Electricity costs in Spain vs USA

Just quick check, in Dec. 2020...

In US, for 166 KWh (funny thing is that I wasn't there for 1/2 the month and I disconnected my water heater) I paid:

1. $23.57 (basically 14.1c/kWh)
2. $10 of minimum usage charge (WTF, why they charge that if I already past the minimum usage?!?)
3. $6.39 usage charge from electricity distribution company (Oncor)
4. $3.42 monthly charge.
5. Tax $1.38 (2.1% + 10% sales tax)

So, although they claim 14.1c/kWh, it is actually more like a fix of $13.5 + 18c/kWh. All in all 27c/kWh. (2x... no comment >.> ). 

In Spain, for 2 months (bills are for two months):

1. 7E (basically 12.5E/kWh) for 56kWh, i.e, 13.9c/kWh
2. 24.51E (for two months): $13.6/month
3. +5% electricity tax
4. +21% sales tax

Total was $46 (41.49E) for 56kWh, or 82c/kWh! Nevertheless, this comparison is not fair as my variable was very small so this cost is mostly monthly fix/installation charge. If we just look purely at the variable, in US we had 18c + 12% tax, about 20c/kWh. In Spain we had 13.9c + 26% tax = 17.5c/kWh, so, actually a bit cheaper, even with the higher taxes. But maybe I am paying too much also in US (as I have not negotiated rates for very long). So, all in all, about the same cost, I would say.

Considering that oil is much more expensive in Europe than US, it makes sense to transition to as much electric as possible in Europe.

Hiring in Spain vs US

As explained, I have never created a company so I am trying to get a sense for how competitive different countries are if I wanted to set a company there. I guess there are different type of incentives; one can get in addition to these, but let's just go by the standards. I can think of factors when taking that choice like taxes (to your employees, which is likely to limit who you can hire) and of course, to your company (corporate taxes), salaries, costs of running the company (like energy costs if a given industry really needs those), raw materials, leasing, transport...

We look here purely at hiring costs. Looking at this article, we basically have that in Spain:

1. There are 14 or even 15 pays per year, so, easiest is to compute things on annual income.
2. From the salary company pays to the employee, the company pays about 30% on social security related expenses and the employee an extra 6% give it or take. So, for a say, $10k salary, company would pay an extra $3k and employee $600 on social security.

So, say that about 26% of what the company pays goes into medical, retirement, disability, unemployment and paternity benefits.

In US for the equivalent items we find (How much does an employee costs):

1. Social Security/FICA (currently 6.2% on the first $90,000 of salary)
2. Unemployment/FUTA (6.2% on $7,000 of salary)
3. Medicare (1.45% with no salary cap).
4. Workmen’s compensation premiums;will depend on the category of your employee, with clerical at about 0.3% of salary and manufacturing at 7.5%.
5. So, we are looking at 15% (without #4) for someone like an office worker, an engineer... The benefits one may get from this social security may not be as high as full salary coverage that happens many times in Spain, so, companies may throw in 401k contributions which could be like 6% of your salary.
6. Health care costs are apart, depend on plan... but we can say that for an individual is about $6k/year and family about 2x that. It is not a percentage of the salary so, for a $10k salary that would be a lot while for a $100k is about 6%-12%.
7. Short and long term disability insurance would also be apart but an estimate is about 1% of the salary. Things start to get even with Spain specially on the lower salary brackets.

So, "the costs to this point (basic salary, employment taxes and benefits) are typically in the 1.25 to 1.4 times base salary range- e.g. the cost range for a $50,000/year employee might $62,500 to $70,000."

In summary, it looks to me that while the compensation costs beyond salary are equivalent or even higher in the US, the employee in Spain (or Europe in general) gets much better benefits. One could obtain similar conclusion fromcomparing benefits from US and Europe article.

One big difference are the firing costs too, as things may not go out as expected initially). In other words, while it is cheaper (for the same benefits) to hire someone in Spain, not even taking into account the salary itself, letting him go could be much worst.

Please comment if I am missing something :)

Cheers!