Hey, you're not wrong. Two employers ago, ALL of our Canadian clients paid significantly lower than their counterpart in the USA. For example, say an entry-level DevOps Engineer starts at $120,000 USD in Silicon Valley. That's about $160,000 Canadian Dollars (CAD).
Alright, so let's look at entry-level DevOps Engineers in Vancouver BC, which is basically Canada's NYC/LA. The last three clients at then-employer I talked to did not even want to start the candidate at $100,000, the highest I could talk them into was $95,000. Again, this is Canadian Dollars, not USD.
So $100,000 CAD is only about $77,000 USD. That sounds like a lot still, but Vancouver Canada rent ain't cheap, and the income tax rate in British Columbia (which Vancouver is a part of) is high too - <strong>For 2020, the income bracket of $83,451.01 to $95,812 is taxed at 10.50%.</strong>
Bracket | Taxable Income - 2020 Brackets | Tax Rate |
---|---|---|
Bracket 1 | $0 to $41,725 | 5.06% |
Bracket 2 | $41,725.01 to $83,451 | 7.70% |
Bracket 3 | $83,451.01 to $95,812 | 10.50% |
Bracket 4 | $95,812.01 to $116,344 | 12.29% |
Bracket 5 | $116,344.01 to $157,748 | 14.70% |
Bracket 6 | Over $157,748 | 16.80% |
I live in Oregon and we have one of the highest income tax rates in the USA, and even my current tax bracket (9.9%) is not as high as 10.50%. I make $170,000 a year.
But let's talk rent. <strong>As of January 2020, the median rent for a 1 bedroom in Vancouver is $2150 CAD</strong>. That's about $1700 USD.
Say you have kids and you want to put them in Montessori preschool. ~~<strong>that's $4650 CAD a year</strong>.~~ EDIT -- this was only for half-day. I looked up a different Montessori <strong>that is more transparent with their pricing</strong>. Annual fee here is $10,500 and that's only for Monday-Thursday, full-day. Want Fridays covered too? $1500. Oh, also, "full-day" is defined as 8:30am-3:30pm. No one works that short of a shift in IT unless you're in Business Development. So, you want "after-care"? $2450 extra. Total cost? $14,450. This is more than what I pay for Montessori daycare in the USA. Here in Oregon I pay $13980. In California I paid $11,140. In Arizona, I paid $10,100.
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Alright, so some basic math (all in CAD):
$95,000 - (bracket 1) = $90,193
$90,193 - (bracket 2) = $86,980
$86,980 - (remainder of bracket 3) = $8,5768
Alright, now rent.
$85,768 - ($2,150 x 12 months) = $59,968
Now daycare:
$59,968 - ~~$4650~~ $14,450 = $45,518
EDIT 2 - Canadian <strong>federal taxes</strong>, need to include too.
15% on the first $47,630 of taxable income (so, $7144)
20.5% on the next $47,629 of taxable income (on the portion of taxable income over 47,630 up to $95,259) (so, $9764)
Total federal tax loss for someone making $95,000 CAD = $16,908 CAD
$45,518 - $16,908 = $28,610 CAD or $22,000 USD
Now you're probably going, "Neil, I have a lot of money left over! Canada doesn't seem so bad! There's nothing wrong with this picture at all!!"
Ahhhhh but remember, we're in Canada, this ain't apples to apples comparison!
You know how in America, we bitch about gas prices being "too high"?
Ever wonder how much it is in other countries?
Well in Vancouver Canada, <strong>the average price was $1.75 CAD per liter in 2019</strong> (1/4 gallon). Do the math...
... That's over $6.00 USD a gallon. Just for gas.
All of a sudden, you realize comparing lifestyles between US and Canada is WAY WAY WAY different.
Take <strong>this portable gas stove</strong>. I own one, it costed me $50 on Amazon.com USA. Meanwhile, on <strong>Amazon.ca (Amazon Canada), it lists at $109 CAD ($84 USD)</strong>.
Oil changes? You know those $19.99 deals we have at Jiffy Lube here in the USA? A "deal" for an oil change in Vancouver Canada <strong>starts at $61 CAD</strong> ($46 USD). And that's before disposal fees, taxes, etc etc. After all is said and done, you're looking at a bill over $100 CAD ($77 USD). For an oil change. This isn't even for Synthetic oil, it's just regular standard oil. (Fun fact, if you read more in that hyperlink, there's a section where the ad reads, "Nevermind the advertised price. In a high-pressure sales environment, the average customer ends up paying $70 to $120 for their cheap oil change" -- Who here in the USA pays $120 for a standard oil change? Synthetic, maybe, but standard?
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I could go on and on, but the point is, living in Canada, even in the metro territories like Toronto and Vancouver, is far more costly than living in the USA. Like I mentioned elsewhere in this thread, this is why a lot of Canadians move down to the USA to work; we simply pay more, and people STILL come out on top despite healthcare not being free here.
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EDIT - formatting, also corrected daycare tuition with a more complete picture.
EDIT 2 - added federal, I'm ashamed to have missed this on the first pass.