Google layoffs: The company plans to set up a new team in Munich, Germany which would act as “cheaper” labour, the report claimed.
Google layoffs: The company plans to set up a new team in Munich, Germany which would act as “cheaper” labour, the report claimed.
Cheaper labour in the most expensive town in a country that is well known for high labour costs?
Compared to Valley workers, Germans are still cheap. 100k is a very very good salary over here.
Yeah, but you still have to pay social taxes on top for every worker. That’s why salary and labour cost are two different things. And boy is it a difference in Germany.
And as far as I’ve been led to believe, workers in the USA will be bullied into not taking any time off. Germans will take their entitled holidays and use sick leave when they are sick.
Workers in the US may not even have sick time. They do make more money though, probably because lots of European tech workers come to the US for better pay.
In practice anyone with this salary is likely to have at least 2 weeks + 10 or so federal holidays. It’s the retail and factory folks who are hurt most there.
Vacation time is not sick time. If you want any type of vacation at all, you need to plan ahead of time. Offering only 2 weeks is a joke. If you get sick one day, you lose one week of vacation.
Monitoring and rationing sick time is like limiting bathroom breaks or coffee time. if your job does it, you have a crappy employer.
So is West Virginia or Oklahoma.
True, but you also need to get enough people with the right skills/knowledge who want to live in West Virginia or Oklahoma when those same skills and knowledge likely make them highly employable in markets with more amenities and greater job opportunities without needing to uproot their life and move to a new town/city when the time comes to get a job with a new company.
If only there was a way to, like, have workers work on things without having to be anywhere near the office. Like distance workers or something, then you could hire people from all over the country in cheap places! Ah well, we need that face time though! ~Executives
But salary does not equal labour cost.
Even doubling the salary is far less than what you’d pay in the US, and as a rule of thumb, German labour, including all the indirect costs, is about twice the gross salary.
Take home or total cost?
For instance, is there a pension to be funded with costs not included in that 100k?
Could easily be that they have a bunch of people in Munich they can not fire since German labour laws are at least compared to a lot of places not that bad and they have to come up with some work for them. So having them work on this is still cheaper then having the people in the valley plus “useless” people in Munich.
You know where there is also cheaper labor? Other places in the US that are not in Bay Area CA.
I don’t think Google pays significantly less in other US cities.
Besides, the kind of people who has the right experience to be hired by Google isn’t cheap.
Maybe they will save money because they don’t have to offer healthcare?
Employers in Germany have to bear half of the mandatory social security contributions.
This is on top of gross salary and includes mandatory health insurance.
That was my first thought.
https://www.levels.fyi/t/software-engineer/levels/senior/locations/san-francisco-bay-area
vs
https://www.levels.fyi/t/software-engineer/levels/senior/locations/munich-metro-region
Even if you assume that additional labour costs are a bit higher in Germany, there’s no way on earth that it could explain the difference of the Bay Area-median being over 3 times higher.