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Annual IT Salary Survey Finds Dissatisfaction
BobB writes "A storm seems to be brewing in the IT job market. Pay raises have continued to outpace inflation, and bonuses are downright impressive — 11.6% on average. Yet, as the 2007 Network World Salary Survey finds, dissatisfaction over salary packages is rampant."
HR is the biggest waste of human resources, EVAR.
A lot of people go to Wal-Mart, see the low prices, and think inflation is low. They forget about housing, college tuition, and healthcare, which have all been running at double-digit percentage increases annually for the past several years.
Trust the Computer. The Computer is your friend.
I'll try. These figures are for the Bay Area, CA (pretty much the epicenter of IT in the USA if not the world). And I'll keep it in Euros to make the comparison easier, using today's exchange rate of 1 Euro = 1.41 USD.
Taxes on salary in various 'slices' (this is federal income tax + social security tax):
16.2% for 0 to 5,354 Euro
21.2% for 5,355 to 21,737 Euro
31.2% for 21,738 to 52,624 Euro
34.2% for 52,625 - 67,286 Euro
28% + 4,171 Euro for 67,287 - 109,787 Euro
33% + 4,171 Euro for 109,788 - 238,688 Euro
35% + 4,171 Euro for 238,689 Euro and the remainder above
(the reason for the last three amounts is that social security tax is only on salary up to 67,286 Euros, salary in excess of that is not assessed social security tax)
You also have to add in state tax, which in CA is between 1% and 9%, depending on how much you make. It's too much trouble to work that into the table above, because the ranges are all different, but if you make more than 28,616 Euros (which just about any person working in IT would), it's 9.3%. So add that makes the tax rates closer to 40% - 50% total for the medium to high tax brackets.
Furthermore, there are small taxes assessed for things like state disability insurance, but these don't sum up to more than 1% usually.
State sales tax: 7.25% (if I rememer correctly)
- Medical insurance: free (paid for by employer) if you have a decent job, anywhere from 350 - 900 Euros per month (depending on the size of your family and your age) if you do not. I personally have never had to pay for medical insurance, and most IT workers would be the same.
- Childcare: ~5 Euro/hour
- Gasoline: 0.56 Euro/liter (= 3.00 Dollar/gallon)
- Public transport: about 3 Euro for 25KM by train, or 6 Euro for a 25KM with a return ticket (I am basing this on $4.00 USD for Caltrain between two "zones", which I am guessing is about 25 KM)
As to new cars, they are much cheaper in the USA and there are no additional taxes beyond state sales tax (although I have never bought a new car, I am just assuming this is true). That E 32,840 car probably would only cost E 22,000 total in the USA.
As you can see, the USA income tax rate is not so much different from your rate, when you factor in all income taxes paid (we pay alot of individual taxes in the USA - federal, state, local (sometimes - in New York City you have to also pay a local income tax!), social security, disability, etc, etc) the rate is typically somewere around 33% total in the USA (if you have a good I.T. job and are making $80,000+ USD per year), whereas it looks like around 40% in your country.
The difference is that sales tax (you call it VAT) is higher in your country (20% vs. 7.25%) and most individual items probably cost more in your country (the cost of gasoline, childcare, and a car demonstrate this).
One big factor you did not mention is the cost of buying a house or renting an apartment. In the Bay Area a modest size family home is at least $700,000 USD (about E 500,000), and renting a moderate apartment is about $1,800 per month (E 1,300). Owning a home in the Bay Area is very, very expensive (compare to homes in Canton, Ohio where my mom lives - houses there are about $150,000 USD, or about E 100,000).
In general, the USA is a very inexpensive place to live.
I have been living in New Zealand for almost a year now and I'd say that it's somewhere between the USA and your country in taxes and cost of living; more expensive than the USA but not as expensive as Europe.
Nothing, unless a) you work different hours from another (one works days the other nights, even if its only part of the time)* or b) you have young children and leave them in childcare, there is nothing inherently wrong with that technically, but it isn't very nice for the parents nor the children.
*This could be a benefit as well though
As a U.S. citizen living and working in Europe, I can tell you that you have some serious misconceptions about pricing on both continents.
...
Europe is extremely expensive and the United States is dirt cheap in comparison:
- I pay ~1711 USD/mo for renting a house
- car insurance + car tax (yes, you read that right) + maintenance per vehicle costs me ~2,995 USD per year; I have two cars, which comes to about ~$6,000 USD per year!
- child care costs me ~1,370 USD per month
- electricity costs me ~$85 USD / month
- phone costs me ~$25 USD / month
- internet costs me ~$71 USD / month
- food costs me around ~$1,711 USD / month (I don't go to eat out at all)
- MANDATORY medical insurance costs me ~$700 USD per month!
I'm sure I left stuff out, like trash, water, lunch,
But do the math: how much does that come to, per month? Roughly to about ~$6173 USD per month!
Now, when I was living in the U.S., I netted $1,519 every two weeks, which comes to $3,038 per month. If I was *very careful*, I would end up with all expenses paid and $300 USD in my pocket at the end of the month. I had a mortgage and a loan on a car; no other debts of any kind. So, what does that come to? $2,738 in total expenses per month, versus ~$6173 USD!
Now I ask you again: which one is cheaper? U.S. is dirt stinkin' cheap!!! But to be fair, most people in the U.S. are poor and in debt. Here in Europe I have no debts, but I don't own a home either.
Generally I am satisfied with my job. It offers a lot of perks that I can hardly find in other jobs. I mean, there ain't many jobs where they don't really care when you show up (I come around noon, usually), where you can pretty much do whatever you please (though my interests somehow happily coincide with the company's) and nobody ever bothers to check what you do and whether you actually do what you're supposed to do? I mean, yes, I do my job, and more than satisfying according to my superiors, but still, it's kinda odd that nobody ever wants anything from me than my final reports.
Still, a bit more salary would be nice. Though, what for? I'd just buy more computers or gadgets.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
It's fairly important to specify where in "Europe" you live. I.e. the UK is one of the most expensive places in Europe, the Scandinavian countries all have fairly high tax rates, but most of eastern Europe is much cheaper. Cost of living, tax and inflation varies wildly across the EU.
In the UK it's approximately:
0% for 0 to 7000 EUR
10% for 7000 to 10000 EUR
22% for 10000 to 53000 EUR
40% above 53000 EUR
Additionally we have Employees National insurance
0% below 7000 EUR
11% for 7000 to 47000 EUR
1% above 47000 EUR
And employers National insurance (Which the employer pays but doesn't appear anywhere on your payslip)
Which I think is
12.8% on everything.
(The employers NI doesn't affect your take home pay - if you earn 100000 before tax you will pay approx 28000 Tax, 5000 NI and take home approx 67000. Your employer will pay an additional 12800 NI so the overall income tax rate is either 33000/100000 = 33% or 45000/112000 = 40% depending on how you account for the employers NI)
Then there's VAT at 17.5% on almost everything.
Contributions to a pension scheme are paid gross (but employers NI is still paid)
Perks such as health insurance are taxed as though they were income but you don't pay any more NI.
House prices vary a lot. In London, average house prices vary from 1M GBP (1.4M EUR) in Kensington and Chelsea to as little as 200K GBP 280K EUR in Barking and Dagenham.
http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/counties/html/county37.stm
Tim.
God said, "div D = rho, div B = 0, curl E = -@B/@t, curl H = J + @D/@t," and there was light.
and renting a moderate apartment is about $1,800 per month
To give you some idea of what prices are like in London, I'd just assumed this said
and renting a moderate apartment is about $1,800 per week
I've managed to find:
Walburgh Street, Aldgate, E1
Total Sq Ft: 533 (49 Sq M) approx.
Bedrooms: 2 bedrooms
For 250GBP/week
To give you some idea of what is available at the low end.
And at the high end:
De Vere Gardens, Kensington, W8
Total Sq Ft: 1,158 (107 Sq M) approx.
Bedrooms: 1 bedroom
For 1000GBP/week
Tim.
God said, "div D = rho, div B = 0, curl E = -@B/@t, curl H = J + @D/@t," and there was light.
I take it that they do not have the general rule of making RENT*3 there.
I'm at ~$1000/week and live in a $1200/m apt that is 30 miles outside of the major city that I work in.
So let's go with my own situation in Southern USA.
PER YEAR
Pay: 52,000
Rent: 14,400
Electricity: 2,400
Gas: 4,160
Insurance: 1,080
Car Loan: 6,000
Food: 3,000
Cell: 600
Taxes: 11,000
Leaves me 9360 for myself over the year, 780/month or 195/week.
Some may find that acceptable but I require more than $195/week of pocket money to live comfortably.
**Anony as I am posting about my pay... I don't need my coworkers to know how much/little I make.
WHAT?! How it is not nice to leave your children to childcare? Are your childcare services so lousy or what? Children, like adults, learn social skills when communicating with each others. Basically more people or around, more skills your learn (unless you have some medical condition of course). Even "bad" situations where kids argue and even fight with each other is a learning experience for everyone. Of course adult supervision is needed so that things won't go out of hand. But if you start over-protecting your kids, what kind of people they make when they are adults?
Don't get me wrong. There's people who abuse this system. They leave their kids for 12 hours a day to childcare because they don't want to be with them for some reason. Those people should get some serious therapy, I think.
And yes, I have a 4 year old son.
You don't know what you don't know.
Studies have shown repeatedly that children who spend a significant amount of time in childcare (I forget what the number of hours involved was, but it was less than the amount of time that would be necessary if both parents work full time) are much more likely to be bullies and have other socially undesirable traits. Additionally, there have been several studies that indicate that children who are home schooled have significantly better social skills than those who went through the school system (considering that the researchers were expecting the opposite result, these latter studies are rather telling). Sorry, I no longer have the references for either of these studies, but I'm sure if you do a little research you can find them. My suspicion is that children are better socialized by being exposed to adults who have already learned how to be responsible than to other children who have not yet learned this.
The truth is that all men having power ought to be mistrusted. James Madison
According to the US Dept of Labor the Consumer Price Index includes medical care, gasoline, fuel oil, housing, and education including college tuition. I think this covers your (1), (2), (5), and (6). Dollar deflation (4) is also covered to the extent that Americans buy imported goods which are now more expensive.
You are right that general income taxes (3) are not included in the CPI. To the extent the US government must raise taxes to cover the wars they are in, Americans' net incomes will be lower, but this will not count as inflation.
I think there's another factor at work here that doesn't seem to be being considered. Employees actually have rights in Europe, whereas our very survival is at the whim of the employer on this side of the pond. Most states are "at-will" employment states over here, which means that you can be fired for no reason at all, and frequently be denied unemployment benefits on a pretense. (I've had this happen to me; a temp agency offered me a gig that I was unable to accept for safety reasons, and I was denied unemployment coverage because I 'refused work'. In this state temp agencies are obligated to contribute to unemployment coverage the same as any other employer, and the more people you lay off, the more you pay to UI. This makes screwing over its former employees in the agency's financial interest.) Even if it's an illegal termination (discrimination based on race, gender, sexual orientation (in some states)), proving it in court is IMMENSELY difficult, as the burden of proof is on the employee. The employer has the ability to say "There is no stated reason for that termination. We're not obligated to give one."
/. readers retire it will be bankrupt, thanks to the Baby Boomers' insurmountable sense of entitlement.
Why is this relevant to the discussion? Because being unemployed is expensive. Unemployment benefits in this state amount to 50% of the highest salary you received in the last 18 months, and only last 6 months maximum. (There's a fairly insultingly small extension to those if you can prove you're in state-approved job training.) As I understand it, this state is on the generous side of average for the US. Most workers try to squirrel away 3 months' salary, and not all of them succeed in doing so because of the costs of living. American employers are not required to offer ANYTHING in the way of severance pay, with the exception of compensation for vacation time earned but not used. (And there are ways around that; they just call it something else other than 'vacation time'.) American employers also are not obligated to contribute anything towards a pension or other retirement vehicle, with the exception of Social Security. (Employers and employees are each required to contribute 7% of the employees' pre-tax income.) Social Security at this point essentially amounts to a 7% decrease in income, as by the time most
Employees in the US generally are worse off than our EU counterparts for the above stated reasons. Add more stuff in like about half as much vacation time, frequently no sick/personal time, no paid leave for childbirth/medical issues (except where the employer voluntarily carries disability insurance), and it's bleak indeed.
Here's a question though: How good are EU employers in general about providing training to IT workers? Over here it seems like a lot of places would rather rip an arm off than provide useful training.
Never underestimate the power of stupid people in large groups.
well 'adapting' isn't quite as easy when the public transportation system stinks. Best I can do is catch a bus downtown, then a bus out to the suburb where I work, then take a circular (or walk 3 miles) for a grand total of 3 1/2 hours (one way, mostly waiting for buses) vs 15 minutes by car. There is a decent bike route, but at 17 miles (about 4 more than driving since the road and paths aren't straight like the freeway) it's a bit long to do daily (and not an option in winter).
So that leaves me with traveling little and wearing sweaters in the winter and opening the windows more often in summer, which I do anyway.
so does Canada, and their economy is doing great while ours is foundering. There is little doubt in my mind that the war in Iraq is destroying the value of the dollar.
you mean flipping burgers at McDonalds?
So what you're saying, in a nutshell, is congratulations on becoming a third world country. Life may stink in the US because it's filled with a bunch of educated cheap labor with no buying power, but in France (or insert country of choice here) it's wine and caviar every day!
Oh, and no, high schools in the US are not required to teach econ (it is required in most colleges, however).
I would agree that most SINGLE or CHILDLESS people don't have to worry about healthcare. My employer offers pretty good insurance for my are and I still pay about $300 (pre-tax) a month, they pay over twice that. It's fine for must things, but if one of my kids has strep throat and we all need to get checked I'm suddenly looking at $100 out of pocket to cover the co-pays on five people. Follow up visits can easily make that over $150 for the month. I have three kids.
Cheap storage VM.
Then tell me:
The list goes on and on. In the end it comes down to - what are you paying for completely up front and what are you are paying for every month (e.g. monthly billed services), and whether or not you can avoid any of them. For example, if you have a static IP you could probably lower your cost of living by letting it go and paying for a cheaper Internet service where you get a dynamically assigned IP - unless of course you are running a business that requires in, in which case what can you do to turn that cost into a 100% business cost that could be written off by the business? If you get Cable or Satellite TV, then you could save by dropping those.
It may not seem like much, but monthly, re-incurring costs no matter how small are a financial death by a thousand cuts as it all adds up. Unfortunately, our culture today encourages spending in that manner. So what could you do to lower your cost of living? There's probably a number of services you subscribe to and pay for monthly that you don't really need (e.g. cable TV), or things you do on a regular basis that could be done more cheaply (e.g. going out to eat, versus cooking it yourself at home; buying pizza or making it yourself from scratch).
My wife & I have been working on this for a while. Sometimes I think she's a bit too strict, and sometimes she thinks I am too. For instance, my policy with our grocery shopping is "if it isn't on the list, we can't get it" - the list is made before we leave for the store. Sometimes we deviate a little (which isn't good), but we do a pretty good job.
In one financial book I have read - don't have the title at the moment - the author did a bit of a study - wrt at least his daily expenses he paid for everything in cash, and perhaps by check otherwise. He observed a 33% reduction in spending as a result. I've heard similar from other sources too. Didn't really change his life style other than changing how he paid for things - it resulted in a bigger change in lifestyle as he was more reluctant to pay for something when seeing the greens live his wallet, thus he ended up saving more.
Cost of living can almost always be reduced - unless you are paying the smallest amounts required to survive - but then, you wouldn't have a computer, you wouldn't have Internet access, you wouldn't have a phone (land or cell), you would be driving a cheap car if you drove at all, and you would be living in or near the slums.
If one of the costs go up, fine - do your business somewhere else that is cheaper, or drop it all together? (e.g. Rent goes up, move. Cell phone service costs go up, drop it or move to another provider that is cheaper.) You have a choice about your lifestyle whether you realize it or not, and you can reduce your costs when you decide to.
I
Truth is like the sun. You can shut it out for a time, but it ain't goin' away. - Elvis Presley (source: imdb.com)
I'm not sure there is one correct piece of information in this post.. The CPI basket of goods is determined by ~30,000 consumer surveys every 2 years. The weight of each specific item within the item category (i.e. steak's weight in the beef category) is initially set by the survey, and then is adjusted throughout the survey period using geometric weighting. If the price of steak goes up, steak will receive a lower weight, and vice-versa. The assumption is that if steak gets more expensive, people will buy more hamburger. There is a debate on whether this method is proper (see my previous post). There is also another method of substitution that only occurs in an supplemental index, C-CPI, which seeks to capture changes in buying patterns across product categories.. say steak gets expensive and instead of buying hamburger, people start buying pork.
The price of energy was not taken out. It is still captured in the CPI. However, some people argued that the CPI less food and energy ("Core" CPI) was a better indicator, which I don't really agree with, but the fact is that the numbers are still published by BLS and the mainstream media simply ignores them. Also it wasn't recent, it was 1978.
BLS is aware of the shortcomings in quality adjustments for technology items, and it is an area of current research. However your example is not correct, the BLS analysts are knowledgeable enough to know that a quad 2GHz != 8 x 1GHz.. and furthermore the weighting that computers get in the overall CPI is small (0.5% for all IT goods/services in December 2006 CPI-W).
... we have a 13 month old, and there WAS a study (again, lacking a cite) that said that kids who were in day care for 20 or fewer hours per week showed no differences from kids who were kept at home. After that, there was again no differences between the kids, so there wer really two groups: One in day care for 20 or fewer, one not.
That said, I have no idea where one would go for an unbiased study of these things. A couple of links for your viewing pleasure:
http://query.nytimes.com/gst/fullpage.html?res=9D0CE2D6143CF935A25754C0A9659C8B63
I suspect the parent's study is the one by the National Institute of Child Health and Human Development. I didn't see that the article attaches NICHHD to a university. Although I'm not sure how that would alter my opinion of the study, now that I think about it.
Same link, another study from UMinn stating that kid's stress levels tend to rise during the day while in day care, but fall during the day while at home.
http://www.signonsandiego.com/uniontrib/20051101/news_1n1earlyed.html
A study showing that negative social effects are most pronounced when the kids are in day care for more than 45 hours a week, which seems pretty extreme.
In short, I dunno either. Go Buddhist. There's a middle path here somewhere.
ceci n'est pas un sig.