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Labor is more expensive in Europe because workers rights add significant overhead. A simple example, 37.5h work weeks and 5 weeks paid holiday is pretty standar

Labor is more expensive in Europe because workers rights add significant overhead. A simple example, 37.5h work weeks and 5 weeks paid holiday is pretty standard. Then there are severances. Also, if you look at the median US wages, it's appearant how much does there is at the top. Yes, Americans do have higher wages overall, but this is because there are fewer worker rights and less hidden costs for the employer. This does not mean labor is cheaper. https://en.m.wikipedia.org/wiki/List_of_U.S._states_and_territories_by_median_wage_and_mean_wage https://en.m.wikipedia.org/wiki/List_of_U.S._states_and_terr...

em-bee 6y ago
in germany the employer overhead per employee is almost 100%
- 0xfaded 6y ago
  That's amazing. In Denmark it's closer to 25% if you don't count severances.
  - em-bee 6y ago
    we may be comparing different numbers. i doubt it's that low. i don't know the specifics in germany, but there is net salary and gross salary, and there are employer contributions beyond gross salary, as well as other costs. my understanding is that put everything together, the cost per employee is twice the gross salary. this includes cost for equipment, work space and whatever else you need to spend money on to help an employee to do their job. 25% seems very low. it's possibly only the taxes and insurance and related contributions. or maybe denmark calculates the gross salary different? i searched a few resources and found references ranging from 1.5 to 1.7. so not quite 100%. here is a swiss example with a compact table. https://www.runmyaccounts.ch/2013/07/wie-viel-kostet-ein-mitarbeiter-wirklich/ https://www.runmyaccounts.ch/2013/07/wie-viel-kostet-ein-mit... this one suggests a cost of 6900 for a 4500 gross salary. but it also adds hiring a manager per 10 employees and splitting that up among the employees being managed, bringing the cost to 8285. so yeah, it depends on what numbers we are actually comparing
    - deleted 6y ago
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em-bee 6y ago

in germany the employer overhead per employee is almost 100%

0xfaded 6y ago
That's amazing. In Denmark it's closer to 25% if you don't count severances.
- em-bee 6y ago
  we may be comparing different numbers. i doubt it's that low. i don't know the specifics in germany, but there is net salary and gross salary, and there are employer contributions beyond gross salary, as well as other costs. my understanding is that put everything together, the cost per employee is twice the gross salary. this includes cost for equipment, work space and whatever else you need to spend money on to help an employee to do their job. 25% seems very low. it's possibly only the taxes and insurance and related contributions. or maybe denmark calculates the gross salary different? i searched a few resources and found references ranging from 1.5 to 1.7. so not quite 100%. here is a swiss example with a compact table. https://www.runmyaccounts.ch/2013/07/wie-viel-kostet-ein-mitarbeiter-wirklich/ https://www.runmyaccounts.ch/2013/07/wie-viel-kostet-ein-mit... this one suggests a cost of 6900 for a 4500 gross salary. but it also adds hiring a manager per 10 employees and splitting that up among the employees being managed, bringing the cost to 8285. so yeah, it depends on what numbers we are actually comparing
  - deleted 6y ago
    [deleted]