London has long been a global tech hub, but a new study indicates that salaries for software engineers in the UK capital are lagging behind those of major tech centers in the US.
The study of salary data from tech marketplace Hired shows that, compared to San Francisco and New York, UK companies actually offer the lowest average salaries for software engineers.
When adjusted for cost of living, an engineer earning an average salary in San Francisco would make the equivalent of £86,000 ($130,000) a year, while an engineer earning an average salary in New York would make an equivalent of £81,000. By contrast, in London the average developer salary is £54,000 a year, making San Francisco and New York salaries are 37 per cent higher and 33 per cent higher respectively.
"Our data science team spent many hours digging into this information to find out not only how different tech hubs like New York, San Francisco and London stack up against one another in terms of salary, but also how that translates into quality of life in those markets", says Lindsey Scott, Director of Communications writing on the Hired blog. "While most people know that software engineer salaries are particularly high in San Francisco, they often don’t fully understand how the cost of living impacts those figures".
Perhaps unsurprisingly the data reveals that, generally speaking, the larger the company the greater the salary offered. For early stage startups that can't compete with larger companies on salary, perks like flexible working hours or the ability to work remotely are an important part of the overall package to help attract candidates. Many of the companies featured in the report cite additional perks, with 18 per cent offering flexible working hours, while 16 per cent free lunches.
The report also shows that although London businesses are hiring talent in the UK, they are also very willing to recruit from across Europe. Some 28 per cent of UK job placements were from other parts of Europe or from the US, with San Francisco-based candidates receiving the highest number of offers from London companies. European candidates were drawn primarily from Spain, Sweden, and France.
More information can be found in the full report which is available to download from the Hired site.