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Living overseas

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UK vs US salaries

112 replies

Star555 · 21/02/2021 02:03

Perhaps a naive question, but why are US salaries so significantly higher (often 2x) than UK salaries for the same jobs, e.g. in science and technology? I know that UK gets NHS and more holiday time and maternity leave than the US, but can that really make such a big salary difference? I also know that private (fee-paying) uni education is insanely expensive in US (state unis are much cheaper), but in UK the cost of fee-paying schools for children up to Year 13 isn't exactly cheap either!

For those of you who moved to/from the US by choice, was the increase/decrease in salary among your main incentives/concerns? Or did salary not play a big role for you? (Perhaps other factors like being near family were more important.)

OP posts:
BritWifeinUSA · 27/02/2021 16:06

Cost of living here is much higher. People who’ve only been here on holiday think it’s cheaper because for most of them the only thing they buy here is fast food and petrol. Those are the only things that cost less. Proper food, utilities, cars, insurance, household repairs, leisure activities, clothes, appliances, etc all cost more.

I do the same job here that I did in the UK. On paper, the salary is higher ($150k here, £80,000 in the UK). But we are not hugely better off than in the UK.

Notalktillcoffee · 27/02/2021 16:29

Salaries are lower in the UK due to supply and demand. In my field, salaries have increased significantly in the past 2-3 years but are still between 100 - 30 percent less than the NYC equivalent ( this is a highly paid field). I suppose that the government support people receive does have an overall impact on wage floors but for very in demand jobs, the market rate has moved a lot in recent years.

KobaniDaughters · 27/02/2021 16:32

We just got paid our first half of the month salaries - $6,300 and it’s all been budgeted into regular line items, so no disposable income - that’s ALL gone on mortgage, car payments, insurance, utility bills and food shopping

ZZTopGuitarSolo · 27/02/2021 17:00

Even low paid jobs are well paid, in my state at least. DD earns $13 an hour for a low skill kitchen job. Our hotels are struggling to hire people and have had to put housekeeping pay rates up to $15/hr. McDonalds and Walmart are paying $15/hr plus benefits.

Supply and demand definitely seem to be having an effect.

JackieWeaverFever · 27/02/2021 17:17

I work internationally and live in london. I started doing it to work out where I wanted to move to but was shocked to discover we have it good in london Shock
Travelling has opened my eyes and once accommodation is sorted I think london is pretty cheap relatively speaking vs quality of life.
Personally you couldn't pay me to work in SF (double my salary wouldn't touch the sides those crappy little tickytack boxes in Palo alto make me shudder. i know i would not have the same standard of living) and NYC I find okay/nice but again crazy commute and food is SO expensive.
Also the clothes!!! It's all synthetic polyester garbage.

Give me UK or Germany anyyyyy day.

Liquorishtoffee · 27/02/2021 17:26

Friends were explaining their house tax (is that it?) and it was 10x our council tax for a property half the cost of ours but larger. My sister bought a large house (and garden) the price of my other sisters small farm (and barn conversion) and my one bedroom flat in London (we all bought about the same time).

Some states are a lot cheaper to live in though and have better healthcare.

We found ‘living’ expenses cheaper (household goods, eating our, food, petrol etc). Doctors are paid crazy money (I’m sure not all but we have a few relatives out there who are doctors and who definitely are).

Liquorishtoffee · 27/02/2021 17:27

(Sister bought house in US, other farm in Scotland)

HerRoyalNotness · 27/02/2021 17:29

Were in Tx so there is no state income tax either. You’d think we’d have a comfortable life on paper earning more but there is no money for holidays, weekends away, or saving. The kids do basic extracurricular activities and are in state school.

Where it goes?
8k a year I property taxes (ours is cheap as our neighbourhood has paid off their utility infrastructure. Includes school taxes)
1k for housing association fees, covers gardens, community pool etc
3.5k house insurance. We get hurricanes and tornadoes so it’s ridiculously high
1.5k car insurance for 2 cars
5k health insurance

That’s 20k after tax before you’ve started living!

I had a MRI the other day that cost me $1k. My son needed a test they wanted to charge $2k for but I told them no, so the reduced it to $1k (which shows how arbitrary the health system and charges are here, constantly feel like I’m being scammed) If we have a good year with few health issues then we don’t spend the yearly bonus. That is very rare.

We have a much worse life here by a long way.

KobaniDaughters · 27/02/2021 17:47

@HerRoyalNotness god I’m so sorry, your insurance sounds terrible Sad I’m constantly glad DH’s company covers ours that we only pay $300/month before tax and yet we have excellent coverage - I had an MRI 3 months ago and my contribution was something like $12

I hope you’re ok in TX at the moment, sounds really rough at the moment

HerRoyalNotness · 27/02/2021 21:57

[quote KobaniDaughters]@HerRoyalNotness god I’m so sorry, your insurance sounds terrible Sad I’m constantly glad DH’s company covers ours that we only pay $300/month before tax and yet we have excellent coverage - I had an MRI 3 months ago and my contribution was something like $12

I hope you’re ok in TX at the moment, sounds really rough at the moment[/quote]
$12! I’ve been ripped off, lol. We’re still confused about how it works here. I think I’ve met my deductible so now it will only be 10% of bills going forward or 30% out of network, which is just as well as I’m having surgery next week.

Luckily and it was blind luck we bought a house on a hospital grid so didn’t lose power. We lost water for a couple of days but had lots in our hurricane supply. Only blew a pump motor on the pool equipment, no pipes bursting so we were very lucky

knitnerd90 · 27/02/2021 22:06

American expats in the UK usually say it's expensive. British expats in the US also say it's expensive. I've looked at the numbers, and comparisons are difficult. We've had to learn entirely different ways of budgeting and looking at money.

I'll leave out healthcare, since 1) we all know that's more here and 2) the actual numbers are incredibly variable (I know people who get 100% of their premium paid, and people who get less than half). As I said above you absolutely must calculate the benefits including health cover when considering an offer.

Housing is a very tricky comparison because it's so local. Many American expats are in or around London where housing prices are high--and they think it's even more expensive because of what you get for the money. Similarly Brits who come specifically for jobs are often in the highest cost cities. Americans come to the UK expecting a more American kind of lifestyle and are shocked at what it costs there.

Taxes are calculated differently in both countries and this can lead to unpleasant surprises. US has much lower national income tax, but can have much higher local (state and property) taxes. Texas, for example, is known for high property taxes because they don't have state income tax and our property tax goes to fund schools. (In New York and New Jersey, both sets of taxes are very high. Then I found out what teaching wages are there....) Here in Maryland, I pay less property tax, but we have state income tax.

HOAs are their own question and they can provide amenities--it's not a required cost unless you buy a condo, which will always have some type of association fee.

Utilities: Even if the price per kW/hr or therm was the same, you'll likely use more electricity and gas here unless you are living in an apartment or a very mild climate. Houses are bigger and the climate is more extreme. People sometimes come to the US and say "ooh the houses are so nice and big!" but you need to heat and cool them, and in a lot of the country, air-conditioning is a necessity rather than a luxury.

Cars and petrol are cheaper--but if you're not somewhere like SF or NYC, you've got two cars, and you're likely driving more, and your car gets lower mileage, and so even though the petrol costs less per litre there goes your total cost.

Groceries are a mixed bag as prices have gone up noticeably in the US since we have lived here. I did some online comparison shopping not long ago, and some things are cheaper here and some in the UK, but when you move countries there is a period of having to learn how to shop again and adjust your shopping habits to what is available there.

Internet is more expensive, period (the USA has become one of the most expensive countries).

Doctors are generally paid more here, but the variation between specialties is much higher. Family practitioners (GPs) are not paid that much more than UK GPs and their training costs much more.

ZZTopGuitarSolo · 27/02/2021 22:30

8k a year I property taxes (ours is cheap as our neighbourhood has paid off their utility infrastructure. Includes school taxes)

I find this fascinating - ours is also $8k but people in my state think that's very high. We're in one of the top school districts in the state and we just spent $65 million on refurbishing our schools, which is included in that $8k (it was lower before).

ZZTopGuitarSolo · 27/02/2021 22:37

Groceries are a mixed bag as prices have gone up noticeably in the US since we have lived here. I did some online comparison shopping not long ago, and some things are cheaper here and some in the UK, but when you move countries there is a period of having to learn how to shop again and adjust your shopping habits to what is available there.

Right - when I first got to the US I was horrified by the high cost of things like leeks. But astonished by how cheap things like squash were. I don't think I will ever get my head around how much bread costs.

You also need to adjust your thinking around what's worth buying the more expensive version of. We buy a lot of our groceries from Misfits Market, because the organic is often worth it, and I can't bring myself to spend what the supermarkets would cost.

KobaniDaughters · 27/02/2021 23:26

@knitnerd90

American expats in the UK usually say it's expensive. British expats in the US also say it's expensive. I've looked at the numbers, and comparisons are difficult. We've had to learn entirely different ways of budgeting and looking at money.

I'll leave out healthcare, since 1) we all know that's more here and 2) the actual numbers are incredibly variable (I know people who get 100% of their premium paid, and people who get less than half). As I said above you absolutely must calculate the benefits including health cover when considering an offer.

Housing is a very tricky comparison because it's so local. Many American expats are in or around London where housing prices are high--and they think it's even more expensive because of what you get for the money. Similarly Brits who come specifically for jobs are often in the highest cost cities. Americans come to the UK expecting a more American kind of lifestyle and are shocked at what it costs there.

Taxes are calculated differently in both countries and this can lead to unpleasant surprises. US has much lower national income tax, but can have much higher local (state and property) taxes. Texas, for example, is known for high property taxes because they don't have state income tax and our property tax goes to fund schools. (In New York and New Jersey, both sets of taxes are very high. Then I found out what teaching wages are there....) Here in Maryland, I pay less property tax, but we have state income tax.

HOAs are their own question and they can provide amenities--it's not a required cost unless you buy a condo, which will always have some type of association fee.

Utilities: Even if the price per kW/hr or therm was the same, you'll likely use more electricity and gas here unless you are living in an apartment or a very mild climate. Houses are bigger and the climate is more extreme. People sometimes come to the US and say "ooh the houses are so nice and big!" but you need to heat and cool them, and in a lot of the country, air-conditioning is a necessity rather than a luxury.

Cars and petrol are cheaper--but if you're not somewhere like SF or NYC, you've got two cars, and you're likely driving more, and your car gets lower mileage, and so even though the petrol costs less per litre there goes your total cost.

Groceries are a mixed bag as prices have gone up noticeably in the US since we have lived here. I did some online comparison shopping not long ago, and some things are cheaper here and some in the UK, but when you move countries there is a period of having to learn how to shop again and adjust your shopping habits to what is available there.

Internet is more expensive, period (the USA has become one of the most expensive countries).

Doctors are generally paid more here, but the variation between specialties is much higher. Family practitioners (GPs) are not paid that much more than UK GPs and their training costs much more.

Excellent post
knitnerd90 · 28/02/2021 07:39

@ZZTopGuitarSolo

Groceries are a mixed bag as prices have gone up noticeably in the US since we have lived here. I did some online comparison shopping not long ago, and some things are cheaper here and some in the UK, but when you move countries there is a period of having to learn how to shop again and adjust your shopping habits to what is available there.

Right - when I first got to the US I was horrified by the high cost of things like leeks. But astonished by how cheap things like squash were. I don't think I will ever get my head around how much bread costs.

You also need to adjust your thinking around what's worth buying the more expensive version of. We buy a lot of our groceries from Misfits Market, because the organic is often worth it, and I can't bring myself to spend what the supermarkets would cost.

I buy a lot of my veg at the Asian markets as it can be half the price and the selection is wonderful. My weird produce item is passionfruit--2 for $5! I was so happy when I learnt about the frozen pulp (already seeded, handy for baking).

Lamb is often horrendously expensive here and hard to get (if it's a good price it's imported Australian--the domestic is better IMO). The cheap chicken is really cheap, but you get what you pay for, so I buy organic.

There is cheap store bread but it's awful and spongy. The good bread is pricey. It's a good thing I do a lot of my own baking in general; good quality breads and cakes are not cheap.

Star555 · 28/02/2021 16:45

This has been a very informative and interesting discussion! Indeed, it's not fair to compare apples to oranges, for example, living in London vs a small US city in the Midwest, or living in New York City to a small city in the north of England. I'm interested mainly in the London-NYC comparison, since I think that's the most "fair" apples to apples comparison. Let's say someone earns 100k USD as a software engineer in NYC. Then is 50k GBP roughly the "equivalent" salary one would earn for the same job in London to have the same standard of living? (Of course in London one would get more holiday, maternity leave, etc.)

@knitnerd90 "Lamb is often horrendously expensive here and hard to get" -- I could not agree more! Do you have any recommendations for large chain stores (e.g. Whole Foods) for getting lamb?

OP posts:
ZZTopGuitarSolo · 28/02/2021 16:51

This thread made me curious to see how much lamb costs in my local supermarket, so I did a search on Lamb. This came up Grin

UK vs US salaries
HazelWong · 28/02/2021 16:57

It's super hard to do a direct comparison. E.g. Americans will often say that British taxes are a lot higher but they aren't factoring in that council tax is fairly low compared to property taxes and the various local income taxes. On the other hand the American tax system has all these deductibles and reductions for children etc. Honestly no idea where that typically leaves you on the tax front.

Then there are other complexities - e.g. we don't run a car here but would probably need to run two anywhere in the US outside very central NYC or somewhere like that - but does that count as an extra expense as it's kind of a choice

KobaniDaughters · 28/02/2021 17:13

FYI our Trader Joe’s (SoCal) stocks pasture raised NZ lamb for a reasonable price, I never see it in WF!

@Star555 don’t bank on the holiday allowance - tech companies on the West Coast now quite often follow the unlimited PTO rule as they’ve realised it does more for productivity especially when they have several crunch times throughout the year. My DH works for a gaming company and when we moved he had to negotiate from 2 weeks annual leave to 3 but 8yrs ago they moved to unlimited PTO and it has made a huge difference to our quality of life, flexibility around childcare my work (I’m a freelancer and have sometimes had to to travel for work so when DC were younger he’d often just take time off rather than do all the childcare and his full time job) and still get 3 weeks at least in the U.K. over the summer

knitnerd90 · 01/03/2021 03:00

It's hard even to do it with the location because the value of health cover alone is that huge. For one person the total premium cost is up to nearly $10K and the average family policy is $20K, though again, this will vary depending on the location as well as the insurance itself. Your employer generally pays some part of that, and you pay your share pre-tax. Then there's almost always some sort of deductible before the insurance starts paying (outside of certain services.... see, it's complicated).

Now, if your employer pays 50% of the premium for you, and then your deductible is $3K a person, that's quite a difference in your total compensation than if the company pays 80% with a $500 deductible.

$100K with a good benefits package is worth a lot more to you than $100K with crap benefits. DH turned one job down because of it.

$100K is a decent salary in New York if you are not then paying through the nose for healthcare. But it also depends on your lifestyle.

Harriedharriet · 01/03/2021 04:02

We have lived in quite a few of the bigger American cities. I was constantly surprised by how high cost are partly due to the "hidden" nature of them. Tip and tax added at the check out or after the decision to buy took a long time to get used to. There are an extra few dollars at almost every exchange, and it really adds up.
I really think that you could really make an argument that America is now an oligarchy with certain businesses/families owing everything on the coastal outside, and they have dried out the middle. Food, petrol, health, communications - all of it. For a vast country like that with a population of over 300 million the regional differences in commercial offerings are almost non existent. That almost always results in poor service and price gouging.

Harriedharriet · 01/03/2021 04:04

Heavy on the "really" there! Grin

Rhayader · 01/03/2021 15:55

DH’s employer has asked him about a move to Connecticut (Greenwich) where they are opening a new office and he’s said he’s interested but they haven’t mentioned money at all yet. It would feel cheeky to ask for such a high number (double in dollars) but then we don’t want to be screwed over. Especially when his visa is tied to his employment so he can’t exactly just move jobs...

Health insurance is paid for 100% though so that’s one less thing to worry about. I did a quick comparison and average wages are 30% higher in CT than in London so that was a least one bit of data to use in the negotiation 😬

Housing is more expensive but you get a lot more for your buck if that makes sense.,. The average house just seems enormous. Good public schools too.

lunarlife · 01/03/2021 16:35

It is a slightly different situation if you are on a temporary internal transfer package or a permanent unit move.

A temporary transfer usually involves a lower salary ( although with a cost of living allowance if needed), often rental, contact home, tax support covered. Pensions and conditions around loss of employment remain in the original home country.

A unit transfer would involve a local salary but also local employment conditions and they can be brutal in the USA. Holidays also have to be negotiated as they are less of a given and pensions may not be the same.

Rhayader · 01/03/2021 16:51

Thanks @lunarlife

For us this a permanent move with a (hopefully plush) relocation package.

The head office is in the US and the UK is essentially a “satellite office”. DH weirdly has a team in the US already which has been a pain to manage during the pandemic because of the lack of travel - he’s never even met some of them! So they want him to move forever.

We wouldn’t get green cards until about 5 years in so if they don’t give proper pay rises then we would be a bit stuffed!