I agree with OP. The salary is way too low for a senior European developer to consider because taking a US job means that there are no employment protections that you'd usually get; employment is at will for contractors.
Source: I live in the EU.
About 4 years back I didn't bother proceeding with a couple of (well, two) mid-level engineering positions based out of Barcelona because they paid too low (about €55,000) compared to what I could get in the UK for an equivalent role. One of them was for King, who was still raking it in then, and I can't remember the other organisation.
Still less than what my expectations had been calibrated for, but way more than what GP is implying!
Among my friends and acquaintances, I’m currently witnessing an exodus from the UK, with people moving to Spain, France, the Netherlands and Germany.
Even if life is a little more expensive in Europe, you don’t need as much emergency savings as in the US.
In Belgium, almost every white collar job has a company car included, since it's much much cheaper than for an individual to buy one.
Where in the US? It's a massive country with a huge regional variation in cost of living.
Does that contradict those figures though? Are you talking about the upper 10% discussed?
Nitpicking, but this is technically not possible. The US company has to have a EU presence or the developer needs to be self employed and invoice the US company
Also no one stoping person living in EU from registering LLC in US and working through that. Corp2corp with own LLC is actually how majority of people from outside the US work with US companies.
I doubt that statement. As a German living in Spain since the pandemic, I dealt with this and my social bubble is full of tech expats dealing with this, too. Living in one EU country and working remotely as an employee for another one, is almost legally impossible, and full of unnecessary hurdles for both employer and employee. Everyone of top-talent grade I know who does this, is basically either self-employed (as I am) or operates a "legal construct" such as having empty "mailbox flats" in the country they work for (breaking all sorts of laws by doing so).
The EU itself has never harmonized income tax laws; actually all of the EUs political system always tries not to touch the tax subject at all. As a result, each EU state has an individual double-tax treaty with all other members states. Yes, do the math - there are hundreds tax treaties between EU member states. Non of them are based on some EU guidance or blueprint, and oftentimes older than the EU itself (german-spain treaty dates back mostly to the 1960s with some minor additions in the early 2000s). Finding legal advice alone is almost impossible (i.e. a lawyer that speaks either of your languages and both legal systems recently well). And if you do, good luck, your fellow civil cervant at your tax offices will screw up your fringe case anyways.
Worker-protection laws apply by country of residence, but the employer is bound by their national ones too. If you live in Spain and work remotely for a german company, legally you are bound by spanish worker laws. That is, you get spanish bank holidays off, minimum wage laws of Spain (and Germany!) and so forth. Even when figuring out all legal subtleties, it is simply not manageable for any companies HR department to deal with all country specific regulations and changes, let alone in different languages. I run a company myself and could not employ a person from another EU country within reasonable effort; the only way to go is hire them as contractors or through payrolling agencies. Both will not make them your employees, which has a lot of other legal consequences (holidays, employee patent/inventions laws, but also stuff like you can't really enforce any policy on them without going through the intermediaries).
More specifcally: SV needs to reflect on how inflated SV salaries are. Possibly with a few outliers elsehwere, such as New York and maybe a few pockets in London. But overall the area where software developers as a rule make > $120K per year is probably less than a few hundred square kilometers and the world is much, much larger than that.
Or maybe people everywhere else need to really reflect on how underpaid they are. It’s not like the revenue of tech companies is lower outside of the US, so why isn’t more of it ending up in developers’ pockets, where it should go?
It actually is much lower.
That doesn't mean that developers aren't underpaid, but there definitely is a huge difference between a company serving the US market from inside the United States and one in Europe. In general the fraction of revenue that goes towards salaries is a fairly substantial chunk of the books of a typical company, but for a scalable proposition that is entirely virtual there is an advantage if your home market is unified in language and currency. And it also is an advantage if you have easy access to large amounts of capital.
Success breeds success and creaming off some of the $ of that success is what causes developer salaries to be what they are where they are: it's based on competition for talent mostly. And that's precisely why some of these large companies were trying to collude to depress the salaries as much as they could.
What you're forgetting is that taxes differ quite a lot from country to country. That, and cost of living is a factor too. If food and housing costs half as much, then even though you're paid less, you're not really poorer for it.
I think many American developers are kind of blind to how absurdly expensive California housing is.
A lot of this completely self-imposed (and very much by design) to prop-up real estate because there's no other industry to support the economy.
Vancouver is a prime example: it's extremely easy (compared to the US) for foreigners to purchase assets (even with questionable sources of incomes that wouldn't pass the higher scrutiny of USCIS) and for owners to collude into restricting the supply. They are happy since their investment appears to grow in value (they can get out of the game and cash-in if another foreigner decides to park his money into these assets) and the government is happy since a lot of people's retirements are tied to their home value and it gives the impression the economy is growing.
You must consider currency exchange rates too. In my country, at the current rates, 80k US$/year puts one above many top executives, doctors and other prestigious jobs. Not bad at all for a remote position in software development.
The real question is: Who is creating the most value here? The top executive at a local company? The local doctor or the software engineer shipping products in markets around the world?
It's unclear whether or not the local doctor's qualifications would even be recognized in the US, yet the remote software engineer's work is making money there and countless other high-value markets as we speak.
And most of the expats I know who did it seemed to be working for SV companies. So they didn't leave the higher salary behind.
Look at all the top surgeons and hospitals in the world for everything from neurosurgery to cancer treatment. They're all in the United States. The median level of care might be much better in Europe but they are behind when it comes to cutting edge treatments, rare diseases, and so on.
Out of stubbornness, I fought with the lab for months to bill it correctly, and eventually got them to write it off by emailing the CEO.
You can have full blown worker coops in the capitalist system, the question is if they are state mandated or not.
The definition of socialism isn't any sytem with a good outcome for workers.
I 'm not sure I understand the question? Socialism is a political philosophy on how the state should operate and what it should permit. It IS a description of the states behavior.
Democracy has nothing to do with it. You can have a socialist country with a king, or with direct democracy and no leader.
You can't have a socialist state without socialist laws and rules.
People refer to systems which apply socialist thinking as socialism, even if the governance is not a state government.
For example, let's say a theoretical union takes guidance from the political philosophy of socialism, and requires union members to contribute the highest percentage of their salary as union dues, that they can legally get away with. Let's say workers are paying 90% of their salaries in union dues.
The union can then use those dues to support the union members in various ways.
This isn't a state government, but it behaves like a socialist system and people would probably call it an example of socialism.
The wikipedia page on [religious socialism](https://en.wikipedia.org/wiki/Religious_socialism) even has some examples of this in religious communities.
You also have socialist anarchy, which supports stateless socialism
Realistically that seems to be more or less completely unsustainable without some use of force. e.g. if individuals who contribute more than they pay in are allowed to opt-out the system quickly collapses. That's how universal healthcare, state pension/social systems work etc. so it's not necessarily a bad thing. However in general socialist "corporations" are generally incapable of competing in a "free" market so they can only exist when they are supported by the state or private/capitalist enterprises are banned or strongly restricted in one way or another.
Sure, that's why I said this was theoretical. I wasn't using it as a demonstration of how socialism can be sustainable without a state, I was using it to demonstrate a system that might be described as socialist even though it's stateless.
You can have a democracy with 51% ruling and 49% in chattel slavery and poverty (but having a right to vote
I would agree that socialism isn't compatible with private property and civil rights as we commonly understand them today (in the US).
If you really want to make it big in nearly whatever profession, you have to go america. All other countries are severely underpaid. (I don't care about Switzerland/similarities because it's just 3M people).
There is a huge salary gap between usa and Canada as well.
Not in my experience. At least not for SV-Caliber talent.
Something you have to keep in mind is that there are two parallel markets over there: SV caliber developers and the rest. The former won't have any issue getting a job in the US (takes maybe a week for a talented engineer to get one). Therefore, comp has to be priced appropriately. The later can't -and likely won't ever be able to- secure a US visa, mostly due to skills. A lot of them are immigrants to Canada themselves (there's a reason they immigrated to Canada, it's way easier and the quotas are close to 10x per capita compared to the US). Some companies leverage this and have floors of international devs they park in Canada for a fraction of their US counterpart through a subsidiary.
There are just (way) more of them in Bay Area than anywhere in the world and they know right buzzwords.
That's an interesting statement. I assume the whole tech ecosystem and market is completely irrational since it seems to price these developer so much higher than their real worth? Where would one need to go to find non-mediocre devs who know more than just "the buzzwords"?
You somehow consider this less likely than the alternative where all less-than-leet-tier devs have decided to stay out of SV and therefore, the inflated salaries for everyone there are actually rational?
VC funding of software startups in the US easily dwarves whatever is being offered in other parts of the world.
A cashier in Sweden earns a very liveable wage, quite close to the average wage, while a programmer earns maybe 75% more than that, if not twice as much. That's already a significant difference. I'm a student and get 1200€ a month (not only is university free, we also get paid to study). With this, I have my own apartment with my own kitchen and all and am still able to save 500 a month. When I start working and get an average salary (the starting salary for programmers is about the same as the average salary for the entire population), I will spend a bit more, but still probably have 1-1.5k€ left every month. That is a lot. Then after some years, that would increase by a thousand or so. Why should I expect more money than that? I don't deserve more than that.
Housing is expensive here too, but not nearly as bad as in the US, so we simply don't need as high salaries. In Sweden, things like preschools are also heavily subsidized and university completely free, which is beneficial if you have children.
I'm using France for reference, and approximate number for the sake of explanation: for 100€ cost to the company, 40€ is employer's taxes, 20€ is employee's taxes. We call 20+40 = 60 the "gross" salary, and 40 the net salary, we never talk about the 100 when negotiating a salary. I don't have the time to check if that 38k is gross or net.
It is my understanding that if you have a 50k€ gross salary offer in Europe, you need to add ~40% to it to compare to compare to total cost for the employer as understood in the US.
I'm 90% sure their number are "wrong" for Spain in the same way.
There is also a portion of taxes and other insurance that the employer must pay. These are generally not summed up in job offers. They include the employer's part of social security, insurance, 401k contribution, and other benefit plans which are often part of an offer for a salaries position.
All of that needs some form of accounting on the employer's side that drives up the gross employment cost.
Or, to put it bluntly, us Europeans tend to see lower take-home amounts on our paystubs for the same gross cost the employer sees on their bank account, but a lot of stuff that you'd have to take care of on your own in the US is covered by that.
Not if you're a software engineer earning 150-200k+
This statement makes no sense. We have a much higher cost of living here than in Europe.
Fun fact, FAANG salaries in Europe depend on the lovation you are hired at, with differences between, e.g., Munich and Berlin for the same job levels. It is funny, because companiesbreally understood how salaries and cost of living are connected, and still every discussion on HN regarding dev salaries ignores this simple favt and only compares absolute numbers. Heck, mostly there isn't even an agreemt on the measurement baseline (including US benefits, EU common health care, vacation days...).
“What’s your best alternative?” is what underlies the companies’ positions on negotiating salaries.
Whhhhaaaat? That doesn't sound right. I know a guy in Barcelona making $200k, although he works for a US company. Heck, even in Eastern Europe, with the right knowledge you can make $150k+.
https://blog.pragmaticengineer.com/software-engineering-sala...
Considering the high costs of living in some of their regions, those salaries may be justified. But I believe they are definitely not in a good position when it comes to remote work + competing with English-speaking developers in poorer countries. Situation in Europe may be similar.
In Europe they can find African developers in the same timezone, while in North-America they have Latin-America. Given the lower costs of living + favorable exchange rates, the difference in terms of purchasing power ending in developers' pockets is huge in favor of the ones in the southern hemisphere.
Maybe those in the richer countries shouldn't be too vocal against return-to-office?
Don't do this here.
You wrongly assume normal distribution of pay.
That's right and wrong and the same time. If we are talking about non-junior positions: Developers in Spain who earn <= $30K/year are not going to apply for positions in American (and non Spanish) companies because they probably don't know they can do so. They are not in the "global" market, they do not read HN, they work either for consultancy companies or agencies (hence the low salaries). They usually don't work for product companies. They may not even speak enough English.
On the other hand, non-junior Spanish Developers who earn more than $30K/year do so because they know their value. They speak good enough English. They work for product companies (either unknown or globally well-known ones) and hence their salaries are higher than the median salary advertised in the link you provided. These developers can earn $80K/year in Spain (either for an Spanish company or remotely for an EU company), so if they decide to work for an American company (and this means usually a) weird working hours because of timezone differences, b) perhaps working as a contractor instead of as an employee), they definitely know that $50K-$80K/year is very low.
So, yeah, for the Spanish developers that American companies can hire, that salary is low.
What will the enlightened Spaniards pay you to kick a ball for Real Madrid?
that's global market already. If apple, google, msft be confident they can hire thousands of high quality engineers in Spain for $30k/y, they would sure open dev offices there and cut jobs in California.
It is what it is.
The only thing holding back Spanish devs is a relatively low level of English by other European standards.
I have friends in India who work as senior engineers for Indian companies that make more than that today. Nice to see that a European holiday is well within the purchasing power of Indian tech workers.
What is there to reflect on? The reasons for this are well-documented. OP was just stating a fact, but got the ranges a bit off.
Shhh, don't tell nobody.
You have to consider:
Benefits, taxes (both yours and the companies), cost of living, exchange rate fluctuations, and hours worked per year.
They likely have a different definition for software developer than myself.
median salary for a developer in Spain is $30,000 a year[1], so 50-80k would easily place them in the upper 10% of the scale.
I think americans need to really reflect on how inflated american dev salaries are.
[1] https://www.payscale.com/research/ES/Job=Software_Developer/...