[kat]

As someone with Canadian and American work experience, I think US wages are higher because there is more capital in the States. Both Canada and the States struggle to find qualified software devs. The companies that can afford to pay more, get their pick of devs out of a very small pool, so the wages increase. However, in Canada, the companies won't/can't pay as much, so the devs end up making less, or moving south. Brain-drain is a problem in Canada for a lot of different industries (healthcare is hugely impacted).

The cost of housing in Vancouver, Canada is right behind New York and San Fran. I don't think wages has anything to do with cost of living. In general I think Canadian investments are less risk tolerant, the market doesn't shift as fast as it does in the States, and therefore less cash flow. Also, its in the employers best interest to keep salaries down and convince their employees that living in Canada (Vancouver instead of San Fran) is better (how ever you define better).

[omouse]

There is more free floating capital. There are VCs in the US who are willing to invest in all sorts of things and willing to take chances. There are few VCs or banks in Canada that would take a chance on Facebook, Twitter, SnapChat or Uber. Brain-drain is a problem but the bigger problem is lack of capital.

Also, its in the employers best interest to keep salaries down and convince their employees that living in Canada (Vancouver instead of San Fran) is better (how ever you define better).

Yes, especially true. I've yet to see any Canadians who have actually received a raise in recent years. No one talks about it and no one knows whether their salary will be increased to at least meet inflation. It's a little messed up.

[kpil]

The free capital is probably a large factor, just as you say because there is a culture of investing in software development. I don't think you see that as much in say Japan or Germany or anywhere in EU.

The northern European countries are more geared for industrial conglomerates, as is Japan, and I have no clue what they do in southern Europe, but it's not investing in software development.

Other factors in Europe is probably as simple as historically less divergent incomes, less incentives for higher salaries due to higher and more progressive taxes, and a lower demand for really skilled developers due to the industrialist mindset that is hard to shake.

[nasalgoat]

Raising money for an internet startup in Canada is effectively impossible. You might get some minor Series A angel investors (dentists and vets are your best bet), but once you start getting into the Series B rounds where you need real money, you won't find anyone willing to risk it. All they're interested in is gas/oil/mining.

Very risk adverse. We've had to resort to roadshows down in California and New York to try and get US capital.

[cylinder]

It's not about risk aversion. There's just not enough money going around. US is a big country so obviously if 1% of your capital will be allocated to high risk VC it's going to be a much more substantial amount.

[nasalgoat]

We've had Canadian VCs tell us it was too risky to invest in internet startups. Full stop.

[Eridrus]

They're not really wrong though. Unless you really know what you're doing you will lose money, as evidenced by the fact that most VCs do in fact lose money and venture as an asset class sucks.

[omouse]

They aren't wrong but salaries are too low; you can't really bootstrap unless you're doing a side business and then you're effectively working two jobs. There's no YC in Canada or at least it's harder to get some funding.

[developer2]

Nearly every single development-based office in Eastern Canada (particularly Toronto, Ottawa, and Montreal), is based here solely to benefit from saving millions on their bottom line. I have worked for multiple American companies (usually based out of New York) who have all of their developers located in Eastern Canada, and it all comes down to this one reason.

They all make their income in the U.S.; all revenue is made in USD. They discover that the most senior positions in Eastern Canada pay $80-90k CAD per year, with $45-60k CAD being made by juniors. These companies take advantage of our economy to pay on average well below $50k USD per developer.

It has nothing to do with cost of living. It's entirely based on the currency exchange. They also gain back a huge percentage of their employees' salaries by lying through their teeth to government-backed programs, meaning they actually pay < $30-40k/year USD per developer. It's actually disgusting. The executives at these companies are laughing all the way to the bank.

[rb808]

That is true, but I think lots of capital is partially an effect rather than a cause. IE global investors would rather invest in a US startup or listed company than a European or Canadian one.

I think USA provides a good environment for companies where most other countries look after people first. One result is that people with skills that make money for companies will have above average salaries. The downsides of the American way are well documented.

[YZF]

The Canadian dollar went from ~parity to <70c over the course of less than 4 years. So that slashed a significant part of your cost of living, in US$ terms, by 30%.

It's a lot of the same companies, e.g. Google, Microsoft, Amazon, so I don't think we can say the can't pay as much. Other than that it's market forces.

[kat]

If you're living in Canada on a savings account that is in USD, then yes, you're ahead by 30%. Otherwise you're making cdn dollars and spending cdn dollars, so you don't see the 30% difference in cost of living.

And as far as I know the big companies like Google, Microsoft, Amazon, do pay more than market salary in Canada. Their Canadian offices are not nearly as large though, they don't influence the wages/benefits culture as much as they do in the States.

[YZF]

My point is the cost of living didn't go up 30% with the currency. I.e. there wasn't 30% inflation over those 4 years. While your salary is down 30% vs. the US$ due to currency exchange rates your cost of living is mostly unchanged. You have to keep that in mind when you compare salaries between the US and Canada. If you work for a US company and have equity as part of your compensation you just got a 30% raise in CDN$ out of that as well. ;)

So in "real" terms, e.g. purchase power of your salary, Canadians are paid reasonably well compared to their US peers while at the same time it seems there's a lot less inequality. Throw in free health, free education, vacation, severance, etc. and it's not such a bad deal for Canadians employees. At the same time their employers get all sorts of benefits for operating here. SRED and other programs. A more reasonable immigration system. Win-win.