Why salaries tend be lower for tech workers in UK compared to US

The optimist in me wants to say better fringe benefits like vacation and healthcare. The pessimist say the your your timezone proximity to inexpensive talent from eastern Europe is a factor

I always had the impression that the US pays better than any other country when it comes to tech. On the other specter the minimum wage in the US is much lower then a lot of places in Europe.

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It has very little to do with incidentals like benefits, vacation time, etc, and is mostly a question of the huge difference in the productivity of labor of software engineers employed by companies that pay well and companies that don't. FAANG (and similar companies) derive a huge amount of value from each software engineer, which puts a much higher ceiling on how much they can afford to pay them before it stops making sense to hire them at all. And the reason they _do_ end up at a much higher number is because they're competing for a limited # of engineers that pass their bar.

Companies which don't get massive scale on the software they write (and therefore derive much less value from "write once, sell many times") pay correspondingly less.

If you're looking at the higher end of the scale in London, and maybe ignore the >99th percentile in US where salaries get astronomical, I reckon the hourly rate might be in the same ball park.

For example a quick search in London shows a dev job at £160K, which is $221K. You would probably have an extra 4 weeks holiday in the London job, so that's the equivalent of $240K.

In London you've got a good chance of sticking close to working 40 hours a week too, depending on the company. In the US it sounds like longer hours are more likely.

I think it’s the same reason that developers in SF make more then their counterparts in say Denver. It’s purely supply and demand and labor doesn’t markets are inefficient (especially geographically)

If I had to guess there are probably 10x the tech workers in California than in the UK, which drives the bulk of the disparity.

Because everybody does it, and because the big US corps conveniently have strict regional salary bands.

Also, for the top tax brackets (120k+), the total cost per employee, divided by net salary, is far higher in the UK than the US. The UK government incentivizes corporations to pay their employees less.

My guess is it has a lot to do with how easy or not it is to start your own thing.

In my mind, developers in the US are more likely to have options to strike out on their own, so they need more $ to work for the man.

I'd actually love to hear facts on this

Business always studies this stuff like crazy

Seems strange that 'we' don't know

Like everything in capitalism, the guys at the top get disproportionally higher rewards.