A very free-market take. Do you believe that a fresh graduate at FAANG is really generating 6 figures in value? Do you believe that US employees on average generate 3x the value of their European counterparts?
I don't believe US employees generate 3x the value of their European counterparts, but the justification is right there -- they're paid 3x (or whatever multiple) more.
The actual problem is how you measure "value". We're used to valuing technical work on technical merits, but the market just thinks in money, dollar/euro amounts. And of course it's no fault of European employees that their "value" is significantly lower than their US counterparts -- it's probably due to company leadership, differences in regulatory environment, geopolitical and macro-economical factors, and history (the fact that modern computing started in Silicon Valley is significant).
I agree with the OP that US devs are producing more value - pound for pound - than European based devs, if what we mean by value is money, and I'm 30 something year old European.
The reasons are that the European dev is probably working for a business that's addressing a much smaller market, and that the smaller market probably has a much lower GDP per capita than the US.
It doesn't mean the American dev is better at what they do, or smarter.
> from which they can afford to pay the devs 3x more doesn't actually mean they create 3x more value.
If these two companies are of equal sizings, or if we can find a ratio/cost per engineer/etc that we can say is "equal enough", and we say that Company A makes 3x what Company B makes using this metric, wouldn't it be right to say that Company A's employees produce 3x the profit of Company B?
Given, Company A has a stronghold on the market, government handouts, etc, that are _causing the 3x profit increase_. I for sure agree with that. But, at the end of the day, isn't the employee, the ones producing the output, generating output worth more than Company B?
European work culture is extremely weak. Where are all the European tech giants? The only reason American companies hire Europeans is because 1/3rd of the cost justifies the low productivity.
> Nope, he says this because Americans have a thing called the Protestant work ethic, whereas many Europeans have exactly the opposite of this.
This divergence is greatly exaggerated. Where do you think those hard working Protestants came from?
The main reason European countries are not as wealthy as the US is that they are all much smaller, and linguistic, cultural, and bureaucratic differences make pan European business much harder. You generally have very few large companies that operate in multiple European countries, in comparison to the US.
I'd argue that the free-market take would be that pay is a function of supply and demand, not value. As an example, musicians provide a ton of value, but the free market dictates that they aren't paid a lot, because people who would like to make music for a living are a dime a dozen.
Given that US and EU wages have about a 3-5x disparity, then you might think a) the US worker is worth that premium, and will fulfil 3-5x of your demand for work as the EU worker, b) you have a need towards hiring in the US (certainly understand this in some cases). Or... c) there is a disparity between supply / demand and salaries - why hire in the US if there is so much cheap supply elsewhere?
Monopoly of US firms in the tech industry, their (possibly irrational) reluctance to go remote (until COVID at least), and US work-visa (H1B) quota restrictions.
Now that chasing growth has gone out of fashion and cutting costs is on the table, I suspect companies might lean more towards hiring cheaper, non-US workforce after the layoffs have settled down.
