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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."
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.
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