Software Engineer Salary In India Per Month – From a salary standpoint, Silicon Valley is the clear winner, with an average annual income of $110,554, according to Glassdoor data. But even with six-figure salaries, many developers struggle to afford the Bay Area’s high rents.
For a more complete analysis, we compared the actual earnings of software engineers in 43 cities around the world to find where they would have the most spending power. The real profit was calculated as follows:
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Real Income = Income – Taxes – Social Security – Cost of Living – Rent A quick summary of our results
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Seattle is the clear winner, with salaries similar to Silicon Valley but with significantly lower rents. Also, with a few exceptions, US cities ranked higher than international cities. Interestingly, San Jose (our Silicon Valley proxy) was still ranked third out of 21 US cities, while San Francisco is back at 19th due to rent disparity.
On the East Coast, New York City and Washington D.C. managed. even worse and finished in the bottom two places. Phoenix finished second, with Austin and Houston rounding out the top 5. Internationally, our recommendations are Tel Aviv, Canadian cities and Berlin. Contrary to what you might expect, our data suggests you avoid London, Singapore and China.
Previously, Glassdoor listed the 25 highest paying cities for software engineers in the US and calculated the actual adjusted salary by factoring the salary into the cost of living. Their model places San Jose and San Francisco 2nd and 3rd respectively on their list, contrary to anecdotal evidence. It’s worth noting that they show that San Jose has a higher cost of living than San Francisco, while our data shows why it’s the other way around.
What does “scale income by cost of living” mean? It is a way to put all cities with different costs of living on equal terms. Here’s Glassdoor’s formula:
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But scaling income by cost of living is not a very accurate way to compare cities. People just want to know how much money they have in their pocket at the end of each year.
Instead of scaling earnings like Glassdoor, we used our own actual earnings formula to calculate the salary of an average software engineer living alone in a city and used that as a ranking metric. This leads to very different results.
Since taxes take a significant portion of every salary and vary by region, we used the same Glassdoor base salary numbers to calculate after-tax income for each city, then subtracted the average annual cost of living and rent from the Numbeo data. You don’t want to move to a city with few jobs, so we selected cities with many jobs and expanded our reach globally.
American cities outperformed almost all international cities, and to make things easier, we split the two into separate rankings. Hereafter, we refer to non-US cities as “international” cities.
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Most people assume that even if wages are lower abroad, the lower cost of living is enough to compensate. With a lower base salary, your real income will be lower, but even relative to the cost of living, foreign salaries typically cannot compete with those in the United States. See the Affordability section below for more information.
Our data confirms the findings of similar reports suggesting that Seattle is currently the best place to be a software engineer. Companies like Amazon and Microsoft are pushing average wages closer to those in Silicon Valley; however, lower rent means more money in your pocket each month.
Phoenix, Austin, and Houston also appear to be good choices, with real earnings above $30,000. However, these markets are still growing and reach the bottom of our job vacancies list. Raleigh, North Carolina is ranked 6th below Houston, but again the job market there is relatively small.
From the table above, you may have noticed the difference between San Jose at No. 3 and San Francisco at No. 19. The two cities are often grouped under the same “Bay Area” category. Why are actual returns so different for similar markets and regions with geographic proximity?
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Our data shows that salary and cost of living are nearly identical, but San Jose’s cheaper rent makes up the difference.
The cost of living doesn’t vary dramatically from city to city, but rents do. For example, look at Phoenix in third place, with an average rent of $972 per month, while San Francisco, in nineteenth place, has an average rent of $3,272 per month.
Washington, D.C., New York and Boston have the largest job markets for software engineers outside the Bay Area, but high rents push them to the bottom of the list. Washington DC has the most jobs in our analysis, but is the worst choice among large US cities due to lower-than-average wages and high costs.
In addition to American cities, we also wanted to learn more about international cities. We selected cities mentioned in similar reports as either established or emerging tech hubs and calculated for them. Keep in mind that almost all of the cities listed below underperform their US counterparts in terms of both real income and job vacancies.
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Oslo tops the list for earning power, but we didn’t mention it earlier because the labor market is the smallest of the 43 cities we analyzed in this report. Compare its 106 jobs to 22,554 jobs in New York City.
Your best bet is Tel Aviv. It is a fairly mature technology hub with the second largest real income and a reasonably large technology market. In addition, there are tax breaks for new immigrants arriving in the country, which are not taken into account in our tax calculations.
Canada is also doing well. Toronto, Montreal and Vancouver rank 3rd, 4th and 5th on our list for real incomes. In addition, the labor markets in all three cities outperform Tel Aviv. Often cited as a strong European technology hub, Berlin is not far behind in sixth place.
Bangalore also deserves a mention. It has one of the most software engineering jobs in the world, surpassing San Francisco and San Jose, and second only to New York and Washington, D.C. In US dollars, however, it has the lowest average pre-tax income of any city. we weighed.
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For the most part, the cost of living internationally is much lower than in the US, but not so low as to compensate for the drop in wages.
According to our data, London’s real income is below the international average and, in turn, much lower than in US cities. Another city that might surprise you is Beijing. Many people are excited about the technological innovation there, and local startups have the advantage of access to a huge but unique home market. However, our data suggests that there are better alternatives in strictly economic terms.
The real income values in Singapore and Hong Kong are close to zero. Those in Warsaw and Moscow are even lower, so we calculate a negative value of real income. This means that if you are a software engineer earning an average salary in any of these three cities, you cannot afford to rent an apartment downtown.
Lower wages internationally usually mean lower incomes even with lower living costs. Perhaps more important is the cost-benefit ratio. We calculated the affordability ratio of after-tax income divided by costs for international cities and then indexed it to San Francisco. So San Francisco has an affordability of 100 and a value of 150 means that city in question is 50% cheaper than San Francisco.
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Income multiplier = (after tax income/expenditure) index value for city A = 100 * (city A income multiplier)/(SF income multiplier)
In most cases, it gives a ranking similar to the actual income. More interesting is the layout in San Francisco. Although San Francisco is not particularly affordable (most US cities have values above 100), about half of international cities have a lower ratio. So even considering the cost-benefit ratio, international cities struggle to compete.
To provide a non-monetary context for each city, we cite Numbeo’s Quality of Life Index, a weighted index based on several factors.
This number is not indexed, so it is only a reference. Because there is less stark contrast between US and international cities, we included all global cities below, except for Baltimore and Detroit, which did not have enough data to calculate the index.
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Many international cities surpass the largest US cities. Consider, for example, that 13 of the 22 international cities surpass New York. Apart from Melbourne, 10 of the top 11 places are all smaller US cities. Take these results as you will; some have mentioned that it can overweight impurities.
Our model assumes you are a software engineer living alone in a city with an average software engineer salary. Although your personal “real income” may vary widely depending on the job,
