Whether you are considering a job as a software engineer or aiming to negotiate better pay, you’ll have realised that reported salaries vary—sometimes too much. This is because the “average salary” aggregator sites don’t consider that software engineer salaries are trimodal, or that FAANG+ companies pay differently than non-tech companies. They also haven’t caught up to speed with certain aspects of the job market: oversaturation, lower offers, and layoffs all play a part in defining what a real salary progression looks like.

In this article, we'll provide a detailed overview of what software engineers can expect in today's market and look at the main drivers influencing salaries based on real data. 

The US or EU—where is the average salary better? 

According to Glassdoor, the average software engineer salary in the US sits around $145,000 (updated on April 2024). The figure is a bit lower when you ask official sources, which claim software engineers in the US earn a median annual salary of $124,200. A junior earns $88,249, while a senior makes an average of $162,281.

Yet, it's worth noting that these are averages, and salaries can vary greatly in the US, especially depending on two factors: the company you work for and the city you live in. The US cities that pay the highest salaries for software engineers are Los Angeles, New York City, the Greater Denver Area, Boston and San Francisco—all of which, of course, are high-cost-of-living areas. You’ll notice that many software engineers from the United States talk about having a “coastal” or “flyover” salary—they’re saying, more or less, that if you have a San Francisco salary (while not necessarily living there!) you’ll be earning more than a colleague working in San Antonio, for example.

As with so many averages, these figures for the United States are not stable. Other sources say that cities with the best salaries for software engineers are San Francisco and Santa Clara, CA, both part of Silicon Valley.

For the EU picture, it’s more difficult to discuss an average software engineer's salary because, depending on the country, the figures can vary drastically. What is easy to see is that salaries in Europe tend to be lower than the US average. For instance, there are testimonials of senior Java developers in Europe regularly being offered under $60k in job interviews, and entry-levels in the UK being paid €35k. At large, what many new graduates in the US perceive as their baseline salary—say, $80,000—is comparable to the salaries earned by senior developers in some European countries. There are some exceptions to this rule. Switzerland, for example, is a sleeper because it pays incredibly high salaries and has an outstanding standard of living (and cost of living).

These are the average software engineer salaries in Europe, gross and annual:

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Realistic salary progression for software engineers

Some outlined estimations are disorienting because the spread is so big. Also, the employer’s region is so influential—a software engineer in Italy might make a third of one in Denmark—that it’s difficult to point down a single global realistic salary.

That’s why it’s a better idea to group the realistic salaries by experience and by the kind of employer. Here's a general idea of what you might expect at different stages of your career, according to the type of company you work for:

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It usually takes around 1.5 to 3 years to progress from a junior to a mid-level role, and then another 3 to 5 years to advance from mid-level to senior.

In general, developers agree that $70,000 is a decent starting salary for a non-FAANG position in 2024. Yet, there are ongoing debates within the community about what is actually a “decent” salary for a software engineer. For instance, let's take the case of a new graduate being offered $80,000 at their first job. While some developers find this a perfectly fine salary, others find it stupendous. Still, some others state they would aim for a higher salary, closer to six figures, before accepting the job. It seems the community can’t agree on what a good entry point is. 

Recently, there's been research that suggests that Gen Z students have unrealistic salary expectations. A survey shows that nearly 80% of students think they deserve more money than average. Also, while 97% of college students would consider lowering their salary expectations, they wouldn’t work for less than $72,580 on average at their first job. So, presently, it seems that for some developers, there is a clear floor below which the salary is no longer decent. In any case, there’s debate online pointing out that the FAANG+ salaries shouldn’t be a benchmark. $70,000 a year for a starter seems like a good fit for a realistic software engineer salary.

How salaries are more valuable in certain locations

Remember that many companies adjust their offering based around the employee’s location. Let’s get back to the new graduate getting an $80,000 offer. In this case, location matters a lot. Earning that money and having to rent a room or a flat in downtown San Francisco is one thing, and a very different thing is having to rent a place in a low-cost-living area, like Nebraska, for instance. In the first case, a salary of $80,000 would mean a super strict budget and probably not even financial freedom, while in the second scenario, $80,000 would mean a solid income and likely even allow for savings. Employers commonly consider this, and that’s why averages are so reliant on guesswork.

This also means that the best earnings for a software engineer (face value and value-for-money) will be those from a high-paying job while living somewhere cheaper and just as sunny, like Spain or Portugal. A .NET developer in Portugal with 4 years of experience will get around €1500 net/month or  €18,000 yearly if they work for a Portuguese company. It’s way below the average €62,200 yearly salary software developers make in Germany. The best way to make the most of it: get a salary at a high-paying location while living somewhere cheap.

Find Entry-Level Software Engineering Jobs →

Salary comparison between FAANG, tech companies, and non-tech companies   

It's easy to get fixated on FAANG salaries, but the good news is that software engineers are in high demand across many other industries. This is a comparison of real salaries for software engineers who are:

• Working at FAANG
• Working at other tech companies, and
• Working at non-tech companies

FAANG companies 

FAANG companies are known to offer top-tier salaries and benefits. If you’re a software engineer working for a FAANG in the US, you’ll be making the most money.

At FAANG+ companies, juniors earn around $180k a year, mid-levels around $250k, and seniors around $350k. Staff engineers and above can make $450k or more. As the table below shows, the salary ceiling in FAANG+ is exceptionally high once developers reach seniority. This has to do with the significant portion of compensation that comes from stock options. So, don’t think every senior software engineer from Meta is raking in $40k a month just for walking into the office and playing with a VR headset. Those are Wall Street-esque earnings, and this table below is possibly skewed because an engineer cashed out some RSUs and shared their compensation.

Source: levels.fyi

Tech companies 

There are many options for working in tech besides FAANG, from regional startups with fresh venture capital to financial institutions and larger Fortune 500 companies. Salaries vary greatly depending on the size and financial structure of the company.  

Source: levels.fyi

Non-Tech companies 

For software engineers, non-tech firms usually don't offer the same salary and benefits as tech companies. Still, many companies in sectors like pharma, healthcare, and finance offer competitive pay and stability to attract and keep tech talent. The table below shows the average software engineer salary for different levels of seniority at non-tech companies in the US and Europe.

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These findings adjust to the trimodal salary hypothesis, which states there are three distinct groups of salary packages in the tech industry.

Salaries for remote jobs  

If you see a lot of difference between offers and the averages, it may be because the current market has some distortions or novelties that the averages can’t catch up with. One of the factors making it so difficult to find a consistent, reliable, realistic salary figure is remote work.

The tech scene is currently divided between companies returning to the office, others running on a hybrid model, and some (less and less) operating fully remotely.

According to a 2023 Future of Work Report, 85% of developers worked either fully remotely or in a hybrid setup in 2023. The report not only reveals that most developers work remotely, but also that 64% of them feel most productive while doing so. However, there appears to be a productivity paradox because, while developers increasingly embrace remote work, their managers are growing more sceptical about its impact on productivity. The result has been that more and more companies—including big tech firms like Amazon and Meta—are ending remote work and calling for mandatory returns to office (RTO).

Meanwhile, a survey found that out of 4,000 workers in the US, half are willing to work from home—and would accept a pay cut to make it happen. On top of this, competition for remote positions is already very high, and it’s even tougher for junior developers because companies tend to prefer candidates with more experience. Companies have been downsizing their workforce, and laid-off experts now go through the same interview processes as beginners.

More people want to work from home, more people are willing to take a cut, and more companies want workers to return to the office: All of these factors are making remote salaries worse than the usual averages.

Additionally, very specific positions in software development, especially those for beginners, are overcrowded, and this saturation pushes salaries further down. Plenty of these roles are also remote. It might reverse in the future, though, as AI enters into everyday life. Software engineers are one of the most equipped trades to switch into any AI-related job.

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All things considered, while remote work offers flexibility, due to the ongoing increased competition and reduced office expenses, companies may offer lower salaries compared to on-site roles. Now, this is a developing phenomenon, so you might find studies explaining how remote workers earn more than in-office workers. This might have to do with inconsistent comparisons. For a software engineer’s case, a company from the Bay Area might now pay less to a remote worker because they don’t need the employee to live in pricey San Francisco. That’s the right comparison.

Browse Remote Developer Jobs → 

Beyond your base salary: how can you make more money? 

Companies often have fixed compensation levels tied to roles or titles to rank software engineers. L3 for Google, E3 for Meta, SDE II for Microsoft… each company has its own. And if you check how the Google salaries we mentioned play out, you’ll notice that an L5 makes much more than an L4 because the compensation includes other items besides the salary.

If you realise your employer won’t give you a raise, here are some pay incentives that can significantly increase your total compensation beyond your base salary:

• Equity: Many companies offer stock options or RSUs as part of their compensation package. RSUs are very popular among employers because they vest over time, so they work as a retention strategy. When you demand RSUs, you’re implying you’ll stay there for long. Critical note: Remember that RSUs are only worth something if the company goes public, because that’s when they vest into stocks you can cash out. So if a private company without real plans for an IPO offers you RSUs, you should instead ask for actual equity. Many employees don’t know this.
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• Upskilling & Reskilling --> Read more.
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• Sign-on Bonus: A sign-on bonus is a financial incentive offered to a potential new employee. The exact amount varies across industries and job levels, typically ranging from 5% to 20% of the base salary.

• Annual Bonus: According to HR consultants, 96% of employers expected to award a year-end bonus to their teams by the end of 2023. Out of those surveyed, 54% said they would intend to offer higher bonuses than last year, while 37% aimed to maintain similar bonus levels to 2022. So it’s a good time to start asking for one (for the next fiscal year, naturally).

For example, a software engineer shared their progression and broke it down into the elements that made their comp. They did not mention an annual bonus but did talk of the sign-on bonus, that started in year three (likely by job-hopping). Their rundown over seven years was:

• Salary: The base pay seems to increase steadily, starting at $60,000 in year 1 and reaching $190,000 in year 7.
• Equity: This amount fluctuates significantly. It's low in the initial years but jumps considerably in years 4 through 6, reaching a peak of $600,000 in year 5. Now, if these are RSUs and there’s no IPO, it’ll be worth zero.
• Bonus: The bonus amounts are relatively consistent, ranging from $0 to $19,000 across the 7 years.

Get a software engineer role in Europe with a clearly-defined salary

A realistic tech career path for a software engineer could start with a total compensation of around $70,000 (combining salary, stock, and bonus) and climb to over $90,000–$120,000 two years in, and then to $120,000–$180,000 five years after that. Those are yearly salaries. These are general figures, but if we had to narrow them down, they’d be more aligned with non-FAANG companies and would more or less resemble a German gross salary career progression.

The numbers we've shared are still estimations, and your individual salary will depend on factors like location, skill set, and the specific company you work for.

Our platform is one place where you can start looking for developer jobs with realistic salaries. At WeAreDevelopers, we’re fully dedicated to helping software engineers find jobs at top European firms. Join us to learn about our job listings, check our job board for the latest available opportunities, and land a job that pays well and promises long-term stability. Good luck!