The Risk of the Outflow of Doctors and IT/ICT ... - Outlook Web App

Table 22 Relations of Gross Income for the “Programmer” Profession and the Average
Earning Standards in the Czech Republic and in Compared Countries
Annual Gross Income, 2004, in Euros
Average Income
Programmers
Standard
a : b
a b c
Czech Republic 12,912 6,566 2.0
Germany 41,628 41,046 1.0
Austria 36,000 32,872 1.1
Ireland 30,504 30,170 1.0
Great Britain 46,248 39,985 1.2
In other countries the income level of these professions hovers right around the national
average income standard (ranging from a coefficient of 1.0 - Germany, to 1.2 - Great Britain).
It also characterises the data on income for the "programmer" profession and its relation to the
national average income standards. 35
The higher domestic income position of the IT/ICT-professions in the Czech Republic is
evidently primarily connected to the operation of a large number of foreign multinational
companies doing business in the area of IT/ICT. These companies provide specialists from the
area of computer technology earnings closer to the absolute level of earnings in Western
European countries. This leads to an increase in the level of earnings for specialists in the
entire IT/ICT sector in the Czech Republic. In 2006 half of the surveyed IT/ICT-specialists
gave an average gross monthly income of over 40 thousand CZK. 36
Overall, however, the relations of the gross nominal earnings provide inaccurate and
strongly misleading information on the income advantage of foreign work migration.
Migrants are often disappointed by the markedly lower financial benefits compared to the
expectations created according to the relations of gross earnings. It follows from the consumer
price level (living expenses) abroad. The proportion of gross earnings does not reflect those
factors that currently bridge the income level of the Czech Republic in comparison with
foreign levels and significantly influences the factual intensity of the motivation for work
abroad.
(5) The first factor is the summary tax rate on gross earnings; 37 in % of the gross wage it
amounts to 27% in the Czech Republic, 43.5% in Germany, 32.3% in Austria, 18.2% in
Ireland and also 26.3% in Great Britain. 38 By applying these rates the gross income is
converted to net nominal income.
35 With regard to the availability and methodological comparability for all countries used in the comparison, the
national average income standards are taken from the OECD publication "Taxing Wages 2004-2005.” It
represents the average gross income of a single childless manual worker in the industry and services branches
(branches C to K according to the CZ-NACE classification).
36 Survey RILSA 2006.
37 The summary tax rate is understood to be the percentual rate of deductions from the gross wage given by the
sum of the income tax rate and the rate of mandatory contributions to social and health insurance; By deducting
the summary tax rate the gross earnings (wage, salary) are converted to net earnings.
38 With regard to the different domestic income status of the IT/ICT-professions in the Czech Republic
mentioned in the text and in comparison with foreign countries, the tax rate specified for the Czech Republic is
for above average earnings and for average earnings in the other countries.
54