Where is it more expensive to hire, in the US or in Europe? And where do employees keep more of their pay?
This study looks at employment costs and take-home pay in ten major cities — five in the US (Seattle, San Francisco, New York, Austin, and Atlanta) and five in Europe (Berlin, Amsterdam, Paris, Dublin, and London). We wanted to understand how different locations, salary levels, and tax systems actually affect what it costs to hire someone and how much employees end up with after taxes.
The findings come from our larger 2025 research on employment costs across 36 European countries, giving companies real data for building international teams.
To reveal both structural differences and market-driven realities, we compared costs in two ways:
*This data we collected from our original study has been converted from Euro to USD at €1 = $1.13 (May 2025).
This two-scenario approach uncovers not only what employers pay and employees receive, but why those amounts differ.
Before diving into the details, here are some standout observations:
| Rank | City | Total Employment Cost | Employer Costs Above Salary |
| 1 | Seattle, WA | $154,338 | $20,631 (+15.4%) |
| 2 | San Francisco, CA | $143,503 | $24,300 (+20.4%) |
| 3 | New York, NY | $128,630 | $18,492 (+16.8%) |
| 4 | Austin, TX | $125,470 | $11,820 (+10.4%) |
| 5 | Atlanta, GA | $125,389 | $11,285 (+9.9%) |
| 6 | Berlin, DE | $91,824 | $18,094 (+24.5%) |
| 7 | Amsterdam, NL | $91,260 | $20,244 (+28.5%) |
| 8 | Paris, FR | $90,690 | $33,696 (+59.1%) |
| 9 | Dublin, IE | $83,586 | $8,385 (+11.2%) |
| 10 | London, UK | $80,146 | $9,921 (+14.1%) |
| Metric | US Cities Range | European Cities Range | Notable Comparison |
| Average Annual Salary (Mid-Level Software Developer) | $110,138 - $133,707 | $56,994 - $75,201 | The highest European salary is almost $35,000 below the lowest US salary |
| Total Employment Cost | $125,389 - $154,338 | $80,146 - $91,824 | Hiring in London compared to Seattle is 48.1% less |
| Net Pay | $79,746 - $101,262 | $38,365 - $54,665 | Net pay in Seattle is almost double compared to London |
| Cost-to-Net Pay Ratio | 1.42 - 1.73 | 1.47 - 2.36 | European cities on average have higher cost-to-net pay ratio, though London (1.47) is comparable to Austin (1.42) |
When we look at identical salary levels across regions, European employment systems generally show higher costs. This is due to more extensive social contribution structures. Our data for the $67,850 (€60,000) benchmark salary clearly reveals this pattern.
European employers (on average) pay significantly more in mandatory contributions for the same base salary, and this is generally used to fund comprehensive social systems, including healthcare, education, and worker protections.
Paris illustrates this well, with total employer costs reaching 59.1% above the base salary, compared to just 10-20% in most US cities. For the same $67,850 salary, an employer in Paris pays $107,772 in costs, while an Atlanta employer pays $74,560. The difference of over $33,000 (a 44% increase).
However, not all European cities follow this pattern to the same degree. At the $67,850 salary level, several cities have practically identical employer costs:
Despite higher proportional costs, European total employment costs are actually much lower than US costs when hiring at local market rates. This is because market salary levels in European cities are substantially lower than in US cities.
European salaries for mid-level software developers range from $56,994 to $75,201, while US salaries range from $110,138 to $133,707. This substantial salary gap more than offsets the higher proportional costs in European systems. As a result, total employment costs in European cities are between 26-48% lower than in US cities.
London ($80,146) costs 48.1% less than Seattle ($154,338), Berlin ($91,824) costs 27% less than Atlanta ($125,389), and even Paris with its high contribution rate still offers total costs ($90,690) that are 28% lower than Atlanta's ($125,389).
These findings demonstrate that market salary levels have more impact on total employment costs than contribution structures themselves.
When hiring at local market rates, the range of net pay across cities is striking. In fact, the net pay gap is even wider than the employment cost gap.
For example, a software developer in Seattle ($101,262) takes home nearly 2.6 times what their counterpart in Paris receives ($38,365). But it’s when using our $67,850 benchmark salary that provides an even clearer picture of how tax systems impact net pay when gross salaries are identical:
The difference in take-home pay is $11,449, or 25.6%, despite identical gross salaries.
Companies building international teams need to understand these variations to create compensation packages that make sense in local markets while still attracting the quality of talent they need.
To dig deeper into the employee experience, we need to look beyond net pay to what their salary can actually purchase in each location. When we factor in cost of living, some of the salary advantages of US cities diminish substantially, while European locations reveal surprising strengths.
A few examples reveal how dramatically this reshuffles our understanding of compensation:
New York ranks last in disposable income among all ten cities, despite having the fifth-highest net pay. The city's extreme cost of living ($67,852) essentially erases the salary advantage it has over European cities.
These findings reveal that there is more to the compensation puzzle than salary numbers alone. The actual purchasing power and lifestyle a location offers can tell a completely different story than what gross or even net pay figures suggest.
Atlanta stands out as the lowest-cost US hiring location in our study, with employer contributions running just 9.9% above base salary. Employees also benefit from the lowest cost of living. After taxes, developers keep nearly 73% of their gross salary, leaving them with about $45,654 in disposable income after living expenses.
Austin delivers the most efficient compensation structure across our study. For every dollar that reaches a developer's bank account, employers spend just $1.42. Thanks to minimal employer contributions and Texas's tax-friendly environment, developers also fare well, keeping nearly 78% of their salary after taxes. Combine this with reasonable living costs, and employees end up with roughly $48,566 in disposable income.
New York shows a significant financial contrast between salary figures and economic reality for employees. While employment costs fall in the middle range for US cities, the metropolitan area's exceptionally high cost of living transforms the value equation. After covering basic expenses that are 80% higher than in Atlanta, developers retain approximately $11,894 in disposable income. This is just 14.9% of take-home pay.
The Bay Area continues to command premium rates as the traditional heart of the tech industry. Employers here spend about $1.73 for every dollar that reaches a developer's bank account, the least efficient arrangement among US cities in our study. California's tax structure and high cost of living means that, despite high salaries, developers keep around $25,567 in disposable income. This is a figure that's surprisingly lower than what their counterparts enjoy in several European cities with much lower gross salaries.
Seattle tops our chart for total employment costs, but this is driven primarily by having the highest base salaries rather than unusually high employer contributions. The absence of state income tax also contributes towards employees receiving the highest net pay among all ten cities. With comparatively reasonable living costs for a major tech hub, Seattle developers enjoy around $55,472 in disposable income, the highest found in our study.
Despite it being one of Europe’s costlier destinations, Amsterdam's total employment costs run significantly lower than even the most affordable US city in our study. Employers here pay 28.5% above the base salary in mandatory contributions (for the software developer salary), which puts Amsterdam in the higher range for European locations.
The city has strong fintech and creative technology sectors, drawing talent from technical universities throughout the Netherlands and neighboring countries. Amsterdam's business environment features widespread English proficiency, making it accessible for international companies.
Berlin has the highest total employment costs among European cities in our study (yet remains 27% below the lowest US city). With a cost-to-net pay ratio of 1.91, nearly half of employer spending goes to mandatory contributions rather than employee take-home pay.
An interesting note is that Berlin offers the second-lowest cost of living among major European tech hubs. The city has developed particular strengths in blockchain, AI, and fintech development, with English commonly used in professional environments.
Dublin tops our European cities for developer salaries while keeping total employment costs far below that in the US. Employers here pay relatively modest contributions at just 11.2% above base salary. This makes Dublin's employment structure one of the more straightforward in Europe. Interestingly, when looking at our $67,850 benchmark, Dublin actually costs less than some US cities paying the same salary.
The city's "Silicon Docks" area houses numerous multinational tech companies (Google, Amazon, Meta) that benefit from Ireland's English-speaking workforce and EU membership.
London offers the lowest total employment costs in our European sample, 48% below Seattle. At the same time, developers also receive the highest take-home pay among European cities despite not having the highest gross salary, thanks to relatively low employee deductions (income tax and social security).
London hosts one of Europe's largest tech ecosystems with particular strengths in fintech, AI, and data science. Its talent pool draws from both world-class local universities and a highly international workforce.
Paris stands out with the most distinctive cost structure in our study. Employers here pay an extremely high 59.1% above base salary in mandatory contributions, by far the highest percentage we observed. This creates a cost-to-net pay ratio of 2.36, meaning for every dollar that reaches an employee's bank account, the employer spends 2.36 dollars.
This becomes particularly apparent at our $67,850 benchmark, where costs reach a remarkable $107,772. That’s just over $20,000 more than any other city at the same salary level. Nevertheless, Paris's actual market-rate employment costs still run 28% below the lowest US city for our software developer benchmark.
Hiring in multiple countries isn’t just a matter of comparing salaries. As this study shows, costs vary widely depending on location, market rates, and tax structures, but so do the rules, processes, and risks involved in employing someone overseas.
That’s where an Employer of Record (EOR) comes in. With Boundless as your EOR partner, you can:
This comparison covers ten major cities — but our complete 2025 study analyses salaries, employment costs, and net pay across 36 European countries. See how every location stacks up, identify the most cost-effective hiring markets, and benchmark your pay strategies with real data.
👉 Download the full 36-country European Employment Cost Study
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