When you include state taxes, social security from the employee and employer, then it starts to look like much less of a difference.
When you include health insurance and college education, Americans get much less value.
I do agree with the first half of your comment. American labor laws make it easier to fire which allows employers to take more risk in hiring.
less risk, you used the wrong word. If they can fire easily, they take less risk by hiring. That's more risk for the employee though, you miss the fact that most of the people is not HN, and they don't get paid 6 or 7 figures and don't find a job in days if they really need to.
This is a scoping issue, the action contains the risk because the system has mitigated it.
This neglects any state income or sales tax as well.
- When you contact government offices to ensure you're paying the right taxes on the right things, it's very difficult to get a real answer. Many of them just outright do not know, and rely on "a good-faith effort".
- The situation is so convoluted that their are specialist companies which sell you the idea that they can take care of it for you, yet want you sign a contract that says they're not liable for any problems.
Or you can go to A&E and wait 8 hours, and have it be free.
At least for me, regular medical care needs scheduled out some months, doctors have poor availbility. I get one freebie a year via insurance, everything else is about $50.
For minor injuries, or medical stuff that needs same-day eyes, but not a full emergency department, there is urgent care. You wait as long as it takes, in my area, usually 30-90 minutes, pay $100 and they may or may not be able to help. Minor prescriptions and stitches they can usually do
For major stuff, such as broken bones, heart attack, psychosis, whatever, there is the ER. You wait as long as you wait, and it's about $300 for the initial visit, though this can climb rapidly if you need to stay.
That's about it for your insured options.
Your uninsured options are similar, but more expensive. If you are extremely poor, or old, or both you may have a semi-free option with medicare and medicaid, but that is more complicated than I care to type out.
You can have your cake and eat it too. It's called the Danish model, although Denmark itself has an imperfect implementation of the model.
In the Danish model, it's easy to fire people, but the social safety net ensures that the employee doesn't get screwed if it happens. They don't lose their health insurance, EI is generous enough that it has minimal impact on their lifestyle, etc.
And this system of being easy to fire people hasn't exactly resulted in an explosive and dynamic jobs market they were hoping for, most likely due to the bureaucracy and high taxes, keeping foreign investment away. Germany has stricter employment laws with better employee protection yet a better jobs market than Austria with higher wages.
*: every 1st or 15th of the month is common
[0]: https://www.usp.gv.at/en/mitarbeiter/beendigung-arbeitsverha...
[1]: https://www.usp.gv.at/en/mitarbeiter/beendigung-arbeitsverha...
[2]: https://www.wko.at/service/arbeitsrecht-sozialrecht/Anspruch...
Yes, that's what I meant by being fired, with notice. You thought I meant being fired without notice which is uncommon anywhere in Europe unless the employee did something illegal.
The fact that in Austria your employer can terminate your employment contract anytime with a notice period, and for no reason, is very rare in Europe as it makes employees super vulnerable to loosing their jobs anytime.
In most EU countries, with better employee protections, employers need valid reason and proof to terminate your contract with notice, otherwise they can get sued for wrongful termination and have to pay penalties.
Also, in Austria you can even get fired (with notice) while you're on sick leave, which is pretty barbaric by EU standards.
Despite what a famous youtuber like to preach, the US participation is on the US and very few countries that explicitly call for help. And when countries need help, it's not usually the US that they ask first.
When you count just the taxes we definitely pay less, especially in places like Texas and Florida. Well, I suppose there's the budget deficit and national debt to consider, though yours aren't exactly great either.
Well, except that there's a middle income trap with social security taxes. Basically, you want to be earning either a fair bit more than the social security cut-off, or to be on welfare. This is a terrible feature of our system.
> When you include health insurance and college education, Americans get much less value.
Honestly I'm starting to believe that our tertiary education system is vastly overvalued and that we can do much better for much less cost. Also, we have state schools that are very good and very cheap (by comparison to private ones anyways). I know people who have done very well in tech without having gone to school or graduated.
As for medical, the only coverage I want is catastrophic, and if I could just just get that then health care would be way cheaper. Health care providers generally have much lower prices when you have no insurance and pay out of pocket.
> I do agree with the first half of your comment. American labor laws make it easier to fire which allows employers to take more risk in hiring.
This is, on the whole, a very very nice feature. We also have better political speech rights than you. And... well, the whole Bill of Rights is a big deal, and European countries mostly don't have anything like it.
I think the US has more freedom of speech (although it's hard to tell without training in constitutional law over 24 official languages (25 if you want to count Welsh, is this EU, Europe, or Council of Europe? Might need to add more…) and a split between common and (multiple subtypes of) civil law), but also I think it's a difference in detail not in kind.
I've had several chronic issues, including cancer surgery and the followon therapies, that I in no way wanted, that stretched out years, ensuring that we (the family) spent our ~$10K deductible for several years running. I've seen this with quite a few other people, as well. It is certain that we would have been bankrupted w/o middling quality corp health insurance. We have also had many $1000s in dental bills, in a year, quite a few times.
The idea that you could self finance these yearly cash flow (up to, what, $100K?) is absurd, unless you are really rich, but you seem to be somewhat price sensitive, so I dunno.
OTOH my sister-in-law makes > $500K/y as an anesthesiologist, and her spouse is a pathologist sadly making somewhat less, so on average the family must be doing great!
Yeah no, my Euro-fruends are aghast at the medical situation here in the US, and we all do view it as a massive effective tax on the unlucky that Europeans more or less don't have to worry about.
We don't have a free market in health care unless you have no coverage, then you can actually negotiate prices. What we have is a monster, and the monster we have today is way way worse than the monster we had in the early 90s.
Not that it helps to say these things. Most of you are either a) bigtech employees with nice healthcare plans and maybe don't care that much (until you're no longer bigtech), or b) fintech employees (same), or c) too young to remember what 80%/20% plans were like back in the day (or never had a non-$WORK plan) and therefore all too willing to demand and/or accept any purported solution that isn't. I hope it helps to say these things here.
Meanwhile we've had a lot of factors pushing up inflation in medical services, so when you add it all up it sucks, but it sucks for all sorts of artificial reasons.
College education can be had for super cheap in the US via community colleges. Going to an expensive college is a lifestyle choice and I know many people who spend first 2 years in local community colleges and then move to the state college system.
College education in Germany and most other EU members is truly cheap: you have semester fees well under 500 EUR (when they were raised to that in Germany, massive protests pushed them back), plus living costs, no matter where in the country you went to high school or your parents live, no matter whether you’re sticking around at Eastern Bavaria University of Applied Sciences (a relatively new institution serving a traditionally less-prosperous part of the state, with enrollment open to anyone who got an Abitur) or managed to win one of the competitive computer science spots at Technische Universität München: both have semester fees around 100 EUR.
They do. It's been quantified. There are many states with no income tax.
A 230k salary and corporate health insurance is going to put you ahead of almost every European software shop.
I love Germany and enjoyed my time there, but I choose to work in the states and have the financial security that can only be gained by saving money from a high salary.
Still, I would love to see some friction added to the layoff process in the US. Perhaps larger mandatory severance periods. Make layoffs possible, but not easy.
Only if you're a highly sought after tech person and thus have actual leverage. Farm workers, hospitality employees, construction workers - they're all exploited just the same.
I've lived in two countries that went through this transition in labor laws to follow the neoliberal playbook. Guess what happened.
See also “less regulation will mean more agile and competitive market which will auto regulate itself”, etc.
We ended up with a recession and less rights.
Don’t want to reveal the countries, but it’s a common tale.
Also don't think you are special to live in two countries. This will not dox you.
It's against the law to steal money. That's a regulation we need to keep.
It's also against the law to build a house if the existing homeowners vote that you can't. That's a regulation that makes the market less efficient, though I can see the reasoning behind it.
It doesn’t get prosecuted nearly as much as other types of theft.
https://www.epi.org/publication/wage-theft-bigger-problem-fo...
There are regressive taxes (e.g., sales taxes / VAT) which are certainly lower in America than most of the rest of the world, and some American states deliberately starve their government of income so that they cannot be obligated to provide basic services and instead shift things to user fees.
This isn't actually true. The total US tax burden is very similar to that of other modern nations.
Can you please explain the causation between easiness of firing / hiring and high salaries?
In scenario H (for hard to fire), we expect employers to spend more time evaluating new hires, because if they make a suboptimal choice, they will be stuck with that employee until they can justify to the authority that the employee is not suitable. This makes them averse to hiring quickly, and also averse to paying a premium unless they are extremely certain of the results. We then expect potential employees to spend more time vetting potential employers, because any involuntary job search process is going to be long and expensive.
In scenario E (for easy to fire), we expect employers to spend less time evaluating new hires, and to be more agreeable to paying a premium, because the loss of hiring suboptimally can be swiftly ended. Since employers hire faster, we expect employees to spend less time vetting employers, since getting a new different job should take less time.
In practice, I suspect that current economic situations are much more of a driver than the regulatory regime.
I'm talking about a post-employment notice period. How much notice does the employee get between getting fired and then no longer receiving paycheques? Basically, how much severance does the company have to pay?
Add to this any red tape involved in firing someone.
Now look at it from the point of view of the company. If I, the business owner, know that I have to comply with a raft of regulations and pay several months' severance to fire someone, I'll be very reluctant to hire them in the first place. I'll jump through hoops, work late nights, outsource the job, do anything I can to avoid hiring someone.
On the other hand, if I'm in an at-will state in the US, you can fire someone for no reason with zero notice. Seems crazy right? But it means I won't even think twice about hiring someone either. Could they maybe help on a project? Sure, hire them! Frequently one thing leads to another and employees stay on for a long time anyway.
Now in the second case the same number of companies with the same capital available will end up hiring lots more people due to the lower friction.
Make it easy to get out of a situation, and more people will want to get into that situation.
As a business you're more risk-averse in offering high salaries since it costs more when you make a mistake.
Even safer is offering them a departure settlement of money and/or insurance coverage, in exchange for which they won't sue you.
Here on earth, what you wrote is much closer to the truth. The American economy is awash with opportunities to work for small businesses, with employees free to move around and chart their own destiny.
If they all are all happy and free to chart their own destiny - why are those contract things then pretty much standard in the US (as it seems to me)?
And maybe things are not perfect on either side of the atlantic?
I would be fine with less regulations and hire and fire here in europe btw - but I would be not OK, having to sign such contracts. But I don't see, why we can't have both. Meaning employee respecting contracts - but not mandated from above.
They aren't standard by any means.
When things that we are used to (but unhappy with) because our jobs involve a lot of proprietary technological secrets trickle down to sandwich shop minimum wage workers…it’s not worth saying that they’re not standard.
There’s a reason that multiple state legislatures are working to ban noncompetes entirely, and it’s not because they’re uncommon.
What about the European system prevents that for the employee?
Otherwise we surely can do this in europe as well, just with a little bit more friction.
1. Less employment opportunities due to no VC funding, and risk averse mentality of entrepreneurs meaning next to no EU SW product companies. That's why the best paying jobs in EU tech scene are mostly US companies.
2. Language barriers and bureaucracy differing from country to country means huge friction and risk when moving to a country you're not familiar with, along with the added overhead of learning a new language on top of having a full time job plus the challenge of building new social circles with a different culture.
This might even be a fun challenge when you're young and single, but when you have a spouse and maybe even a child, things get even more complicated fast when it comes to immigration, especially if your spouse doesn't work in tech or any other career where English is normalized at work or even needs her credentials translated and locally equivalated by the authorities.
A friend of mine got laid off as part of his company going bankrupt with his last two wages going unpaid. The bureaucracy, letter bombardment and appointments in dealing with the authorities to try to recoup those two months wages, all in German, a foreign language to him(and me), makes the experience completely exhausting and I can feel he just wants to give up.
Imagine someone from Ohio having to learn a new language when moving to California or New York. Not having to deal with bureaucracy in a foreign language for every state is a huge asset for the US and a weakness of the EU labor mobility.
3. Racism, xenofobia, discrimination and glass ceilings from the locals, when you come from the "wrong" country.
#4 is definitely a bit of an issue. Europe is surprisingly regressive, even compared to the US. Lots of rude comments towards non-white coworkers.
Totally not true at all. Maybe in northern Europe but it's definitely not my experience in Austria. Language barrier is defiantly an issue here, especially outside the SW dev world.
Plenty of government offices you have to interact with don't or don't want to speak English (mostly due to older grumpy staff). Plenty of police officers don't speak English (also the older staff). Plenty of doctors, nurses and specialists don't speak English. Plenty(most?) companies outside of SW require German knowledge. Plenty of landlords and building management companies or utility companies don't speak or don't want to speak English. The list can go on, especially if you mostly land with older staff memebers. The language barrier is real. Sure, sometimes you can get lucky and land a young contact person who speaks great English and will want to help you, but that's quite rare, most will tell you "nur Deutsch" and then you're shit out of luck as a lot of the issues need to be solved over the phone or in person.
Saying English is all you need to get by is a gross over-exaggeration and does not match the srruggles me and my friends had here at all. Sure, you can order a beer and a pizza in English just fine, but any and all official bureaucracy needs to be done in the local language, not in English, often on the phone or in person, on paper and the spot, without the possibility to easily google translate the thing you're signing, like you can on web forms. And believe me, there's a lot of paper work: contracts, insurance forms, complaints, etc.
Also, it's respectul to learn the local language to integrate, unless you want to make life difficult for yourself, and live in isolation in exapt only bubbles.
Every system could be improved and if you prefer one the other isn't by default inherently evil.
People within both systems can suck.
I'm from Africa and both places are like heaven on earth in comparison.
I've always found it much easier to "chart my own destiny" when my healthcare is guaranteed, forever, for free, whether I have a job or not.
I'd put myself on the Europe-side of employment law/regulation ideals.
A small handful of countries in Europe*
Those making less than a certain amount can only be terminated:
a) immediately for cause (theft/fraud/etc)
b) with notice for poor performance
c) with notice and a legislated payout for redundancy where the job is no longer required.
Those earning above a certain amount need to negotiate any/all of these into their contract.
Admittedly it does occasionally result in employees being reinstated whose sacking was (IMO) completely justified. I don't like those specific instances, but I figure it's the price you have to pay for a system that is tilted slightly in favour of employees.
[0] The actual laws are rubbish though, they're intentionally obtuse/vague owing to industrial relations being a political minefield and no government wanting to touch it for fear of voter pushback.
Sure, I make more than 2x the salary, but the cost of living of a bit tech hub chips away most of it. Specially housing, which has increased dramatically since Covid. Even with my big fat tech salary, getting in the properly ladder seems to be years away.
Pay less taxes? sure, but then you have to pay for everything and then some, and everything is incredibly expensive. And we don't even have children yet. I can't imagine being able to afford childcare even with my current income.
I agree that I choose the worst time to move over. In the last year we experienced drop in stock prices combined with soaring inflation, which means that both my income went down, and my expenses went up. Also it's not like I can change employers and get a better deal. Even if the job market wasn't depressed, my visa (L1) doesn't allow me to change employers. Also the latest visa bulletin pushed the current date of my visa category back a couple of years, so Green Card seems like a somewhat distant dream.
All in, I'm not sure my quality of life in this country is better (and the UK itself is not doing great lately).
You only get to the part where it's all worth it once you've settled into the new country, gotten a few jobs/promotions/started a business, bought a house, made lots of friends, learnt the new culture (not such a huge shock for UK->US), etc.
This takes years and sometimes a whole generation!
Maybe after I get my green card I can get a pay cut and move to a LCOL area. But again, is it worth it? I can also get a fully remote job and move back to my hometown by the mediterranean.
No, there's nothing easier about hiring US employees. It only makes it easier to fire them. This reduces the risk of bad hires for the employers, by allowing them to be easily fired.
That encourages employers to be less risk-averse in hiring, but, once again, it does not facilitate the hiring process.
Whether Americans pay far more for health insurance, and whether they're far more likely to be bankrupted by a health crisis, has a very straightforward answer: "yes."
Privatised social services - most obviously health, but also some utilities, transport systems, rented housing, and so on - are de facto corporate taxes.
Americans are subjected to constant and insistent "private good, government bad" propaganda from birth, so it's not always easy to get this point across.
Even so. If you're being forced to pay for essential services, and those services are unaffordable and/or may bankrupt you, you would - unquestionably - find that public ownership would be significantly less precarious and more affordable.
But it's not a one-way street. Being easier to fire makes American employees easier to hire, which is at least in part responsible for much higher pay in the USA compared to employee havens such as Europe.
Furthermore, Americans tend to pay less tax. This isn't usually thought of as an employee rights issue, but in my mind, keeping more of your money = stronger property rights