It is a common shock for Europeans visiting LinkedIn: seeing American job postings offering $150,000 for a role that pays €60,000 in Germany or the UK. On paper, Americans seem vastly richer. But the reality is more complicated.
While the gross salary gap is real, the "net lifestyle" gap is much smaller. Let's break down the math behind the paycheck differences.
1. The Gross Difference
In the tech and finance sectors, US salaries blow European ones out of the water. A senior software engineer in San Francisco averages $180k, while in Berlin, the average is around €85k ($92k). Why?
- Venture Capital: The US market is flooded with investment money.
- Competition: Companies fight harder for talent.
- Less Employer Tax: US companies pay less social security tax per employee than in France or Germany.
2. The "Hidden" Costs of America
Before you pack your bags for New York, look at where that money goes. In Europe, taxes are high, but they cover services that Americans pay for out of pocket.
| Expense | 🇪🇺 Europe (Avg) | 🇺🇸 USA (Avg) |
|---|---|---|
| Healthcare | Free / Low Cost | $400 - $1,200 / month |
| Childcare | Subsidized | $1,500+ / month |
| University | Free / Low Cost | $20,000+ / year |
3. Work-Life Balance: The Real Currency
This is where Europe wins hands down. The average American worker gets 10 to 15 days of paid vacation per year. In the EU, the legal minimum is often 20, but most professionals get 25 to 30 days.
Furthermore, "at-will employment" in the US means you can be fired without notice. In Europe, strong labor laws provide job security that is hard to put a price tag on.
Verdict: Who is actually richer?
If you are young, healthy, and single, the USA offers a ceiling for wealth accumulation that Europe cannot match. You can save $50k a year easily.
However, once you have a family or face health issues, the European model provides a safety net that protects your wealth. It's a choice between maximum potential (USA) and maximum stability (Europe).
Want to see how your country ranks? Check our full salary database.