This is why there needs to be less taxes and mandatory benefits. Counter-intuitively, these things work together to reduce the number of jobs and reduce worker flexibility and happiness.
In Australia "taxes and mandatory benefits" on a $100k USD salary cost the employee ~30% in taxes and medicare levy and the employer ~5% payroll tax + ~10% superannuation (401k). In total, 1.15x the salary is being spent and of that, 0.69x goes to the employee.
If the employer pays an extra 50% salary in the US, then 1.5x the salary is being spent but the employee only gets salary after tax, which (based on my payslip) is only ~0.65x salary. So the employee only gets 0.43x the total amount being spent. If the employer has a fairly generous 401k match that results in an extra ~10% going to the employee from that extra 50%, that's still only 0.50x the expense going to the employee.
As someone who's lived in both countries, I don't really get anything extra in the US thanks to that cut. The health insurance seems to be the main thing people care about but I found healthcare in Australia to be cheaper and superior to the care I've had in the US (on PPO).
I think the US needs to adopt single payer healthcare like the civilised world and work out its government spending and taxes a little better.
Or completely the reverse - all mandatory benefits as a percentage of wages. We kind of, sort of do that in Germany (up to about 50k for health insurance, 90k for retirement, I think)
How would increased taxes and mandatory benefits reduce the cost of employees?
Increased employee costs make an employer less likely to take risks and produce pressure to hire less workers. Then a few workers gain at the expense of others not having a job at all. Why do you hate workers?
It would make benefits a more constant cost per 1k paid to employee, making the cost per hour of a 30 Hr/wk employee closer to that of a 40 Hr/wk employee.
Come to think of it, that's probably why I have so many colleagues on 20-32 Hr/wk contracts... Mostly, mothers of young children. But they're doing the same sort of technical work others on full time contracts are.
In Australia "taxes and mandatory benefits" on a $100k USD salary cost the employee ~30% in taxes and medicare levy and the employer ~5% payroll tax + ~10% superannuation (401k). In total, 1.15x the salary is being spent and of that, 0.69x goes to the employee.
If the employer pays an extra 50% salary in the US, then 1.5x the salary is being spent but the employee only gets salary after tax, which (based on my payslip) is only ~0.65x salary. So the employee only gets 0.43x the total amount being spent. If the employer has a fairly generous 401k match that results in an extra ~10% going to the employee from that extra 50%, that's still only 0.50x the expense going to the employee.
As someone who's lived in both countries, I don't really get anything extra in the US thanks to that cut. The health insurance seems to be the main thing people care about but I found healthcare in Australia to be cheaper and superior to the care I've had in the US (on PPO).
I think the US needs to adopt single payer healthcare like the civilised world and work out its government spending and taxes a little better.