It depends. Yes, the salaries are lower, but so are the expenses on average. The fringe benefits are usually good. There's a legal minimum amount of paid holiday days, in my country the minimum is 20/year but some unions have close to 40. There's also a legal maximum amount of allowed overtime, the employer pays a part of the employee's pension in my country et cetera.

It's probably true that it's easier to upscale a company in the US. The hire and fire strategy wouldn't work here as it would only attract poorly educated people that are willing to take any job. It may be a cultural difference, but most middle class people like to have financial stability here, even if payment is lower in that case.

I think that for software companies, the history of computers plays a big role as well. US has always been at the forefront when it comes to hardware, (military) investments and research of integrated circuits and computers, which led to big companies like IBM and subsequently Silicon Valley companies like Apple and MS. I think it may not be the best example because there isn't really any other country or continent that equals the US here, regardless of wages and labor rules.