On a serious note: why is it the norm in the US to state your annual gross salary? For context: I’m in the EU and to me it makes a lot more sense to deal with a monthly, take home (i.e. after taxes) sum. Moreover most people here don’t even have access to the non-taxed amount - they receive the net amount directly.
In the US about 5-10% of people are “self-employed” and have access to all their pre-tax income.
Essentially a single employee business, they are required to withhold their own taxes from their earnings, including the employment taxes normally paid by the employer, etc. which is an additional 15.5% on top of the progressive income tax.
Aside from that, in the US there are forms you fill out at the beginning of employment which determine how much is to be withheld. While they can be updated at any time, it’s not always done promptly. Divorce or death of a dependant child could increase how much is withheld.
I have been self employed for almost 20 years. I pay a far higher tax rate than billionaires and I haven’t been able to afford to go to the dentist even once in that time.
as an american, i have to assume its because its a bigger number. “graphs go up and right, and bigger numbers are better.” is a motto for a lot of terrible practices here.
one of these that has been bothering me lately is when people state something like “ten times less!”. this statement means nothing to me, but it has a bigger number than a % of total.
The other reason likely has to do with taxes. If I was making 50k a year and filing my taxes as a single earner, I’m going to end up with a different take home vs if I was married filing jointly and my spouse made 300k. Plus all of the other things we can have and adjust as deductibles and pretax things like 401k, 403b, Insurance, HSA, etc.
US companies define pay either hourly or annually. In general upper and middle management will make an annual salary and the people actually doing the work will be hourly. So some of the people making annual pay believe it to be very important people know they aren’t an hourly worker.
…every employer i’ve worked with endeavors to put people doing the actual work on salary as soon as possible, so they can harvest that sweet sweet unpaid overtime for maximum profitability…
Thanks for explaining. So it’s kind of a class thing too - I didn’t know that. Still, I’ve heard (read) about a lot of folks in engineering and manufacturing (so not management) talking about their annual numbers.
Don’t forget the contractors, we flooded the market with contractor positions for a few different reasons. Some having to do with firing practices, same with insurance practices.
Then there’s the bids for jobs where contractors can take the job and some of those can be sketchy with subcontractors who may or may not be legally allowed to work or be getting paid rates that are legitimate.
Example: Beagal Cinema’s says they want an overnight cleaning crew that will clean all the theaters/floors/bathrooms and such nightly. Another company tells them they can do it for $500(made up number) a night. Then that contractor hires anyone, say 4 people and they bring their kids. Run through and clean it all up between 3am-9am every morning. Each one of them takes home $100 a day, and the contract-owner keeps $100. Beagal isn’t illegally hiring children in said case, and neither is the contractor, but the kids are having to work many nights a week with their parents to get the job done in time so they can be dropped off for school or maybe do homeschooling. (But those parents often don’t speak English, so I assume they would want their kids to go to a school to learn english at the very least).
Worked at a theater that did that from 2006-2012. So it isn’t a new thing.
On a serious note: why is it the norm in the US to state your annual gross salary? For context: I’m in the EU and to me it makes a lot more sense to deal with a monthly, take home (i.e. after taxes) sum. Moreover most people here don’t even have access to the non-taxed amount - they receive the net amount directly.
In the US about 5-10% of people are “self-employed” and have access to all their pre-tax income.
Essentially a single employee business, they are required to withhold their own taxes from their earnings, including the employment taxes normally paid by the employer, etc. which is an additional 15.5% on top of the progressive income tax.
Aside from that, in the US there are forms you fill out at the beginning of employment which determine how much is to be withheld. While they can be updated at any time, it’s not always done promptly. Divorce or death of a dependant child could increase how much is withheld.
I have been self employed for almost 20 years. I pay a far higher tax rate than billionaires and I haven’t been able to afford to go to the dentist even once in that time.
as an american, i have to assume its because its a bigger number. “graphs go up and right, and bigger numbers are better.” is a motto for a lot of terrible practices here.
one of these that has been bothering me lately is when people state something like “ten times less!”. this statement means nothing to me, but it has a bigger number than a % of total.
The other reason likely has to do with taxes. If I was making 50k a year and filing my taxes as a single earner, I’m going to end up with a different take home vs if I was married filing jointly and my spouse made 300k. Plus all of the other things we can have and adjust as deductibles and pretax things like 401k, 403b, Insurance, HSA, etc.
US companies define pay either hourly or annually. In general upper and middle management will make an annual salary and the people actually doing the work will be hourly. So some of the people making annual pay believe it to be very important people know they aren’t an hourly worker.
…every employer i’ve worked with endeavors to put people doing the actual work on salary as soon as possible, so they can harvest that sweet sweet unpaid overtime for maximum profitability…
Thanks for explaining. So it’s kind of a class thing too - I didn’t know that. Still, I’ve heard (read) about a lot of folks in engineering and manufacturing (so not management) talking about their annual numbers.
Right, that’s the third group. People who do higher priced work that upper management doesn’t want to pay overtime for.
Don’t forget the contractors, we flooded the market with contractor positions for a few different reasons. Some having to do with firing practices, same with insurance practices.
Then there’s the bids for jobs where contractors can take the job and some of those can be sketchy with subcontractors who may or may not be legally allowed to work or be getting paid rates that are legitimate.
Example: Beagal Cinema’s says they want an overnight cleaning crew that will clean all the theaters/floors/bathrooms and such nightly. Another company tells them they can do it for $500(made up number) a night. Then that contractor hires anyone, say 4 people and they bring their kids. Run through and clean it all up between 3am-9am every morning. Each one of them takes home $100 a day, and the contract-owner keeps $100. Beagal isn’t illegally hiring children in said case, and neither is the contractor, but the kids are having to work many nights a week with their parents to get the job done in time so they can be dropped off for school or maybe do homeschooling. (But those parents often don’t speak English, so I assume they would want their kids to go to a school to learn english at the very least).
Worked at a theater that did that from 2006-2012. So it isn’t a new thing.