Wages in Australia and US

Ohio XB · 18-02-2011, 06:27 AM

So I have recently learned that Australia has a $15 minimum wage. Here in the US it varies by State and there is also a Federal minimum wage which is usually lower than the State's minimum wage.

Here in Ohio it is $7.25/hr. McDonald's pays about $7.50 to $8 per hour.

I was told in Australia a worker stocking shelves at the Big W gets paid $15 per hour. Here in Ohio a worker at Walmart stocking shelves would be paid around $7.50 to $7.75.

A new worker highering in to Ford or GM to work on the assembly line will get paid $14 or $15 per hour here in the US.

Do you see my fascination?

When the minimum wage in Ohio was being raised to $7.25 from about $5.50 many employers said they would have to lay off workers to be able to pay the increased wage. The present minimum wage is still touted as a burden. Companies have to raise their prices as those who were being paid about $7.00 had to have their pay increased so that they would be above minimum wage as they were before.

Minimum wage in Australia is twice what it is in Ohio. Do you think this contributes to the higher prices that Australians pay for a lot of things? Higher costs for employers, higher prices for their wares? True, there are a lot of things immported to Oz which would not be under the effect of higher costs for the manufacturer, but the manufacturer, off shore, may be charging more because your wages are higher than in the US.

Drug manufacturers in the US charge Americans more for their product than any other country in the world, as far as I know. Their reason for this is that other countries with lower wages and healthcare systems cannot afford much of a price for the medications, so they make up the difference by charging more in the US where insurance companies pick up most all of the cost. However, I know elderly people on fixed incomes who have to pay $600 a month for medications out of their own pocket.

Besides wages and benefits employers here also have to pay into the Worker's Compensation fund, which helps those who have been injured on the job and/or are unable to work due to injury cover their expenses and sometimes compensate them for being injured in an unsafe work environment. This is a government (State) insurance program which all employers are required to contribute to based on the number of employees they have, I believe.

The employers also have to match the employee's contributions to Social Security tax. Whenever $80 is withheld from my paycheck for the Social Security program Ford also has to pay $80 to the program. This is for every single full time employee they have. This happens weekly.

I don't know if Aussie employers have equivalent costs to pay like these. If not it may be why they can afford higher wages.

I am looking forward to your info on things.

Steve

dre fgf6 · 18-02-2011, 06:40 AM

I didn't know wages were so low there! I work in manufacturing, I make approx 120k per year working 3 days on 4 days off.

For the record I make lollies. The job does have a 30% loading as I work nightshift.

I couldn't live on $7 an hour. I think I eat more than that.

FrogInASock · 18-02-2011, 07:55 AM

Figures aren't the whole story. Aussies do have higher wages, but stuff costs more here. A base, stock as a rock Falcon retails for around $38,000 on the road. Check out the Ford US website for their prices on an approximately the equivalent.

What does America pay for a loaf of bread (AUS $3.50 for brand name white bread), 2 litres of milk ($3.50, but Coles and Woolworths recently dropped it to $2.00), a Big Mac ($4.50)?

GOLDIE · 18-02-2011, 08:01 AM

think about this you guys get 7 to 8 an hour low compared to us but tkae cars and fuel as just to exsamples car are at least 20 to 30 % cheaper but look at fuel you guys are about $2.60 to $3.00 dollars per gallon we are at the moment $6.30 per gallon.also rego here is very high a v8 is about 1200 per year here not sure about it there but i believe it to be a lot cheaper.

Ian

pauljh74 · 18-02-2011, 08:26 AM

Quote:

Originally Posted by GOLDIE

think about this you guys get 7 to 8 an hour low compared to us but tkae cars and fuel as just to exsamples car are at least 20 to 30 % cheaper but look at fuel you guys are about $2.60 to $3.00 dollars per gallon we are at the moment $6.30 per gallon.also rego here is very high a v8 is about 1200 per year here not sure about it there but i believe it to be a lot cheaper.

Ian

Remember a US gallon is about 3.79 litres, not 4.55 like an imperial gallon, but still that works out to be up to 80 US cents per litre over there.

dre fgf6 · 18-02-2011, 08:38 AM

Sorry guys, did you sat 1200 for a v8? Dam that is expensive. At least in Vic a car is a car regardless of cylinders and it's almost half that price!!

Simple6 · 18-02-2011, 08:50 AM

Quote:

Originally Posted by dre fgf6

Sorry guys, did you sat 1200 for a v8? Dam that is expensive. At least in Vic a car is a car regardless of cylinders and it's almost half that price!!

That includes 3rd Party I'm assuming. At least if he's in NSW

**Charliewool** · 18-02-2011, 08:54 AM

Steve.. From memory you're in a similar industry over there to mine here...
As an example, my guys (indentured machinists) are on $28- $29 per hr, with a couple that specialise in CNC machining (and programming) into the low $30's an hour.
We'd be middle of the road, pay-rate wise, not the highest and certainly not the lowest for this type of industry.
With overtime, most gross around 80-100k per year.
9% Superannuation (paid by the employer) is on top of their normal time earnings, as is any applicable allowances IE: Tool, and Site allowance.
Then theres RDO's (13 Rostered Days Off per year) and 4 weeks annual leave that attracts a 17.5% loading (this loading is to make up for lost wages whilst on annual leave)
Workcover (accident and injury insurance) is also paid by the employer.

My32Doors · 18-02-2011, 08:56 AM

Besides wages and benefits employers here also have to pay into the Worker's Compensation fund, which helps those who have been injured on the job and/or are unable to work due to injury cover their expenses and sometimes compensate them for being injured in an unsafe work environment. This is a government (State) insurance program which all employers are required to contribute to based on the number of employees they have, I believe.
Employers here are required to have worker's compensation insurance which is paid by the employer to an insurance company of the employer's choice. The more employees the higher the premium. The type of industry can also have an effect on the premiums.

The employers also have to match the employee's contributions to Social Security tax. Whenever $80 is withheld from my paycheck for the Social Security program Ford also has to pay $80 to the program. This is for every single full time employee they have. This happens weekly.
Superannuation is our equivalent. Every employer pays 9% of the employee's base wage into a superannuation fund of the employee's choice. Employee's can contribute as much or as little as they wish. This money is not available to the employee until retirement age (65 i think) or in special circumstances such as permanent incapacitation.

My32Doors · 18-02-2011, 09:07 AM

Sorry I forgot to highlight the bits I quoted from OhioXB's post ^^^^^

GOLDIE · 18-02-2011, 09:18 AM

in queensland with compulsery thrid party insurance.

Ian

PHANTMXR6 · 18-02-2011, 09:28 AM

I'd be interested in knowing the difference in tax rates as well.

Also, home loans in the US are cheap as well, are they not??

Living costs in Australia seem to be quite a bit more expensive in every aspect to the US.

Out of curiosity, what would you pay for electricity, gas and water in the US?

And how is it calculated? eg by the kWh, not sure how gas is calculated in Australia, and kL of water?

trippytaka · 18-02-2011, 10:16 AM

In the U.S.A houses are 1/4 of the price of Australia. Cars, shoes, building materials, t-shirtseven McDonalds etc are much cheaper too.

One simple fact is pure volume. Take t-shirts for instance, USA market is more than 10 times the size of Australia, so buying bulk makes more sense. Businesses have higher volumes so can make less margin and also buy cheaper.

What you also have to put into perspective is that not long ago the Aussie dollar was only worth 70 US cents. The Australian dollar wasn't worth anywhere near as much as it is now a little while ago so being paid $15/h hour wasn't the same as

(Parity with your $ will in the long run will sting us...)

As far as health etc goes. America is one of the only developed nations in the wrold without free health care... well you were until Obama pushed through the bill, which has met with feirce opposition and could possibly get scrapped.

Australia is a country of hard working people who band together when they need to. we help each other out and that's one of the reasons we believe that medicines should be affordable (government sponsored PBS) and health care should be free. We pay taxes, which go (in part, not enough in my belief) to pay for free health care.

Some things in life just shouldn't be left to "free market capitalism". When they are you get high prices for medicine and health care that is out of reach to the average person. Unfortunately when it comes to medicines the vultures in business have taken over... basic health care shouldn't need to be a $30k salary sacrifice!

If you look closely at the lobbyist groups and how much power they have in washington you can see why the pharmaceutical companies etc get their way. They line the pockets of the political parties in order to get their way...

One thing you need to know is that living in Australia (Sydney is moy experience) is getting harder and harder each year. The cost of living is skyrocketing and it's getting to a tipping point... change is coming here too.

dre fgf6 · 18-02-2011, 10:19 AM

Houses are cheap over there now but i read not long ago that upto 85% of home loans are larger than the homes worth. That would be a very depressing situation to be in.

trippytaka · 18-02-2011, 10:34 AM

Quote:

Originally Posted by dre fgf6

Houses are cheap over there now but i read not long ago that upto 85% of home loans are larger than the homes worth. That would be a very depressing situation to be in.

Not just America that this has happened. The bust of the speculative bubble of real estate has hammered many countries.

MYVYSS · 18-02-2011, 10:38 AM

Also where you total wages bill exceeds 550k (ballpark) for all employees every state has payroll tax, where you pay between 5 an 7 % to the state government. Our highest tax bracket is effectively 48.5% now which also includes a 2.5% medicare levy, The medicare levy covers us for nearly all free medical that is non elective. Once a person exceeds 70k a year or 120k for a family you MUST have private health insurance otherwise you will be charged an extra 1 or 2 % in tax to "cover". Wages may read higher in Australia, however if you compare consumer goods with the equivalent in the USA we are paying much more.. When I was living in CA, the cost for 24 cans of Coke was approx 7 dollars, here on the best day you can expect to pay around the $15-18 dollar mark, Alcohol is much much more expensive here a bottle of Jim Beam will set you back around the 35 bucks mark. As mentioned fuel and cars are almost double if not more the cost in Aus.

When living in the USA I was on approx 82.50 an hour (160k), now back I am earning approx $150.00 an hour here, however I would say I was on a better wicket whilst in the USA. I found my purchasing power was far greater and the cost of living was heaps cheaper.

vibe_xr6 · 18-02-2011, 10:45 AM

MYVYSS

What the heck do you do for work ?

MYVYSS · 18-02-2011, 10:49 AM

Quote:

Originally Posted by hazxr6mk2

MYVYSS

What the heck do you do for work ?

I am a SAP Functional Consultant - Computer Super Nerd...

I basically build and design Payroll systems for large companies. We start with a standard product being SAP and then re engineer the processes and make everything more efficient. I mostly work as a consultant these days rather than a full time employee, although the contracts are usually 6-12 months work and the going rate is around 1100-1500 a day now...

csv8 · 18-02-2011, 11:10 AM

Thats why Tipping is so big in America..so people can get a living wage...

MYVYSS · 18-02-2011, 11:16 AM

Quote:

Originally Posted by csv8

Thats why Tipping is so big in America..so people can get a living wage...

Yet surprising over there if you work in a services type industry where tips are regular, you are taxed on the tips Uncle Sam never misses out of his share of the pie. I heard that in some industries there is an automatic amount applied to your taxes to take into account your tips.

vibe_xr6 · 18-02-2011, 11:34 AM

holy crap, super smart to by the sounds of it, good on you champ !..... lucky *****

dre fgf6 · 18-02-2011, 11:36 AM

I use SAP at work and the more I use it the less I know about it.

MYVYSS · 18-02-2011, 11:52 AM

Quote:

Originally Posted by hazxr6mk2

holy crap, super smart to by the sounds of it, good on you champ !..... lucky *****

Yeah maybe not the super smart though...LOL I dropped out of high school at year 10 and just worked my ring off, its mostly all self taught, was always told you will never or you cant...my attitude has always been I will and I can and then it basically become I DID....

vibe_xr6 · 18-02-2011, 11:57 AM

i hope i get somewhere like that, i got kicked at at year 8 and worked since then, i could go concreting and maybe eventually take over it, but hes a hard bugger to work for lol

**nuthin' fancy** · 18-02-2011, 12:00 PM

Don't forget in the US your home mortgage is tax deductable but thee is no negative gearing.

No wonder we pay so much for property (and contribute stamp duty to the state govenment coffers as a result).

trippytaka · 18-02-2011, 12:40 PM

Quote:

Originally Posted by nuthin' fancy

Don't forget in the US your home mortgage is tax deductable but thee is no negative gearing.

No wonder we pay so much for property (and contribute stamp duty to the state govenment coffers as a result).

We pay so much because we have been caught in a mania... speculative bubble

dre fgf6 · 18-02-2011, 01:03 PM

I haven't purchased since the start of this property price bs as it's like musical chairs with everyone trading around, I don't want to get caught out when the music stops.

If it all goes to **** I'll actually be better off lol

KYSBF · 18-02-2011, 02:49 PM

Quote:

Originally Posted by MYVYSS

I am a SAP Functional Consultant - Computer Super Nerd...

I basically build and design Payroll systems for large companies. We start with a standard product being SAP and then re engineer the processes and make everything more efficient. I mostly work as a consultant these days rather than a full time employee, although the contracts are usually 6-12 months work and the going rate is around 1100-1500 a day now...

Hopefully not for the Health Dept........

MYVYSS · 18-02-2011, 03:03 PM

Quote:

Originally Posted by KYSBF

Hopefully not for the Health Dept........

LOL no not for QLD Health....

**nuthin' fancy** · 18-02-2011, 03:58 PM

Quote:

Originally Posted by trippytaka

We pay so much because we have been caught in a mania... speculative bubble

That was not and never is my contention. Economies pay what they can afford for goods and services at all levels. We pay more for property because we are prepared to and we can get funding. Your suggestion that there will be sudden correction to the market may be suitable in theory but has never been borne out in fact in Australia.

Our banks are properly run (I concede they are among the most expensive in the world), there is an enormous amount of regulation throughout the financial industry that prevents widespread problems. There have been isolated problems such as Storm Financial, Westpont and Pyramid but these affect relatively few people and people recover quickly. We have the capacity to meet the world's demands for a variety of raw materials for a long time to come. Our population will continue to grow.

Are we expensive? Yes
Is it sustainable? Yes