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pintxo | karma 2225 | avg karma 2.06 · 2024-01-01 05:20:35

2x sounds like it includes non-billable employees like assistants, HR, accounting etc. A 100% overhead is probably quite common.

Pure employee costs are more in the 1.2 - 1.3x range (Europe). That is 30% on top of the gross salary for employer taxes, health insurances etc.

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speeder | karma 11979 | avg karma 4.61 · 2024-01-01 09:15:59

I am in Portugal. Here your real wages are tiny compared to the company expenses.

To start: everyone pays 34.75% of mandatory social contribution, even if you are on minimum wage. Government tricks people saying the contribution is "only" 11% but charges the other 23.75% from the employer.

So if a company pays 1000 eur to "you" (remember a chunk goes straight to government and skips you, but they are still spending that to pay you) you get 652.5 euro. Or 65% roughly. And that is only the social contribution part.

The average income tax for a tech worker is around 20%. Thus you get instead 500 euro flat.

Thus a Portuguese company to hire a tech worker would literally spend the double of your taxless wages just to hire you and pay the income taxes and social contribution. Then if you factor all other potential expenses things get even sillier.

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pintxo | karma 2225 | avg karma 2.06 · 2024-01-01 13:53:10

So, Portugal is pretty much in my 1.2-1.3 range?

speeder | karma 11979 | avg karma 4.61 · 2024-01-03 09:15:38

So a company to pay 500 euro in wages, spends 1000. Thus 1000/500 = 1.2 to 1.3. I don't get it.

pintxo | karma 2225 | avg karma 2.06 · 2024-01-03 14:05:13

I am purely looking at gross salary. As that’s the only measure of interest for the company. How much of that you loose to the state, that’s your problem. /s