's.
- We solve problems by creating new regulations. Instead of amendment of laws we adding bunch on new ones. In my country, its about 50 000 new legislative regulation every year. System is full of unnecessary bureaucracy. It costs many resources thus make it collapse in near future because of lack of resources (financial, personal, even mental).
Those aspects affect motivation in business significantly.
Many don't believe in reformation of EU. I expect EU exits of few member states in near future.
CEE (Germany+Austria excluded) has the right mix of regulation and ease of business for innovation to succeed, but French and German lobbying seems to be undermining it.
Maybe an EEC membership like Denmark's might be helpful down the line.
We have database of artist, voluntary joined by digital identity, that are open for work with companies (mostly PR - visual identity). After company choose an artist and they agree with collaboration, grants will fund about 80% of project costs (max. 8000 EUR). This cripple art free market because it give opportunity for unskilled artists to make something that company wouldn't pay by regulatory earned money. Company, that cannot see value in good design wouldn't profit from weak design anyway. As an artist, this frustrate me most. https://vouchery.kreativnicesko.cz/
In culture segment there are multiple film and music festivals that wouldn't exists without EU grants and funds. https://www.efa-aef.eu/en/initiatives/european-festivals-fun...
Feminist https://www.globalfundforwomen.org/ that is driven mostly by grants https://www.globalfundforwomen.org/who-we-are/financial-info...
Fighting against disinformation is driven by grants: https://gulbenkian.pt/emifund/grants/
There are plenty of those ideology driven nonprofit organizations that wouldn't exist without involuntary collected money (taxes) driven by centrally planed economics (socialism) with questionable benefits.
I'm not sure the author understands what he's asking for.
While having California residency, you can start a Delaware company, open offices in California, pay taxes to the State of California. If the State of California sues your company for unpaid taxes, which court do you end up in? California. If the State of California sues your company for civil rights violations, which court do you end up in? California. The US doesn't have some magical system where just because you register in another state, you can resolve all legal disputes in that state, therefore you're not beholden to the laws and governments of the state you operate in, or that Delaware is legally bound to enforce the laws of the other states and localities you operate in. Indeed you are beholden to said laws and localities. And indeed, complying with 50 different states and all their localities can be so damn complicated that there are entire products built to help you figure out how much sales tax to charge when crossing state lines, as well as how to pay it correctly; not to mention how to offer health insurance to remote employees, since every state has its own insurers.
At the end of the day, sure an "EU Inc", as the author puts it, may help make it easier to close deals. But it does not reduce the operational complication of operating across different localities. The rights of different localities to set their own laws and regulations for those who operate within their jurisdictions is unavoidable. You could have a single Brussels sovereign and a single English legal contract language and this would still be true, because it's already true in the US.
The EU has a "single market", not a "single marketplace". The market is the customers, not the companies, not the banks, not the courts.
This is the biggest factor why most European countries suck at innovation - dealflow is utter garbage in most of Western Europe because there are almost no VCs and most "VCs" are just family offices.
As a Western European founder, it's better to shift to the UK, CH, or US in order to simplify fundraising.
Look at Datadog, Databricks, Spotify, and others.
If you’re building the next Uber sure, this might be a problem.
But this is also a HUGE advantage if you’re not though. If you’re building the Workday for Estonia, or the LinkedIn for Germany (ie Xing) you have a huge advantage over any other big company that wants to steal your market share. Because there’s a bunch of local regulations, customs and ways of doing things that they simply can’t “port” over.
So yes, it’s a barrier if you’re building the next huge consumer startup, but at the same time it creates all these long tail opportunities for a LOT more startups that want to conquer a local market. And that probably helps a LOT more European entrepeneurs
Assuming you build a product custom tailored to Estonia's unique regulatory requirements that is targeting primarily business users, then you are targeting a maximum market of 324,000 businesses. It's realistic to assume, given Estonia's population of 1.32M people, that most of those businesses are sole proprietorships or small businesses that will not have any IT or service department to support them. Building a successful, competitive product in this fashion requires protectionist policies that favor a local product, and those policies will often run afoul of public tendering rules. At least with Germany, you are dealing with a much larger scale (~84M people, and ~5.3M businesses).
It is certainly possible to build and operate a service that would target Estonian, or other small countries, specific regulatory requirements, but the size of the potential market is extremely small, and the path forward to build a competitive service is to abstract away Estonia specific regulations so that you can build country/regional specific versions.
All that said, assuming you are successful in building a business that accomplishes an "X" product for "Y" market model, the entire success of the business is predicated on a market that is created by differentiation in regulation, and your product benefits from lobbying for eliminating those differentiation.
Optimizing for small, local markets is definitely a path to success for some businesses but it's not an easy one, and it doesn't seem like a reasonable investment for growth oriented startups that seek to compete in a global marketplace.
This last thing you said is worth pondering more on. Many places are happy not growing, doing what they love, in a way that suits their workers lifestyles. They can afford to stay small and protected, at the cost of needing to be locally focused, and they love it.
The way companies fundraise here is a bit weird to me. Much smaller rounds. Also typically thinking smaller in general. Obviously, everything is very commercially focused. In Germany, the worker protections make operating really quite difficult and it changes the culture of the company, too. Don’t even get me started about on-call culture.
I can’t really think of a distinct advantage to starting a company in EU vs US if you have a US passport outside some minor niceties. My current thinking is operating on both continents is likely best, with GTM in US and engineering in EU. But not sure…
Given how exploitative some US companies are, this sounds wonderful to be honest. The only way I can see this as a negative is if you view your employees as fungible commodities rather than valued team members.
No, I don't want to answer to your pager robot at 3 am for things I have no control over and don't want to touch. Get another robot to answer that or hire an SRE. I want to write my CSS and my 1 hour lunch break and live a life.
I keep seeing more and more from business types in the EU salivating over US business conditions: weaker labor laws, weaker regulations, record profits, etc. From the US it seems like the EU is doing fine and enviable from an employee perspective (except wages).
„Except the wages“ is kind of the problem. The source of that issue is the ability to raise capital, which is kind of addressed in the article, if you’d bothered to read before commenting.
and firing people is also not a mystery, interestingly PIPs are a US invention (but if labor laws are so lax, why were they needed there? :))
Granted, the hoarding of money and drive to greater wealth eventually leads to a capitalistic dystopias with massive wealth inequality. But you get lots of startups!
In reality what happens is you get 3 months notice of a firing in the form of PIP. Perhaps if you work at Walmart you can get fired on the spot, but honestly in industries where this is a common occupance, it's also well known that the employees also just don't give any notice at all either. They just stop showing up, maybe won't even give a 1 second of notice.
Personally, I'm happy for at will as someone who has had a shitty. Shitty job that ate at my mental health. I just had to say "today is my last day" and I fucking left and that was that. Got a final pay check and paperwork for continuing my benefits if I wanted them and this was at a random company in a labor hostile state. In some place like California, they would have been required to pay my last paycheck that moment instead of when the never payment day was.
I've seen employees work contacts that mandate notices by punishing you with legally enforced fines and whatnot and I just cannot see the benefit of being forced to give notice. It's just encourages your employer to make your life hell in that period if you're on bad terms and you had a good reason for leaving.
Right to work laws can get bent though. That's active underminement of unions for no benefit at all for an employee.
India has similar non-competes to Western Europe, but is able to maintain an innovation ecosystem.
If all of the EU's innovation system is sclerotic compared to Illinois or MA or India where non-competes are vindictively enforced, then there is a major issue.
Pretty much this. The best way to operate in India is to use a mixed Chinese and Israeli mindset tbh.
> India’s where offshoring from the us is
True, but there is a massive change now from the 2000s where it's just BPO. Literally the crown jewels of enterprise and deep tech and increasingly innovated and designed by the India teams directly (eg. the cybersecurity backbone of a major 5G telco in the US, the Apple mobile chips, Google Pay, etc).
What do you mean by that?
Cadre-driven parties like the BJP, DMK, BJD, BRS/TRS, etc are organizationally similar to the CCP but other parties are more loose and disorganized, so having a local partner act as your firewall helps massively by pointing you where to invest, just like in China, where most western companies invested in Guangdong, Zhejiang, etc but ignored Hubei or Guangxi.
There's a reason why Israeli, Chinese, Japanese, and Korean companies tend to be fairly successful with their India ventures, because they're used to this kind of an operating model, and most American companies tend to have a first-gen Indian American or Indian educated in America managing operations with India.
[1] https://m.economictimes.com/jobs/fresher/it-freshers-beware-...
[2] https://www.business-standard.com/amp/industry/news/non-comp...
[3] https://timesofindia.indiatimes.com/city/bengaluru/cant-enfo...
Not that I complain, six months of rest and vest life wasn’t bad :-)
You can ask your employer to let you go sooner if you want to leave, and they may ask you to leave sooner if they want you to leave (and pay you as an incentive). But it has to be by mutual agreement.
Usually they’d let you go sooner rather than later because they know you’ve already left mentally and they don’t want to pay for that. But they might also not, not necessarily out of spite but because they have a deadline and they think they still need your warm body.
My notice period is 3 months. I've also got 2 months of long service leave built up so in effect it's 1 month (as I can just take the 2 months notice)
On the flip side if they make me redundant I get the best part of 18 months salary after paying taxes, and at least 5 months pay after they say its happening where I can look for another job.
But OK, UK shot itself in the head with Brexit. Ireland speaks english natively, has low taxes (especially corporate ones), is easy to incorporate there, so how does notice apply?
https://www.workplacerelations.ie/en/what_you_should_know/en...
> Employees who have been in continuous employment for at least 13 weeks are obliged to provide their employer with one week’s notice of termination of employment. If a greater amount of notice is specified in the employee’s contract of employment, then this notice must be given.
Oh no, a whole week!
> Ten to fifteen years: Six weeks
Of course your contract may be different, but there's no real legal impediment here.
Increasingly not the case. I'm seeing an awful lot of "One month in the first three months, three months thereafter". It used to be pretty universally one month.
Notice to quit given by the employee is often the same time period as notice for termination given by the employer: what's good for the goose is good for the gander.
* https://en.wiktionary.org/wiki/what%27s_good_for_the_goose_i...
it's perfect for starting a company, working on your startup on the side.
If we look at other major developed countries (say Japan, S Korea, Canada, Austalia, New Zealand) they also lack the same innovation ecosystem the US has. Their economies have also been largely stagnating since the 2008 GFC in terms of metrics like nominal GDP per capita, labor prodictivity (GDP/hours worked), market cap of their national stock exchanges and diposable income. Canadian GDP per capita was $52k in 2011, and in 2021 it was still $52k. Meanwhile, these countries also saw their tech sectors decay. Blackberry was so big in late 2000s. Japan had the world's most advanced tech sector in the 80s and 90s. All of it gone, and the breaking point was 2008. You can see that in the productivity and GDP per capita charts of all developed economies except the US.
Why did the US outperform everyone so much? The main dynamic change in 2008 was QE. In my opinion, because the USD is the global reserve currency, it meant that the printed money gave an outsized benefit to the US due to the seigniorage effect, and distorted the dynamics of capital formation greatly in the US' favor.
So the US government got all this money. And this led somehow to the US economy outperforming the rest of the developed world?
Debt is money creation. Deficit spending by the US govt is money creation; FED literally creates out of of thin air some money to buy T bills when it does QE.
USD is the global reserve currency. Practically all trade deals are in USD, even when say a S Korean firm sells stuff to Indonesia. Only the US can print USD, all other countries must export goods or services to acquire the USD needed for their imports.
Say an amount X USD represents all goods and services in the world. When the USG prints money, now X+dX dollars represent the same goods and services. USG spends the dX amount via salaries, purchase orders etc, and this amount reaches US companies and individuals. These individuals then purchase goods and services abroad. Essentially, without producing or selling anything in return, US gets to import dX dollars worth of goods and services. That's what seigniorage means in that context.
As an interesting correlation, modern institutional venture capital was invented in the US immediately following WW2, and was producing notable outcomes by the 1950s. That has never really been replicated anywhere else.
It's usually better to use the local currency and adjust for inflation. If I got the numbers right, the real GDP per capita of Canada grew ~14% from 2008 to 2022. That's less than the 18-19% for the US, but not that much less.
* That the US functionally speaks a single language
* Has the single largest piece of arable land on the planet
* Overlaid with the largest navigable river system in the world
* Has by far the greatest energy resources of any country
* And is separated from any competitors by massive oceans and thousands of miles
https://www.reuters.com/markets/deals/basf-agrees-15-year-ga...
Apparently the Chinese are working too hard and being too productive, hence Janet Yellen complaining about 'overcapacity' recently:
> "I think the Chinese realise how concerned we are about the implications of their industrial strategy, for the United States, for the potential to flood our markets with exports that make it difficult for American firms to compete" Yellen said. "And then other countries have the same concern."
That statist description only started post-2016 after the market crash.
From 1979-2015 Beijing was very hands off (excluding local level PLI subsidizes, but basically every country offers them - think Amazon HQ 2.0 back in the 2010s or Yozma in Israel back in the 1990s).
Not really. The safety net is much better in some EU countries.
I’m, of course, talking generalities here; there will be exceptions.
I've never seen a single competing offer from a German company, not even at the highest level. A local career here as a developer is a dead end.
Is it the country you live in or the country where most of your customers are based in? What if your customers all live outside the EU?
France is never going to accept that you live in France but your business pays it's taxes in Germany or vice versa.
Also I don't agree with the author's take that Europe is not risk averse. It is risk averse.
I tried to open a bank account in USD at my local bank because I wanted my accountant to have access to all the deposits/invoices for my business. I had to answer a form with 50 questions as to why I needed this bank account.
I was told the process would take months potentially. the result is that 6 months later I never received a response and now I am using Revolut as my bank.
It's the small things really.
About the lack of English, that is absolutely true but not because EU kids don't spend enough time learning English, it's because of the teaching style and the culture.
In France all the movies/tv shows are dubbed in French. In Sweden it's not. Guess who speaks better English?
In Sweden I hear kids as young as 11 or 12 talk in English with their friends because it's cool. In France, there is no way in hell that this would happen. Finally the way languages are taught in France is absolutely terrible. There is a lot of emphasis on reading and grammar rules but barely any talking.
The result is that a high school graduate who has spent almost 8 years leaning English 2 hours per week at school can't hold a normal conversation in English for more than a few minutes.
Every country proportional to the profit they generate and the tax rate they set?
Companies overall EU profit $100M: - France $30M profit taxed at 20% = $6M - Germany $50M profit taxed at 25% = $12.5M - ...
Seems like it "just" needs an accounting system that works across the EU.
I forgot to mention, but if this EU Inc gets then created who gets the capital gain tax? Should it be divided in 27 or should it prorated to where you lived or where your customers live?
Don't get me wrong, I would love to see this happen but just like most of the things in the EU, it would become a nightmare to manage and add even more bureaucracy.
It's like VAT collection. We have to rely on middle-man companies to do the proper collection because most countries have vastly different rules regarding VAT.
As a business owner every minute I spend on paperwork is a minute less I spend on my business.
Personal taxation is always your country of residency. If you hold stock in an EU Inc., the capital gains tax in your country of residency would apply.
God people still haven't figured out how knowledge work and work ethic there is illustrated when you are giving your brain to your employer instead of your body. Some of these workers are thinking about work problems literally 24 hours a day, and come up with solutions in their dreams, but because they aren't literally chained to their desk writing lines of code every single second they are observed they are lazy slackers.
Can't stand this crap and it's just gonna get worse. Unless executives see you in pain, or are forced to sacrifice something you value like attending your kids piano recital they don't beleive you are dedicated enough to the cause like they are.
My observations (in the USA) over the past few years suggest that most people who were hired around 2019-2021 when hiring technical staff was super difficult, have an absolutely bonkers level of entitlement. People are making 200k a year, and bristle at the implication that it's not acceptable for them to be completely absent (from their fully remote jobs) and unreachable all day without warning. None of the nearshore workers I've worked with exhibit this attitude -- it's only Americans, and only the engineers. They assume that the company wouldn't dare risk losing them by calling them out on this, and that if they did lose their job it's going to be trivial to get an equal or better one anyway, so why should they do anything that might cause any stress? Why should they have a sense of urgency? "I'll get on it when I get back from the beach, the waves are really good this morning." That's the work ethic. I'm not saying it's everyone, of course, but it's a common attitude. Oh, and all these people have incentive stock options, but don't seem to really believe they matter, so they are deeply disappointed with like a 4% raise, thinking a 10-20% annual raise makes sense. Overall the attitude isn't one of "i'm going to do everything I can to make us successful so my equity will make me rich" it's "I'm going to maximize my cash compensation and minimize my hours spent on work until it's not fun anymore, then on to the next."
By the way, it is their right to act this way if they want, but I'm pretty sure the bottom 50% of US engineers (in terms of ambition) are going to find themselves replaced by nearshore talent that works harder than they do and doesn't even think hard work is an injustice.
But that sentence I highlighted just illustrates the thinking at the executive level (writer of this post is a CTO/Founder) and it drives me mad, and I believe the primary desire for in-office work. Creating a sustainable working environment where you deal with business problems is not the goal, the goal is to squeeze every ounce of labor you can for the money you pay and with no real idea how much work goes into the job, what's actually hard v. not, the only thing they can do is observe and bristle at stupid metrics like "how long is that coffee break."
So, why are those people not being fired? Because it sounds like they are judging their contribution to their employer and their own bargaining power exactly right if they are not being fired.
There are many ideas about how to fix things. What is missing is political will . Politicians find it easier to leech off (european and US) entrepreneurship , in order to "give back" trinkets to their audience. Look at how EU subsidies and grants are given, and how little return europe gets from huge research projects like ERC grants. It's mainly a eu-wide jobs creation program for perpetual academics.
Until you change that thinking, all ideas are not usable
If I take the relocation I get an automatic 50% salary cut, and my tax bill goes way up. Not to mention VAT and other expenses.
Seems like Europe’s problem with innovation is maybe related.
It's obvious that cashflow will suffer. The question is whether you will like living in Paris on the money that's left. There is a good chance you would and will also discover where the hidden taxes of living in US were. Or not.
My health insurance is free in the US, covered by my employer, my tax rate is 35% whereas I would be taxed at 45% in Paris. Gas costs more in Paris, car registration and taxes cost more, just buying a car in the first place costs way more, not to mention the car I own is not even legal there so I’d not even be allowed to do the same types of activities. Forget taking my truck to the lake with the kayaks and forget hauling materials to build my house.
It just doesn’t make sense why any smart, capable person would choose to live in Europe unless they absolutely loved the culture.
This is totally not how you move to Paris.
Do you have data to back this up?
Marginal tax rates are very similar between the US and France.
France taxes more than the US is a myth that needs to go away (at least for individuals, might be true for corps)
Sales tax is 8% where I live in the US. VAT is 20% in Paris.
In the US, you put a credit card form on your website and you're done. That's how people pay online, period.
In the EU, this is not the case. You have countries like Germany, where many people use EC, not Visa or Mastercard. You have countries like Poland, where (debit) card adoption and usage is very high, but online card usage is almost nonexistent. Except for the young and tech-savvy, there's a weird phobia here when it comes to anything that can take money from your account without your explicit consent. That complicates subscription payments for one, most major streaming services had to give in and allow bundling with cable and satellite TV plans (Netflix), phone plans (Spotify and Tidal) or payments by SMS (Storytel). There was a Storytel blog post once where they discovered that 90% of Polish people that cancelled at the "payment" step of the subscription flow did so because "credit card" was the only method available.
And that's just two countries, I'm pretty sure the other 26 have their own nuances I'm not aware of.
The creates the abundance of data required to win at AI.
Because Europe doesn't own its own data, they lack the data necessary to win in AI against others that do.
Creating a EU startup ecosystem without the megacorps is just feeding the American megacorps more because those startups will get acquired by the highest bidder.
Look at this snippet:
The European Commission approved on Tuesday up to 1.2 billion euros ($1.30 billion) of state aid for a European cloud computing project to try to boost the involvement of EU business in a field dominated by U.S. companies.
1.2 B is nothing compared to what the US giants are investing each year in their services. How can EU corps expect to compete like this? it's like high-shool team competing against Olympians.
Linux?
In my opinion, bureaucracy is a growing problem, at least in Germany. There is just so much compliance work involved in running a business, and it keeps getting worse. As a sole proprietor running a very simple business, my first year felt like I was just working on compliance, and my actual business was just a side quest.
I wish there was more effort at every layer to make bureaucracy easier to handle. We should consider the bureaucratic experience the same way we consider developer experience, because it affects adoption the same way. We need good architecture, good documentation, good utilities. It makes a big difference.
Reading between the lines, I do not think it distinguishes between full-time and part-time employment: "In Europe, employees tend to work fewer hours than in the US, partly because there are more paid holidays, the typical working week of a full-time employee is shorter and there is a larger share of part-time workers than in the US."
The work culture is very different. There's a clear attitude of working until the next holiday and the company never gets one minute more than what they pay me for. That's honestly not a _bad_ perspective to have but it's not ideal if you're trying to build a startup
Maybe next time take a look at this table: https://en.wikipedia.org/wiki/List_of_countries_by_labour_pr...
The countries at the back of "total hours worked" are at the top of "most productive per hour worked". These are also the countries that are doing very well economically.
I was 80% of the way through the comments before I saw any mention of the article's point. (Though I did see two comments claiming that they didn't understand it, which seems hard to believe, given that it was both simple and stated about three times.)
So: Flagged because it led to a lousy discussion, not because it was a lousy article. But that actually seems to be on HN rather than on the article, at least in my humble opinion...
You cant send a box into Germany. I'm sure I'm butchering the refined details but something like: You need to register with some approved entity who will sign off on the packaging you use with different rates for different volumes of which the first is 100 times what I need.
People who compare salaries obviously have no idea about the difference in cost of living in the US especially in California and especially in SV.
The productivity graph is obviously totally useless and not a representation of tech workers, but maybe fast food workers and diversity officers.
The characterisation of taxes and ease to start a business is utterly false.
To hire across the EU you need 27 tax offices and lawyers, following laws in every language, privacy policies, etc. in every language.
Oh they'll understand. They will just pretend not to. It's France.
And as for your snark, no, many French people do not speak English, and a fair number resent Americans going around like they own the place without making even a cursory attempt at being polite.
I speak French, German, and a small amount of Greek (enough to order a coffee and read a map). That's no use when I go to Italy or Spain or Poland or Latvia or Sweden of course, so we just speak English.
The big difference between europe and america is the market. The US is a homogenous culture with a single language and single desires with 350 million people. You can launch a product in the US based on US culture and assumptions and reach a massive economy
Launch it in Belgium and you've got a fragmented market. Not just the language, but also the culture -- expectations in Belgium, Romania and Norway are all very different.
On the other hand, as a foreigner, I have been to tiny villages in Sweden where even 70 year old grandmas know enough English to communicate.
Never believed that for a second. First, twitter is not real life. Second, let the europeans speak about Europe, not those who live thousands of kilometers away.
Somehow I don’t think many people living in the EU want the work/life balance of the US with paltry benefits and no social safety net.
These are not in the article.
> Eastern Europeans work harder than Americans. Even Italians work more hours than Americans. hours worked
> And based on my experience in the US, I honestly think that the US numbers are overstated.
Did you read the article?
1 EU Corps
2 Standard English language schooling
Seems wise enough. What will it take?
Personally, I think that English as the lingua franca makes sense in many contexts, since that's pretty much the case in IT already.
For example, trying to translate various terms in any given language from English usually causes inconvenience and confusion (everyone needs to know the localized version and then translate it back into English to find literature etc.). Therefore, it makes sense to teach everyone English.
I've had an easy time managing Eastern European employees in English, but Western European ones sucked at the language, and always had a bit of a complex surrounding English.
Similarly, translating a lot of terms from German or Russian to English often causes inconvenience and confusion. So better learn German and Russian. :-)
If the programming language key words that I needed to know used those languages, as did all of the documentation and forums, conference videos and literature, that's exactly what I'd do. But somehow those aren't the languages that everyone uses, nor is something like Chinese (and its dialects) which has a lot of users, but isn't as geographically widespread. Maybe people have also settled on English because it has a somewhat low barrier to entry as well.
I guess it's the same as needing to know at least some latin in the natural sciences, because otherwise something like naming bones when talking to a foreign colleague would get awkward, fast.
Other one I've heard is that if you start a company and it fails, at least in Silicon Valley they ask "So, what are you making next?". But, in Europe they imply that you apparently are not the right kind of person to be starting companies.
If we lived in a fair and just world, the EU having the 4th largest economy doesn't seem like a bad thing. Going by numbers alone China (1.8bn) and India (1.5bn) are much more populace than the EU (450mln).
However, I would would probably side with the author and personally much prefer a group of liberal democracies following the rule of law to always be on top. If the world needs to bow to autocracies then we will have a bad time, Russia is just the prelude.
Lingua franca really matters. China, for example, didn't have a unified spoken language until about 100 years ago. However, Mandarin is today universally understood and spoken in the country. And the result? You only to know one language, and you can have access to one of the largest markets in the world. Alas, the same could not be said for Europe.
(In fact, Europe needs a unified language if people are serious about getting rid of English and the Anglo-American hegemony, because each smaller language really cannot fight English now.)
I honestly don't think this is a fair comparison at all in the context of the entire US vs Europe.
Gotta be the Googlers. Elon and Zuck have shown the light to most tech cos and they are emulating to one degree or another. But Google seems unwilling/unable to deal effectively with the WLB'ers. After all, how can they conduct all of their political activities if work is getting in the way?
The English language thing, meh. I used to think the same but no longer do. Diversity is a good thing, it's Anglos who could use learning to work in different languages and cultural contexts.
Last but not least, just the tech bro-itis is so strong with this article. Like yeah if your identity and life is consumed by being a tech bro and you want the world to optimize for that and your startups, sure, let's make everywhere Delaware and the Bay Area. But that's not what most of the world wants or tries to do.
Hell, Switzerland does this, as do countries like China and India.
Based on this post that experience isn't much.
If you target the US market the pie is basically 10x times what it would be if you targeted your country in Europe.
Realistically speaking, Europe ain't got a chance unless we abolish our countries entirely, creating a single market. And that's not gonna happen. Ever.
you could try to change that for macroeconomic gain, but i highly doubt that will work if we look at history.
That's a bit gratuitous
I am sorry but this argument cannot be dismissed.
The reason why Europe struggles to implement changes is precisely because it is not a single country but a large group of countries represented by complex bodies where politics strive.
[0]: https://worldhappiness.report/ed/2023/world-happiness-trust-...
When you're rich you have AC. When poor you die in heat waves. When rich you get to integrate immigrants to the point. When poor neo-Nazi politicians stir up trouble as they languish in poverty and squalor.
When rich you get to crush pandemics. When poor you have to pretend they aren't happening.
Europe was not poorer in the 2000's. This is just cope about the failure to handle the financial crisis and COVID properly.
TL;DR: 1) simplify and uniformize company creation process 2) teach English to everyone.
(I agree, BTW)
Abandon all hope. The race to the bottom is over. Any country not bowing at the feet of ever tech founder will be relegated to third-world status by the end of the decade. Canada, Finland, Australia, the US east coast ... all are doomed unless they drop taxes and abandon all hope of regulating anything. But that just isn't how the world functions. All those countries that are "hard" on new tech surprisingly keep ticking along year after year despite the ire of tech founders. Think London/Paris/Berlin/Vancouver are too hard on business? Ok. Leave. Make room for all the people that are ready and happy to do business in those cities.
Before 2020-22, Russia was a major tech hub in Europe, and most of that was because Russian founders would incorporate in the UK or Netherlands, but operate with a subsidiary within Russia.
And the 45% is at a high threshold (much higher than Ireland for example) though 42% will kick in at a lower % (and the 5.5% is a % on tax, not on the full income, which is a non-obvious aspect of it)
Edit: Went back and tried allowing the firebaseio script, which added some blur to the top and the bottom of the page as well as some light blue elements to the background, but didn't otherwise noticeably affect performance. But it is possible those elements were added via some normally 3D accelerated operation that may not work on all browsers and be painfully slow when not accelerated.