[HN Gopher] "Location-Based Pay" - Who Are You to Complain?
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"Location-Based Pay" - Who Are You to Complain?
Author : whoooooo123
Score : 275 points
Date : 2021-02-14 10:35 UTC (12 hours ago)
(HTM) web link (blackshaw.substack.com)
(TXT) w3m dump (blackshaw.substack.com)
| teekert wrote:
| I already get location based pay. My collegues in the US (I'm in
| the Netherlands) make about 1.5 times my salary. Ok, they need to
| buy an expensive house in an expensive neighborhood so their kids
| can go to a good enough school. He also need expensive
| healthcare, and even then, when he gets cancer he needs
| significant savings. Our schools are just all fine, and when you
| get sick, you just get help.
|
| My colleagues here in the Netherlands do make the same, whether
| they are living in Amsterdam or a small village. So I guess
| location based pay is also about where you draw some lines.
|
| Anyway, if my boss would tell me I'd be getting less when I move
| to somewhere cheaper, I'd say: Ok, bye! Next job. In another
| country, hmm, not so sure.
| tybit wrote:
| I suspect while most companies say location based pay is based on
| cost of living, this is not actually true.
|
| Amazon is quite upfront about this, they pay based on cost of
| labor. I.e they pay what they need to get the staff they want in
| that area.
| ghaff wrote:
| And cost of living is only one factor feeding into cost of
| labor. Tech companies tend to pay more in the Bay Area because,
| if they didn't, they'd have trouble hiring people. But they're
| probably not going to pay the same amount because someone
| chooses to live in Aspen.
|
| I honestly don't expect big changes--20% adjustments don't
| really qualify as "big." All the data I've seen suggests that
| most people will likely remain within at least a 1-2 day/week
| commute into an office.
| yowlingcat wrote:
| Another comment brought up optionality, and that's certainly part
| of it for big companies -- so much of how much you're paid is
| directly related to their perception of your own optionality and
| how you and others like you bucket into their leveling system to
| keep the buckets full enough.
|
| For smaller companies, I think fungibility is another way to look
| at it. Fungibility is sort of taken for granted at big companies
| because it needs to be there to grow past a certain size without
| imploding. But small companies can make a lot of money by
| accepting non-fungibility and keeping total headcount minimal.
|
| What I think this means is that they'll probably be a lot more
| inclined to dismiss location-based pay because for a growth
| inclined company, it's basically a rounding error in their cost
| benefit analysis. You need capable people to do stuff /and/ work
| well with other people, it's hard to find them anywhere (even if
| you're looking globally). If someone's doing good work and you
| want to pay them more to incentivize them, it's not going to be a
| huge pain to get that checkbook control and the CEO is likely to
| implicitly sign off on it. The same can't be said for big
| companies.
| Decabytes wrote:
| I think it is reasonable that companies wouldn't pay silicon
| valley prices for someone living in middle of nowhere Idaho. With
| that being said I think part of the issue is that most people are
| not being paid enough in general, and with the increase in
| student loan debt, stagnation in wages, and overall less buying
| power that people have today, the idea of having wages cut feels
| very bad.
|
| That compounded with the fact that companies already look for
| ways to pay you less, this is just adding another reason. It's
| also important to bring up that the company will save money by
| not having as large of an office (or even having one), saving on
| any commuter pass subsidies, etc so just cutting wages for remote
| workers, puts more money in their pocket.
|
| And what are they doing with all this extra money? Are they
| hiring a few more employees in those teams that have been begging
| for extra hands for years? Are they reinvesting in the company,
| giving more employee benefits, setting up funds for employee
| hardship, helping employees set up a remote work space, helping
| employees relocate? Or are they just using the money and doing
| stock buy backs, pocketing the extra change, and expecting people
| to continue working in the same environment as before, just from
| their bedroom?
| bagacrap wrote:
| I think they should pay you /more/ to live in Idaho. Clearly
| California is an extremely desirable place to live, and too
| many people do elect to live there, causing issues with:
| traffic (pollution), wildfires, power outages, affordable
| housing shortages, long lines at the DMV. We need to add more
| disincentives to living there in order to load balance the
| population a bit.
| 0xbadcafebee wrote:
| > Why? My value to the company hasn't changed!
|
| Of course it has. Go read the definition of "value". It's the
| market price, or a fair return or equivalent value, relative
| worth, etc.
|
| You are literally less valuable if you work in some podunk town
| where cost of living is half. They pay you more to work in SF
| because _in SF_ you 're more valuable. Because it's a market full
| of other engineers who all demand (and will actually get) more
| pay. The company would love to devalue you, but they can't in SF.
|
| You have to remember that they aren't paying you relative to your
| worth to the products. They're paying you relative to the costs
| necessary to produce the products. They want to reduce those
| costs, and so they _will_ reduce those costs. One of those is
| paying the market rate for an engineer. Paying _over_ the market
| rate is just throwing away money.
| ralphc wrote:
| If it's all remote, how does your employer know where you're
| really at? I'm waiting for the story where someone's caught
| claiming to live in SF or NYC for the pay but really lives
| somewhere rural.
| erikerikson wrote:
| Pointing out the difference in our thinking is great. I
| appreciate that.
|
| There are a couple problems.
|
| The inequity of wages in Asia to those in "the West" are a
| temporary artifact that is slowly receding. Wages have been
| rising as has cost of living.
|
| Location based pay says, I see you reduced your costs and I want
| to capture your increased profits. Increased efficiency is a
| normal mechanism for businesses to increase profits but you're an
| individual and you don't get to do that. More raw: I think I can
| get away with giving you less.
|
| It reflects a growing problem in our society, that we are pulling
| up ladders to prosperity by reinforcing natural dynamics to
| exacerbate them (i.e. bigger slice). Often we're doing so in ways
| that reduces additive economic outcomes (i.e. smaller pie).
|
| The challenge with location based pay is that this makes the
| offered salary less competitive and the labor more competitive.
| This increases the probability of turnover so those costs eat up
| the gained efficiency. However, the losses are booked in an
| illegible manner which allows them pay reducer's biases to avoid
| noticing them.
| LatteLazy wrote:
| Companies will pay as little as they can, employees will charge
| as much as they can. Everything else is an excuse or window
| dressing. What someone is paid is not connected to what they are
| worth or their value. Nor is it "fair" because fair isn't a real
| thing. Your company is not your family. Unless you own a
| significant share, it's purely your adversary.
|
| I wish people would just honestly admit this. Pretending
| otherwise almost always leads to workers misunderstanding what is
| happening and getting underpaid.
| DrBazza wrote:
| One thing about this is that the money saved by paying employees
| less, goes into someone's pocket. Senior management, or the
| owner. Some people will benefit massively from this. And don't
| forget zero office costs since everyone is remote. I'd also
| expect to see coworking spaces in some of the larger towns to be
| thing soon too.
| mustyoshi wrote:
| Even if nobody is going to the office, it isn't free.
| kweinber wrote:
| If this continues, expect to see a lot of high-paying jobs
| leave high earning markets like San Fran and New York as pay
| decreases to meet lower cost cities and countries. Working from
| a lower cost area could be all the market supports in a few
| years.
| ghaff wrote:
| >Working from a lower cost area could be all the market
| supports in a few years.
|
| At which point, SF and NYC would be low cost areas as well.
| This won't happen for various reasons but real estate is
| determined by demand of which employment opportunities are a
| big component outside of resort communities and similar.
| 6gvONxR4sf7o wrote:
| There's absolutely no reason they need to know your location
| before making an offer. "Where am I? Pacific time zone in US tax
| jurisdiction."
|
| I hope location becomes something people talk about in
| negotiations like salary expectations and previous compensation.
| "Don't tell them where you live until you get an offer." "Get
| them to name a number before you say where you are." "Recruiters
| who force you to tell them up front are a huge red flag."
|
| There's a big list of questions you aren't allowed to ask a
| candidate because while yes they do indicate that a candidate has
| a weaker negotiating position and therefore paying them less is
| "fair" in a market sense, we have collectively decided that
| exploiting that market disparity is unfair. So you aren't allowed
| to ask it anymore. In other words, the market doesn't define a
| "fair" wage. Fairness comes from elsewhere.
|
| Hopefully "what city are you in" becomes an off-limits question
| ASAP. You live in a historically disadvantaged location? Great
| we'll pay you less. I wonder what kind of disparities that's
| gonna cause.
| djoldman wrote:
| Why does it sometimes seem like there is a willful disregard for
| what actually drives companies (profit)?
|
| As a consequence of US laws and the way the economy runs (US
| capitalism), companies are incentivized to seek cheap labor. They
| will pay the lowest price they can.
|
| If person A and person B produce the exact same work but A will
| accept a lower wage, obviously the company will hire A.
|
| If people are upset/perplexed/confused by this, I think the crux
| of it is: why do some people accept a lower wage? In this case
| it's ostensibly because some people live in lower cost of living
| areas.
| benlivengood wrote:
| Who are we to complain? Location-based pay is 80% political
| because immigration law keeps the majority of the world's people
| from immigrating to countries with better human rights laws than
| their own. The U.S. fought a civil war over the biggest human
| rights abuse (slavery) so I'd say it's worth complaining about.
|
| Disparity of human rights is arbitraged by national governments
| in free trade (ever wonder why free trade and not free movement?)
| agreements to allow profit at the national levels on both sides.
| That explains $10 T-shirts.
|
| The reason that SV in particular currently has insane income
| disparity is because online advertising is a very inefficient
| market and FB and Google can still afford to set arbitrary de-
| facto salaries for tech workers. There is a mix of other market
| disruption and speculative investing that helps to keep the whole
| thing afloat. The trend in a healthy market should be for tech
| salaries to normalize with the rest of the world.
| trhway wrote:
| >Why? My value to the company hasn't changed! I am still worth
| the same amount as I was before! The only thing that changed is
| where I choose to reside. What difference is that to the company?
|
| it did change a lot. Most low COL locations are the locations
| with comparatively bad job market and that means that by moving
| to such a low COL you're chaining yourself to that nicely paying
| remote job. You wouldn't risk to argue with your boss, to insist
| on your opinion, etc. and instead you're more probably going to
| become a complacent long-term employee, more and more becoming
| kind of office dead weight with each year. Getting $600K at FB in
| SV is just getting your appetite wet, you're thinking about
| bigger things while getting the same $600K while living deep in
| Montana - well, it is a retirement, you've made it.
| kache_ wrote:
| Location based pay? "We looked at your '''Peer Group''' and the
| '''best''' we can offer you is Z" - Yeah, well you can blow it
| out your ass. There are N (which you know is a lot) other
| companies willing to hire me, and I currently make X amount
| (which I will not tell you). If you don't offer me Y, I will not
| move (which I will also not tell you how much it is).
|
| I don't need money, but I'm not going to work for anything less
| than what I can pull, and I pull a lot already.
|
| t. remote worker
| chrisbennet wrote:
| ".., and I have to wonder if "location-based pay" works in both
| directions. I live in suburban London, ten-ish Tube stops from
| the belly of the beast. If I worked remotely for Facebook and
| wanted to move somewhere central where rents are three times
| higher, would Zuck give me a raise? Somehow I doubt it."
| Mc91 wrote:
| I started last year living in New York City. Many of my friends
| have moved down to Raleigh, Charlotte, Atlanta, and Tampa over
| the past few years, and in spring of last year I got a job offer
| and moved south as well.
|
| Insofar as living expenses - coming from New York I do not own a
| car so a place near good public transportation was important. I
| also wanted to live in a nice neighborhood that had other young
| professionals. This narrowed things down to two neighborhoods -
| one had a lot of theaters, bars, restaurants, art galleries etc.
| but had no decent supermarket within walking distance - the other
| did (and also had my bank and other convenient places). I went
| with the latter neighborhood.
|
| The ballpark for a one bedroom in this neighborhood was
| $1400-1600, with square feet being one determining factor.
| Knowing that I would be stuck inside due to Covid I opted for
| more square feet and was looking for apartments around $1600. A
| very desirable two bedroom townhouse came on the market for $1700
| which was $100 more than I wanted to spend, but it was so perfect
| I went $1200 over a year. I'm a software engineer, I can afford
| it.
|
| I have a parking space in the building garage that I rarely use
| as I am from New York City and have yet to buy a car (I rent when
| needed). I have two bedrooms (one converted to a gym, as public
| gyms were closed for a while) and two bathrooms. I have a door on
| a tree lined street where twentysomethings walk by walking their
| dogs and such, another door goes to the apartment building. I
| have two parks nearby, one which is pretty nice where I jog when
| it is not winter. I am two blocks from my bank, a good
| supermarket, and several bars and restaurants. I have a washer
| and dryer in the unit. The place was built a decade ago and is
| all modern appliances. I am less than a ten minute walk from the
| train station. My office is actually moving next to my train
| station, but if it re-opens before the move my commute is less
| than half an hour. $1700 a month.
|
| 1000+ square feet, in-unit washer/dryer, first floor door opening
| to the outside, attached garage, walking distance to train,
| supermarket, bars, parks - it would be difficult to even find
| this in the New York metro area. Everything in New York City is
| at least double the price for something like this.
|
| It's a nice place to hole up in and WFH during the pandemic, and
| not expensive. The reality is if I moved back to the NYC metro
| area at some point, I would be paying more for a smaller
| apartment with less amenities in a less desirable neighborhood
| that was farther from everything.
|
| Especially talking to young (or entering middle age) married
| professionals who moved down - with the breadwinner earning
| $100-150k a year - they can afford to buy a nice sized house in a
| nice neighborhood, two cars, go on vacations etc. They can just
| live a nice comfortable life on $100k while the well-educated
| wife is raising two kids until they're grown more and she'll go
| back to work. The math would just be impossible to work out in
| New York, even on the salary of a programmer or PM or QA etc. who
| is getting paid well compared to the average Joe.
| u678u wrote:
| It doesn't make sense for remote workers to be paid based on
| location. But that doesn't mean remote workers should be paid as
| much as those who are working in the office in SF.
|
| At the end of the day its supply/demand. When everyone worked in
| an office supply of great developers was limited. If you're
| remote suddenly the pool is larger. People used to live in low
| COL for other reasons not just cost.
|
| You can argue that all the best developers used to live in the
| Bay Area, and if those people are distributed across the country
| the supply is the same.
| cactus2093 wrote:
| Does anyone know how equity is affected by remote policies at
| most big tech companies? I think that perhaps it isn't? Companies
| take back unvested equity if you're terminated or resign, but I
| don't think I've seen anything in my equity agreement docs that
| would let them take some of it back for a cost of living
| adjustment (though they could probably adjust the terms of new
| equity grants going forward). If I'm hired in a low CoL area I
| bet they adjusted for, but what if I was hired in the Bay Area
| and then move?
|
| Am I crazy or is there perhaps a huge loophole here, at least in
| the short term, that nobody is talking about? Let's look at a
| senior engineer (E5) at FB on levels.fyi - $380k total comp
| comprised of $196k base, $30k bonus, $154k equity. If your base &
| bonus get cut by 50% by going remote but you keep the equity,
| that's still $267k a year so your total comp has only been cut by
| 30%. And hell you could make up a significant amount of that in
| taxes alone. For a staff engineer or manager at E6/M1 level it's
| even more dramatic - $578k total comp down to $436k, which is
| only a 25% decrease and just a stupidly high compensation for
| somewhere with a low cost of living where, say, you can buy the
| equivalent of a $3M silicon valley home for well under $1
| million.
| [deleted]
| balhbloo wrote:
| Companies have no business telling me how much they think my life
| should cost nor how I should spend my money. If they're paying
| "lifestyle" choices, based on bullshit cost of living make
| believe metrics, they should reward my lifestyle choice to travel
| constantly and pay that cost of living accordingly.
|
| I'm not surprised tho, remote work is still an embryo, I'm gonna
| keep pushing for what I want but we can't expect too much.
|
| When I'm rich and successful I'm gonna pay a standard global rate
| for the each role. No bullshit country adjustments. The market
| will just have to eat it
| robertlagrant wrote:
| This just means (at least) one of three things:
|
| - you're making this up, and have no conception of what you'd
| do
|
| - you won't be able to hire people from places where the cost
| of living is high, as your global rate will be lower than
| competitive salaries there
|
| - you won't survive, as your competitors who do location-based
| salaries will be able to offer your customers more value for
| the same price, or same value for less price
|
| You pick :)
| ghaff wrote:
| Even across the US, it's hard. Basecamp is an outlier.
|
| Now, in practice, a fair number of companies probably don't
| have large systematic salary adjustments by US location,
| including remote generally. But they mostly do it by just not
| paying market rates in the highest paying markets like the
| Bay Area and, especially, not going toe-to-toe with the likes
| of Google and Facebook.
| throwaway316943 wrote:
| I hope you are irreplaceable then because they are paying you
| based on a) how many people are competing for your job and b)
| how many other companies are competing for your skill set. If
| you are fully remote then you are competing with at least as
| many skilled people as are in your time zone and at most the
| number of skilled people in the world that speak the same
| language both of which are a huge increase over the number of
| skilled people in your metro area. The number of companies
| competing to hire you will also have gone up but I doubt it is
| on the same scale.
| moocowtruck wrote:
| you can do it, my current single contract pays 325k, and i'm
| just doing jquery(much to my dismay) and C# for it, all
| remote... been doin it for almost 3 years now. I live in a not
| very popoulated area . I've learned that there are plenty of
| very high paying jobs with a low bar..the things people go
| through to work for these big companies for such little pay and
| having to live in cities blows my mind. The best part is my
| current job leaves me lots of time for sidework to and to get
| experience in technologies i prefer to use.
| julienfr112 wrote:
| Good for you ! But your situation seems to me to be quite
| extraordinary.
| balhbloo wrote:
| Hey, where are you sourcing these? Reach out to me: reverse
| ('ef7sirc') on outlook
| sokoloff wrote:
| Markets are two-sided. If you pay a single, global rate, you
| may find yourself setting that rate such that you're priced out
| of certain markets and lack access to money-motivated talent
| there.
|
| You will be part of the market that's eating it.
| dragonwriter wrote:
| > Markets are two-sided. If you pay a single, global rate,
| you may find yourself setting that rate such that you're
| priced out of certain markets and lack access to money-
| motivated talent there.
|
| Except for differences imposed by differential transaction
| costs, freely competitive markets have one price for a given
| good. If there's not a single, global rate for a
| nondifferentiated good, it means it's not a competitive
| market and a cartel or monopolist is imposing segmentation.
|
| If there's some places where the supply (in the economic
| sense of the function relating price and quantity delivered)
| is restricted so nothing is delivered at the global market
| clearing rate, then that place just isn't a source of the
| good.
|
| The benefit of segmentation for buyers isn't that they get to
| avoid being priced out of markets where you pay more for the
| same service, it's that imposing segmentation lets you reduce
| the price you pay to suppliers in low-cost regions to a level
| below the global market clearing price.
| balhbloo wrote:
| This is fascinating. Where can I read more to learn more
| about how to think about economics like you?
| barry-cotter wrote:
| Any Economics textbook. Here are two good, free,
| technically demanding ones. Friedman's is less demanding
| in terms of Mathematics than McCloskey's.
|
| https://www.deirdremccloskey.com/docs/price.pdf
|
| http://www.daviddfriedman.com/Academic/Price_Theory/Price
| %20...
| forrestthewoods wrote:
| > If there's not a single, global rate for a
| nondifferentiated good
|
| I would say that software engineering labor is extremely
| differentiated?
| sokoloff wrote:
| > If there's not a single, global rate for a
| nondifferentiated good, it means it's not a competitive
| market and a cartel or monopolist is imposing segmentation.
|
| Much of the work of product development and marketing is
| _creating_ differentiation (real and perceived). Is a
| Mercedes E-class different from Toyota Camry? Is 90% lean
| ground beef from Whole Foods different from 90% at Trader
| Joe's?
|
| Is economy class 21-day advance, Saturday night stay
| required travel different from a walk-up ticket out Tuesday
| back the same Thursday?
| lotsofpulp wrote:
| > Is a Mercedes E-class different from Toyota Camry?
|
| For this example, obviously they are different. The job
| of marketing is to justify the difference in price for
| whatever differences the Mercedes offers.
|
| > Is economy class 21-day advance, Saturday night stay
| required travel different from a walk-up ticket out
| Tuesday back the same Thursday?
|
| Yes, for the seller, guaranteed payment 21 days before is
| different than a volatile payment minutes before the
| goods expire.
| dragonwriter wrote:
| > Much of the work of product development and marketing
| is creating differentiation
|
| Sure, and that's definitely an important phenomenon, but
| it is not really germane to hiring for a role and paying
| differently for the exact same role depending on where
| the successful applicant lives.
| balhbloo wrote:
| Hahaha thanks. I'm not smart enough to consider second order
| effects at this point. It's more of a personal crusade that I
| know is right so I'll just have to do it see what happens .
| lotsofpulp wrote:
| What will happen, unless your product is unique, in high
| demand, and has a large moat, is your customers will
| purchase from a competitor selling goods at a cheaper
| price. See what happened to US textile and manufacturing
| industry.
| balhbloo wrote:
| I suppose I'm idealistic to think that paying people more
| (what I think of as) fairly will better motivate them
| retain them and lead to better productivity. And also
| we'll be able to attract better people everywhere to
| produce better product. I could be wrong. Sad if so, but
| it's worth a try
| sokoloff wrote:
| Motivation is a complex topic to be sure. An argument
| that has always resonated with me (and I bring up mostly
| to see if we can find a good rebuttal here) is that if
| I'm paying someone wildly more than their second-best
| alternative, they are in part motivated (to keep the
| gravy train rolling) and in part trapped ("I better learn
| to deal with this, because I can't go anywhere else
| without massive sacrifice for my family").
|
| The latter can lead to "I'll quit mentally but not
| actually" which is horrible for all parties. (I'm not
| saying that's an excuse to underpay people "for their own
| good", but I think anchoring pay to an employee's actual
| market makes some non-zero amount of sense.)
| ghaff wrote:
| It probably depends on what their intrinsic motivation
| related to the job is. Do they find it fun, mentally
| challenging (in a good way), etc,? If they're motivated
| in that way, the extrinsic motivation of above-market pay
| is probably a good thing. But if that's their _only_
| motivation and they 'd rather be anywhere else if it
| weren't for the money, that's a negative.
| sokoloff wrote:
| 100% agreed. My hypothesis (previously unstated) is that
| some slice of people who start out in the first bucket
| inevitably turn into the second bucket. (They get bored
| of "doing the same old thing" or they "just want a
| change".)
| lotsofpulp wrote:
| > An argument that has always resonated with me (and I
| bring up mostly to see if we can find a good rebuttal
| here) is that if I'm paying someone wildly more than
| their second-best alternative, they are in part motivated
| (to keep the gravy train rolling) and in part trapped ("I
| better learn to deal with this, because I can't go
| anywhere else without massive sacrifice for my family").
|
| The rebuttal to this argument is that if you're selling a
| commodity product, then you're going to get steamrolled
| when Walmart/Amazon/Aliexpress/Multinational company
| comes rolling through and offers a comparable option to
| your product at 50% less by arbitraging labor costs.
| sokoloff wrote:
| I agree with that observation. I don't understand how
| that rebuts the presumption that I should pay market
| wages to avoid trapping overpaid employees in jobs they
| don't find fulfilling.
| lotsofpulp wrote:
| Oh, I thought you meant a rebuttal to your first
| paragraph, to which I would say you wouldn't survive as a
| business.
|
| I don't know anything about trapping people in a job they
| don't like with a high wage.
| barry-cotter wrote:
| All of the things you posit do occur. Costco employees
| are better, and better paid, than Walmart employees. That
| doesn't mean both firms can't exist in something close to
| the same market niche. And Costco's strategy is not
| infinitely scalable. Paying more gets you better
| employees. It doesn't automatically get you more profit.
| lotsofpulp wrote:
| There's a few segments of the customer market that will
| pay varying premiums for more customer service/quality,
| but only so much. Costco exists only in areas with above
| median wage shoppers, and can afford to exist by offering
| a limited selection of items sold in bulk. Similarly, a
| handful of retailers can afford to exist in this market,
| such as Trader Joes/Nordstrom/Apple/REI/etc, but most
| consumers are fairly price conscious and won't hesitate
| to shop elsewhere that offers lower prices. Or they can't
| afford the premiums for these places in the first place.
| [deleted]
| lotsofpulp wrote:
| There is decades of data and sound reasoning to show what
| has, does, and will happen if arbitrage opportunities
| exist.
|
| It's no different than purchasing groceries from store A
| because they are cheaper than store B.
|
| Paying people extra does not necessarily produce better
| product, at least not better enough to offset the extra
| costs.
|
| If the goal is to give people a better life by giving
| them more money, that is better solved via wealth
| redistribution.
| aokiji wrote:
| Lets steer clear away from Marxism please.
| Alex3917 wrote:
| > If they're paying "lifestyle" choices, based on bullshit cost
| of living make believe metrics, they should reward my lifestyle
| choice to travel constantly and pay that cost of living
| accordingly.
|
| Why not ask them to? Companies pay for people to get things
| like masters degrees all the time.
| balhbloo wrote:
| I'm asking them to. Let's see if they do :)
| Alex3917 wrote:
| I mean if you have a strong network in multiple cities that
| you're letting them access then they should absolutely pay
| for that. Or if you're traveling around and using the stuff
| you learn to improve your design skills or whatever.
| heisenbit wrote:
| The elephant in the room is not whether I'm worth 150K in S.V.
| but 50K if my cost of living is lower elsewhere. The real issue
| is what enables S.V. companies top pay three times as much. Why
| is it not possible to set up a similar company elsewhere which
| makes similar revenue and should be either insanely profitable or
| pay 150K and employees would become insanely rich as cost of
| living are lower.
|
| I think neither S.V. nor the market is rational.
| UncleMeat wrote:
| > Why is it not possible to set up a similar company elsewhere
| which makes similar revenue and should be either insanely
| profitable or pay 150K and employees would become insanely rich
| as cost of living are lower.
|
| There are two reasons why SV companies pay outrageous amounts.
|
| 1. Some companies have insane revenues. Google/Facebook lead
| the way but others are in this space as well. They can pay
| engineers huge amounts because they can afford it. These
| companies are rare and there aren't many outside of a few hubs.
|
| 2. Other companies run huge deficits and are funded by VCs.
| These companies pay huge amounts because their VCs want them to
| grow crazy fast and want them to hire top people, so they have
| to compete with the rich companies. The VCs are primarily
| located in a few hubs because they want to be able to
| physically stop in to their startups.
|
| If a few companies weren't bringing in stupid high revenues,
| the entire HCOL compensation for the industry would collapse.
| It'd return to something closer to what we saw in 2005 before
| the rise of the megagiants with more money than God.
| ip26 wrote:
| It's like a black hole. The more dollars & developers you feed
| SV, the more gravity it has to suck in more dollars &
| developers, in an endless feedback loop.
|
| If the supply of dollars was limited, it would never have
| reached such critical mass.
| lrem wrote:
| Well, one reason that S.V. companies can pay more is that they
| earn more thanks to being in S.V. Once I've been visiting the
| mothership and took a bike to drive up/down the road. There
| have been offices of all kinds of companies I would've never
| heard about... Except I've seen so many of the logos on various
| things in the office a quarter world away. I imagine there's
| quite some value in having your engineers mingle with potential
| customer's engineers after work.
| Ericson2314 wrote:
| https://en.wikipedia.org/wiki/Economic_geography cities matter.
|
| You might say "but...but...the internet". Well, perfecting
| remote work is just the beginning. The unplanned/sponteneous
| interactions that lead to new relationships also matter. Maybe
| when we get that soviet internet that browses you.
|
| > I think neither S.V. nor the market is rational.
|
| I agree, and it's possible general "bullshit jobs" and
| Q.E./softbank bubble type phenomena dwarf the intrinsic value
| of cities. But still, those are orthogonal effects. Contrary to
| most American nostalgia, going rural does not defeat the
| bullshit.
| minikites wrote:
| All the more reason to implement a land value tax, with
| additional taxes on speculation properties (say, lived in for
| less than 33% of the year), and on vacancy (blight tax).
| Ericson2314 wrote:
| Amen to that! Land is a public good, and density even more
| so.
| SilasX wrote:
| >cities matter.
|
| >You might say "but...but...the internet". Well, perfecting
| remote work is just the beginning. The unplanned/sponteneous
| interactions that lead to new relationships also matte
|
| Yes, I can totally get why anyone would pay a premium for
| someone who is physically present, or can be on relatively
| little notice.
|
| But that only be relevant as far as "local or remote?", where
| the former gets a premium against the latter, and it
| shouldn't care about looking up the specific CoL of _which_
| remote location you 're working from (so long as business
| hours are maintained). The issue is that location-based pay
| _does_ do this.
| Ericson2314 wrote:
| I agree.
|
| PP was asking about why SV pays so much more in the first
| place. That's a related question but with different
| variables fixed constant.
|
| Indeed, it's very stupid to so discriminate between
| different locals. And it's not even clear this is in the
| employer's interests besides the higher order effects of
| dominating labor: in simplistic first-order modeling pay
| scales like this only hinder the arbitrage between
| different remote locations that are equivalent in the big
| corp's eyes.
| dasil003 wrote:
| Yeah a few years ago I was looking around at companies and
| had some interest in joining Gitlab. Then I saw their pay
| scale for Oakland and it was laughably low compared to SF
| even though that was all within my local job market.
|
| Ultimately remote first companies that don't do this will
| win the talent war and steadily push remote salaries up.
| Depending how successful they are it may also push major
| market salaries down over time.
| dasil003 wrote:
| What "enables" companies to pay more is profits, but what
| forces them to is the labor market. SV pays more because as an
| IC you can get a $150k job at thousands of other companies
| within commute distance.
|
| Of course it is possible to set up a tech company elsewhere and
| have lower operating costs--there are plenty of examples--but
| that doesn't it's a slam dunk; remote work is a trade off that
| does not work for every person or company, and talent pools and
| ecosystems matter a great deal.
| IshKebab wrote:
| It's kind of amazing how many people on this site don't
| understand the very simple economics of how salary is
| determined.
| gnopgnip wrote:
| Apple has a gross revenue of $1.9 million per employee. Paying
| 150k is generally only a small fraction of the value they
| create and Apple could afford to pay more, and at the same time
| a better offer than anywhere else for many
| s1artibartfast wrote:
| >Why is it not possible to set up a similar company elsewhere
| which makes similar revenue and should be either insanely
| profitable or pay 150K and employees would become insanely rich
| as cost of living are lower.
|
| The canned answer is that SV provides easy access to capital
| and talent. These are rationale incentives, although they may
| be overvalued and this is changing.
|
| Companies can absolutely pocket the difference. I know a SV CEO
| who is building out his software team in Pakistan because
| college educated programmers are paid $6/hr and the talent is
| adequate
| 6gvONxR4sf7o wrote:
| Right. It indicates that market forces aren't benefitting labor
| as much as they could an extreme degree. What aspect of the
| market needs to be changed in order for everyone to benefit
| similarly? Clearly companies are making far more per worker
| than they're paying out (at least in this case). Why is it so
| extreme?
| [deleted]
| bryanrasmussen wrote:
| Location based pay makes some sense when hiring or applying for a
| job, I live in Denmark, it is pretty expensive here and I charge
| quite a lot even in my market. If you can't pay my price I can't
| afford to work for you, partially because of my location.
|
| But let's suppose I am hired, and I decide to move to another
| location because I am in a position to do so. Basically, the
| company using location based pay takes out one of the benefits I
| can derive from moving. Because I work for a company with
| location based pay I might not be able to move somewhere else
| until I quit that company! Especially as the company with
| location based pay probably isn't calculating in the expenses of
| moving, finding new schools, babysitters etc. all the extra stuff
| you need to do when you move somewhere new, which if you're
| making a lot of money for that area can be better handled
| because, guess what, money makes lots of problems more
| manageable.
|
| So yes if you want to hire me you have to pay me something I can
| afford and you can afford, but if you want to change my pay based
| on if I decide to move somewhere cheaper later I don't think I
| could afford to tie myself to you like that.
| aneutron wrote:
| I don't think the analogies made in this article stand for the
| markets nor the skills we are considering.
|
| You may think I'm full of shit, and its within your right, but I
| the amount of time and resources you'll spend to find a good
| match for a factory worker at some assembly line, compared to
| that for a skilled software engineer with that's being paid
| 150k$, is not even remotely comparable.
|
| And the value each bring to your company are not the same either.
| Perhaps you can make the argument that in both cases there are
| "plenty of fish in the sea", but I'd wager there's a lot less
| fish in the developer side of things.
|
| I don't know, but it just smells like false analogies and I'm too
| tired to write about it ...
| softwaredoug wrote:
| If some companies do location based pay, and others don't, won't
| the market naturally begin to favor those that don't?
| locallost wrote:
| I was in this boat a little bit, working remotely for someone in
| an expensive city. Initially I was paid a little bit less, and
| probably still am, but not that much. But anyway, at one point my
| counter argument was: location is not the only factor. If you're
| not going to compensate people based solely on their performance,
| then you also need to include other factors, not only their
| location because it's not the only expense in life. One can have
| rich parents, and the other parents that need support, etc. One
| can be a single person, the other can have six kids. You can go
| on and on. If you go that road it will be hard to figure out any
| compensation because there are too many individual factors.
|
| One other thing is: a company operating in an expensive market
| will itself be expensive. When they start paying the workers
| less, I doubt they will become less expensive. Basically somebody
| will just pocket this difference, most likely few at the expense
| of many.
| f430 wrote:
| > Facebook, one of many giants to be shifting permanently to a
| more remote-friendly culture, has announced that those who move
| to lower-priced locales will have their salaries reduced
| accordingly.
|
| There it is. The cost savings of giving workers a haircut because
| they moved to a place with low cost living is the _TRUE_ driver
| from WFH-forever initiative.
| prlambert wrote:
| "If I worked remotely for Facebook and wanted to move somewhere
| central where rents are three times higher, would Zuck give me a
| raise? Somehow I doubt it."
|
| I can't speak for Zuck, but Sundar does. I work for Google. We
| also have local market indexed compensation (which I support, but
| not relevant to this point). If you move to a city with higher
| labor prices, you get paid more. I've seen it multiple times with
| people in my team. It's a total non issue, just paperwork. Very
| very standard.
| choeger wrote:
| I do not want to debate the fairness of it, because it is way too
| complex for a comment.
|
| But there is another downside of pay cuts for remote workers: A
| remote worker does not have access to the same market as someone
| living in a hot cluster like The Valley.
|
| A real-world example from Europe: If I take my Berlin salary and
| live just 50km out of the city, I am easily one of the top-
| earners in that area. Naturally, I lose easy access to many
| offerings of that city, but that's part of the deal, I think. Now
| if I ever wish to switch employers, I can look in Berlin, but I
| am at a disadvantage if many companies insist on on-site work. If
| they don't, I compete on a much larger market with many more
| would-be employees. This problem should be reflected in payment,
| I think.
|
| So from my, completely egocentric, perspective it would be ideal
| if companies demand on-site one or two days a week, so I can
| choose the best spot for living in a larger area, but still only
| compete in a limited market.
| lotsofpulp wrote:
| > But there is another downside of pay cuts for remote workers:
| A remote worker does not have access to the same market as
| someone living in a hot cluster like The Valley.
|
| It's not another downside, it's the very reason the employer
| can reduce pay. They are betting your supply and demand curves
| are moving in such a way that you will be willing to accept a
| lower price, because you won't have a better option.
| Ericson2314 wrote:
| Let me take it another step: Every reason that it's
| "rational" that remote workers are payed less, i.e. not just
| a stupid faux-rationilization of the labor market reaching a
| new equilibrium, is evidence that remote work is a failure.
|
| A world of resort-town skilled works chained to their hegemon
| isn't just terrible for workers. It's a terribly inefficient
| market: a "sharded monopsony". The very unplanned
| interactions that allow hot-spot workers to change jobs is
| also a big reason cities are such dynamic economies in the
| first place.
| fantod wrote:
| On the other hand, if this kind of thing became commonplace,
| you'd have the advantage that companies could hire you for
| less.
| ghaff wrote:
| >So from my, completely egocentric, perspective it would be
| ideal if companies demand on-site one or two days a week,
|
| Pretty much all the surveys I see suggest that this will be the
| most common outcome. Maybe roughly 20% fully remote and 20%
| mostly back in the office. Though doubtless not uniform across
| companies. (I expect my company will tilt more towards remote
| given that we were relatively heavily remote pre-pandemic.)
| Which implies that most will probably remain in the orbit of a
| larger metro; many of the jobs aren't in the city anyway. And
| many people will want to stay accessible to a metro for other
| reasons.
|
| I had about a 45 mile commute most non-travel days at one point
| for a while. (I did take the train some days.) It was pretty
| doable 1-2 days per week but wasn't sustainable on a daily
| basis.
| hackissimo123 wrote:
| I'm applying to jobs now (in the UK) and I'm yet to speak to
| a single company that plans on a full return to the pre-
| pandemic normal. Everyone is either staying 100% remote
| indefinitely, or they're hoping to adopt a hybrid approach
| like what you describe.
|
| It's a bad time to own city-centre commercial real estate.
| pydry wrote:
| This wasn't my experience. Most companies I talked to
| planned on having 1-2 days in the office per week. A few
| were planning on 100% remote.
|
| I bet a lot aren't being open about how remote they will be
| also, to avoid putting people off.
| ghaff wrote:
| I expect a lot of companies just don't really know how
| things are going to play out right now. So, unless you
| _know_ that a position can be 100% remote for all time,
| the conservative thing to do is to basically say "You're
| going to have to live somewhere that allows you to
| commute in a couple of days a week." You don't want to
| put yourself in a position where you've told someone they
| can live anywhere in the country they want and then, in
| nine months, tell them "Just kidding. You need to move to
| London."
| hackissimo123 wrote:
| That doesn't contradict what I said. "Remote-first" was
| more common in my experience too than "100% remote".
| vidarh wrote:
| Notably, the market is such that a skilled candidate
| going in and explicitly negotiating how remote they want
| to be has a good shot at getting it approved. At least if
| aiming for e.g. 80% remote.
|
| It's also notable that now being someone with longer
| experience in working remote - especially managing remote
| teams - has suddenly become a very valuable skill.
| ghaff wrote:
| For most people who have proven they can productively work
| remote, it's sort of a no-brainer. Even if they don't want
| to move to the mountains or otherwise go 100% remote, most
| people will at least want the flexibility to commute fewer
| days and spend some days at home/out-of-the-office for all
| sorts of reasons. (As well as more flexibility in how close
| they need to be to an office.)
| ajmurmann wrote:
| > Pretty much all the surveys I see suggest that this will be
| the most common outcome. Maybe roughly 20% fully remote and
| 20% mostly back in the office.
|
| While intriguing as an employee, this seems very pricey as
| the employer. Office space is expensive. Is it worth the cost
| given the low utilization? Would you really miss out on an
| excellent employee who cannot come in the 20% of the days
| others come to the office? How intriguing is it gonna be to
| hire someone who works the same time zone, is equally
| qualified but only costs 30%?
| jrlocke wrote:
| Location is simply a convenient cudgel. It would be just as
| defensible to trot out family size based pay (greater pay for
| more mouths) or net worth based pay (greater pay for lesser
| existing privilege) or the like.
|
| Location just gets those in power what they want: higher personal
| comp and lower employee salaries.
| carapace wrote:
| I agree.
|
| This is the same industry that formed a "wage-fixing cartel"
| against their own developers and engineers.
|
| I'm sure that they will do anything they think they can get
| away with.
|
| https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...
|
| > The defendants are Adobe, Apple Inc., Google, Intel, Intuit,
| Pixar, Lucasfilm and eBay, all high-technology companies with a
| principal place of business in the San Francisco-Silicon Valley
| area of California.
|
| Pando had a story about the scope of the fraud:
|
| > "Revealed: Apple and Google's wage-fixing cartel involved
| dozens more companies, over one million employees"
|
| > Confidential internal Google and Apple memos, buried within
| piles of court dockets and reviewed by PandoDaily, clearly show
| that what began as a secret cartel agreement between Apple's
| Steve Jobs and Google's Eric Schmidt to illegally fix the labor
| market for hi-tech workers, expanded within a few years to
| include companies ranging from Dell, IBM, eBay and Microsoft,
| to Comcast, Clear Channel, Dreamworks, and London-based public
| relations behemoth WPP. All told, the combined workforces of
| the companies involved totals well over a million employees.
|
| https://pando.com/2014/03/22/revealed-apple-and-googles-wage...
|
| There's a lot more coverage: https://pando.com/tag/techtopus/
| asdfasgasdgasdg wrote:
| I don't really understand why we're talking about this. There's
| not any realistic regulatory approach to preventing companies
| from paying based on CoL. And absent such regulation, the market
| forces are far too powerful to be counteracted by internet
| comments, no matter how strident.
| ineedasername wrote:
| I think we should go a step further. Companies should audit all
| of the expenses of their employees, because it's not just people
| living in a low COL area: It's people living in the same high COL
| area but still living way below their means. Why should a company
| have to pay an employee who chooses to live in a $2k apartment
| the same as one across town who pays $3k? And food, or cars...
| Pets... Kids.... If you choose not to have additional expenses,
| why should a company pay you so much more than it costs you to
| live? Want to save 10% of your salary each month? Too bad,
| company policy says 5% is the max. /S
| InstantCapital wrote:
| I guess this is the digital version of a captive audience, i see
| it becoming more popular.
| phendrenad2 wrote:
| > Should remote workers have their pay reduced if they move
| somewhere cheap?
|
| That makes the most economic sense for the company, as they can
| judge employees based on their local office, not the other global
| employees at that salary level. Also it's good to not have people
| in the same office doing ostensibly the same job with wildly
| differing salaries.
|
| > Some call this unfair, and they're probably right.
|
| Agreed. But fairness rarely factors into business decisions.
|
| > Why? My value to the company hasn't changed! I am still worth
| the same amount as I was before! The only thing that changed is
| where I choose to reside. What difference is that to the company?
|
| By moving to a low-COL area, you have proven to the company that
| you can't handle the high-stress high-stakes world of a financial
| center. The company usually has a bad idea of your worth. What do
| you think happens when you send them an indicator like this?
|
| > If I worked remotely for Facebook and wanted to move somewhere
| central where rents are three times higher, would Zuck give me a
| raise? Somehow I doubt it.
|
| No, but you can go next door and interview at Google the next
| day, and get bumped up to the standard big-city salary. So it's a
| pointless argument.
|
| > Companies reduce your pay because they can.
|
| Not only that, they have to to compete with all of the other
| companies that do it. They made a risk/reward assessment and
| decided that the ill-will toward their employees and potential
| resignations is worth the salary savings.
|
| The rest of the article dives into comparisons with extremely
| impoverished areas, which I don't think are relevant for a
| discussion about remote work.
| mhb wrote:
| Also apply this to the price of college whose price is similarly
| set based on the circumstances of the applicant rather than its
| value.
| tomaszs wrote:
| I have heard about the idea twice during two job interviews. And
| I closed negotiations immediately. The reason why:
|
| These companies reps told they do it, to prevent inequalities.
| However this is a straight in your eyes lie. If I will go to
| Apple in my country, they won't sell it to me two times cheaper
| that in the US.
|
| But the most important issue for me:
|
| With proper salary I can invest where I live. I can hire people.
| Create jobs, support for foundations, pay more taxes.
|
| All of this combined helps to lower inequality. When I have to
| earn less because I am from poor country, it just cements the
| inequality.
|
| That is why I consider it an offensive lie, and an immediate deal
| breaker. Actually such companies are immediately blacklisted by
| me.
|
| Because what they really say is that they want to hire me not
| because of my skill, but because I am cheap person from a cheap
| country.
|
| It is not only about me. But also about employees from their
| countries. How should I feel if a company explicitly tells that
| it will fire local skilled professional to replace him with
| cheaper me. He has family too. It is not kind of a deal that
| interests me at all.
| [deleted]
| wwww4all wrote:
| The company will pay you the lowest amount you are willing to
| accept. Location has nothing to do with salary rates. If they
| could find someone at lower salary, anywhere in the world, they
| would hire that person. They can't, that's why they are paying
| the current salary rates.
|
| The company may use it as an excuse, but you can choose to walk.
| When enough top level people refuse pay cut, the company will
| drop the charade quick. Even if just 10% of high performance
| engineers decide to walk, that would cause major disruptions in
| the roadmap and cost millions in development costs.
|
| Simply demand higher salary and negotiate. The company will make
| adjustments to fill the in demand positions. Be prepared to walk
| away and find the company that will pay the higher salary.
| GekkePrutser wrote:
| Location-based pay is an unfortunate necessity.
|
| If it didn't exist, companies just wouldn't get any employees in
| San Francisco, nobody would be willing to work for the wage.
| Obviously they're not going to pay SF wages in the rest of the
| world. I mean a company like FaceBook could, they certainly have
| the means. But they wouldn't. The shareholders wouldn't let them,
| due diligence and all. They have to maximise their return to the
| shareholders.
|
| If I would be earning what I do in Barcelona and living in SF I
| wouldn't be able to even pay the rent. If wages for the same jobs
| had to be the same everywhere, it would mean the lowest common
| pay would quickly become the standard. Effectively all IT jobs
| would be moved to India. Nobody would bother working in the US
| for that pittance so there'd be no point hiring for it.
|
| So obviously cost of living factors into it. It makes sense that
| this goes both ways. Otherwise someone from SF moving elsewhere
| would be making a lot more than their local colleagues and that
| wouldn't be fair either.
|
| In fact when I moved to Barcelona from Ireland (with the same
| company) my pay was reduced somewhat. I had to sign a new
| contract with the local entity against local conditions. It was a
| bit of a bummer but on the other hand, I did gain a lot of
| quality of life. Great weather. Free healthcare that's actually
| good. Public transport that actually works (so no more car
| expenses). In the end it was a good move.
|
| If you fight against this you will only increase the race to the
| bottom (and to Asia). It's this very thing that keeps areas like
| San Francisco viable as an IT hub. If you're expecting them to
| honour the juicy SF pay everywhere you won't see that. Even if
| they do you'll be the first to get axed when budgets need
| cutting.
|
| What you see in general is that pay is indexed to local standards
| so you get the same standard of living for the same job in each
| place. At least this is what my employer does. Which is fair
| enough in my point of view. Money is a means to live, not a goal
| on its own.
|
| Would it really be fair to have people living in one place
| scraping pennies to get by and others living like a king while
| doing the same job?
| sneak wrote:
| The reason companies are paying people less when they move is
| because they are declaring a pay cut to their staff and the staff
| are saying "oh, okay".
|
| If a customer started paying me less than our previously agreed
| rate, I would stop working for them, and find a different
| customer.
|
| Employment is no different. Don't get screwed every single time
| your employer tries to screw you.
| new_here wrote:
| The remote tech workers and manufacturing labourers compared in
| the article are both still subject to the same market forces.
|
| Remuneration is the equilibrium of what a company is willing to
| buy at and what the worker is willing to sell at. A worker will
| want a higher price and a company will want a lower price. If
| they agree at an equilibrium then an employment contract is
| signed.
|
| Manufacturers have leverage to lowball the salaries of workers
| because if a worker declines to sell their labour at a low price,
| then the company can likely find other sellers because there is a
| large supply of unskilled labour.
|
| But if the supply of a specialised labourer is limited and the
| company really needs it, then the company has to consider more
| carefully if they want to pass on the deal or if they want to buy
| the labour at a higher price.
|
| If Facebook now chooses to pay lower salaries based on the cost
| of living of a worker's location, then that is their risk to take
| as they'll open themselves up to more competition. It's up to the
| remote worker to decide if they want to sell their labour to
| Facebook at that price or if they're comfortable to decline and
| look at their other options, which depends on the demand for
| remote workers of their particular skill set.
| joshuaissac wrote:
| > Let's say I manufacture a shirt in San Francisco and you buy it
| for $100. [...] $100 is a price you're willing to pay to wear it.
|
| > [...] if I [...] make the shirt in [...] Bangladesh, you want
| to cut the price and reduce it to $20, because of "cost of
| living" for the workers
|
| This is a strawman argument. If I am willing to pay $100 for a
| shirt, I would not demand the price be cut just because it was
| made in Bangladesh. Given a choice between a $100 SF shirt and a
| $99 Bangladesh shirt that are otherwise identical, I would buy
| the latter. I think many others would make the same choice.
|
| The only times I can think of where I would discriminate by
| location are if:
|
| 1. I am trying to support a particular industry in a particular
| region
|
| 2. I am trying not to support a particular industry in a
| particular region
|
| 3. I am actually paying for the "Made in X" label rather than the
| shirt itself, for social status, prestige, etc.
| malka wrote:
| Why should I be truthful when my employer ask where I live ?
| hackissimo123 wrote:
| If you're going to lie, make you sure you fake the timezone in
| your git commit timestamps.
| yawaworht1978 wrote:
| I have had this exact situation once way before the covid
| situation. And I did not take advantage, I should have perhaps.
| Cannot even say lesson learned, covid will likely be the new
| normal for a long long time.
| ghaff wrote:
| For one thing, you're probably committing tax fraud if you lie.
| KDJohnBrown wrote:
| I've been getting paid a San Francisco salary for 7 years while
| living abroad working as a Sr DevOps Engineer (I have 25 years
| experience).
|
| After the pandemic hit, my company slowly fired half the staff
| and replaced us with Russians & Belarussians for 1/5 the price.
|
| Now it's a buyer's market and wealthy startups (including many
| ycombinator startups) are offering me 50-70% less than I made at
| my last job. Literally so little money I would have $800 leftover
| after child support and paying my dying mother's mortgage.
|
| I ask them, "do you understand that paying employees 60% less for
| the same work creates a toxic environment? You are already
| struggling with 18 month average turnover. If I take this job, I
| will quit in a month, without notice, if somebody offers me 5%
| more, since you view me as a commodity."
|
| It has disgusted me enough that I've left tech entirely and
| instead am about to buy an apartment building. I would rather be
| a rent seeking parasite than get paid less than interns and
| junior engineers with 2 years experience.
| lordnacho wrote:
| The real question raised in this blog is actually why we allow
| capital to move and not labour. People who are wondering why
| living standards in the West have underperformed productivity
| should take a look at that question.
|
| Of course he's right about location based pay, too.
|
| The thing that ties it together is negotiating position. Chances
| are if you're a firm that many of your employees will in fact be
| OK, implicitly or explicitly, to share the gains from relocating
| to a cheaper area with your company. If you move to a place where
| you have 20K lower expenses, it's reasonable to think you'll
| share some of that with your employer, if only because you find
| it inconvenient to find a new one.
|
| It is of course true that you're as useful to the company as
| before, but it's a poker game. It's perfectly fine for you to
| insist on the same pay, but you'll have to run the gauntlet of
| your employer calling your bluff.
|
| I foresee more movement on this issue. Different firms will try
| different policies, and different employees will try different
| jobs. We'll get some moves to read about shortly, once this has
| played out a bit. One thing is for instance simply representing
| you live somewhere other than where you spend your time.
|
| Someone is going to find a friend in central London, NYC, or SF,
| and swap addresses with them. For instance if I live with my
| family in the suburbs, I could "swap" with some younger person
| living in town centre, and give them a piece of the action
| instead of my employer.
| jschveibinz wrote:
| Should your pay be reduced if you move somewhere cheaper? Well,
| like everything else, the market gets to decide. So the answer is
| probably "yes" because of market pressure.
|
| Like my father used to say in his own version of English, "you
| don't get nothin' for nothin'".
| draklor40 wrote:
| You are paid the minimum the company can get away with. No more,
| but a lot less.
| ajmurmann wrote:
| This debate is made more complicated than it needs to be because
| almost everyone keeps getting confused between cost of living and
| cost of labor. These two are somewhat correlated but can easily
| deviate from each other especially for a given industry in a
| given place.
|
| We are right now in a transition phase during which employers and
| employees are trying to find market equilibrium under these here
| conditions were remote work suddenly is a bigger option. I expect
| that we'll naturally arrive at a few different pay ranges for
| similar work that result in essence in different markets based on
| constraints required by the work. That might be based on a
| requirement to be in a specific location, time zone, country (for
| legal reasons), or unconstrained as long as the work gets done.
|
| Ultimately I expect this to result in location mattering a whole
| lot less for most software job's compensation. This means much
| lower comp for folks in SF or NYC and much higher comp for folks
| in places that currently have low cost of labor like the middle
| of the US, but also Central and South America.
|
| Remote work is gonna be the great equalizer. It's exciting to be
| able to work from more locations. On the other hand the dream of
| a silicon valley salary for folks who moved to Bozeman, MT will
| last a short time for the average developer. And salaries in SV
| will also adjust down as fewer jobs will require being there and
| now compete with developers in more locations.
|
| Edit: typo
| jaarse wrote:
| As someone who is more interested in economics than software, I
| believe you are 100% right. Once companies figure out how to
| have employees work remotely, there won't be as many high
| priced SV developer jobs. Companies just might decide to higher
| all (insert Eastern European block country here) developers
| because they are "local" to each other and are willing to work
| for a fraction of the cost. It's not about what you are worth.
| It's what companies can replace you for, and if you are remote
| that replacement value goes down.
| ummonk wrote:
| They could have done that in the past too (and plenty of
| companies did - just not the ones that went on to be the most
| successful). Outsourcing to one country didn't require remote
| work.
| comprev wrote:
| I have told clients they are entirely within their rights to work
| with another contractor who probably charges 1/3 of my rate from
| a cheap "developing" European country. It's up to them to assess
| if the additional costs working with me are value for money. To
| this day, they are still my clients.
| teddyh wrote:
| The concept of a "profession" or "field" is, properly speaking,
| meaningless, because every situation is slightly different. What
| is, then, this concept we have of what a fair wage ought to be
| for any given group of people with a similar occupation? I would
| guess that the concept of fair wages is a rudimentary, and
| emotion-based, form of unionization. If everybody _can't help_
| but feel upset about something which is "unfair", this is, in
| effect, a form of collective action - a sort of union you can't
| help but be a member of.
|
| In this light, the idea of a location-based pay can be seen as a
| simple hack to neutralize this de-facto union. If people
| otherwise aren't unionized, this hack gives employers back the
| sole power in the employer-employee relationship, which was what
| employers wanted from the start.
| xyzelement wrote:
| > Let's say you hire me for your company in San Francisco and pay
| me $150K. .. But now if I decide to move to Tulsa, OK, you want
| to cut my pay and reduce it to 90K, because of "cost of living".
| Why? My value to the company hasn't changed!
|
| The average article/comment on HN is extremely confused about how
| compensation works. This is a huge problem because if you don't
| reason about comp well, you're guaranteed to make suboptimal
| moves for yourself.
|
| In the example - does the author also expect to pay SF-level rent
| in Tulsa since "the value of housing to me hasn't changed?" Nope,
| because of the scarcity dynamic: if you HAVE to be in SF, you are
| forced to pay SF rent. If you can be anywhere, you can follow
| inexpensive supply.
|
| If you understand that, you can understand the employer side. If
| I HAVE to have a SF programmer, I HAVE to pay them SF level
| rates. If I can have a programmer anywhere in the US, I can
| follow the supply. So I pay a Tulsa programmer a Tulsa salary.
| The fact that he once lived in SF is irrelevant to the equation.
|
| I totally get why you don't want to hear that but that's how it
| is. It doesn't make sense to pay you more just because you were
| once in a pricier locale any more than you will pay more for rent
| just because you once did. I am making this clear because I find
| that it's important to understand reality you're operating in.
|
| If you are with me so far on this argument, you can follow it to
| the natural conclusion of how you can make big bucks: don't be
| generic. If your biggest salary driver is your proximity to the
| office, it was always a matter of time. Instead, work on
| developing combinations of
| knowledge/skills/experience/network/etc that are valuable and
| unique.
|
| That's always been my strategy and while I worry about many
| things in life, I don't worry about a Tulsa version of me driving
| my salary down (even if the version of me in Tulsa is me...)
| true_religion wrote:
| If a company hires someone in Tulsa and then they move to San
| Francisco will the company pay more?
|
| The end goal of location based compensation seems to be
| encouraging everyone to live in a low cost area, and take a
| lower wage thereby saving the company money.
|
| I can see why it makes sense to the company, but as an employee
| I wouldn't support the idea.
|
| We may not have a software union, but the least we can do is be
| critical of ideas that will directly lead to paycuts.
| xyzelement wrote:
| Oh I totally get that "it would be very nice" to get paid a
| lot and spend a little.
|
| I am not debating that part, just the reality part.
| iamhamm wrote:
| (n=1) When I moved from MA to CA, my then employer increased
| my salary by 18% to ensure market competitiveness. My boss
| said HR told him it was needed otherwise I'd just leave when
| I saw other options.
| ghaff wrote:
| In reality though, for a given company, cost of living
| adjustments don't really compensate for the difference in
| actual cost for most people. If you're earning market rate in
| Tulsa and get a 20% bump in your base pay for moving to the
| Bay Area, you're almost certainly not coming out ahead.
| motohagiography wrote:
| Please, for the love of anything meaningful, read a book about
| negotiation before trying to sound this stuff out.
|
| If you accept the term "location based pay," you have basically
| handed your wallet to the "wallet inspector," and you are being
| hustled. It's just like "policy," or "pay scale," they are utter
| bullshit if you have something of value. The media people who
| write articles about whether "location based pay, is it good?"
| are literally just 20-something bloggers with zero life
| experience trying to get published, and their editors and
| publishers have a stake in promoting the idea that your work
| should be cheaper.
|
| If you want to pay me based on location, I'm going to charge you
| based on location, because I know what kind of prima donnas
| people from the bay area <or insert region> can be and I charge a
| risk premium for having to put up with their nonsense. If that
| sounds offensive, why should using their perception of my housing
| situation as leverage be legit?
|
| If you are looking at a role, you need a clear idea of the total
| comp you are looking for as a part of your own plan for your
| life. Comp isn't a reward for good behaviour unless you are a
| prisoner begging guards for privileges or an animal doing tricks
| for treats - it's earned from value. When an HR person tells you
| what they want to pay you, say, "that's interesting, thank you,
| here is the data I have on what this role looks like from sources
| x, y, z, and these are the criteria I am using to evaluate the
| total package value." Those X, Y, and Z sources and references
| are things I've written about here before.
|
| Please, please, please, if you write code, read a book on
| negotiation.
| lifeisstillgood wrote:
| There is a delicate balance to be handled here
|
| Firstly, yeah negotiate based on (potential) value delivered.
| It's the best way for any _freelancer_ to base their pay. But
| for an _employee_ things get trickier. You see a freelancer is
| part of the gig economy - if at the upper end but still it 's a
| gig - you negotiate per gig and move on from the bad ones.
|
| But we hate the gig economy with a passion at the bottom end -
| it's exploitation - and a hundred years ago workers unionised
| (or sometimes less usefully revolted) in order to stop it.
|
| And asking an employee to negotiate for their own salary at
| odds with their co-workers is how collective action gets
| strangled in the crib.
|
| And let's face it, collective action in the US looks like it
| was strangled in the crib anyway.
|
| So looking at the next ten years we have a real issue over how
| to pre/re/distribute the wealth the century will hopefully
| bestow. And solid collective action will be a significant and
| important part of that.
|
| Grabbing the most value for yourself and to hell with the rest
| is not going to be the path to utopia.
|
| So, to start with, put unions on the boards of major companies,
| have them elected by the employee / members - and start seeing
| questions like "why can't we vote for the other folks on the
| board"
| greenrd wrote:
| > Grabbing the most value for yourself and to hell with the
| rest is not going to be the path to utopia.
|
| That argument is not going to convince anyone who is able to
| twist a prospective employer's arm into paying them top
| dollar. Never mind utopia. I got mine!
| [deleted]
| kache_ wrote:
| Based. Recruiters are in the business of lowballing you as much
| as possible. If you produce value and there is a market for
| your skills, then they are bidding against other people.
|
| https://www.kalzumeus.com/2012/01/23/salary-negotiation/
| minton wrote:
| Do you have any solid recommendations for a book on
| negotiating?
| rokusei wrote:
| Do you have any recommendations on books to read to help with
| negotiation?
| hx2a wrote:
| Can you suggest a book on negotiation? I know I'm terrible at
| it and could really use such a book.
| amelius wrote:
| How would this work for Facebook offices in Europe? Should
| employees there demand the same pay as their colleagues in the
| Bay area?
| ummonk wrote:
| Note that while the other offices don't pay the same, my
| understanding is that Zurich pays similarly to SF / NYC /
| Seattle.
| amelius wrote:
| Yeah, but housing is also more pricey there.
|
| It seems we are in a vicious cycle of high salaries ->
| higher housing costs -> even higher salaries -> even higher
| housing costs.
|
| To prevent the same problems elsewhere, it might seem
| useful to not increase salaries too much. But the real
| problem is that housing cost depends too much on what the
| buyer can pay.
| dilyevsky wrote:
| So you read a book on negotiation and it didn't cover leverage?
| motiejus wrote:
| Can you recommend a specific book?
| number6 wrote:
| Can you recommend a book on negotiating?
| paultopia wrote:
| ^^^ Yeah, this. "Location based pay" just means "I'm giving you
| a paycut," which in turn just means "I don't think you have any
| leverage." Pure and simple.
|
| So go find what the negotiation wonks call your BATNA and then
| see if it's better than the paycut. If it is, now we're
| cooking.
| kodachi wrote:
| And please, read patio11's famous and log post about salary
| negotiation.
| antihero wrote:
| Could you be so kind as to link this?
| david_allison wrote:
| https://www.kalzumeus.com/2012/01/23/salary-negotiation/
| vidarh wrote:
| It'd be a start if people just started trying to do _any_
| negotiation.
|
| Over 25 years in tech, I've hired many dozen developers. Only
| maybe 3-4 of the candidates I've given offers to in that time
| have tried negotiating.
|
| I've _never_ given an offer where there wouldn 't be at least
| some room for us to negotiate.
|
| Meanwhile I _always_ negotiate when I receive offers, and
| have usually ended up with substantial increases over the
| initial offer.
| jeffbee wrote:
| I know it seems like that but most people simply
| "negotiate" by getting multiple offers and taking the one
| that suits them best, or leaving one company and joining
| another. In that way it's a bit like a blind auction.
| Whatever room to negotiate you've left at the top of your
| offer represents risk that you've underestimated the other
| partys' offers.
| vidarh wrote:
| If we kept having a lot of people turn down offers,
| that'd likely be the case, but even if we assumed all
| rejected offers was down to pay, it'd mean most people
| are not "negotiating" that way either.
| biztos wrote:
| I was one of those developers who didn't know you're
| supposed to negotiate. I ended up being friends with a guy
| who got hired at the same time into the same team, for a
| slightly lower position, and got paid about 10% more for
| it. Because he had asked.
|
| That was 15 years ago, people didn't talk about this stuff
| as much back then, and hopefully I'm wiser now.
|
| Next time I have a salary negotiation, if ever, I'm
| definitely going to scour HN for advice and read some
| books.
| HeyLaughingBoy wrote:
| One of the most important things I learned in life, and
| I'm really glad I learned it early, is that if you want
| something, _ask_ for it. The worst that can happen is
| that the other person says no.
| psim1 wrote:
| Or "no and we don't like your attitude; offer retracted."
| I think it's rare, but it happened to me once and I was
| sore about it and am a bit less confident in my
| negotiating now (but I still do).
| HeyLaughingBoy wrote:
| Unless you desperately need that job to stave off
| imminent homelessness, that's generally a good thing. An
| employer who outright refuses negotiation, or any request
| with a "no, thx, bye" is _not_ someone you want to work
| for.
| spamizbad wrote:
| I would say any company that would retract an offer when
| you attempt to negotiate isn't worth working for.
| Probably an awful culture. The only way I could see you
| losing out an offer at a good company is if the
| negotiation drags out long enough (weeks) that someone
| else comes along and agrees to take the role at X pay
| while you're still negotiating.
|
| I've hired many engineers. Neither myself, nor any
| cofounder has been insulted or angry by a counter-offer.
| Sometimes we said to ourselves "this is kinda high for
| someone at their experience level" and held firm or met
| in the middle, but most of the time if you ask you'll
| squeeze at least 5K more out of it even if your counter
| was 30K higher than the offer.
| vidarh wrote:
| I've never seen that happen, and would never do it. Not
| doubting you, but I'd expect this to be rare enough that
| it's worth ignoring.
|
| The closest I've seen was someone with wildly out of line
| expectations (a developer who asked for basically the
| whole employee option pool to himself). Even then we gave
| a counter-offer (that he declined).
|
| Personally I'd see it as a sign they're not someone I'd
| want to work for.
| psim1 wrote:
| In hindsight, I overshot. But not by much. I considered
| their retraction to be in poor taste and poor faith. All
| it would have taken is a counter-offer to realign the
| discussion.
| vidarh wrote:
| Yeah, I think you probably dodged a bullet. If people
| come to me with a ridiculous counter, all it tells me is
| they don't know what the market is like, and I'd have a
| conversation about that, and make another offer. If
| people come to me with a high counter but one that might
| be plausible, I'd ask them to justify it, explain why we
| can't/won't go that high, and counter.
|
| If someone takes it as some perceived slight that you've
| asked for a higher amount, then consider they'd probably
| be equally offended if you asked for a raise down the
| road, and then you'd be in a bad spot...
|
| Of course being able to not worry about being turned down
| is a luxury we can't always afford.
|
| (Also, I have at times thought I massively overshot, and
| kicked myself because they immediately accepted; you'd be
| surprised how much of an increase you can ask for
| sometimes)
| nkrisc wrote:
| That might be a problem if you've only got enough money
| for this month's rent, but otherwise any company that
| would pull that would abuse you in other ways had you
| been hired.
| mtberatwork wrote:
| Speaking of rent, you can often negotiate that as well!
| When I was living in an apartment, any time there was a
| rent increase, I would go into the leasing office and ask
| if they could do anything about the increase. I always
| walked away with knocking around $100 off the monthly
| rent.
| anticristi wrote:
| As someone who gave up 15% of his salary when moving from
| Germany to Sweden, let me give you a different perspective on
| location-based pay.
|
| 1. How much do you value commuting by bike 15 minutes, instead
| of taking the tube for one hour? 2. How much do you value
| walking 15 minutes to the nearest forest, instead of being
| surrounded by highways, buildings and artificial parks? 3. How
| much do you value having a proper lunch break, instead of
| taking a sandwich in front of the computer? 4. How much do you
| value your male CEO regularly staying home with sick kids,
| instead of women getting that task by default? 5. How much do
| you value not having to see beggars and homeless people
| everywhere you look? 6. How much do you value living in a 9-5
| culture, instead of a "constant death march" one? 7. How much
| do you value pedestrians being given priority, instead of a
| honk? 8. How much do you value breathing in fresh air, instead
| of getting smog alerts every week?
|
| I could go on and on.
|
| Once you put a value on all of the above, location-based pay
| actually makes sense. Maybe not based on your exact zip code,
| but when moving from a large city to a smaller city, or from
| one country to another, you get certain things "for free" that
| you might value more than total compensation.
| Aeolun wrote:
| I feel like you should be able to get all of those in Germany
| too? At least it doesn't sound at all representative.
|
| More likely you switched from a bad company to a good one.
| locuscoeruleus wrote:
| You gave up 15% of your salary to work in a company where,
| presumably, everyone earns 15% less than your previous
| salary. Would you accept earning swedish wages working remote
| from sweden in a german company?
| moneywoes wrote:
| Any negotiation book suggestions
| justapassenger wrote:
| > Comp isn't a reward for good behaviour unless you are a
| prisoner begging guards for privileges or an animal doing
| tricks for treats - it's earned from value.
|
| Comp is a retention mechanism that's determined by supply and
| demand. Not a single reasonable company will be willing to pay
| you more that's bare minimum to keep you to stay. Hiring isn't
| about rewarding workers based on the value they provide, it's
| about optimizing costs so you can maximize profits.
|
| While location based term is a BS term, it is very real market
| mechanism. In your local market there's less non remote
| companies than in high cost of living areas, that are willing
| to compete for you, so your price point is lower.
| wpietri wrote:
| > Not a single reasonable company will be willing to pay you
| more that's bare minimum to keep you to stay.
|
| That's definitely not true. Indeed, I think that's a pretty
| bad way to think about comp, leading to an adversarial
| employer/employee relationship.
|
| As examples, consider Netflix, which is widely known for
| paying above market, or Gravity Payments, which changed their
| minimum pay to $70k/year:
| https://en.wikipedia.org/wiki/Gravity_Payments
|
| I'm just about to post 3 new positions, and I have no
| interest in squeezing people on cash comp. I want people who
| are happy, relaxed, and feel like they're being treated well.
| And I also want a fair salary structure. Could I pressure bad
| negotiators and naive people and pay less? Absolutely. Will
| I? Fuck no. Maximizing shareholder value has been called "the
| world's dumbest idea". I wouldn't go that far, but it's
| certainly up there.
| justapassenger wrote:
| Netflix is skewing hiring heavily towards very senior
| people, and is paying all cash, no stock. For the level of
| skills, total compensation you get from them is pretty much
| in line with peer big tech in Bay Area market.
|
| You can call maximizing profits maximizing shareholder
| value, and often they're aligned. But it's how businesses
| were always designed to work, long before stock markets. Is
| it fair? Most likely not, but it's business 101, same as me
| writing reliable production code is engineering 101.
| Aeolun wrote:
| Businesses are not necessarily designed to maximize
| profits. In theory they're designed to provide a
| comfortable lifestyle for the owner and keep them busy.
|
| If that involves maximizing profits, then great, but if
| the owner enjoys doing work with happy, un-stressed
| people more than he does a few humdred extra dollars in
| his pocket, it's clearly not (only) about optimizing
| profits.
| jiveturkey wrote:
| gravity also famously walked that back. netflix may be
| famous for paying above market but actually they pay
| market.
| ZephyrBlu wrote:
| Can you link or point me to a source about Gravity
| Payments walking that back? I can't find anything about
| it.
| Tempest1981 wrote:
| Yes, an easy way to understand this is to imagine yourself
| living where costs are low, and pay is adequate. Now you
| interview for a job that requires you to relocate to London
| or San Francisco. You wouldn't accept the offer unless the
| pay was much higher.
|
| Feels like this reasoning changes for those starting in San
| Francisco or London, looking to relocate?
| tharkun__ wrote:
| Companies probably like people moving from the middle of
| nowhere to SF or London better though. Especially young
| kids will probably undervalue themselves. They may know or
| figure out that you gotta ask for more salary in those
| areas but they might not know how much exactly they need to
| ask for and/or go down too much when HR starts their spiel.
|
| Hopefully they've learned enough about how much the company
| values them and how much it cares about them, that they
| don't just accept a relocation and whatever salary their
| company gives them. I'm not too hopeful though, given what
| working conditions they already accept while living in SF
| (or wherever).
| BeetleB wrote:
| I came looking for a comment on negotiation, and frankly, it
| was a disappointing comment.
|
| Yes, everyone should learn about negotiation. And as the
| authors of _Negotiation Genius_ point out, you 're making the
| mistake most people make - only considering your BATNA and not
| considering the other party's BATNA.
|
| Ask yourself what alternative Facebook has if you insist on a
| Bay Area salary while living in the Midwest. The answer will be
| "More than they had pre-COVID." This _reduces_ your bargaining
| power. Allowing remote work has significantly increased their
| pool of applicants. For every one of you, there are probably
| over 10 people as good as you who are happy taking a 20-30%
| salary increase while still getting paid 30% less than SV
| folks.
|
| While your advice is sound, you are only providing one half of
| the dynamic. One of the lessons in almost all negotiation books
| is to spend time understanding the position of the _other_
| side.
| mewpmewp2 wrote:
| Yeah as someone who has always lived in a low cost city, but
| getting 2-3x less salary than SF same level counterparts,
| should my salary also now increase to SF levels? But
| honestly, I should've been receiving that from the beginning
| then.
| throwawayboise wrote:
| Exactly. And now expand this to the entire world. This is now
| the pool of applicants.
| sbretz3 wrote:
| Any negotiation books that you suggest?
| ghaff wrote:
| Been years since I've read it but _Getting to Yes_ is a nice
| slim volume that seems still to be hugely popular.
| pawelmi wrote:
| For me 'Getting to yes' was too idealistic. It is a classic
| and good starter but did find it that usable for me. I was
| impressed though by radical approach of Chris Voss on
| 'Never Split the Difference'. Author is a former hostage
| negotiator, so there are also a lot intriguing stories
| included w high makes it a great read.
| chias wrote:
| If you want to get your feet wet with a short writeup
| online, I found these two blog posts (part 1 and 2) to be
| extremely valuable. It does a fantastic job of making sure
| you're mentally framing the situation correctly, which
| makes an enormous difference.
|
| part 1: https://haseebq.com/my-ten-rules-for-negotiating-a-
| job-offer...
|
| part 2: https://haseebq.com/how-not-to-bomb-your-offer-
| negotiation/
| gunnr15 wrote:
| For jobs that can be done remotely, location based pay is the
| new "college degree required".
|
| It is a perfect strategy to save time reviewing resume's today,
| and eliminate the need to in the future.
| bennysonething wrote:
| Can you recommend a good book on negotiation please? You make a
| very good point.
| sithadmin wrote:
| >If you want to pay me based on location, I'm going to charge
| you based on location
|
| Charging customers variable rates based on location is the de-
| facto norm amongst enterprise software vendors and most
| professional services segments, FWIW
| PragmaticPulp wrote:
| Charging variable rates based on location is the standard for
| just about everything, outside of e-commerce where prices are
| clearly advertised online and mass-market consumer devices
| like an XBox.
|
| The mistake I see in compensation discussions is to assume
| that abandoning location-based pay means everyone gets paid
| as much as the company's most expensive location.
|
| In practice, prices for services start to trend toward the
| least expensive locations once location is removed from the
| equation. There's a reason why the price of electronics
| manufacturing went down when it moved to locations like
| China, not up when manufacturing in China became accessible
| to to the expensive locations.
| zamalek wrote:
| > total comp you are looking for as a part of your own plan for
| your life.
|
| I very recently learned a damned hard lesson in this. I
| believed in the product, I was given interesting problems to
| solve, there were good benefits, there was a good culture, I
| had stock options. The pay was shit, the options evaporated
| during a merger, and I want to buy a home.
|
| Next round, I'm getting paid my worth and it's going to remote.
| "Believing in the product" is just a load of bullshit that
| C-suite spin to enrich themselves. They believe in nothing but
| their own bottom line, so why shouldn't you? Figure out what
| you are worth, what working conditions (overtime etc.) you can
| tolerate, and do good work for good money.
| tachyonbeam wrote:
| The best advice I've seen is to value stock options at zero.
| Most startups fail. There can also be huge dilution and other
| risks. At the end of the day, it comes down, as you're
| saying, to whether you enjoy working there or not, and
| whether or not the base salary is enough to make it
| worthwhile.
| skeeter2020 wrote:
| This is true of all variable compensation components,
| regardless of being stock options, profit sharing or
| discretionary bonuses. You need to weight it by risk, which
| typically means zero real value and potentially a nice
| surprise.
| skeeter2020 wrote:
| From the outside it looks like you're swinging too far the
| other way now. Pay is known to be a huge motivator to a
| specific point, then fade rapidly; that's where a product you
| believe in and interesting work picks up. It sounds like you
| didn't get enough money, or your needs changed, and obviously
| it's best if you get both types of rewards. I just quit my
| job knowing I was getting paid more than comparable coworkers
| because I was bored though, so try and be conscious and
| intentional in your own motivators.
| tharkun__ wrote:
| I would say there's an equilibrium (that many people don't
| seem to reach).
|
| With an actual objective look at it, I couldn't care less
| for any of the products of my past (or current) companies.
| However, I'm able to care about doing my best work for
| whatever the company is building but I also haven't had to
| contend with having to build stuff that I actively
| disbelieve in (like no advertising for example). I do like
| the fact that my companies have used reasonably recent
| technologies and at times also "too new technologies" - as
| in "the newest JS framework that nobody knows yet and that
| screws up all the time and you can't google for
| troubleshooting". So that keeps me interested enough.
| However, I am not someone that will work 80 hour weeks just
| because I am allowed to work on project X or with
| technology Y or because I "believe in the product". That's
| what many companies are trying to achieve. You believe in
| Facebook and their product, you get 'great perks' and are
| willingly staying at the office for way longer than you
| should for your own good.
|
| The other end of the spectrum is unionized workers that
| will drop everything as soon as the clock hits 5p.m. And no
| I'm not talking Walmart cashier type work here. It can be
| understandable enough I suppose given how some companies
| treat workers but so far my companies have been treating me
| well enough.
| zamalek wrote:
| Right, this was more along my line of thinking "good work
| for good money." I'm still delivering great ideas and
| code for my new/acquisition employer, but their money
| isn't good so I'm not sticking around.
|
| My main contention with "believe in the product" is that
| it's a canned phrase that I've heard time and time again,
| to encourage employees to "pull through for our mission"
| through "sacrifice from your family that is appreciated."
| The only people who ever benefit from that are the
| C-suite; customers get broken software coded by broken
| developers and support has to break themselves fixing the
| mess. It's a meme, by the purest definition, and it seems
| to work: people (myself included) get riled up in
| cameraderi and put themselves and their family second.
|
| If they truly appreciated our sacrifices, we'd have money
| in our bank accounts, not "belief in the product."
| HeyLaughingBoy wrote:
| I will say that it's not BS to "believe in the product and
| have interesting problems to solve." I've been there myself.
|
| However, you have to look out for #1 and "interesting
| problems to solve" won't pay the mortgage, so you better make
| sure that despite how great the job is, you are paid at least
| the market rate.
| rayiner wrote:
| Location-based pay also has a disparate impact on Black and
| Latino people, who are statistically much more likely to have
| family in the south and Midwest, which have low cost of living.
| There's something very troubling about two workers at a Bay
| Area company moving back home while working remotely, and a
| white or Asian worker getting paid more because family is in
| the Bay Area suburbs while a Black or Latino worker gets paid
| less because family is in the much cheaper Atlanta or Houston
| suburbs.
| EveYoung wrote:
| I don't think it matters how a company or candidate justifies
| their offers and demands. It really comes down to their
| respective bargaining power. So when remote work increases the
| pool of potential candidates, it's no surprise that employers
| will try to use this to lower costs.
| RA_Fisher wrote:
| Ah, but it also increases the pool of potential employers.
| Aunche wrote:
| It's not a symmetric increase. Employers that pay FANG
| level salaries are concentrated in a few major cities. Lots
| of very skilled developers scattered across the globe don't
| care about money that much, so they aren't tempted to move
| to SV for a dramatic salary bump. However, they may be
| tempted by a modest salary bump if they're allowed to stay
| with their social circle.
| RA_Fisher wrote:
| True, it's the law of one price. However, privileges /
| capabilities aren't evenly distributed. So, while remote
| does widen the labor market, wealthy countries tend to
| carry large shares.
|
| It's not a zero-sum game at all. Employees from wealthy
| countries can gain labor surplus through technology
| transfer a number of ways or even find business partners
| and employers.
|
| Mutually beneficial exchange is the name of the game.
| It's true that different folks achieve different relative
| success compared to their peers. That's okay and good
| when it's the product of honest just exchange.
| mwcampbell wrote:
| This whole thread is side-stepping the point of the original
| article. As I understand it, the point is this: if we're going
| to get on a moral high horse about equal pay, then we should
| also apply that standard to the things we consume. So I'd think
| that links to ethical consumption guides would be more on point
| for this thread than further discussion of what _we_ are paid.
| jackcosgrove wrote:
| I doubt the employer is considering what is moral when they
| cut your pay. It's all just rhetoric to them.
| mwcampbell wrote:
| Sure. And my point is that we who are relatively fortunate
| should focus on what we're indirectly doing to people less
| fortunate than us, and what we can do instead. In other
| words, we shouldn't keep seeing ourselves as victims.
| contravariant wrote:
| That would be a good point, unfortunately the article misses
| it entirely by advocating people don't have to 'right' to
| demand equal pay because they're guilty of the same thing (by
| association).
|
| It's the kind of tit-for-tat moral whataboutism that really
| doesn't do much to solve either problem.
| mwcampbell wrote:
| True, the author backed away from the uncomfortable point
| when they wrote:
|
| > I don't have a good answer to this, but I buy Chinese-
| and Bangladeshi-manufactured clothes anyway.
|
| But that doesn't mean we should avoid the more difficult
| discussion. I know that I'm privileged, and I figure I
| should focus on what I do, not what's done to me. I
| expected more commenters on this thread to take that
| position. As it is, the insistence on discussing what we
| are paid just makes us look like prima donnas.
| [deleted]
| [deleted]
| geoduck14 wrote:
| Oh, by the way, Starbucks has "fair-trade" coffee, which
| costs more because the farmers get a decent wage. And the
| produce I buy at the grocery store comes from Florida, Texas,
| and California that hire legal immigrants with an American
| minimum wage.
| falcolas wrote:
| Negotiation only works if both parties are equal. You are not
| equal to Facebook, they have a hiring pipelines miles long to
| replace you, and have no need to negotiate anything with you.
| The cost to replace you is just the cost of doing business.
|
| I hate how this always comes up as if the hiring model is in
| any way balanced between an employer and employee.
|
| I was once asked by a New York based company, at one of their
| remote offices, what I wanted for a salary. I said "$180k, what
| you're paying for this position in NY". They said "No. We know
| what you were making before, so we'll offer you $5k over that."
| It was never a negotiation.
| francis-io wrote:
| As a general rule, never disclose current or old salary. Just
| because you get asked, doesn't mean you need to tell anyone.
|
| I usually politely sidestep the "what's your current salary?"
| with a "in rolling to accept at least x, but we can negotiate
| if both parties are satisfied and get to offers". If a
| recruiter insists, I tell them I have a personal rule to
| never disclose that. I think I have lost a single prospect,
| which likely was never real to begin with. Likely just
| fishing.
|
| While I'm at it, I never mention who my current employer is
| either. I usually obscure it on my cv of I'm still employed.
| I also had a request recently to provide a scan of my
| passport on initial application, which i also declined.
|
| Honestly, recruiters think they can ask for any and all
| personal information they want. If you have value, no one
| will drop you because of it.
| boatsie wrote:
| I think next time I will say, "Sure, I'll tell you my
| salary once you tell me those of the hiring manager and my
| new teammates. That way we all have the relevant
| information."
| skeeter2020 wrote:
| You can use this to your advantage by setting the anchor.
| I'd never give a dollar figure but I would give an
| acceptable range. At my current position there's a variable
| comp component based on personal and company performance;
| this is a legitimate opportunity to give a forward-looking
| optimistic range: "Looking towards the next year, if I meet
| performance metrics similar to what I've demonstrated in
| the past I will be somewhere in the range of x and y".
|
| >> I never mention who my current employer is either
|
| Why is this? It's typically the most relevant information
| to a new position, and usually trivial to determine without
| you volunteering it.
| falcolas wrote:
| > As a general rule, never disclose current or old salary
|
| Don't worry, Equifax takes care of that for us. Both who
| you're currently working for, and your current salary. It's
| a service it offers to HR departments across the US.
| ghaff wrote:
| Bonuses and RSUs presumably give you wiggle room to
| handwave your total comp though.
| erosenbe0 wrote:
| Equifax does not have accurate information. Do you know
| something I don't?
|
| One time they thought I worked on staff at the local zoo.
| Seriously.
|
| It would be a waste of effort for HR. They don't have
| time for that I don't think. They want to get to a number
| not do forensics on your background.
| naveen99 wrote:
| Refusing to answer a fact seeking question in a negotiation
| isn't great strategy. it may not even help your case. if
| you make too little, that's already your problem. Someone
| offering you more than what you make is a net positive.
| Withholding information leading to a whitheld offer does
| you no good.
| erosenbe0 wrote:
| I've had people say that they already had other offers
| well in excess of current pay, making current pay moot.
| It's not a fact seeking question in a conventional sense.
| It's just one method of trying to move the process along
| with least effort. If you give an answer then they can
| make an effective offer quicker. If you don't there may
| be more work, that's all.
|
| Suppose you are just finishing a Ph.D. and took a few
| years off. Suppose you took a year or two to do freelance
| or work 1099. Suppose you went abroad to work for a year
| or two to take of your dying parent. These are all things
| I have run into.
|
| Edit: One more good one. I've known people who won a
| green lottery or married an American citizen they met
| abroad. Showed up in USA with lots of skills having made
| much less in Eastern Europe.
| naveen99 wrote:
| Do you prefer other people put in more effort than
| necessary?
| chias wrote:
| > Negotiation only works if both parties are equal.
|
| That is not true at all. It only works if both parties have
| something of value that the other wants. It's always a
| negotiation, but the _only_ thing that ever matters in a
| negotiation is the BATNA (best alternative to negotiated
| agreement) on both sides.
|
| If your BATNA is unemployment and their BATNA is a minor
| delay getting someone almost exactly equivalent to you, then
| you'll take their offer and they'll politely decline if you
| ask for more. If your BATNA is one of a few other competing
| offers all of which excite you, and their BATNA is having to
| settle for someone who doesn't bring your particular
| expertise to the company, or worse, having to start their
| search over again, you're in a much stronger position to ask
| for more money.
| missedthecue wrote:
| Your batna is only unemployment if Facebook is the only
| company on the face of planet that will hire you
| chias wrote:
| Philosophically yes, but "unemployment" and "unemployed
| for another month that I really can't afford while I go
| through this whole process _yet again_ with another
| company who 's just going to do the _same damn thing_ "
| can feel pretty equivalent.
| droopyEyelids wrote:
| If I understand your point, you're only considering marginal
| engineers that aren't expected to make a significant
| contribution to a product, and don't have competing offers.
|
| In the other case, the company needs to accomplish something,
| believes you can do it, and you have a list of companies
| sending you offers.
|
| Thats not so far fetched! Many of us hit that point in our
| careers.
| falcolas wrote:
| > you're only considering marginal engineers that aren't
| expected to make a significant contribution to a product
|
| So, 99% of the workforce? Or, 99.9999% if you consider that
| companies just don't give a fuck unless you happen to be
| Guido van Rossem?
|
| HR departments, who approve/deny pay changes, don't care.
| My current company is being forced (with the approval of
| the board) to compensate high performers in alternative
| ways (like stock grants, or vacation time) if they're
| outside of the "approved pay bands".
|
| I know someone who 100% qualifies for a title of "high
| performer" (they promoted him to a director a month after
| this) who would have had his pay cut in half if he moved
| away from his current location due to "remaining
| competitive with the local market".
| humbleMouse wrote:
| This comment should be pinned every time this topic hits hacker
| news. People are out here getting scammed by these hiring
| managers!
| ghaff wrote:
| Just remember that negotiation has two sides. You're
| perfectly welcome to go into a negotiation stating that
| Google pays $X for the equivalent position in Mountain View.
| And the company you're negotiating with is perfectly able to
| come back and say they're not Goggle and they're not in
| Mountain View. Nothing says that two parties need to be able
| to come to an agreement.
| [deleted]
| dheera wrote:
| Can they really have right to know where you are at every
| instant in time?
|
| You could be a resident of San Francisco but just rent a token
| shared bedroom with a bunch of people just to have an SF
| address, or even a UPS box, and actually be on working
| vacations in random houses across the country close to 100% of
| the time, and I'd say they shouldn't have a right to know
| exactly where you are through your journey, only what times you
| will be working. Everything else including location should be
| abstracted out if it's defined as a remote job.
| rmah wrote:
| They _need_ to know where your primary residence is. Because
| of things like payroll taxes, social security taxes, income
| tax withholding and unemployment insurance. Which vary by
| state and (sometimes) city. Not knowing means the company is
| not in compliance with labor laws and can lead to rather
| large fines.
| dheera wrote:
| > They need to know where your primary residence is
|
| I think even for privacy reasons it's perfectly reasonable
| to never give out your address. You can always give out a
| UPS box as your primary address.
|
| You could also have 2 residences in 2 states or even 2
| countries and have them both with weight=0.5 and no primary
| node.
|
| The entire idea of a "residence" address is an invented
| notion and de facto optional. You could always be on the
| move in an RV for example and still go show up for remote
| work every day.
| filereaper wrote:
| There are tax implications to where you live and work. If
| you're moving around the country say one new state every
| month, you're required to file taxes in all the states that
| you've worked from and received salary.
|
| This increases the burden on both the employer and employee.
| ghaff wrote:
| And some states are starting to crack down on this sort of
| thing. Someone was telling me that their company is going
| to start tracking time spent in different locations based
| on expense reports so that they can take appropriate
| actions (and have the employee do so as well) if they're
| above thresholds.
| dheera wrote:
| > based on expense reports
|
| Don't expense anything from the state you are in.
|
| Have everything shipped to an address in California and
| forwarded.
|
| This is the snail mail version of a VPN, and I'm not sure
| why people are downvoting me on a hacker site. Hacking
| the world is _what we do_. This is how we stand up for
| our privacy. If you use VPNs at all in your online life
| to conceal your location there is no reason you can 't
| invent a VPN for packages and mail as well.
| ghaff wrote:
| Am I going to ship my hotel room? It's business travel
| that's being discussed here.
| filereaper wrote:
| I don't think the hacking argument will stand-up when
| you're up again the IRS for tax evasion.
| dheera wrote:
| Don't evade taxes. The only thing I'm suggesting evading
| and standing up against is location-based salary
| discrimination.
|
| Remote workers should be allowed to move and live
| wherever they want as long as they can be online at hours
| that are useful for the company, and they should be
| treated as a black box that gets work done and paid
| according to _what_ they get done, not _where_ they get
| it done.
| filereaper wrote:
| Don't get my position wrong, I'm all for freedom of
| workers moving around and working from wherever they
| want.
|
| The issue is the current regulatory and taxation
| structures aren't built for that. You're encountering
| friction because of these current systems.
|
| The way to properly address this js to overhaul the
| system itself, this is by legislation and having
| representation that is aligned with what you want.
|
| "Hacking" around it isn't the way to go.
|
| To take a coding analogy, you're currently frustrated
| with the limitations of the architecture, which is
| understandable and I emphasize. But adding hacky patches
| to get around it isn't the way to go.
|
| Unfortunately architectural overhauls in society are slow
| and take a long time.
|
| I strongly encourage you to get involved in any
| grassroots movement to further the way you want to the
| world to become.
| dheera wrote:
| > overhaul the system itself
|
| I agree with this, but it will take decades, and I'll
| leave it to politics experts to deal with that. There are
| things I want to get done in my life, and I will get them
| done without needing to involve myself in that mess. If
| it needs me to move into another country or jurisdiction
| to get those things done, I'm open to that.
|
| I respect those that want to go fight that battle, but
| everyone needs to pick their own battles to fight, and I
| have enough battles I'm fighting already.
|
| > adding hacky patches to get around it isn't the way to
| go
|
| I disagree. You should fix the architecture but you
| should also feel free to use hacky patches until the fix
| is done.
|
| Meanwhile it isn't the taxation structure I'm arguing
| against, it's the salary discrimination by location.
|
| If a company values my work at $X/year they should give
| me $X/year independent of all other considerations, and
| also give someone else who accomplishes the same exact
| work $X/year independent of other considerations.
| ghaff wrote:
| Many companies don't make "significant" (yes, word doing
| a lot of work) cost of living adjustments within the US.
| But most of them probably have salary bands that are
| materially lower than top of SV scale. Flat wages for
| remote across the country isn't a general problem but it
| is if you want to get paid what Google will pay locally.
| ghaff wrote:
| Fundamentally, there's an incompatibility between living
| in a country that normally has complete freedom of
| movement between states and a system that _also_
| essentially requires you to be a resident of a specific
| state for reason of things like driver 's licenses and
| state income taxes (although if you split your time in
| multiple locations you may actually be required to file
| in multiple locations anyway). It can be done legally
| but, as I commented up-thread, a number of states are
| starting to look harder at people who spend a lot of time
| in their state but are paying all their income taxes
| elsewhere. You can't just say you live in Nevada because
| you have a PO Box there.
| throwaway-xxv wrote:
| Slightly off topic, In 2019 I did some work for a company. The
| project started when they were in a pinch regarding the
| product, and I just happened to have the expertise that they
| needed (very niche expertise).
|
| I quoted a figure that is usually reserved for the Thoughtworks
| of the world rather than individual contractors. They accepted
| without hesitation.
|
| The project went well, and eventually ended in a support
| contract. Fast-forward ~2 years and there is a new head of
| procurement. In a conversation he balked at approving a
| purchase order for a large chunk of work that they want done
| this year and said something about wanting to negotiate closer
| to the work.
|
| At the time I couldn't help think 'good luck with that'. If
| anything time has only strengthened my position. The only other
| person knowledgeable about the product at the company moved on
| to a new job. I'm the only person that now knows the domain
| (let alone the code base).
|
| To your point, it's all about knowing the position that you're
| in. I'm not likely to be an asshole about it _cough_ 2021 rate
| _cough_ , but they're not likely to have success negotiating a
| better price either.
| geoduck14 wrote:
| Ok, help me out here. I currently work for a company that has
| offices all over the globe. Pre Covid, I was in the office 5
| days a week.
|
| I work in Texas, with pretty low COL. The people who work in
| DC, NY, or SF all get paid more than I do. Should I get paid
| the same as them?
|
| Our company also has people in India (some are outsourced, but
| we have many full time associates). Should I get paid the same
| as them?
|
| What, then, is the value of my work? If I ask my employeer to
| disregard location based pay, how much do I get paid?
| fhrow4484 wrote:
| IMO, assuming everyone is WFH, Location based pay should only
| be considered within a same _timezone_ and in same _country_.
|
| Even if market rate price for developers in India was same as
| SF, to maintain its "output/$ per employee", the salary may
| differ.
|
| For instance, a company whose main operations are happening
| in PST, engineers whose main hours are offset 13h30min are
| less valuable to the company than those with 0h0min offset.
|
| Sending a PR for review or reviewing a PR from someone with
| more than 8h time zone difference usually means you have to
| wait a full day of turnaround time.
|
| Now within a same time zone but different country (or even
| states in the US), the differences diminish but there are
| still local labor laws and taxes that affect what the ratio
| of "what the employee provides" vs "what it costs the
| employer"
|
| So at the moment, people living in SF and [some remote town
| in the middle of california with fiber internet] should be
| paid the same, but, people in TX should not. (This only
| applies to 100% WFH companies whose majority of workforce is
| all in California)
| benhurmarcel wrote:
| I'm in Europe. I'd work US hours for a US salary.
| stevegalla wrote:
| What about the people in PST who work outside of normal
| office hours? Should they be penalized because they are
| effectively working in a different time zone? Should those
| in different time zones that decide to work PST regular
| office hours be paid more?
| cantankerous wrote:
| The value of your labor is how much the company is able to
| leverage it for a return. It has next to nothing to do with
| where you live. It's on the company to answer this question,
| not you or some third party to the negotiation between you
| and your employer.
| maxk42 wrote:
| You determine the value you're willing to work for: not just
| your employer. It sounds like you've never looked for a job
| while still employed. Take your location out of the equation:
| Is another employer willing to pay more for your skills? If
| so, you should be interviewing. When I'm hiring an employee
| I'm looking for anybody that has the skills I need, not their
| location. I'll pay top dollar to get hard-to-find skills
| regardless of where that person is located. I'm not going to
| tell them "Well you live in India so I'm only going to pay
| you half of what you're looking for" because they'll reject
| my offer and take one from another employer. If your
| colleagues are making more than you and your skills are
| comparable then you need to begin interviewing immediately
| because you're undervaluing your own work.
| Tempest1981 wrote:
| > I'll pay top dollar to get hard-to-find skills
|
| I feel like that's more true at a small-scale company than
| a large company with thousands of employees. Maybe the
| large company has already found those "hard-to-find
| skills".
| maxk42 wrote:
| So what? Don't work for a large company if they're not
| willing to pay your salary.
| toast0 wrote:
| Small-scale companies are probably more likely to have
| shapes for hard-to-find people. If you can hire one
| person to do three jobs you need 1/3rd of a person for,
| that's more valuable than finding three people who can do
| that; especially if those three people would have needed
| to be in close communications with each other.
|
| Big companies tend not to have as many places where they
| need one person to wear many hats; so their hard-to-finds
| will tend to be finding deep experts, but there's
| probably not a lot of positions that really need that.
| padobson wrote:
| It's shocking to me that I had to read a whole blog post
| and scroll through 50+ comments on HN to find someone who
| understood how salaries work. Well said.
|
| I feel like this entire discussion can be summed up in four
| sentences: "Feel like you're not making enough? Find
| another company that will pay you more. No one will pay you
| more? Keep adding skills until they do."
|
| Everything else is just window dressing for the negotiating
| table.
| dmitryminkovsky wrote:
| Location-based pay is _remarkably_ offensive, and for the exact
| reason you state:
|
| > you have basically handed your wallet to the "wallet
| inspector"
|
| By accepting location-based pay, you concede that your employer
| has the right to treat you like a child receiving an allowance;
| that your remuneration is based on the lifestyle that _they_
| think is appropriate for you, and not on the market value of
| your work. But your choice of lifestyle, your needs, etc, are
| strictly none of their business and it 's exceptionally
| inappropriate for employers to act like your parents. Once you
| let these people "inspect your wallet," you are establishing an
| abusive relationship and will get hustled around the clock.
| cactus2093 wrote:
| > and not on the market value of your work
|
| Interesting choice to invoke market value to argue that the
| salaries that the market has settled on for remote work are
| too low.
|
| The market value of work isn't the amount of revenue that the
| work brings in. If you think you can capture the full value
| of the work you do for yourself, you're always free to work
| as a solo entrepreneur instead of working a traditional job.
| That's kind of an upper bound on what the company could pay
| you, but the market value of the work is based on the number
| of employees the company needs and the number of qualified
| employees they can find. Remote work floods the supply with
| lots more available workers than they can find in any one
| city, so salaries for those roles go down. That's not
| treating you like a child, it's just how a market works.
| eli_gottlieb wrote:
| >Interesting choice to invoke market value to argue that
| the salaries that the market has settled on for remote work
| are too low.
|
| My friend who works remote makes just as much as I used to
| working in the office (when I was in industry). He's not
| getting "location-based" pay, so I'd say that "the market"
| has not unanimously decided on that quite yet.
| rayiner wrote:
| > Remote work floods the supply with lots more available
| workers than they can find in any one city, so salaries for
| those roles go down.
|
| You're correct, but that's not what's happening here.
| Facebook isn't paying remote workers uniformly less than in
| person workers. It is paying different amounts for
| different remote workers depending on where they live. That
| makes no sense given that, as you observe, there is a
| single national market for remote workers. The fact that
| Facebook can do that is an indicator that it either has
| market power in the employment market for programmers, or
| that we're in an odd situation where the market hasn't
| reached equilibrium.
| robocat wrote:
| > the full value of the work you do > That's kind of an
| upper bound on what the company could pay you
|
| No. If you have a monopoly on a
| skill/knowledge/certification/etc, then in theory you can
| extract rent from the business, potentially up to the
| profits of the business (well, profits less the returns
| required to cover risk of capital). The maximum you can
| earn is _far_ more than the value you create.
| cmeacham98 wrote:
| Your comment could justify a divide in pay between in-
| person and remote workers. Presumably, the ability to be
| available in person is valuable in some companies and the
| market for that is smaller, so more compensation.
|
| However, what it _does not_ justify is location-based pay.
| From the company 's perspective, there is no significant
| difference between a remote worker in New York City or
| Birmingham, Alabama.
| cactus2093 wrote:
| I still think what I said is true basically by
| definition, but yeah fair enough it does beg the question
| why companies don't hire exclusively in cheap areas now,
| driving down the market rates in expensive cities.
|
| I think supply and demand is still a big part of the
| answer. By square mileage the potential locations where
| employees can live has grown by 200x by opening up to
| remote work anywhere in the US (napkin math, US is 3.8
| million sq miles, bay area and tri-state area combined
| are ~20k sq miles). But obviously the number of available
| engineers hasn't expanded by nearly that much, engineers
| are much more concentrated in the areas where most of the
| jobs have been concentrated up until now. I.e. companies
| still can't afford to limit their supply to remote only,
| just as they increasingly can't afford to limit supply to
| bay area only.
|
| Then there's also the perhaps more controversial issue of
| skill & experience. The most in-demand engineers are the
| people with experience at Google, FB, etc. and these
| people are concentrated in the places where these
| companies are. Ambitious people also have self-selected
| to live in these hot markets for years. You could argue
| that these proxy factors shouldn't matter and companies
| should be measuring skill directly, but as an industry we
| still haven't cracked that problem. So on average, a
| remote engineer in NYC probably is more valuable to most
| companies than one in Birmingham, Al. Like it or not,
| there's still a lot inertia to overcome here (and maybe
| even a little bit of validity to these patterns).
| mattmanser wrote:
| This is pretty much wrong, the evidence is against you,
| you are paying for in-location developers.
|
| There are plenty of developers who speak great English in
| the EU, many natively in the UK and Australia and Canada.
|
| Why are these not all getting heavily poached by SV?
|
| Because SV value in-person developers, so have driven up
| the pay for developers in SV, but in Europe a mid-level
| developer is still on something like EUR40-50k.
| burntoutfire wrote:
| Remote work from Europe for a SV company is problematic,
| there's practically no overlap of working time so the
| European workers needs to work late evening and into the
| night to be able to stay in touch with the team. Not that
| many experienced (i.e. older and with families) people
| are ok with that.
| MAGZine wrote:
| timezone and cultural differences.
| ianai wrote:
| It's funny how the power of markets seems so easily used
| to reinforce the current market outcome. Like wage prices
| are artificially high or right where they should be
| because the market must be right. Without looking at the
| factors closely (like one should when discussing labor
| especially), there's the possible outcome that current
| wages are held down below their market clearing prices by
| external factors and market power.
| Negitivefrags wrote:
| The market is always right pretty much by definition.
|
| The "external factors" you speak of are the market
| conditions in which the market operates. You can change
| the external factors and the market will rebalance to a
| new equalibrium but that doenst mean the market was wrong
| before and correct now.
| pc86 wrote:
| A lot of people on HN scream against location-based pay,
| because for some reason they assume they'll make more
| without it. If they live in Europe, or rural America, they
| might be right. But HN has a highly disproportionate number
| of Valley and NYC residents. They're all getting [big] pay
| cuts if you get rid of location-based pay. The _biggest_
| (but not only) reason someone in SF makes $250k+ total comp
| is because it 's so expensive to live in SF.
|
| Not too long ago, I remember threads on HN where people
| were saying that $200k or $250k wasn't enough for a SF dev
| and using real estate prices and general cost of living as
| justification. You can't have it both ways - either your
| general cost of living is taken into account in your salary
| (location-based pay), or it's not. If it's not, get ready
| for a market where the average senior developer makes
| $90-110k/yr, total comp.
| HenryBemis wrote:
| Was approached by a headhunter for a role in Bratislava
| for Amazon. They were giving a 'generous' salary of
| EUR20k (net) per year (it was a few years ago). The
| headhunter was desperate and wanted to convince me that
| "this is a lot of money!!!" (for Bratislava).
|
| My simple counter was that "if I save 20% of my salary
| per month, I will have 4k in the end of the year. If I
| take an EUR60k (net) job in Frankfurt and again I save
| 20%, I will have 12k". Why would I 'sell myself short'
| for 8k of savings per year? It only made him angrier
| because my narrative did not match his sales-pitch. I
| never got to work for Amazon (or anyone else in
| Bratislava).
|
| Location matters.
|
| If you want EUR100k then don't look in Bratislava.
|
| If you want a 'slow calm life' (away from the madness of
| London/Paris/etc.) go to Bratislava or Ljubljana and be
| happy with the EUR40k.
|
| > You can't have it both ways..
|
| No but people love to complain.
|
| PS/Addition: it feels like "bait and switch". It's like
| hiring me in Bratislava, giving me a small (net) salary
| and ask me to work from London. I wouldn't accept that.
| The employee would also feel cheated the other way
| around. And with that said this is my favorite cities'
| cost comparison: https://www.numbeo.com/cost-of-
| living/comparison.jsp
| adkadskhj wrote:
| Yea, i really don't get so many of the comments here.
|
| If i live in a low COL area and i apply, why _wouldn 't_
| i want the competitive advantage of being able to charge
| them _half as much_ and make _twice as much_ profit as my
| competition?
|
| People outside the bay area can make a good living
| charging well below crazy SF rates.
|
| This isn't even an argument to me. It's not even a
| discussion. Of course when you have a pool of talent, and
| that talent is competing for a single job, they will use
| every tool possible. If you can work for half the price
| of some SF guy paying massive SF rates, why wouldn't you
| use that tool?
|
| Yea sure, i could make $200k a year - that would be neat
| i suppose, but it's insane imo. The number only exists
| because of SF specific problems. And i'm not in SF.
| loufe wrote:
| I'd argue the opposite. The price of living rose to meet
| the means of the people who lived there. People in tech
| are highly paid because it is a workers' market where
| talent and special education and skills are generally
| required. If the industry could hire people who could do
| the same job remote at $50k per year this trend would
| have begun decades ago.
| galangalalgol wrote:
| It did, didn't it? faangs have been moving development to
| the Midwest for at least 20years.
| User23 wrote:
| There is no nice way to say this anyhow, but it needs to
| be said to further the discussion that does in fact
| exist: this is thinking like a chump. Being a chump is
| not a competitive advantage, it's being taken advantage
| of. I fully respect your right to sell yourself short,
| but please don't present it as somehow economically
| sophisticated and potentially lead less experienced
| readers here to follow the same foolish path.
| adkadskhj wrote:
| Not at all. It's playing the numbers.
|
| If you're aiming for $50k/y in profit after all COL, your
| required pricing is different in SF than it is in rural
| America.
|
| If you live in rural America and compete at hiring with
| SF people, it's your competitive advantage to keep the
| same profit as them but negotiate a lower price. This
| increases your relative value in the hiring process.
|
| Sure, i _could_ keep the same SF rates, but then my
| competitive advantage may just be my skill. If i want
| more than skill alone, i could lower my rates.
|
| I'm not making less profit. I'm competing to get a job.
| kortilla wrote:
| > advantage to keep the same profit as them but negotiate
| a lower price. This increases your relative value in the
| hiring process.
|
| That is how you negotiate when you're struggling to find
| a job. By doing this you're admitting that you're not
| going to be as good as the high CoL candidate so you
| adjust your price to make your offer more attractive to
| the company. That's a terrible position to put yourself
| in (but entirely understandable if you can't get offers
| otherwise).
|
| If you've passed the same bar and the company is truly
| fine with remote, there no reason to accept anything less
| than what they would pay a local. Speaking from
| experience in several tech companies in the bay, a proven
| remote employee is just as valuable as a local and
| getting decent software people is fucking hard.
|
| It's unlikely as a candidate that there is even any
| competition for the position you are filling (as in not
| multiple candidates that have passed the bar being picked
| over). Talking you into cost of living adjustments or
| whatever bullshit is just salary negotiation, not
| competition with other engineers.
|
| Get multiple offers if you have to, but there is
| literally no reason a company willing to pay Bay Area
| salaries can't pay that to a remote employee. Accepting
| less is just letting them convince you your labor isn't
| as good as Bay Area SWE labor.
| adkadskhj wrote:
| > That is how you negotiate when you're struggling to
| find a job. By doing this you're admitting that you're
| not going to be as good as the high CoL candidate so you
| adjust your price to make your offer more attractive to
| the company. That's a terrible position to put yourself
| in (but entirely understandable if you can't get offers
| otherwise).
|
| Yup. That's what i said.
|
| If you see no reason to negotiate, why negotiate? Set
| your price at what your think your value is. Don't
| indulge COL requirements of another location.
|
| > It's unlikely as a candidate that there is even any
| competition for the position you are filling (as in not
| multiple candidates that have passed the bar being picked
| over). Talking you into cost of living adjustments or
| whatever bullshit is just salary negotiation, not
| competition with other engineers.
|
| As someone who hires, i disagree. Every one of our hires
| has been a debate on expected output when compared to
| cost. But we're a fully remote company.
|
| _edit_ : Oh, and we're not flush with VC cash. We also
| can't afford any SF employees for this reason. We're much
| more willing to hire a junior engineer if their priced
| accordingly. Likewise, if we hired someone at $250k/y,
| we'd expect twice the output of him/her - and that's
| unlikely.
|
| I don't get why this is controversial.
| benhurmarcel wrote:
| We're all somebody else's chump
| pc86 wrote:
| Being a chump is living in the Midwest and asking for SV
| rates just because you think it's "being taken advantage
| of" to underbid someone else for the same work.
|
| The era of $400k total comp software development is going
| to end someday and more accessible remote work is only
| going to hasten it.
| peacefulhat wrote:
| It follows from this that you think the future of
| software companies will be reaping even greater profits
| from massive payroll cuts. I doubt it.
| anonyxyz wrote:
| It wont end, just be reserved for the elite, much like it
| is today. Few Average Joes are making that 400k total
| comp.
| mtberatwork wrote:
| > The era of $400k total comp software development is
| going to end someday and more accessible remote work is
| only going to hasten it.
|
| Well, the same argument has been made before regarding
| offshoring and so far that hasn't seemed to have spurred
| any major declines in total compensation.
| jorblumesea wrote:
| You're assuming a highly optimistic scenario where you
| take an even pay cut but make out like a bandit. The
| reality is that a "fair wage" for many rural white collar
| workers is 40% of what you might make in SV, or even
| worse. Getting $250k in SV sucks, but try getting paid
| $50k in Cincinnati. Then imagine a scenario where there's
| maybe 2-3 local companies that hire, and they all collude
| on prices.
|
| I feel like people saying "just move to a low COL area"
| have never actually lived and worked in a low COL.
|
| If you lose your job or get fired, there's no one to back
| up that "half as much, x2 profit" unless you find remote
| work again, and then you're also at the mercy of whatever
| people feel they can get out of you. Without competing
| offers or local competition, you're at the mercy of the
| market.
|
| People are underselling the competition that nuclei of
| talent can produce from top competing companies.
| zippergz wrote:
| I think people are also assuming that the "market" rate
| for tech jobs in these "low COL" areas keeps up with the
| cost of living. I am here to tell you that it does not,
| in the cases I'm familiar with. Especially in the
| relatively hot "cheap" areas, outsiders moving in are
| driving housing prices up dramatically, but the pay rates
| have not increased the same amount. So if five years ago
| you could make 2X the profit, now it might only be 1.25X,
| and getting worse.
|
| Also, people need to remember that "cost of living" is
| not actually one thing. It's not like I get a "living"
| bill once a year that I have to pay. Even in relatively
| cheap areas, there are some things that cost the same as
| or even more than they do in major metro areas. Don't do
| math based on some web-based COL calculator or even on
| housing prices and assume that it will apply across the
| board.
|
| I have absolutely seen offers within the last six months
| where the candidate would be worse off financially
| despite living in a "cheap" place because the pay
| reduction was more than the all-in cost of living a
| similar lifestyle (yes, if you're willing to downgrade
| lifestyle you can offset this, but you can do the same
| thing in SF. Most people I've seen actually want to
| UPGRADE lifestyle with larger houses, more land, nicer
| neighborhoods, etc.).
| Swizec wrote:
| > Getting $250k in SV sucks
|
| Ok hold up in what world does $250k in SV _suck_? Median
| household income here is around $120k last I checked.
| Making more than double that cannot be described as
| sucking, come on.
| kortilla wrote:
| That's how bad housing is. If you grew up on the dream of
| a nice house with a garage and a big yard, $250k _still
| doesn't get you there_ in SV.
|
| This type of housing setup that would cost $300k in, say
| Dallas, will cost $2.5 million on the peninsula. Between
| property taxes, mortgage insurance, interest, and
| principal payments and a jaw dropping $140k down payment,
| that is a monthly payment of $14k or so.
|
| Your take-home after taxes on 250k in the bay is probably
| around 160k, or 13.3k a month. Whoops, no "American
| dream" home for you.
| Swizec wrote:
| As a European I think American expectations of a
| reasonable home size are completely ridiculous. Guess
| that's a hidden immigrant advantage :D
|
| Then again I would describe most of the houses here as
| somewhere between a hovel and a shack in terms of build
| quality. But I'm getting used to it after 6 years.
| jorblumesea wrote:
| It was mostly sarcastic. I don't actually believe it's
| bad, that's just "average market rate" for senior/mid
| level engineer. Roughly translated, 250k in SV is 120k in
| the Midwest. Housing issues aside.
| pc86 wrote:
| > _Roughly translated, 250k in SV is 120k in the
| Midwest._
|
| I'll believe this only insofar as $120k in the Midwest
| means you are "set" in the sense that you can max out
| your retirement, buy a home, have nice cars, etc. and
| basically live on autopilot from a financial sense.
| AngrySkillzz wrote:
| The point is that the companies are making the same
| amount of revenue regardless of where you live. If Google
| cuts your salary 50% because you move to a cheaper area,
| maybe that doesn't make a difference to you but it is
| free profit for Google shareholders. It makes it more
| obvious to people that the amount they are paid and the
| amount of marginal profit they earn for the company is
| WILDLY incommensurate, even for over-compensated Silly
| Valley engineers, and would be even moreso if you move
| somewhere cheaper and take a pay cut.
| adkadskhj wrote:
| > The point is that the companies are making the same
| amount of revenue regardless of where you live.
|
| Agreed entirely. It depends on what specifically we're
| discussing. I often look at hiring.
|
| > If Google cuts your salary 50% because you move to a
| cheaper area, maybe that doesn't make a difference to you
| but it is free profit for Google shareholders. It makes
| it more obvious to people that the amount they are paid
| and the amount of marginal profit they earn for the
| company is WILDLY incommensurate, even for over-
| compensated Silly Valley engineers, and would be even
| moreso if you move somewhere cheaper and take a pay cut.
|
| I wouldn't work somewhere that did this for this very
| reason. But there's a huge difference to paying someone
| based on their finances, and negotiating hiring pay. I'm
| just talking about hiring pay being negotiable.
| ActorNightly wrote:
| >. If Google cuts your salary 50% because you move to a
| cheaper area, maybe that doesn't make a difference to you
| but it is free profit for Google shareholders.
|
| And thats exactly how a company should operate - maximize
| profit while minimizing cost. And conversly, as an
| individual, you should do the exact same, which is get
| paid as much as you can for your work (or do the minimum
| amount of work for the pay you get). When both of those
| strategies meet in the middle, you get a paid job
| position.
| xorencrypted wrote:
| They could also hire more engineers or expand into new
| territory which requires additional (non-engineering)
| labor. The cost of living in the bay area seems almost an
| artificial constraint on the supply of labor at these
| companies
| AOsborn wrote:
| You're right. I think so much of this discussion is
| missing the forest for the trees though. The bigger
| picture question is whether dense, expensive metropolitan
| areas, or other locales with expensive cost-of-living are
| the right fit for many jobs. I think there will be major
| changes in the next five-to-ten years.
| wayoutthere wrote:
| Frankly I would be ok with that.
|
| The situation in the valley developed in the 90s and 00s,
| so that companies could be located close to their
| investors. That was a time when remote work tools sucked
| and work practices forced people to be in the same office
| as the founders, so it made lots of sense that the
| proximity to capital spiked rents and comp to match.
|
| But now, post-pandemic, remote work is the norm. The
| founders can relocate to the valley because investment
| finance is largely a relationship game and those are
| still way better done in person, but there's no longer
| any reason the technical team needs to be located near
| the founders or even each other.
|
| There is huge disparity in engineering salaries -- if you
| work for a smallish company in a rural area you're
| probably making $80k/yr for doing the same job someone in
| the bay gets $175+ for. Ideally it will work the other
| way around though -- the folks making $80k are much more
| likely to jump ship for a remote job that pays $125k than
| the folks making $175k are to jump to the same job.
|
| Of course, if organize via collective bargaining we can
| likely push that even higher, so listen to your union
| organizers.
| walshemj wrote:
| But collocated teams are still more efficient - there's
| plenty of studies that prove that.
|
| And my current job quite often has multiple teams from
| multiple employers/agencies from multiple time zones -
| even being able to have key meetings with all hand
| present would massively speed up - we could have avoided
| so many problems and delivered things months quicker.
| bennysonething wrote:
| I always assumed that it the high paid jobs in SF were
| proper software engineering positions as opposed to line
| of business apps that lower paid jobs else where often
| are?
| chris11 wrote:
| There's a wide range of salaries. The highest paying
| companies will pay $175+ to a new grad. A of jobs pay
| $200k+ with equity for senior engineers.
| ZephyrBlu wrote:
| What is "proper software engineering"?
| rrrrrrrrrrrryan wrote:
| Calling it "proper software engineering" is little
| pretentious at best, but there is some distinction to be
| made between software engineering in the bay area and
| most software engineering elsewhere.
|
| When we think of SF software, we think of software
| created by a company whose core product is the software
| itself, especially when the end-users are individuals or
| other software companies.
|
| This is quite a bit different than _most_ software
| developed outside of the bay area. Most of it is either
| in-house stuff or industry-specific B2B stuff. In these
| situations, the software doesn 't have to be pretty, it
| doesn't have to use cutting-edge tech to woo investors,
| resource utilization is much less important, and hell -
| it usually doesn't even have to scale. It just has to
| work. It just has to make someone's job incrementally
| better, and it'll be a success.
|
| This software can be tremendously valuable, and creating
| it has its own unique challenges, but the job is indeed a
| bit different than software engineering in the bay, and
| the compensation is different as well.
| vkou wrote:
| This holds true for junior engineers, but not for
| seniors.
|
| Raises tend to be percentage-based. The junior making
| 200k in SF may be worse off than the junior making 100k
| in Pittsburgh.
|
| But the senior making 400k in SF is much better off than
| the senior making 200k in Pittsburgh.
|
| Since Silicon valley is that one weird place where it
| takes five years for a junior to become a senior, taking
| that job in Pittsburgh is quite short-sighted.
| sedachv wrote:
| > You can't have it both ways - either your general cost
| of living is taken into account in your salary (location-
| based pay), or it's not.
|
| Cost of living allowance/adjustment (COLA) was a
| retention strategy originally designed to give workers
| being transferred overseas and to large metropolitan
| areas more money, not less. You should do some reading up
| on HR practices if you want them to stop taking advantage
| of you.
| ehnto wrote:
| They aren't isolated of course, SV is expensive because
| SV has money. Rentals go up because people keep paying
| stupid high rents, property goes up because people CAN
| afford it. Rent seekers keep pushing their luck and it
| keeps working.
|
| I have become interested with the real value of software,
| and how getting rid of stupid high wages could be a great
| thing for the industry.
|
| As an analogy, if a country has reasonably priced
| infrastructure workers (laymen and engineers) it can
| afford to build the infrastructure it's community needs.
| If you blow your annual budget building 6 miles of train
| line, you'll never have high speed rail. Real world
| example: Australia, one of the richest countries in the
| world, notoriously high infrastructure costs. While the
| rest of the world is speeding away with high speed rail,
| we could barely afford a two stop tram extension in the
| CBD.
|
| Now have a think about all the software that doesn't get
| written because it's prohibitively expensive to make it,
| lots of boutique applications for specific needs, or
| local communities that need software to help with
| problems in their community. There are probably a lot of
| companies that could really do with an inhouse software
| team, but would never entertain the idea on account of
| the cost.
| jacksonkmarley wrote:
| Is Australia and HSR really a good example of this? I
| would think the only viable route would be Sydney-
| Melbourne, and that seems far enough apart to be directly
| competing with air travel, likely a major reason for it
| to be marginal profit-wise.
|
| Also Australian workers are no doubt well paid compared
| with some, but compared with the U.S. or Western Europe?
| Taking into account cost of living etc.? Certainly
| engineers in Australia in general don't seem to be
| getting SV wages.
| sgtnoodle wrote:
| That reminds me of a story. In 2009 I flew into Sydney
| with a team of 20 people and 40 duffle bags, and the
| regional airline to Melbourne refused to check half the
| luggage despite us having a pre-arranged letter from them
| stating otherwise. So, a team member and I rented a car,
| bought a SIM card and several Red Bulls, and drove to
| Melbourne to join the rest of the team the next morning.
| With the international flight, that was a very long day!
| ACow_Adonis wrote:
| we have generally higher wages and prices on the low end
| (that is, the rest of the population and high minimum
| wages), and comparatively lower wages compared to the US
| coasts for tech/stem. That high minimal wage and
| remoteness affects the price of a lot of things.
|
| That being said, the original poster is a little bit off,
| as both Sydney and Melbourne have inner-city transport
| options and infrastructure that outcompete practically
| all American cities in that regard, and punches pretty
| damn well on a worldwide basis (behind only a few cities
| that are notable specifically because they are world
| leaders).
| cycomanic wrote:
| You're right that Melbourne and Sydney infrastructure
| outcompete pretty much all US cities, but the punching
| above their weight on a worldwide basis is Australian
| mythology. I've lived on both and several cities in
| Europe and Melbourne and Sydney are behind pretty much
| every big city in Europe and Asia. Public transport for
| example is absolutely atrocious, the state of the roads
| are extremely poor...
| phinnaeus wrote:
| I can confirm, I moved from Seattle to Sydney. It's not
| even close.
| jacksonkmarley wrote:
| Single data point on new grad s/w engineer salary at
| small/medium business in Melbourne, circa 2015 ~40k in
| USD.
| XorNot wrote:
| High Speed Rail is not being built because no one is sure
| it'll be used, whereas expanding public rail in the
| cities is always going to be expensive because you're
| renovating around a dense urban area. It's also non-
| optional - Sydney's traffic problems are bad, and getting
| worse. We either do something now or watch as the CBD
| eventually dies.
| dilyevsky wrote:
| Many contractor shops have terrible wages yet they charge
| eye watering prices. You can't improve the costs here by
| pushing the worker wages down. All that money is just
| going to accumulate in jeff bezos bank account
| michaelmrose wrote:
| Not having it both way is an argument to fairness. You
| should want fairness in a game of checkers. It was never
| a thing in employment anyway nor will it be.
|
| A high local real estate price is a reason you can't
| profitably work for less and its something you can
| profitably express to an employer if they will take it
| into account in order to access the local labor market.
|
| A lower local real estate cost is a reason you could work
| for less not a reason you ought to want to.
|
| You absolutely should try to have it both ways to the
| greatest extent possible because they are too.
| cm2187 wrote:
| At the end of the day, it is neither a matter of fairness
| or formula, it is a market, supply vs demand. If
| companies switch to remote working from any location, it
| will be easier to find a cheaper workforce, the
| equilibrium will go down. If you don't like the new rate,
| find an employer that will pay more. If there isn't one,
| then the new rate is a fair rate.
|
| I am not sold on full remote working for most companies.
| I am not even convinced the little covid experiment
| demonstrated anything, as companies still benefit from
| employees knowing each others from before the lockdown.
| Long term the effects in term of productivity, employee
| morale or culture may be quite different. A compromise is
| having more local offices, but even then, everywhere I
| saw it before, it creates a "them" vs "us" between
| offices, people feel remote from the centres of decision,
| etc.
| michaelmrose wrote:
| A good question is if a local workforce drawn from major
| hubs of civilization doesn't add value why are tech
| companies paying so much for it now?
| anticristi wrote:
| To me, the "little covid experiment" kind of validated
| the value of an office: Situational awareness.
| Previously, it was so easy to grab a coffee or lunch, and
| get an overall awareness of who is doing what. I'm still
| struggling to find a substitute for that.
| TravHatesMe wrote:
| Not sure why you are downvoted. I observed this as well.
| One manager hired a few new grads during covid. I spoke
| with them over Zoom to introduce myself, seemed like
| really smart and passionate people. One later told me
| that they are really lonely, managers are rarely there to
| push them / give them work / check up on them. I bet they
| feel awkward .. they're barely working, they don't know
| anyone in the company, and no one really cares about
| them. Perhaps this is just a symptom of mismanagement but
| I bet they feel invisible, they're probably asking
| themselves "why am I here? oh well the paycheque is nice"
| ummonk wrote:
| Two different groups of people. The ones complaining
| about location based pay are the ones who would rather
| work in cheaper cities.
| klipt wrote:
| Of course getting paid Bay Area salaries while
| simultaneously living somewhere you can buy a big cheap
| house is a great arbitrage, but not achievable for many.
|
| But many engineers can work in the Bay Area for 10 years
| to become a millionaire then move elsewhere, buy a house
| cash and retire early (or work a lower pay job if they
| feel like it).
| kortilla wrote:
| > But many engineers can work in the Bay Area for 10
| years to become a millionaire then move elsewhere, buy a
| house cash and retire early (or work a lower pay job if
| they feel like it).
|
| This sounds good on paper, but what you're saying is
| establish roots in one place and then rip them up (take
| your kids out of schools, away from their friends, leave
| your friends, hobbies, etc). 10 years isn't exactly an
| in-n-out stint on an oil rig.
| SkyPuncher wrote:
| > But HN has a highly disproportionate number of Valley
| and NYC residents. They're all getting [big] pay cuts if
| you get rid of location-based pay. The biggest (but not
| only) reason someone in SF makes $250k+ total comp is
| because it's so expensive to live in SF.
|
| I'd argue that this isn't really what location based pay
| is worried about. In this case, you're being paid
| specifically be close to some location or collective
| building because your employer values that
| collectiveness. That's okay. That's the company
| communicating "we value the ability for you to be here,
| in person, with this group of people - so we're going to
| incentivize it".
|
| The problem with location based pay is when an employer
| says, "You can work from anywhere you want, but we want
| to know where that is so we can pay you less". You
| provide them the same value from mid-city America as you
| do in rural America. They simply want to pay you less
| when they can.
| lucideer wrote:
| > _so we can pay you less_
|
| Setting aside that obviously, on an individual level, an
| employer will typically want to pay you as little as they
| can get away with, this isn't how location based pay
| works at a macro level.
|
| Saying "You can work from anywhere you want, but we want
| to know where that is so we can pay you more" is an
| equally (in)valid statement since it's about pay
| distribution.
| llbeansandrice wrote:
| This exactly. If they want me to live somewhere specific
| they should pay me more to live there. If my employer
| isn't requiring me to love somewhere, I should be
| compensated for my value and work, not judged for living
| where and how I choose.
| alisonkisk wrote:
| > I should be compensated for my value and work,
|
| No, you are compensated for how much someone doing the
| same work would demand.
| Aeolun wrote:
| Yes, so if we all demand that that isn't based on where
| we live we should be fine right?
|
| I don't understand why pepple keep repeating this.
| Obviously we are paid what they can get away with. We're
| just trying to change what that is. If everyone starts
| accepting location based pay, we'll be fucked in the long
| term.
|
| Or, well. It's strictly better for me if I get paid SF
| wages anywhere in the world.
| fxtentacle wrote:
| You are assuming that the employer had many candidates to
| choose from. Usually, that is not really the case.
|
| Like the original comment said, most programmers probably
| need to read a book about negotiation so that they can
| clearly communicate their skills and why they are not
| easily replaceable. Once you're established as an unique
| professional with an unique skill mix, you'll be
| compensated for how much the team to replace you would
| cost.
| wpietri wrote:
| I'm not a fan of location-based pay, but I think this is too
| strident:
|
| > that your remuneration is based on the lifestyle that
| _they_ think is appropriate for you
|
| Often, these schemes happen because it's employees who have
| lifestyle expectations. "I'd love to work for your company,
| but I'm not cutting my standard of living." And that's
| reasonable. The raw amount of money means way less to most
| people than what it means for their lives. And straight cash
| compensation is only one factor in picking a job.
|
| The truth here is that the Internet has caused context
| collapse in far more than work. Labor markets used to be
| local. They still mostly are, but for those of us lucky
| enough to be able to work remotely, that's changing. That's
| going to have knock-on effects in other markets (housing,
| food, education, etc) for at least a couple of generations.
|
| As we jointly work out the new normal, I think it's worth
| starting with the assumption that people are not all complete
| assholes. Yes, by all means let's watch out for worker
| exploitation; there's a lot of it. But from what I've seen,
| so many policies are just well-meaning people tinkering with
| things that they inherited. We can be firm about negotiating
| for fairness without assuming everybody's out to get us.
| doublejay1999 wrote:
| the only question, is how long employers will continue to pay
| a premium based on your postcode.
| shoguning wrote:
| Or they believe (possibly correctly) that you don't have as
| strong a negotiating position because there are fewer options
| for you based on location.
| alach11 wrote:
| This is it. Free market at work. If you live in Tulsa, OK
| you won't have easy access to as many $150k jobs. The goal
| of the company is to get the best quality of work for the
| lowest price. Why would they pay extra?
| repsilat wrote:
| People move, and these policies give people an incentive
| be in certain places. Paying more in SF is saying,
| "Please move to a city where you'll have more
| opportunities outside this company." The company is
| shelling out five or six figures to increase your cost of
| living, bid up SF house prices, and increase your
| likelihood of leaving the company. And even the other way
| around -- "Don't move somewhere you'd rather be, where
| you'd be happier and more loyal. We'll cut your pay if
| you do."
|
| When looking at an individual employee's decisions, these
| policies don't seem to help the company. I think they
| only really make sense when thinking about populations,
| where people are less mobile and more fungible.
| nipponese wrote:
| Isn't having a "wallet inspector" what working a salary gig
| is all about? Low financial risk for pre-determined financial
| reward?
| willcipriano wrote:
| It was, but they got rid of the pension and the gold watch
| so it really isn't like that anymore.
| lucideer wrote:
| > _offensive_
|
| You're really not doing the HN user stereotype of entitled
| valley types any favors using very personal ego-centred words
| such as "offensive".
| jiveturkey wrote:
| > employer has the right to treat you like a child receiving
| an allowance
|
| i can't understand this pov at all. unlike a child allowance,
| you can say no and court a different parent.
|
| you are simply labor, and location based pay reflects this.
| the only ones complaining are those receiving _less_ pay.
| it's like when people complain (loudly) that "stealerships"
| add a markup above msrp for high demand cars, but the same
| people don't complain about discounts from msrp for basic
| cars. if you don't want the car at the offered price, move
| on!
| joe_the_user wrote:
| I'm against location based pay. But I'm not sure your
| argument is a good one against it.
|
| Just about all benefits offered by employers, from maternity
| leave to health care, function _as allowances_ for particular
| purposes. They pay a variable amount based on the varying
| needs of a workforce.
|
| One could even relabel the location-based-pay as a "rent
| supplement". If everyone get the same pay but those paying
| crazy high rents get extra to ameliorate this, it sound
| better.
|
| Which still isn't saying I like this idea. I don't think pay
| should be able to be easily translated to benefits and I
| think only things that are unalterably unequal, like health
| care and maternity leave, should be doled out as benefits.
|
| But I don't think one can make the argument that "allowance"
| type pay is inherently offensive. I mean, one allowance thing
| that's totally reasonable is when employees have to go to
| conferences for a work and the employer gives them an
| allowance for the incidental expenses they're incur.
| matz1 wrote:
| Its just part of negotiation, The reason I will accept lower
| pay is to entice you to continue using my service, rather
| than replacing me with other people.
|
| Its not about the location, employer should always try
| maximize profit, if they can get the same service with lower
| expense, they should.
| biztos wrote:
| OK, but if "lower pay" is a main enticing tactic, don't be
| shocked when someone else in a cheaper locale makes them a
| "better" offer and they accept it.
| [deleted]
| stevegalla wrote:
| They don't even need to be in a cheaper location.
|
| I have worked with two kinds of employees that are
| willing to accept lower pay.
|
| - those moving for a better lifestyle who have earned and
| saved considerably more elsewhere. I call these "working
| retirees".
|
| - those who have family sending them money to subsidize
| their cost of living in an expensive city.
| dmitryminkovsky wrote:
| That is right, one can chose to accept any offer that works
| for them for whatever reason. If you have no leverage, you
| may need to accept an offer just to avoid being replaced by
| other people.
|
| But, I am saying, that if you accept an offer that is based
| on what your employer thinks is an appropriate lifestyle
| for you, adjusted to the cost of living in your area, and
| not on the value of your work, that will immediately
| establish what I consider is a particularly inappropriate
| relationship between employer and employee. Of course this
| happens all the time for many reasons, but what we're
| seeing now is employers inventing and normalizing yet
| another, new tactic to deploy when trying to get you to
| accept less compensation. It's just another trick. But
| what's particularly insidious about this trick is that what
| they're doing is openly laying claim to your lifestyle by
| saying that: suppose you're a senior developer, you are
| entitled to organic groceries, whereas a junior developer
| is entitled to conventional produce, regardless of where
| you live, that's what you deserve. But that's wholly
| inappropriate: your compensation should depend on what you
| produce, and your lifestyle should be none of their
| business. If I want to move to Thailand or the middle of a
| field in Nebraska and save money, that's none of their
| business. There is no "objective" lifestyle that a senior
| developer should be entitled to. But that's this new trick
| they are trying to pull, and it's nothing short of
| disturbing and creepy.
| matz1 wrote:
| Its nothing disturbing and creepy, it is expected that
| employer to use all available 'tricks' they have.
|
| The same way employee should use whatever 'tricks' at
| their disposal to get a higher pay.
| true_religion wrote:
| If you're going to say that, then you ought to accept
| that labeling the employer action creepy and disturbing
| is a great 'trick'.
|
| If we can remove location-based pay as a negotiation
| tactic, merely by creating social disapproval because its
| 'invasive', and the like then that's _wonderful_ for us
| as as employees.
|
| Why shouldn't we work together to hobble employers at the
| negotiation table? They have enough power as it is.
| lotsofpulp wrote:
| Every single reason given for why the pay is what it is
| is just a veneer for the reality that the buyer and
| seller couldn't (or think they couldn't) get a better
| deal elsewhere.
|
| For a buyer, that means a lower price. For the seller,
| that means a higher price.
|
| Not a single other factor matters.
| znpy wrote:
| I tend to agree with your post (how could I not, i'm on the
| same side of the table as you) but I cannot help but see
| _THE_ fallacy in your thinking.
|
| You claim that you should be paid based on market value. You
| are probably speaking about the pre-covid market value.
|
| But once you open up to full-remote working... The market
| broadens immensely.
|
| Your "competitors" in the market are not bay-area people
| anymore. It's the whole US. If your company has branches in
| other countries too (think FAANGs) and the workforce was
| already spread across timezone then now most of the world is
| filled with potential competitors for your job.
|
| And now with a huge supply of workers, _your_ market value
| decreases a lot.
|
| And to be 100% honest: as an european, if you (an american)
| think you're worth 250k and your employer is thinking of
| firing you and offering me 125k for your job... Well good
| luck with your next job search.
| u678u wrote:
| > Your "competitors" in the market are not bay-area people
| anymore. It's the whole US.
|
| Agreed, not just American, anyone roughly in the same time
| zone. There are lots of well educated people in
| Peru/Chile/Brazil that would work 24hrs a day for a $25k
| salary.
| ymbeld wrote:
| The employer setting most of the terms is the reality for
| most of the working class.
| DanHulton wrote:
| Absolutely, and also it opens up a whole host of other
| questions that are similarly intrusive:
|
| - I have a family with children. Should I get paid more than
| an employee who lives alone? - I have a big house that has a
| large mortgage. Should I get paid more than an employee who
| lives in a cheap apartment? - I have purchased a yacht that
| requires maintenance. Should I get paid more than an employee
| who hasn't?
|
| Sure, the last one is ridiculous, but honestly, they're _all_
| ridiculous. The idea that your employer should be able to
| look at your expenses and judge which ones are valid and
| which ones aren't, and then adjust your pay "appropriately"
| is offensive on a deep level.
| dmitryminkovsky wrote:
| > The idea that your employer should be able to look at
| your expenses and judge which ones are valid and which ones
| aren't, and then adjust your pay "appropriately" is
| offensive on a deep level.
|
| It truly is. I may have a passion for Alize and Cristal and
| to afford that passion I may want to live in a rural
| setting. That's my business. Who are these people to try
| and tell me that whether I live in SF or Nebraska, they're
| only going to let me drink Andre?
| true_religion wrote:
| The argument from the employers point of view is: we are
| forcing you to live in SF in order to work, thus we will
| pay you a premium to accept _our choices_.
|
| If an employer has nothing to do with your lifestyle
| choices, then they won't pay for them. For a truly remote
| position, they won't pay extra if you life in NY/SF vs
| Nebraska.
|
| However, I think the world hasn't adapted to that market
| economics yet, so in this time of transition people talk
| about location-based pay as a stopgap measure. Software
| development doesn't benefit from a centralized location,
| so in the future developers won't naturally live in big
| expensive cities and employers won't pay them wages that
| permit them to do so.
|
| To be honest, I think the best thing would be for SW Devs
| to have a guild that aids in collective bargaining.
| Otherwise, the power balance will gradually tilt too far
| towards employers. Other professional jobs (e.g.
| medicine, law) have similar arrangements, and that's the
| only reason why pay can remain high in them.
| lotsofpulp wrote:
| >The idea that your employer should be able to look at your
| expenses and judge which ones are valid and which ones
| aren't, and then adjust your pay "appropriately" is
| offensive on a deep level.
|
| No one making these decisions actually has this idea. It's
| just more acceptable PR than "we're going to lower your pay
| because we think you will accept it because we think that
| you won't or you think you won't have better options."
| adkadskhj wrote:
| > I have a family with children. Should I get paid more
| than an employee who lives alone? - I have a big house that
| has a large mortgage. Should I get paid more than an
| employee who lives in a cheap apartment? - I have purchased
| a yacht that requires maintenance. Should I get paid more
| than an employee who hasn't?
|
| Should you? No. Do you have to? Yes.
|
| If you have a family of four, a yacht and a mortgage maybe
| you _need_ to make - say - $200k /y. Cool. But what about
| some single guy with none of those things, he can work for
| $100k/y and make the same profit as you.
|
| Are you saying he shouldn't use his competitive advantage
| over you to get hired?
|
| This isn't about the employer. It's about the employee, and
| what their life allows them to work for.
| enumjorge wrote:
| > It's about the employee, and what their life allows
| them to work for.
|
| So rather than compete in the job market based on your
| skill set and what value they bring to a company, you
| should instead focus on not starting a family and living
| as cheaply as possible in order to make yourself
| attractive to companies. I'm sure employers would love
| for you to center your life around making yourself as
| cheap to hire as possible, but from the point of view of
| the employee it sounds extremely unhealthy.
| adkadskhj wrote:
| > So rather than compete in the job market based on your
| skill set and what value they bring to a company, you
| should instead focus on not starting a family and living
| as cheaply as possible in order to make yourself
| attractive to companies. I'm sure employers would love
| for you to center your life around making yourself as
| cheap to hire as possible, but from the point of view of
| the employee it sounds extremely unhealthy.
|
| Maybe. I got into this market because i was able to apply
| at a much cheaper position, beating out other more
| skilled employees. I levered my lower pay to offset my
| lack of history in the market. Were there more skilled
| people applying? Definitely. Did they apply at a higher
| rate? Definitely.
|
| Sure if you wanted to go to extremes you should live as
| cheaply as possible. But you could say that about
| anything. Instead, live how you want to live and expect
| to deal with that cost of living. You said it yourself,
| "skill set _and what value they bring_ ". What value you
| bring to a company is relative to what they pay you. If
| you cost $500k/y but your skillset is that of a junior
| engineer, do you honestly think your value is the same of
| a similar junior engineer working for $100k/y? Unlikely.
|
| If you want to live in a city you are simply required to
| make more money than someone living in a rural
| environment. If i have a huge mortgage i can't work at
| walmart. I need to make more. These are all relative
| values based on COL, how much you spend, etc. This
| shouldn't be a controversial statement, in my view.
|
| Mind you i'm very liberal. I believe in worker rights.
| But forcing everyone to be paid for insanely high COL SF
| rates seems bonkers. Absolute bonkers.
| motohagiography wrote:
| I don't have a boat, my friends who do have one bill based
| on what it costs to maintain it. Do they tell the HR person
| or clients "I have a boat I need to maintain," never, as
| that just gives away leverage, but they only seek out roles
| that facilitate their life.
|
| The language itself, "should I _get paid_ " assumes a
| parental allowance relationship and we should get out of
| the habit of using it. "Get paid" is a day-labourers
| colloquialism. The form of the phrase itself defines you as
| the passive subject.
|
| Bill for work, draw a salary, agree to compensation, accept
| consideration, negotiate a package, earn bonuses, settle
| invoices, sell services (not time), sell equity - do not
| "get paid" by anyone. It's a psychological impediment that
| keeps people poor.
| cantankerous wrote:
| Structural impediments keep people poor. Not internal
| monologues.
| GavinMcG wrote:
| Internal monologues _absolutely_ keep people poor.
| Failure to effectively negotiate is nearly 100% about
| internal monologues, particularly once the time has come
| for negotiation.
| anaerobicover wrote:
| Perhaps. Wouldn't you agree that internal monologues
| often reinforce structural impediments, though? I.e. "I
| couldn't possibly do _ACTION_ , I'm just an _ADJECTIVE_
| _NOUN_ ".
| K0balt wrote:
| Internal monolouges enable structural inequalities and
| broken paradigmes. Memetic constructs form the basis for
| all societal constructs, so I think maybe you are under
| selling the importance of thoughts in this case.
| syops wrote:
| Your first sentence is quite a claim. Do you have
| evidence that this is what enables structural
| inequalities and broken paradigms? Maybe it would be more
| reasonable to say such internal monologues help
| perpetuate these things. It seems to me that the
| structural inequality comes from first.
| GekkePrutser wrote:
| The reason they look at cost of living is because they
| won't fill the jobs otherwise. You can pay a Bangalore wage
| for a developer in San Francisco but it'd be less than a
| local janitor makes. So obviously they have to take this
| into account.
| LudwigNagasena wrote:
| Location-based pay is based on your market value. Different
| locations have different markets.
| djhworld wrote:
| > you concede that your employer has the right to treat you
| like a child receiving an allowance
|
| (off-topic) this reminds me of a job interview I had early in
| my career. The person interviewing me was one of the
| directors of the company and he asked me why I'd requested
| such a salary.
|
| Initially I was thinking he'd want me to answer some bullshit
| about Bringing Value To The Company etc but he started
| probing about my personal life - do I have a wife/kids, what
| do I spent money on, how much is your rent, how much
| disposable income do you have and why do you want more.
|
| Needless to say I wasn't impressed by this and decided to cut
| the interview short.
| walshemj wrote:
| Dodged a bullet there.
| izacus wrote:
| > Dodged a bullet there.
|
| Except that it seems that there are a whole machine gun
| worth of bullets just in this HN thread.
| dvirsky wrote:
| At one of my first jobs in the early days of the internet,
| the hiring manager had a very low budget and was offering
| me really really low pay, and to try and convince me he
| literally said: "Look, I know it's not much, but we work
| long hours here and there's free food. You'll get home at
| around 9pm every day and just collapse to sleep, so believe
| me, your expenses will be very, very low".
|
| (I actually took the job despite this because I wanted to
| get on the internet train, and I don't regret it. Also, it
| took me a bit over a year to take over that manager's role
| and make X2.5 of the original lowball salary)
| [deleted]
| motohagiography wrote:
| I like your allowance simile better than my post.
| andrepd wrote:
| But, as a certain bearded German economist once noted, the
| remuneration of labour _is not_ related to the value it
| produces. As long as there is a reserve mass of unemployed
| people, that remuneration is related to the minimum that the
| worker needs to survive. Agree or disagree with the rest,
| Marx was right on the money with this one.
|
| Of course, since there is more demand than supply of
| qualified workers, remuneration rises above that minimum. But
| as long as an Indian developer is "glad" to do the same work
| as you for 1/4 pay...
| bradleyjg wrote:
| > and not on the market value of your work.
|
| The market value of your work depends, in no small part, on
| whether or not that work includes showing your face X days a
| week at an office in San Francisco.
| tomrod wrote:
| Actually, COVID-19 has shown that this _is_ a small part of
| the work. Non-trivial, but mostly meaningless.
|
| Pay market rates. If you want people on location in SF, pay
| SF market rates. If you want people occasionally on
| location in SF, pay SF market rates. If you want people to
| travel _rarely_ to SF pay local area rates to the nearest
| office the person lives by.
|
| SF is neither the center of the universe nor where all the
| interesting problems/projects reside.
| tzs wrote:
| > Pay market rates. If you want people on location in SF,
| pay SF market rates. If you want people occasionally on
| location in SF, pay SF market rates. If you want people
| to travel _rarely_ to SF pay local area rates to the
| nearest office the person lives by.
|
| One change. For those you only rarely require to travel
| to any of your offices, pay the same regardless of where
| they live. All remote locations are the same as far as
| the company is concerned [1].
|
| For a company with N offices, there are only N+1
| locations as far as pay should go: the local rate in each
| of the N office's local area, paid to people who are
| required to be on location there more than rarely, and
| the rate for everyone else.
|
| On those rare occasions when someone in the everyone else
| group is required to come to one of the offices, treat it
| like any other required business trip and the company
| pays for travel and lodging and food.
|
| [1] to a first approximation. If the company needs a job
| to be done on a particular daily schedule, then there are
| two remote locations as far as the company is concerned:
| time zones where that schedule is reasonable, and
| everywhere else.
| ghaff wrote:
| So which office are we using for the remote rate? It's
| probably not going to be SF. Tampa? Austin? Buffalo?
| Memphis?
| bradleyjg wrote:
| This is exactly why the grandparent post doesn't make
| sense. Market rates matter.
| znpy wrote:
| Mumbay, probably.
|
| (i'm being ironic here, btw)
| ghaff wrote:
| :-) You're not going to have equalization across
| countries for the most part for _many_ reasons,
| especially those in distant timezones. It 's a more
| interesting discussion within the US because there are at
| least reasonable arguments to be made for flat pay bands
| across locations.
| tzs wrote:
| You don't use any of your offices for the remote rate.
| The remote rate is whatever is sufficient to get enough
| qualified remote workers to fill your needs.
|
| The point is that you as a company do not care where your
| remote workers are except perhaps they need to be in a
| timezone close to that of whichever office of yours they
| are working most closely with.
|
| If you can pay remote workers what would be a good wage
| in El Paso or Tulsa or Boise and that is sufficient to
| get you enough good workers from such places to fill your
| needs, you don't care that it is not enough to get
| workers from Boston or Minneapolis or Chicago because you
| don't specifically need workers from Boston or
| Minneapolis or Chicago.
| RA_Fisher wrote:
| Sure, for inefficient businesses likely to have their lunch
| eaten by wiser competition.
| bradleyjg wrote:
| That remains to be seen, doesn't it? Because right now
| the scoreboard is looking pretty good for companies with
| lots of office space in the Bay Area.
| mrybczyn wrote:
| https://en.wikipedia.org/wiki/Causal_analysis
| dmitryminkovsky wrote:
| For sure I see the argument there: it is way more of a pain
| in the ass to show up to an office on Market Street than
| chilling wherever you want. And if that was their stated
| argument, I'd have no problem with it.
|
| However, that this _not_ the argument these people are
| making. The argument I see time and again is that your
| compensation should be location-adjusted based on cost of
| living. And by making that argument, they are clearly
| saying you are--or are not--entitled to a certain degree of
| living, which is where it gets creepy, inappropriate and
| inevitably abusive.
|
| And why do I say creepy? Because saying that a person does
| or does not deserve a certain lifestyle, and saying that
| they will or will not facilitate that lifestyle for you,
| crosses a boundary into your personal life that degrades
| you as an independent individual who is entitled to decide
| whether or not you do basic things like saving money.
| Instead of treating you like a person, they treat you and
| force you to conceive of yourself some sort of "lifestyle
| consumer." Sure, some people just have no leverage. But
| normalizing this way if thinking is going to lead us down
| an even worse labor path than we are on right now. Your
| employer is not your legal guardian.
| bradleyjg wrote:
| I think there's poor reasoning on all sides. Plenty of
| employees that want to make SF market salaries while
| living in Thailand talk about the value of their work.
| Whether or not those claims are accurate they are
| irrelevant.
|
| Employees have no more reason to be concerned about the
| value of their work to employers than employers have to
| be concerned about the value of their pay to employees.
|
| If you want to be logical about it the only thing that
| matters is the market. But both sides try to bring in
| irrelevant arguments in hopes of getting leverage in
| negotiations. Sometimes it even works!
| vinger wrote:
| Employees are a marketing asset and powered by a SV dev
| team is more marketable compared to a dev team. Many
| companies are funded / sold by the value of their
| employees.
|
| There isn't one market. A remote SV developer should be
| able to command more if they can sell a connection to SV.
| Same for a FAANG company.. you can get paided more for
| being associated with a faang
| TLightful wrote:
| If you exist in the 20th century.
|
| Say hi to Doc Brown for me, thanks.
| Kaze404 wrote:
| Sometimes I catch myself pondering if location-based pay makes
| any sense, and every single time I end whatever train of
| thought I'm having with "but they're not gonna pay me more if I
| decide to move to LA".
| jiveturkey wrote:
| why do you think that in your theoretical world? higher pay
| actually happens in practice.
| ChuckMcM wrote:
| As I understand your point, your trying to make it from the
| other side, as in "I negotiated this pay level so that I can
| afford to pay more for my house."
|
| It isn't an unreasonable argument. The author of the piece
| glosses over the level of preparation/skill and automated vs
| non-automated manufacturing[1] in their clothing worker
| argument. And of course the cost of goods for a shirt that cost
| $10 in labor vs one that cost $1 in labor won't retail for the
| same amount.
|
| [1] Jobs that train "on the job" (erroneously called "low
| skilled") typically have a wider workforce to choose from and
| thus get more workers competing for jobs and thus and lower
| wages.
| bengale wrote:
| Spot on comment. Can you recommend any good books on the
| subject?
| kache_ wrote:
| https://www.kalzumeus.com/2012/01/23/salary-negotiation/
| cactus2093 wrote:
| I don't know what x, y, and z you have in mind, but it seems
| that companies have pretty much standardized on cost of living
| adjustments to pay for remote workers. So maybe you can try to
| cherry-pick some numbers that help your case, but the data
| probably works against what you're arguing for here. It feels
| like the ship has sailed, as long as enough other people are
| willing to accept location based pay then it will be the norm.
|
| Also, I guess YMMV but I haven't found this approach to be very
| effective. Lots of companies will openly admit they just can't
| compete with FAANG salaries for instance. The recruiter wants
| to sign you for the sake of their commission, but they lose
| people all the time and aren't going to lose sleep over you
| walking away. Even if you really are 1 in a million, the
| recruiter is not incentivized to avoid missing out on those
| people at all costs. They're incentivized to bring in a steady
| stream of pretty good people, and you're still just one person.
|
| I'm not saying there is no use in negotiating, but you're
| basically hyping it up as if there is some magic incantation
| that will let you convince anyone to pay you whatever you want.
| I think that does a disservice to anyone looking for salary
| advice. In my experience, if you can get a 5-20% increase from
| their first offer that's about all you can expect. You're
| better off applying for higher paying companies from the
| beginning, and learning skills/playing the politics to get
| promoted to higher levels (e.g. senior, staff, principal
| engineer) where the comp you want is in band, rather than
| trying to turn a mediocre offer into an amazing one due to
| sheer force of negotiation.
| ghaff wrote:
| >Lots of companies will openly admit they just can't compete
| with FAANG salaries for instance.
|
| Yeah. Anecdotally, many tech companies don't have big
| location-based pay differences across the US. But they mostly
| do that by not having offices or at least major offices in
| places like SV and NYC--and basically don't really try to
| salary match the big tech companies. I have a feeling that if
| you looked at most tech employers you'd see a lot more
| outflow to FAANG than the other way around.
| motohagiography wrote:
| Try to get %20 from the stock market. If your tech role
| typically earns ~$100k/year, that conversation is a $20,000
| phone call.
|
| The difference between their first offer and 15 minutes on
| the phone with the right attitude and tools is what a lot of
| people make in a year. On an hourly 1-year contract rate
| haggle, upping $10/hr is $20,000 in the contract value. I'd
| call that a valuable phone call and probably the best return
| on $15.95 anyone ever spent, especially because it was
| probably just for some cheesy ebook on negotiation.
|
| Is that hype?
|
| I may have to write that cheesy ebook. :)
| andai wrote:
| Can you recommend any books on negotiation? I checked your
| profile but I couldn't find what you were referring to
| earlier.
| flyinglizard wrote:
| "Never Split The Difference"
| JoshTriplett wrote:
| https://www.kalzumeus.com/2012/01/23/salary-negotiation/
| cactus2093 wrote:
| For sure, everyone should try to get more on their offer,
| it can be significant. I'm still not convinced there are
| many secrets an ebook can unlock, vs just asking for it and
| trying, as always, to be both confident and likable.
|
| But I suspect it's equally possible whether you're in a low
| or high CoL area, I haven't seen anything to suggest
| otherwise. It's unrelated to the issue of whether the
| company will pay you more in certain locations than others.
| RHSeeger wrote:
| In a world where no companies scale pay based on employee
| location:
|
| - It's rare that employees in expensive areas do not get to
| work remotely - because there would almost always be someone of
| similar skill in a cheaper location to hire
|
| - It's rare that a company that has in-office workers in an
| expensive area would hire someone working remotely - because
| they are certainly paying the local workers more than what
| would be considered normal for a remote worker... because those
| local people need to earn more to have the same quality of
| life. And if they hired the remote worker for that "normal
| remote rate", they would need to cut the pay of their local
| workers (otherwise they _are_ scaling pay based on location).
|
| _(Note that certain "this is one of only a few people in the
| world that meet our criteria" situations would not follow the
| above)_
|
| So it seems like either
|
| - This world does not have in-office worker in expensive areas,
| or
|
| - All areas have the same cost of living, or
|
| - There is a hard split between companies that hire remote
| workers and those that do not.
| [deleted]
| austenallred wrote:
| Your salary is based on supply and demand.
|
| What is the supply of workers? All things being equal the
| company will pay the least amount possible.
|
| What is the demand for those workers? All things being equal
| the worker will work for the company that pays the most.
|
| When you move from San Francisco to Des Moines, Iowa you shift
| markets. If you move from San Francisco to "the metaverse" you
| shift markets.
|
| Facebook may have moved from a small handful of people able to
| do a job to a whole world of people. You may have moved from a
| small handful of opportunities to a world of opportunities.
|
| It's difficult to predict how prices will change, but they
| almost definitely will, and it's not a matter of "holding out"
| or "negotiating" in the long run.
| ehnto wrote:
| I think it's a fallacy to compare different countries in this
| way. If you take the "What right do you have to complain" route
| it would just be a race to the bottom, and guess who wins? The
| companies who get to pay everyone less. You can advocate for
| making your local community better while still advocating that
| other parts of the world who have it worse off as well.
|
| However I think missing in this argument is an admission that SV
| wages are ridiculously inflated thanks to the playground of
| economics software tends to play in, which is what is causing
| this issue to crop up in the first place.
| vhiremath4 wrote:
| So we don't do location-based pay at our company, but we do
| factor in PEO costs in order to ensure folks are full time
| employees for legal reasons. So, if you're a senior software
| engineer in Nigeria (for example), your salary would be exactly
| what we'd pay a senior software engineer in SF, NY, etc. but we'd
| lower the pay by ~40% (for example) if that's how much the PEO
| firm charged us to operate within that country.
|
| I hate that we have to do this, and I'm really looking for PEOs
| that charge less but they all seem to take a significant amount
| of capital so we're starting to consider spinning up entities in
| order to scale more efficiently and take on lower operational
| costs. However, then we get back to having to hire within that
| country's entity to get that benefit (Ireland for example).
|
| Anyone know of cheaper PEOs or better ways? I want my team
| getting paid as much as possible because, at the end of the day,
| it's the same cost to our business anyway.
| 627467 wrote:
| "Should remote workers have their pay reduced if they move
| somewhere cheap?"
|
| Who is anyone to say one way or another? It's a negotiation
| between 2 parties. Employee will try to argue that value they
| bring is indifferent of where they are based and employer will
| try to argue that employees are a) less valuable when remote
| and/or b) more replaceable by other similar workers in
| those/similar locations.
|
| Either part will try to call each other bluff.
|
| Both will learn that it's ultimately expensive to take an
| absolute approach and likely to negotiate a middle ground.
|
| I don't buy that remote-only companies benefit by being able to
| quickly arbitrage by hiring only from cheapest places because you
| can only remain truly remote when vast majority of your workers
| are all in various locations, not pooled together in certain
| locations.
| BerislavLopac wrote:
| One of the main problems here is that the companies have
| absolutely no idea how much an employee is valuable to them, or
| at best not until they have been working there for several years,
| and even then only in vague terms.
| iEchoic wrote:
| If you're running a remote company, there's another reason
| (besides fairness) that location-based pay is a bad idea: it
| makes it harder to create a compensation structure that
| incentivizes high performance.
|
| If Person A is outperforming Person B, but is getting paid less
| because they happen to live somewhere else, you lose the ability
| to claim that you compensate people for performance without
| sounding like you're talking out of both sides of your mouth. Not
| only is Person A not going to be happy about that, Person A is
| not going to believe that compensation at your company is based
| on performance.
|
| Companies that want to hire and incentivize the best people need
| to be congruent in their messaging around compensation and
| performance. Claiming that compensation is performance-based and
| then including a factor (location) that has no bearing on
| performance is incongruent and will not help to develop the right
| culture in this regard.
| [deleted]
| jimmaswell wrote:
| If I could choose between paying $500 rent and earning $10000 a
| month or paying $5000 rent and earning $10001 a month I'd pick
| the first one even if the absolute number is higher, and I
| wouldn't feel ripped off if the other guy was a newer employee.
| The point of contention here seems to be people wanting to see
| a bigger number regardless of who actually takes home more
| disposable income. Seems short sighted to me.
| benrbray wrote:
| The numbers don't quite work out that way though. What if
| it's $500 rent and $10,000 a month or $5000 rent and $16,000
| per month?
| PragmaticPulp wrote:
| I managed remote, multi-national teams before COVID.
|
| The unspoken advantage of remote teams is that employers can
| use the location pay disparity to their advantage. For example,
| we had pressure from executives to do more hiring in our
| international offices because employees were cheaper.
|
| Abandoning location-based pay sounds good to people who feel
| they are disadvantaged due to location, but location-based
| modifiers suddenly become popular again when companies start
| moving compensation toward their cheapest location instead of
| toward their most expensive location.
|
| The other advantage of hiring in cheap locations is that it's
| equally cheaper to provide large incentives to the best
| performers in those locations.
|
| I could pay $150,000 for an average engineer at some of our US
| offices, and that employee would still be shopping around for
| their next 10% raise at a competing company.
|
| Or I could pay $100,000 USD equivalent for a great engineer at
| some of our international offices, and that employee would be
| so far above market rate that they'd be doing their best work
| every day because they were so thankful for the opportunity.
|
| I suspect HN's opinion on location-based pay might change over
| time as Americans realize that US salaries are the outlier on
| an international scale, regardless of which state or city you
| live in.
| iEchoic wrote:
| > I managed remote, multi-national teams before COVID.
|
| > I suspect HN's opinion on location-based pay might change
| over time as Americans realize that US salaries are the
| outlier on an international scale
|
| The world's most valuable tech companies still do the vast
| majority of development work in their home countries, and the
| trend to keep core development at home has only accelerated
| in recent years. A lot of things would have to change -
| including that - in order for this belief to age poorly.
|
| Also fwiw, we built our team fully-remote pre-COVID as well,
| with location-agnostic pay. It only becomes clearer that this
| has been the right move with each passing year, and we're
| continuing to lean into this as a result.
|
| I will say, though, that this can depend on what type of
| company you're building. If your company's core competency is
| something other than software (e.g. sales), building an
| extremely high-performing engineering culture may not be the
| most important thing to your company, and the tradeoffs you
| have to make in order to do so may not be worth it.
| ironmagma wrote:
| There's nothing stopping companies from shipping their jobs
| overseas. It's always been an option. Luckily (for
| Americans), we as workers carry significant advantages over
| those who work overseas. If we didn't, there would be no
| reason to hire locally at all.
| tester756 wrote:
| what are those "significant advantages"?
| granshaw wrote:
| Can confirm. Was involved in interviewing multiple candidates
| a day the moment our non-London UK office opened
| kmonsen wrote:
| I mean it's, but if you don't take location into account then
| suddenly you can only hire from low cost locations where the
| talent does not exist.
|
| It's really unfair whatever you do, and right now there is no
| good solution. Partially because there is no good way of
| understanding the value of an employee.
| benrbray wrote:
| What do you think of employee-owned companies as a way to
| accurately assess that value? It seems like _capitalism_ and
| the question of whether profits should go to laborers vs
| owners is central to this issue.
| kmonsen wrote:
| I mean I like it, but I don't think that's very relevant as
| I don't have a few billion dollars.
|
| There is just so much money splashing around in investor
| driven companies right now because of cheap money that I
| don't see it working out.
|
| I also think investors provide more then money that is hard
| to overcome. They have a network you will only get access
| to if they get cheap investments and for some type of
| companies that is necessary.
| iEchoic wrote:
| > right now there is no good solution. Partially because
| there is no good way of understanding the value of an
| employee.
|
| This is the perception among many startups, but I think this
| is more perception than it is reality.
|
| Exceptional engineers are several times more valuable to most
| startups than an average engineer, but almost all will hire
| an average engineer for $115k before they hire an exceptional
| one for $175k. There's no rational basis for this, but it is
| the path of least resistance. You won't need to defend hiring
| an engineer for $115k to cofounders or investors.
|
| This is counter-intuitive, but the solution is to actually
| pay _more_ for remote engineering jobs. When you do this, you
| 're widening your talent pool to the entire world - and then
| you're selecting from the very top of the pool. We've been
| doing this for years, and it's been one of our most
| significant competitive advantages.
| kmonsen wrote:
| Yeah, I feel we are a bit in an inverted world. Startups in
| my opinion need better engineers as they are in the hard
| part of making them product while the large companies
| mostly need people who can follow existing processes and do
| as they are told. Both types of companies hire the opposite
| because of economic incentives.
|
| I also agree with your solution, but not sure how practical
| it is short term. Long term that is probably what will
| happen.
| humanrebar wrote:
| Large companies also need excellent engineers because
| novel engineering problems emerge at scale and as a large
| codebase evolves over the years. You can't really attack
| those problems by only doing what you're told. If nothing
| else, someone has to figure out what the plan is.
| genewitch wrote:
| whatever happened to the mentality, that "nobody ever got
| fired buying IBM" - seems to me that 175k for a corporation
| paying an exceptional engineer would see that as a steal.
|
| I think a lot of the discussion is assuming FAANG rates,
| and realistically, exceptional engineers at those companies
| should be getting paid absurd, outrageous amounts of money.
| However what you're talking about is a smaller company, and
| sure, you can hire two average engineers for only 2/7th
| more money than one exceptional person.
| carlio wrote:
| I think the problem is that the conversation is "we'll pay you X
| of which one factor is where you live" when it should be "we'll
| pay you X if you work for us, do you accept?". The reasons for
| people offering a salary amount is irrelevant, it's about if the
| offer is acceptable to an employee. If I move somewhere, I get
| paid the same, and if it's cheaper I get more spending money, if
| it's more expensive, I have to swallow the costs.
|
| If the contract says "we can renegotiate if you relocate", that's
| not a contract I'd sign, but it's up to the company and employee
| to decide if that's an acceptable clause in the contract.
|
| A contract which says "we'll pay you less if you move somewhere
| cheaper" must also say "we'll pay you more if you move somewhere
| more expensive" but then suddenly my employment incentivises my
| location. I wouldn't move from Warsaw to Bangladesh but it might
| make economic sense to move to Zurich. If it's in the contract
| that the employer must honour the movement, then they have
| unexpected cost recalculations to do. If it's not, and you're
| just hoping for a "good faith" agreement, again that's not a
| contract I'd sign, but others might.
| tchalla wrote:
| > A contract which says "we'll pay you less if you move
| somewhere cheaper" must also say "we'll pay you more if you
| move somewhere more expensive" but then suddenly my employment
| incentivises my location
|
| I believe this is a key point in the argument. Currently, I see
| only one party having an upside but no downside.
| lotsofpulp wrote:
| Because only one party has the upside when the seller of
| labor moves to a location where they have few buyers of
| labor.
|
| A seller of labor that has multiple buyers can negotiate for
| more pay in places where they have lots of buyers for their
| labors (and their buyers can afford to pay).
|
| A buyer of labor will not explicitly state this for obvious
| reasons, just like a seller of labor will not explicitly
| state they will accept lower pay if their situation changes,
| but every transaction in life is possible to be subject to
| negotiation.
| carlio wrote:
| To be very capitalistic about it, that is a choice that the
| seller makes. Why should the burden of relocation fall upon
| the purchaser of goods when it's the decision of the
| provider of goods? I shouldn't have to pay more for a
| product because they decided to move their manufacturing
| process, that's their call not mine. They can price it in
| to their new rates, but then it's up to me to agree or
| disagree if I'll pay them. But equally, if their
| manufacturing costs drop, I have no recourse to demand a
| rebate.
|
| I definitely agree that it's strange that the same labour
| is worth different amounts depending on point of origin,
| when the goods sold is essentially information. I don't
| like it, either. But employers are not beholden to the
| relocations of their employees, it's the responsibility of
| the employees to negotiate the agreement.
| odessacubbage wrote:
| furthermore what's to stop someone from living as a fulltime
| itinerant within the cheapest parts of the 2nd world while
| keeping a p.o box within the highest pay bracket and claiming
| that as their residence?
| KingOfCoders wrote:
| The article talks about fairness. But there is much more sides to
| fair salaries. I wrote about it some time ago
|
| "The reason for discontent and thoughts about unfairness is that
| people have very different ideas about what is fair. They base
| salary fairness on different things. Some think it's fair to base
| salary on past performance, current performace, past performance
| and future potential, needs, equality, experience or current
| market demand."
|
| https://svese.dev/fairness-in-salaries/
| erik_seaberg wrote:
| Market demand is the correct answer. None of us would be making
| six figures if not for the _other_ nearby employers who would
| like to hire us. Before the web happened, we were paid like
| accountants.
|
| > If you hire engineers when the market for engineers is tight,
| you might overpay compared to your existing employees. A Junior
| developer might end up with a higher salary than your senior
| guys.
|
| It's on you to know how much your competitors might offer to
| lure away your senior devs, and deter it. If you wait for
| _them_ to negotiate, you might lose some of them.
| KingOfCoders wrote:
| Yes I try to convince people to have better salaries without
| the employees demanding them.
| carapace wrote:
| > But there's another point I haven't seen get as much attention:
| what right do any of us in the rich world have to complain about
| "location-based pay"?
|
| > The label in my shirt says Made in China. Likewise for my
| jacket, and my jeans were made in Bangladesh. "Equal pay for
| equal work" is a nice idea, but I don't think we apply it
| universally.
|
| I actually heard that "record scratch" noise in my head. This is
| a totally different thing. Apples to oranges.
|
| If an European or American textile worker moved to China but was
| doing the same work for the same company and the company tried to
| lower their salary that's the same problem.
|
| If a company fires an European or American textile worker and
| outsources their job to China, that's not the same problem.
| echelon wrote:
| What if you drive around the country in an RV and call SF home
| for one month out of the year? If you've got an address there and
| spend more time in California than any of the other states you
| visit, seems like you'd be a Californian resident.
|
| One of my coworkers did this.
| jokethrowaway wrote:
| You will need to pass California residency test (probably being
| in California for more than 6 months). Given the company is
| employing you, they should know where you reside.
|
| If you're working through another company you could give an
| address to your actual employer without being resident.
| dbcurtis wrote:
| California's tax authorities are much quicker than that to
| decide you are a resident and tax you accordingly.
| maytc wrote:
| From my experience working remote, there are two intertwining
| issues. Should geography factor into an employee's pay? And how
| much should pay differ in different geography?
|
| My answer to the first is yes. The second however is a bit more
| nuanced.
|
| The first case is when employers find the best and brightest
| talent from all around the world and expect these employees to
| work together and deliver similar value. In this case I think
| globally fixed base salary * a cost of living index multiplier
| _capped at 10-15% difference_ makes the most sense. You don 't
| want the pay discrepancy here to be too large as these people
| work together on the same level. For example, using local market
| rates, a Bay Area employee will likely earn double someone in the
| EU for the same role.
|
| The second case is when employers want to outsource work to a
| cheaper labor market. In this case, expectation is that the
| workers will not be of equal skill and/or the work can be done
| with little training. Another way to look at this, the
| relationship is more hierarchal. The HQ is managing the remote
| worker for work for example. In this case I think a competitive
| pay relative to the location's market rate make sense.
| mvh wrote:
| Anything having the premise "what right do laborers have to
| complain ..." is offensive and ridiculous. (Regardless of who the
| laborers are or how well paid they are or what form the labor
| takes.)
| ymbeld wrote:
| Basically "be careful what you wish for". Really? I can stop
| capitalist globalization by merely asking inconvienent questions?
| Will Nike forego their profit margins by moving production close
| to wherever their HQ is? Somehow I doubt I have that power.
| RivieraKid wrote:
| It's not unfair. It's a voluntary transaction, in which both
| parties benefit. Both companies and workers have always behaved
| in a profit-maximizing way.
| teddyh wrote:
| Some volontary transactions are nonetheless illegal, because to
| allow them would negatively affect society as a whole. The
| usual example is that it is not legal (as it once was) to sell
| yourself into slavery. Also, overly onerous contracts can (in
| many jurisdictions) not be enforced.
|
| Simply put, "It's a voluntary transaction" can never be a
| sufficient argument for why something ought to be legal.
| jokethrowaway wrote:
| It's interesting you bring up slavery. I think I should be
| allowed to sell myself or kill myself if I wanted to. I
| certainly don't want society or a government to regulate on
| that.
|
| Eg. I'd rather be a slave than starving on the road, I'd
| rather be dead than in some particular irreversible painful
| medical condition.
|
| The only actions which are ethically wrong in my book are
| hurting someone else or damaging / stealing their property.
| Incidentally the government breaks these rules legally
| everyday (eg. taxation, wars, spying on people).
| teddyh wrote:
| If it _were_ legal to sell yourself into slavery (as it
| once was), we know what would happen: A lot of companies
| would try to push people into the position where people
| would feel they had no other choice to become slaves, and
| companies would position themselves to take advantage of
| this fact. We would then have a permanent class of slaves
| in the world, which would dehumanize them and gradually
| freeze the hearts of everybody who was made to interact
| with this system. We know this would happen because it _did
| happen_. And it was a long road for humanity as a whole to
| get rid of it (and we still haven't completely).
|
| And you would throw it all away because of some personal
| libertarian principle? This isn't only about what you would
| like to be able to do in any given moment, it's what this
| ability does to _society as a whole_. Your ability to
| someday be able to sell yourself into slavery has _some_
| value (for the principle of the thing, if nothing else),
| but it is _certainly_ not worth the above-mentioned effects
| on society.
| Closi wrote:
| Voluntary transactions that are profit maximising and benefit
| both parties can still be unfair.
|
| For instance, most people accept that for the same job and all
| things being equal you should pay a black/white person the same
| wage. If there was a job posting that said 'we pay this skin
| colour X and this skin colour Y because according to our
| analysis people with darker skin tones are willing to accept a
| lower wage' there would rightfully be outrage. It would be
| _unfair_ , while being a voluntary transaction which is profit
| maximising and in which both parties benefit.
|
| I know you aren't arguing for that though - we accept as a
| society that we shouldn't pay people different based on race,
| but lots of people do believe that we should pay people
| differently based on where they were born and what visa status
| they hold. I personally think this view will change over time
| as globalisation and remote working continues.
| daxfohl wrote:
| Soon the employer side of the debate is going to be "move
| somewhere cheaper or you're fired".
| inglor_cz wrote:
| I wonder to which degree do the companies still consider remote
| work subpar and count the expected loss in output into the total
| remuneration.
|
| It isn't a given that people will work less at home, lone
| introverted developers may actually increase their output, or
| people who were freed from constant interruptions at their
| workplace. But people with family, especially with young kids,
| may really be way less efficient when working remotely.
| jorblumesea wrote:
| People are vastly underselling the risk associated with remote
| work. As someone who works with remote workers and developers
| from the developing world, the idea that companies can just
| outsource all of this work is a bit of a pipe dream, at least
| now.
| crazygringo wrote:
| > _... But now if I decide to move to Tulsa, OK, you want to cut
| my pay and reduce it to 90K, because of "cost of living". Why? My
| value to the company hasn't changed! I am still worth the same
| amount as I was before!_
|
| If the company is only willing to pay you 90K, then the company
| is pretty sure it can find another remote worker for the same
| 90K. Then that's all the position is actually worth.
|
| It was paying you 150K until now, that's because the company
| thought it needed SF workers, where demand had driven the price
| up to that. But now that it's figured out it is doesn't need SF
| workers, it's dropped its rate.
|
| If you stay in SF and the company continues to pay you 150K, then
| honestly they're doing that kind of out of charity. They could
| just let you go and hire someone else for the 90K today -- or not
| just you but the whole team. Which is a super-common thing by the
| way and happens all the time, it's just usually to a different
| country.
|
| So, yes, your value to the company _has_ changed. It 's dropped,
| which is something that happens all the time when labor markets
| expand geographically. What's happening to you is what's been
| happening to factory workers for decades. It turns out that what
| you were being paid _before_ , you weren't worth.
|
| That's just the cold brutal reality of the market, folks. People
| have been warning for a long time that the normalization of
| remote working means salaries going down.
| rmrfrmrf wrote:
| there was once a guy that said that wages, at the end of the day,
| trend toward the employee's means of subsistence. seems like
| companies now are doing away with the window dressing around the
| employer-employee relationship.
| dbjacobs wrote:
| Location based pay for "in-person" jobs makes sense. You are
| trying to convince a person to live and work in a specific locale
| and the requires different amounts of money depending on the
| location. But for jobs which are fully remote, the pay should be
| the same regardless of where you live.
|
| If a person wants to live in Thailand so they can save more of
| their paycheck vs living in NYC where they could enjoy city life,
| that is a tradeoff for the employee to make and the employer
| should not care.
| cangencer wrote:
| Your salary is only partially based on "the value created by
| employee" - most of it is the market forces of supply and demand.
| When you're remote, you're competing with a much larger number of
| people for the same positions.
| RivieraKid wrote:
| Salary is always lower than the (expected) value of work. If
| the value of work was equal to salary, the employer would have
| to reason to do this transaction.
| nanis wrote:
| The price of everything is always between the value placed on
| it by the buyer and the cost to the seller. Not a revelation.
|
| At the margin, they are all equal because trade continues
| until the gains from trade are exhausted.
|
| In many countries and U.S. states, laws guarantee that the
| cost of an employee to an employer is almost twice as much as
| what the employee is paid. In those circumstances, the
| potential gains from bilateral trade are not exhausted and
| people engage in that trade outside of the dominion of the
| state.
| emidln wrote:
| > In many countries and U.S. states, laws guarantee that
| the cost of an employee to an employer is almost twice as
| much as what the employee is paid.
|
| This might be true at the lower end close to minimum wage,
| but payroll taxes are a specific % (usually around 15% at
| the federal level, and the employee pays about half that)
| and insurance and other benefits are typically a fixed cost
| per head (15k to 30k per year at most of the places I've
| worked). The only thing that might be variable are things
| like 401k match. Once you get to six figure salaries, the
| fully loaded cost per employee is 120-130% of their salary.
| lotsofpulp wrote:
| It's the opposite at the very low end, since many near
| minimum wage jobs don't even offer benefits.
| andrejserafim wrote:
| That's it. I believe, like in any market the top earners,
| who are hard to get and hurt when they go will continue to
| get high pay. Since even if you include the world (and most
| jobs don't, they include some timezones, jurisdictions
| only) the market is still rather small.
|
| But if you're just the average developer, like most of us
| really are - the higher competition will surely make it
| harder to negotiate higher pay.
| jC6fhrfHRLM9b3 wrote:
| Negotiating skills matter above all else once you are at a
| certain level.
| dragonwriter wrote:
| > Your salary is only partially based on "the value created by
| employee" - most of it is the market forces of supply and
| demand.
|
| Value created is the driver for the demand side. Yes, the
| supply side will differ regionally, but for a service that
| isn't differentiated by the region it comes from, that doesn't
| matter--the law of one price should, in a competitive remote
| hiring market, prevail equalizing wages for remote work. Firms
| trying to normalize location based pay are trying to short-
| circuit the law of one price--or at least slow the development
| of equilibrium by introducing friction--by way of creating
| artificial market segmentation, which can only work so long as
| the market is not competitive because of either a monopsony or
| an explicit or tacit agreement not to compete for labor.
|
| The public discussion that passes for transparency and
| explaining to prospective workers isn't just about that, it's
| most signalling to other employers to get them onboard.
| [deleted]
| lotsofpulp wrote:
| > Firms trying to normalize location based pay are trying to
| short-circuit the law of one price--or at least slow the
| development of equilibrium by introducing friction
|
| Considering the firms lowering the prices are currently
| paying far above the median in global wages, they're doing
| the exact opposite of short circuiting the "law of one
| price".
|
| The whole reason for paying higher than median wage was the
| friction of being geographically located in high demand
| areas.
| esotericn wrote:
| I just reject WFH out of hand for these reasons.
|
| If the culture of software development remains primarily WFH, and
| it becomes too onerous for me to find a job that's actually an
| in-person, in-office role, I'll just leave, wasting all of the
| experience I've built up and contributing further to the supply
| issues.
|
| It's just sad. Terribly sad. You want to sit at home and only
| look at a screen - that's cool, enjoy your dystopia. I'm out, I
| don't need this shit.
| semiquaver wrote:
| Location based pay is generally set based on _cost of labor_, not
| cost of living.
| emteycz wrote:
| And cost of labor is generally at least the cost of living.
| semiquaver wrote:
| Sure, but they vary by a lot. For example, engineering
| salaries in Canadian cities are roughly 60% of US cities with
| comparable cost of living. I see people talking about "cost
| of living" being an unfair criteria to set salaries and I
| agree! But that's a strawman: almost no employer uses that to
| set salaries, they use a much more sensible number: the
| estimated cost to hire a replacement in the same area.
| emteycz wrote:
| That's exactly the point - it's not good for people when
| the market rate goes too close to or below cost of living.
| 60% of cities having the same pay are irrelevant when
| there's the rest of the world, which is generally poorer.
| EVa5I7bHFq9mnYK wrote:
| But that's always been the case. I worked remotely in a 3rd world
| country for $1500 a month, then moved to SV and saw my salary
| magically sextuple, for the same exact job.
| Wowfunhappy wrote:
| This is why I'm concerned (selfishly) that the remote work trend
| might end up being terrible for wealthy countries.
|
| If you're working 100% remotely in the US, is there really _no
| one_ in India who couldn't do your job just as well? Are you
| sure? There's a lot of people in India, and they all have a
| _much_ lower cost of living.
|
| (I don't mean to single out India, it's one of many countries.)
| sokoloff wrote:
| But singling out India is somewhat sensible here (in a positive
| way). The Indian education system churns out tens of millions
| of new grads each year, most of whom speak English and many of
| whom have a strong grounding in math/comp-sci.
|
| India has the raw materials to be super-competitive in a
| remote-primarily software development environment. You might
| single then out as they're a place with one the best
| combinations of these raw materials and still a relatively low
| cost for daily living.
|
| (My company is remote-forced right now and intends to go
| remote-first/primarily when COVID's acute phase is behind us. I
| don't think remote will be as terrible for wealthy countries if
| COVID is contained in 2021. Remote is hard and comes with its
| own set of drags. Once companies can get back together, I think
| you'll see "remote but with monthly travel to HQ" or "1-2 days
| in office" dominate over "I never have a lunch with any
| colleague" modes of working.)
| vp8989 wrote:
| US tech workers are massively over-payed so it's tough to feel
| sorry for ourselves. I moved here from Europe and the salaries
| are completely absurd, especially at the junior level. People
| are being brought in from college, they can barely tie their
| shoe laces without someone there to help them and they are
| given 6 figures. Meanwhile I know people in the UK who are
| seasoned lead engineers who work hard and literally put entire
| companies on their backs and they make half the money.
| shagie wrote:
| Tech workers exist outside of Big Tech and well funded SaaS
| companies. I've worked as a person working on the internal
| bulletin board, planograms and point of sales devices at a
| retail company. I've worked writing reports at a small
| logistics company that specialized in getting auto parts to
| garages. I'm currently working in the public sector.
|
| In none of these have I made six figures.
|
| Part of this is locale. Part of it is I'm not seeking out
| those Big Tech jobs. Part of it is the industries I've been
| working in.
|
| Lumping the public sector in the midwest into "US tech
| workers" and claiming the entire pool is overpaid is the
| reality for a small set of industries in (what has been) a
| few geographic bubbles.
| KDJohnBrown wrote:
| European salaries are absurdly low. As an expat who doesn't
| benefit from government services the same way an EU/UK
| citizen would, it's a non starter. London is easily as
| expensive, if not moreso than San Francisco. I don't
| understand how engineers can work for 30-45% less.
| aurizon wrote:
| Often people are paid a 'London Allowance', to maintain
| their residence equitably. Their engineer/other salary
| being the same as places further away. I assume there is a
| cost of residency allowance for other UK cities that have a
| premium. If you move away, that residency allowance is
| adjusted to where you work from. Thus the technical salary
| is ~~flat. After all this allowance is a pass through to
| the landlords. Those whose parents onw London center digs
| do very well. I am not sure how property taxes are levied
| in the UK, but one would anticipare the Lords would have
| long since levelled that via head taxes that are levelled
| in some manner? Any UK people care to weigh in here?
| dbetteridge wrote:
| "Often people are paid a 'London Allowance', to maintain
| their residence equitably.
|
| Their engineer/other salary being the same as places
| further away. I assume there is a cost of residency
| allowance for other UK cities that have a premium.
|
| If you move away, that residency allowance is adjusted to
| where you work from. Thus the technical salary is ~~flat.
|
| After all this allowance is a pass through to the
| landlords. Those whose parents onw London center digs do
| very well.
|
| I am not sure how property taxes are levied in the UK,
| but one would anticipare the Lords would have long since
| levelled that via head taxes that are levelled in some
| manner?
|
| Any UK people care to weigh in here? "
|
| Reformatting for readability, sorry aurizon my brain was
| struggling.
| aurizon wrote:
| NP, I am known for my dense code...
| hackissimo123 wrote:
| > London is easily as expensive, if not moreso than San
| Francisco.
|
| As a Londoner, I find that hard to believe. London is a
| huge, diverse city with many industries other than tech,
| and the vast majority of London's population don't make
| anything close to an SF tech salary. If London was as
| expensive as SF then I know I wouldn't be able to afford to
| live here.
| ghaff wrote:
| One of the things that distorts these discussions is that
| it's not just SF proper that's expensive for the most
| part. It's also the South Bay, Marin, and even parts of
| the East Bay. It's hard to have a decent daily commute
| from anywhere that's relatively inexpensive. That's not
| the case with most cities where a 20-40 mile drive (or
| even a commuter rail) to where the jobs are (which may or
| may not be in the city proper) can get you into fairly
| reasonably-priced housing.
| hackissimo123 wrote:
| London also has excellent public transport. (Some
| Londoners might disagree, but have they ever travelled?
| I've never been to any other large city where it was
| easier to get around by train and bus.) It's very easy to
| live in London without needing a car, which brings the
| cost of living down substantially.
| ljm wrote:
| London is very well connected in a bunch of ways (bus,
| tube, ferry, overground, DLR, tram, train, boris bike...)
| and in the centre is a lot more walkable than you might
| think, to the point of not really needing any of it in
| certain areas.
|
| The reason we call it shit is because (before COVID)
| they're pretty much all pushed beyond capacity during the
| commuting hours, or practically all the time between the
| main tourist spots. Commuting in London is a truly
| hellish experience.
|
| And that includes the commuter trains that are frequently
| delayed or cancelled while ticket prices increase above
| inflation every year.
|
| The best thing that happened from covid is skipping the
| commute and saving the PS300 a month it took to get to
| the office and back.
| KDJohnBrown wrote:
| Perhaps it is local familiary. Living in Oakland and
| working in San Francisco I made $175k and was able to
| save $4,500 per month after all of my living and familial
| expenses. When I've spoken to companies in London they
| seemed to max out around $100k.
|
| Whenever I looked at apartments online trying to find an
| equivalent lifestyle (30 minutes door to door commute,
| nearby parks and restauranta, 1 br 85 m^2 with good
| amenities) the rent always came out about the same as
| what I was paying ($1,840/month).
|
| The difference being home in Oakland My hood was mostly
| single family homes with yards (and a few yuppy apartment
| complexes like mine). In London everything within that
| commute range seemed to be a concrete jungle, and I
| couldnt figure out how to find an equivalent neighborhood
| withot really going far away from the tech companies.
|
| Whenever I visit london my dollar never seemed to stretch
| far and food / groceries / transit felt reallly spendy.
|
| London pubtrans is clearly better than anywhere in the
| USA, that goes without sayyng, but was also more
| expensive (if I went to the office I think I paid $4 each
| way for the transbay bus, with a 5-10 minute walk on each
| end of my commute).
|
| It's a great city (except for the traffic. I would be
| terrified to ride a bicycle there), and one of my
| favorite things to do in life is smoke a spliff and walk
| down the camden locks trail.
| vidarh wrote:
| I was recently called by a Facebook internal recruiter
| that claimed (I wasn't interested, so can't verify - he
| might have been telling bullshit) that the relatively low
| level developer job he was hiring for in London had a
| budget of around USD $165k/year. But the London developer
| market has very broad salary range. It's not that many
| years ago I worked at companies where we hired senior
| developers around the GBP 40k/USD 55k mark.
|
| The 30 minutes door to door commute is the problem if
| comparing, as London is huge. A 1 hour commute is closer
| to the norm. But a 1 hour commute on a train is very
| different to the same 1 hour if you're driving and can't
| spend a good chunk of it with your face in a book or
| watching Netflix or whatever.
|
| In terms of housing, my current mortgage for a 3 bedroom
| terraced house with a garden in London is about USD
| $2k/month, but that does mean living further out from the
| centre than what you want.
|
| For anyone moving to London, my tip is Croydon. It has an
| awful reputation which is mostly unearned (it's a very
| large borough, and very diverse, and it's reputation is
| pretty much down to scale and some small pockets of the
| most deprived parts of the borough), and so it's
| unreasonably cheap for how good transport links it has in
| to the centre. There are places in London I might prefer
| if money was no object, but money really would need to be
| no object, as up until maybe the 3-4 million pound range
| you'll get more for your money here than ost other places
| in town.
| 6gvONxR4sf7o wrote:
| Why say US workers are overpaid instead of saying UK workers
| are underpaid?
| DC1350 wrote:
| > remote work trend might end up being terrible for wealthy
| countries
|
| I don't think so. Most wealthy countries don't have jobs paying
| anything close to what Americans make. When you're talking
| about tech, the division is really just between America and
| everyone else. This is going to be really great for Canadians
| who don't want to immigrate to the states since there's almost
| no difference in talent, culture, or time zone compared to the
| USA but wages are about half as much at the top end.
| Wowfunhappy wrote:
| But why stop at Canada?
| DC1350 wrote:
| There are lots of good reasons not to outsource to a third
| world country, but not many reasons to hire a remote
| American over a remote Canadian if a company already has a
| presence in Canada.
| ironmagma wrote:
| Again with the corporate shills.
|
| > Companies reduce your pay because they can.
|
| And employees increase their pay because they can. There will
| always be at least a few companies that don't partake in this
| location-based BS, and the rest of the companies will have to
| compete with them somehow.
| hankchinaski wrote:
| anecdotal evidence of mine is when i interviewed for a large US
| tech company for a remote role based in the UK. based on their
| pay bracket someone living in central london or in a rural
| village in northern ireland will be entitled to the same pay. how
| does that make any sense? this all remote work "bonanza" from big
| tech companies seems to be just another cost optimization trick -
| all thanks to supply-demand imbalance for remote roles
| paulie_a wrote:
| This is just another example of the imbalance of the hiring
| process
|
| Who a.i to complain: I'm the person. Interviewing your company
| AYBABTME wrote:
| Location based pay adjustments will stop being a thing when
| competition for remote workers will justify it. Companies want
| location-based pay because they can get away with it: either they
| think office-first will return, or they think more workers from
| cheaper areas will be available, so no need to pay more. Whether
| this will happen remains to be seen. Personally, I think
| location-based pay will fail to attract top talent, so it'll
| diminish in prevalence over time. But my conjecture is as good as
| yours.
| spoonjim wrote:
| I think that the optics of "location based pay" are going to kill
| the concept in name but not in reality.
|
| Nike doesn't offer "location based pay" in its factories. It
| doesn't tell people in Bangladesh that they will be paid 20x as
| much in San Francisco, because they won't be.
|
| Companies will open engineering offices in say Texas or Florida
| and say "the job is software engineering. It pays $80k a year,
| not $280k. Take it or leave it" and eventually through attrition
| or "incredibly difficult decisions" end up closing down the San
| Francisco offices.
| [deleted]
| sschueller wrote:
| Since gitlab does location base pay I should ask them for
| location based price. Oh wait i'ts the same for everyone!
| MrPowers wrote:
| Think the programming talent pool is increasingly getting split
| into run-of-the-mill and superstar developers.
|
| The location based pay argument depends on if you're an average
| or superstar employee.
|
| Average employees (e.g. building CRUD websites) will get location
| based pay because that's what the market dictates.
|
| Superstar employees, people that are unique on the global scale,
| will get superstar pay, regardless of location. In the Spark
| world, there are few people that are able to understand the
| source code, optimize Catalyst plans, write huge data processing
| pipelines, etc. These types of employees won't see location pay
| adjustments.
|
| Basecamp pays superstar rates for superstar employees.
|
| Factory workers that perform "routine functions" earn location
| based wages.
| varjag wrote:
| It's not working like that; there is no committee deciding your
| fair pay based on your technical prowess.
|
| It's all down to how well you are able to market yourself.
| Granted possessing actual competence makes that easier, but
| really, the world is full of competent, smart but not
| particularly pushy people who get ripped off.
| MrPowers wrote:
| I agree, the free market decides your wage no only on
| technical prowess, but also your "influencer score" and your
| personality traits.
|
| Technically savvy folks with a low influencer score may get
| paid less.
|
| Technically savvy folks who do not negotiate well may get
| paid less.
|
| The modern market rewards folks based on their "basked of
| skills".
| Ericson2314 wrote:
| > Think the programming talent pool is increasingly getting
| split into run-of-the-mill and superstar developers.
|
| Absolutely bullshit also designed to turn workers against each
| other to the ownership class's benefit.
|
| We live and die by the quality of each other's abstractions. If
| everyone is writing shit, I can go it alone 1980s nolstagia
| style, or swim in molasses. If everyone else is writing
| excellent libraries, I am flying with a jet pack.
|
| There is definitely attempts with certain bootcamps, anti-
| intellectual languages like Go, to beat programmers into
| submission. The "superstars" may do fine in the short term, but
| will not survive this trend long term.
| Forge36 wrote:
| There are large questions of trade offs, how are we measuring
| value? Run-of-the-mill works best when things are well
| understood and stable. Superstar is needed when things get
| unpredictable and stop working unexpectedly. Think of the
| large number of JS frameworks which have come and gone over
| the past decade. Microsoft's .net4 -> core -> .net5
|
| How can we tie compensation to ownership?
|
| We've seen software die as the abstraction falls into
| disrepair. There's a huge numbers of frameworks to try and
| solve this, WINE, Dosbox, SCUMMVM, Dolphin.
|
| Flying with a Jetpack is great until it runs out of fuel
| biztos wrote:
| > anti-intellectual languages like Go
|
| Meaning...?
|
| I generally agree with your class argument but don't see how
| Go fits into it, nor what an "intellectual" language would
| be.
| riskable wrote:
| Perhaps they thought the lack of memory management options
| in Go is anti-intellectual?
|
| I'm not a huge fan of Go (more of a Python/Rust person--to
| promote my bias) but I can't think of how it would be
| "anti-intellectual" (either). The statement was way out of
| place.
| Ericson2314 wrote:
| Ignoring prior art, like generic types until 10 years
| later. Basically it's the evolution of java repeated; the
| second time is farce.
| [deleted]
| Frost1x wrote:
| The limited empirical data I've seen shows the idea of
| _superstar programmer_ in terms of efficiency may be a facade,
| unless superstar is a 1.5-2x efficiency developer (the slides
| are concise, there 's a corresponding paper published I can't
| seem to find this morning):
|
| https://resources.sei.cmu.edu/library/asset-view.cfm?assetid...
| lokar wrote:
| Top talent in big tech are not working as programmers. They
| work as engineers. They often do a limited amount of actual
| programming, most of the contribution is leadership, design
| and architecture.
| Frost1x wrote:
| I agree completely, I think this is really the distinction
| that is lacking when people talk about _superstar_
| developers. Most aren 't developing much of anything in
| terms of raw implementation, they're redesigning existing
| architectures, theorizing new approaches, bridging domains,
| etc.
|
| Those skills are often tied to specific domains that are
| not quickly transferable so what talented engineer A does
| efficiently or makes them a _superstar_ is specific to
| engineer A. Talented engineer B probably does something a
| bit different or has their own sets of expertise they 're
| _superstars_ at.
|
| There are a lot of misguided organizations hiring on the
| wrong premise though, that there are developers who just
| churn out implementations at 10-100x speed so they can
| reduce their workforce. What they should focus on is
| engineering talent that makes sure they're tackling the
| correct problems and focus on the right solutions to those
| problems as opposed to something silly like developer
| velocity.
| red-montaigne wrote:
| You explained the fundamental philosophical divide in
| software development today. One group sees development as
| a process of production. They still think of developers
| as people who produce code. The other group sees software
| development as a process of problem discovery and
| definition. Programming is an exploratory learning
| process that, at its best, refines and condenses human
| concepts and symbols into concrete representations
| automated by a computer. In my opinion the latter group
| will always outperform the former (barring massive
| resource discrepancies) because they have a more powerful
| theoretical grip on their activities.
| lokar wrote:
| A great design/architect will mean you need to write
| 1/10th as much code.
|
| Well, not really but maybe 1/2
| TheCoelacanth wrote:
| > For routine tasks, professional programmers have a narrower
| range of productivity than we first supposed, but almost half
| of the variation in individual productivity is noise, making
| programmer rankings suspect.
|
| > Focus only on Programming Effort (limit the scope)
|
| > This is for small programs that should not exceed normal
| capability
|
| Yes, when you eliminate most of the sources of variation,
| there is a lot less variation. The most efficient developers
| aren't more efficient because they churn out boilerplate code
| faster.
| MrPowers wrote:
| Dominique Brezinski's latest Spark Summit talk is what
| cemented my feeling that superstar economics are at play in
| the current marketplace (in certain fields):
| https://databricks.com/session_na20/patterns-and-
| operational...
|
| He talks about the data processing framework he built that's
| ingesting "hundreds of terabytes, approaching a petabyte a
| day".
|
| New technologies let small teams do tons of work.
| barry-cotter wrote:
| Quite. 10 fresh graduates of the University of North Central
| Tennessee's CS program are capable of doing a better job of
| anything in the CS realm than Notch, Jeff Dean or Linus
| Torvalds.
| lokar wrote:
| While Jeff is a great programer, writing code has not been
| his primary contribution at Google.
| gravypod wrote:
| I highly doubt that for Dean and Torvalds. They are not
| programmers, they are software engineers. Both guide others
| to make 10x or 100x impacts to the world. 10 new grads, in
| most cases, cannot do that. Let alone this takes for
| granted both of their algorithms and data structures
| knowladge.
| brmgb wrote:
| > Think the programming talent pool is increasingly getting
| split into run-of-the-mill and superstar developers.
|
| That doesn't conform to my experience (European / working in
| the industrial sector / hiring developers but not a developer
| anymore myself) at all.
|
| Pay is mostly based on the sector you work in and the origin of
| the company you work for. You will have an incredible salary if
| you work for an American web company especially a big one. You
| will have a fairly good salary in finance which might become an
| extremely good salary the closer you get to trading. Meanwhile,
| some of the guys working with me were experts in sensors
| fusion, embedded development and highly available systems with
| decades of experience and were paid peanuts (that was in the
| defense industry). They all stayed out of a mix of loyalty and
| the conviction they wouldn't find something as interesting
| somewhere else (probably right founded from what I have seen).
| HeyLaughingBoy wrote:
| HN has a very strong web bias, so that comment is likely only
| looking at that kind of work. Here in Midwestern US, I see
| the same stratification that you do.
| nonameiguess wrote:
| I wanna upvote this so many times. I used to work in
| geointelligence surrounded by some of the world's smartest
| people doing some of the most amazing work I will ever see.
| We were doing things with pixel data that Google is still at
| least a decade away from, and the efficiency of the ground
| processing ingest systems were so insane that when the
| government tried to give the contract to someone else, it
| took their software 21+ days to do what we could do in
| minutes. But it took decades of fine tuning to get to that
| point, physicists and mathematicians working in close concert
| with engineers who understood hardware, software, and orbital
| mechanics equally well.
|
| Meanwhile, I left and am now making double, in some cases
| triple, what some of my old coworkers are making, all because
| I'm in a hotter industry infused with VC cash, not because
| I'm any better.
|
| And I absolutely miss it and understand why some of those
| people don't leave. The problems you get to work on and the
| access to classified data and close collaboration with so
| many world class research laboratories is unmatched. You'll
| never get that level of intellectual engagement working for a
| web company until you're in one of the handful of moonshot
| programs staffed by PhDs, but you will get money, so I chose
| money.
| ajmurmann wrote:
| While the work at your previous employer sounds really
| cutting edge, how profitable were they?
|
| There also seem to be some areas where highly skilled
| workers will take a pay cut to work on something they love.
| This of course leads to lower pay in that field. A common
| example is the video game industry.
|
| Your previous job sounds like it might have been affected
| by both lack of a money printer and lots of folks who take
| lower salary because they love the work
| nonameiguess wrote:
| As you might imagine, working on a classified program
| means you're working for the government, so your
| company's profitability is inherently a function of the
| lowest bid mechanism for contracting - to an extent, as
| we proved they can't just costlessly switch to the
| cheapest bid unless they want a system that doesn't
| actually work. It's maybe counterintuitive, as the
| federal government is the only employer that literally
| does have the ability to print money, but in practice,
| even though they often face and solve problems far more
| complex than any faced by industry, it is often not a
| money-making endeavor.
|
| Specifically, the point of geointelligence is we're
| trying to gain a long-term strategic advantage over all
| other enemy and competitor countries. To the extent we
| succeed at doing this, the government itself doesn't earn
| a profit from it. Everyone else does. We try to tax them
| in order to pay ourselves, but people don't like taxes
| and they frankly don't understand the ways in which
| spycraft is benefiting them because all that ever gets
| publicized are our failures. When what we do works, you
| never hear about it.
| jjice wrote:
| A bit off topic, but how does a university student distinguish
| themselves as a good developer? I have projects I think are
| interesting on my GitHub and I've worked three internships
| while in Uni, but how can I make sure I stand out during the
| job hunt (currently in my last semester) while I'm competing
| against some of my classmates that didn't know the equality
| operator could be used outside of an if statement (a real
| example)?
| carapace wrote:
| "Game recognizes game."
|
| People who are really good can recognize each other.
|
| At some point in the interview process they'll sit you down
| in the room with a couple of their other really good people,
| you'll "grok" each other and be hired. (If that never
| happens, decline the offer, they have no one and no clue.)
| gravypod wrote:
| What I did: Post on HN who wants to be hired, work at a small
| startup for a while, be a driving force between positive
| change.
|
| My first job was 50k/year and I lost money just by getting to
| work (gas, fees, parking, etc). Told my boss and in 6 months
| I got a >50% raise to 80k/year + stocks + parking space.
|
| Next job was 120k + stocks + remote for a company in the
| valley.
|
| Each job hop will net you a pay increase similar to this.
| It'll also give you new perspective on software engineering.
|
| My email is in my profile if you want to discuss in more
| detail!
| ricardobayes wrote:
| I stood out by taking part in my uni's Formula Student group
| and wrote safety-critical code for the car. This enabled me
| to find an interesting job straight out of uni where my code
| would be deployed to millions of cars around the world.
| HeyLaughingBoy wrote:
| I work for a much smaller company now than I did a few years
| ago, so I'm interviewing at a much lower rate. That said, if
| you have a single project on Github and can discusss it
| intelligently, you are already head and shoulders above the
| vast majority of people I've interviewed over the last 20
| years.
| auspex wrote:
| There is a bit of a marketing element to it as well. You have
| present yourself as the perfect candidate based on your
| experience.
|
| Let the employer know how much you want the job. Know the
| details about the company. Practice answers to questions.
| Treat this like you're training to win the US Open. You would
| be surprised how little effort most people out into
| preparing.
|
| Also keep in mind that you won't get every job you apply for
| and it might not even be your fault. When hiring managers are
| building a team they may be looking for a specific
| "personality or subtype" to fill out the team. Where If they
| had multiple head counts they would probably hire you but are
| holding out for the perfect fit.
| throw8932894 wrote:
| You need to demonstrate that you understand and can modify
| code in real project. Many programmers are code illiterates,
| job interview is all about filtering them out.
|
| Small trivial projects on github profile do not count for
| much. Contributions to some established OS project are great.
| paulie_a wrote:
| I absolutely disagree, the pool of superstar/senior devs is
| tiny. The vast majority of devs that are past junior are mid-
| level, don't let the job title fool you
|
| I'd say superstar is probably 10 years minimum of experience.
| And even then it doesn't just come to a person. Most will
| forever be mid and that is ok
| MrPowers wrote:
| Seems like you're equating superstar developers with years of
| experience and that hasn't been my observation. PyTorch was
| created by an undergrad. I've worked with senior devs that
| have let engineering pass them by and are now the equivalent
| of non-programming programmers:
| https://blog.codinghorror.com/the-nonprogramming-programmer/
|
| I agree that the pool of superstar devs is tiny.
| lokar wrote:
| As a data point, in big tech the Sr staff (L7 at G/FB) and
| higher is no more then 2% if ICs.
| yks wrote:
| For anyone confused, "senior staff" is L7 and rare but
| "senior" is L5 and usually a majority of SWEs.
| lokar wrote:
| Correct. Sr/5 is the expected terminal level for most.
| Both FB and G expect steady progress to that level or you
| get fired (if you really can't make it).
| chillacy wrote:
| L4 is terminal at Google now afaik, but same concept.
| paulie_a wrote:
| I didnt say years of experience is equal to status
|
| But it sure as hell takes years of experience to achieve
| certain status
| p1esk wrote:
| It takes building and shipping an outstanding product to
| achieve certain status, if we're talking about
| "superstar" status. This has almost nothing to do with
| years of experience. I'd even say most superstar devs
| achieved it pretty early in their career.
| paulie_a wrote:
| It absolutely does take years to achieve that. Most
| people that think they are superstar are really just
| mediocre mis with an ego.
|
| I doubt there are many superstars under the age of 28
| minimum
| nnp7000 wrote:
| Yes, I feel pay for developers is going to become more bimodal
| as time goes on; similar to lawyer compensation.
| MrPowers wrote:
| Yep, agreed. Here's an article for the bimodal nature of
| starting salaries for lawyers for interested parties:
| https://www.biglawinvestor.com/bimodal-salary-
| distribution-c...
|
| The upper end of the biglaw salaries was capped because of an
| unspoken "cartel pricing cap". Big law firms don't want to
| compete for the upper-echelon talent.
|
| Not sure if tech companies will be able to informally collude
| in such a manner to cap the upper end of the bimodal curve.
| phendrenad2 wrote:
| This is fascinating. I wonder if doctors and engineers and
| other knowledge-based professions have a similar
| distribution if you look hard enough.
| [deleted]
| bradleyjg wrote:
| BigLaw is getting squeezed by its clients. There are
| increasing numbers of companies that don't want to pay
| hundreds of dollars an hour for fresh grads no matter how
| bright. That leaves law firms with the choice of either
| subsidizing young associates, which is dangerous given the
| competition for top partners, or finding some way to cut
| pay. While few have wanted to break away from marquee
| associate pay, the quiet rise of staff attorneys at BigLaw
| represents the breakdown of the bimodal system.
| lotsofpulp wrote:
| I know a relatively new lawyer that moved from a top law
| firm in NYC to a tech firm on the west coast and got a
| huge increase in pay, especially per hour worked.
| vidarh wrote:
| Getting a rise _per hour worked_ in law by leaving the
| big law firms is often "easy". My ex worked for one of
| the top lawfirms in London, and quickly realised their
| very high headline pay (straight out of uni into ~2x
| median UK pay, and increasing at far above average rates
| for 10+ years) gave the new graduates lower per-hour pay
| than their secretaries.
|
| It was basically a death-march to see who'd stick it out
| long enough. Only a few would make partner anyway, so
| they needed to shed a lot of people to make their cost
| structure work, and so they'd work them into the ground
| and use who stays as the selection method at the lower
| end.
| bradleyjg wrote:
| In case anyone want to read more about this, that
| employment structure is called the "tournament model".
| lotsofpulp wrote:
| It was a raise by absolute value also, not just per hour.
| Added bonus of no income tax in Washington.
| njarboe wrote:
| They have before[1]. I think one reason salaries started to
| climb so much recently in silicon valley was because this
| collusion to suppress salaries ended.
|
| [1]https://www.cnet.com/news/apple-google-others-settle-
| anti-po...
| sbpayne wrote:
| If the company is not "remote first," I think there's a
| reasonable argument that your value is not location independent.
|
| That being said, I can't really think of a good argument for
| anything beyond pay based on in-office vs remote.
| asimpletune wrote:
| The best explanation for this is to think of yourself (assuming
| you're an employee) as a small business with one customer.
| gunnr15 wrote:
| Author lost me at "you get paid what it takes to make you do the
| job"
|
| In a distributed future (for tech at least), information re: my
| value to the company will also be increasingly available.
|
| This availability of information + liquidity of talent will
| create a more perfect market where "what it takes for me to do
| the job" = how much value that job creates.
| ogre_codes wrote:
| Pay should be pegged to your skills and any demands the job is
| placing on you. The only time changing pay based on location
| makes sense is if where you work is a requirement of the job.
|
| Paying people more because they work at an office in a high rent
| area makes sense.
|
| Varying what remote workers get paid based on where they choose
| to live makes zero sense.
| yelite wrote:
| Before remote working becomes a trend recently, location-based
| pay is just a result of price being determined by supply and
| demand, plus the fact that location is a major constraint for
| both job seeking and recruiting. For anyone believes their work
| has intrinsic value, if you try to calculate this value into a
| number (salary), ultimately you need to use some kind of market
| reference (Like, I am able to get an offer of $xxxx from another
| company). This market reference is heavily based on location if
| remote work isn't a viable option to you.
|
| Now, why do companies still stick to location-based pay when many
| other companies are embracing remote work? I think that's just
| cultural inertia and eventually software engineers will be paid
| without taking their location into account. But that's not a good
| thing for everyone, because the salary at that point will
| probably be much lower than what people get paid in SF area
| today.
| gamesbrainiac wrote:
| As a Bangladeshi, I can tell you that the workers in my country
| don't have proper unions. They can't negotiate. Salary is the
| last thing on their minds, they can't even negotiate safe working
| conditions. They are uneducated, so they don't know what they
| deserve. See here ->
| https://en.wikipedia.org/wiki/2012_Dhaka_garment_factory_fir...
|
| So, the cheap stuff that you're getting is because someone is
| getting a super bad deal, by exploiting the heck out of workers.
| Same in China.
|
| The garments factory owners are walking away with tonnes of
| money, leaving the workers high and dry.
|
| The more _subtle_ point that the author is making, is that,
| "wait, if people realize that they can get awesome developers in
| developing nations for a lower price, I'm not going to get hired
| any more in my over-priced city".
|
| Good, move to a place where your salary is worth more, and work
| to enrich that community. Why should SF and NY get all the
| benefits of economic growth?
| jrochkind1 wrote:
| I find the author's point to be a very disturbing one: If we
| really pay people fairly, I won't be able to afford all these
| cheap consumer goods any more.
|
| The "idea" of location based pay for developers is that you an
| have the same standard of living in Boise on less salary than
| in London. Whether this is true or not is subject to debate.
|
| But what's not subject to debate is that, as you say,
| Bangladeshi garment workers do _not_ have a standard of living
| that is okay. What do we do with the fact that our (in the USA
| or UK) cheap clothing comes at that "price"?
| runarberg wrote:
| Precisely. The OP reaches the wrong conclusion from an
| excellent point.
|
| The fact that they are benefiting as a consumer because of
| location based salaries is another point against them. Pitting
| _"closing down the 'sweatshops'"_ (i.e. unemployment) as the
| only alternative for the workers is disingenuous. Another
| alternative is worker control over the factories. Yes OP as a
| consumer will loose some luxury as the price of consumer
| products rises along with the workers' pay, but what natural
| law states that the OP has the right to that luxury at the cost
| of foreign workers?
|
| The original point, you deserve the value of your work in
| salaries regardless of your location still holds. Even more so
| when it is applied to the global scale. And the fact that it
| isn't applied on the global scale is just another fact pointing
| to the fact that we live in an unequal economy that exploits
| workers. Instead of rejecting this, OP should have reached the
| conclusion that there are alternative worker arrangements which
| would benefits workers globally.
| vslira wrote:
| The author doesn't actually say it out loud, but
|
| > OP should have reached the conclusion that there are
| alternative worker arrangements which would benefits workers
| globally.
|
| This is specifically what he DOESN'T want. What he's saying
| is that someone from Boise, ID shouldn't complain too loud
| about location-based pay, because taking the logic to its
| extreme would mean redistributing all this worker and
| consumer welfare with the rest of the billions of workers
| worldwide and, surprise surprise, that would actually suck to
| essentially every American, doesn't matter how poor.
|
| So, basically: "Hey guys, don't rock the boat. We might be
| crew but you don't want the rowers competing for our place"
| runarberg wrote:
| Thanks for calling it out. This is what I read as well but
| I wanted to give the author the benefits of the doubt
| (don't attribute malice... and so on). However it is hard
| to read anything else from this short, concise, and well
| worded article.
|
| In my circles we have a saying that there is no such thing
| as an ethical consumption under capitalism. What the OP is
| basically saying is: "That is fine, unethical consumption
| is good actually. As long as I'm the one benefiting on
| other's expense".
| tachyonbeam wrote:
| On the flipside, if you can make Silicon Valley money and go
| live in Mexico or Thailand, chances are that you will cause
| real estate prices there to increase and become less accessible
| to the locals. You and your high salary, particularly in a low-
| income country, are an inflationary force. Does you bringing
| your high income there automatically translate in enriching the
| local community?
| gamesbrainiac wrote:
| It definitely does. You are not going to have enough people
| migrating to make a large enough difference. By all means, go
| to Thialand, they will welcome you with open arms. More money
| in the economy means more jobs for people.
|
| More people with a higher level of technical skill will also
| enrich the community should you choose to participate.
| throw8932894 wrote:
| Foreigners can not buy or own properties in Thailand. Often
| this scenario enriches some local after divorce.
| true_religion wrote:
| If you live in Thailand and marry a Thai national, its
| pretty straight forwards to become a citizen.
|
| There's no reason Joe Shmoe developer won't do this.
| Lunatic666 wrote:
| I wouldn't call living and working in Thailand for 10
| years, speaking fluent Thai and passing an interview in
| Thai for your citizenship straightforward, but YMMV.
|
| edit: typo
| true_religion wrote:
| If you are married to a Thai national the only
| requirement is that you stay there for 3 years.
| toyg wrote:
| _> the cheap stuff that you 're getting is because someone is
| getting a super bad deal_
|
| And this is Bad and should be fixed. Developed countries should
| push poorer countries into paying better salaries to their
| workers and improve their conditions. This would directly
| benefit "westerners" too, since it would reduce migratory
| pressures and get a more level-playing field in economic
| sectors that have been wiped from these shores -- some even in
| quite strategic sectors, like the PPE shenanigans last year
| showed.
|
| Would that mean my plastic bullshit would get more expensive?
| Yeah, so what? Maybe this would reignite the debate on
| effective _redistribution_ in our countries too, which was
| basically killed in 1989.
| ClumsyPilot wrote:
| It's not always even passed to consumer -> you might pay $20
| for a T-shirt but the worker might get paid $1 for it!
| ymbeld wrote:
| > They are uneducated, so they don't know what they deserve.
| They are uneducated, so they don't know what they deserve.
|
| You don't need a formal education to know whether you are being
| taken advantage of. Only people with formal education believe
| such lies.
| bagacrap wrote:
| I have a feeling that many of the engineers who live in
| locations far off from SV such as Bangladesh, who do have the
| skills to make it as a FAANG employee (for example), already
| choose to move to SV/London/etc and collect that salary. If so,
| there shouldn't really be all that much untapped potential* in
| the third world. The way FAANG companies greedily hoover up the
| eligible talent pool (regardless of whether they have good
| project ideas for those folks to work on) makes me think it's
| not likely they'd overlook a vast pool of talent that's cheaper
| and just as productive.
|
| *Not counting those who never had access to education or a
| computer to become fully realized engineers in the first place.
| Just commenting on ready-to-go software engineers.
| gamesbrainiac wrote:
| I think there are a lot of preconceived notions regarding
| developing nations.
|
| A lot of people who can leave, do leave. I left, for example.
| However, there are a tonne of people who are super smart, but
| can't leave because of their ageing parents, or other
| reasons.
|
| Leaving everything you know behind takes courage, and
| adapting to a new world, a new life takes a lot out of you.
| Not everyone wants to leave their loved ones. Furthermore, if
| you are older, it's even harder.
|
| Funny story, one of the reasons I left Bangladesh is because
| I used to work for this company that paid me 1/6th of the
| salary someone else was making in a more developed Asian
| country. I was doing the same work, succeeding at it too.
|
| However, when I wanted equal pay for equal work, they decided
| to not renew my contract. Back then, I was young, so I
| decided to apply abroad, an was luckily accepted. Not
| everyone can do this, because again, you have family, and
| responsibilities.
|
| 2 months into my new job, my old company begs me to come
| back, and offers me the salary that was more than I wanted,
| and an O1 visa sponsorship should I want to go to America.
| comprev wrote:
| Most Eastern Europeans I worked with in the Netherlands all
| had one thing in common - they put the effort in to leave
| their home countries (Romania, Hungary, Greece, Bulgaria,
| Belarus, Latvia, Lithuania, etc.) and never return. They
| took all the optional extra courses at school, took as many
| professional exams as they could afford, and worked on
| their craft as software engineers to get an opportunity to
| move to NL, IE or UK.
| petre wrote:
| Mostly because they're sick with corruption and
| politicians in those countries or they hadn't had much to
| leave behind.
| gamesbrainiac wrote:
| Even then, it took my friend 7 years and the death of his
| father to start thinking about leaving the country. By 7
| years, I mean that I've been telling him to leave for 7
| years.
| hntrader wrote:
| Definitely agree with the inertia thing. The labor market
| works in the long-run but isn't frictionless for
| practical real-world reasons pertaining to personality,
| personal circumstance, immigration policy and so on.
| gamesbrainiac wrote:
| In Bangladesh, the tried and tested way is to enrol in a
| master's program and take it from there. Not always
| something that you can afford though.
| purple-again wrote:
| I very much doubt this is true. I'm sure there are a very
| large number of FAANG quality engineers all over the eastern
| US, let alone other countries, that couldn't or wouldn't make
| the move to SV. I would be willing to put money on it being
| the MAJORITY capable of being hired into those roles couldn't
| or wouldn't move there to take them.
|
| There is no amount of money that would have convinced me to
| leave Florida. My family and my wife's family is here. My
| children's friends and extended support networks are here.
| This life is not worth losing for any pay raise. I'm willing
| to bet a very large number of quality engineer made the same
| decision I did.
| eternauta3k wrote:
| There are plenty of skilled engineers who either don't make
| it into FAANG or don't manage to get into the US.
| luckydata wrote:
| you really overestimate how much FAANG companies understand
| about the world, or how to hire productive employees. It's
| all dances and bullshit, and puffery on behalf of the
| employees to make you believe we're the pinnacle of human
| intellect. I should know, I'm one of them :)
| benhurmarcel wrote:
| As if it was easy to emigrate to the US or western Europe for
| non-citizens...
| hh3k0 wrote:
| Not everyone is willing to leave family, friends, and country
| behind.
| JoeAltmaier wrote:
| But its a larger fraction than ever before in history, its
| pretty safe to say. So the problem is perhaps the smallest
| its been, and declining. That's a positive thing.
| jrochkind1 wrote:
| So many parts of the world have such terrible living
| conditions that anyone with an option will leave even
| though it means leaving your family and everything you
| know behind, while those left behind are those with no
| options stuck there, and most rich countries do their
| best to make it harder and harder for anyone else to make
| it there... and you conclude this is a positive thing?
| Truly we live in the best of all possible worlds!
| JoeAltmaier wrote:
| Its against the site rules to construe the worst possible
| meaning to a comment. And its lazy to put words in
| others' mouths. If you have something to say, just say
| it. Without attacking others, please.
| irrelative wrote:
| I don't think that's true. See, for
| example,https://www.brookings.edu/blog/the-
| avenue/2019/11/22/for-the...
| ClumsyPilot wrote:
| that's quite silly - leaving your family is a very
| questionable deal, you grandparents or parents basically
| wither away without seeing their children and grandchildren.
|
| The visa laws make you a second-class citizen (well non-
| citizen, really) and ensure that you cannot spend much time
| with them - there is a maximum limit on the number of days
| you can spend out of the country. Also usually they mean you
| cannot bring your grandparents. Hell, UK home office
| basically killed a woman because they denied entry to UK to
| her sister for an organ transplant.
| https://www.independent.co.uk/news/uk/home-news/leukaemia-
| pa...
|
| You have to have relatives and friends that can look after
| your family, because every now and then they need help and
| you are not there to help them.
|
| For many folks who have half-decent life at home, the trouble
| is not worth it. I have many friends from eastern Europe who
| have come to UK to study and went back.
|
| Lastly, why is FAANG the ultimate benchmark? Some people
| develop safety and life-critical systems, land rovers on
| mars, etc. I hold them in higher regard.
| marcus_holmes wrote:
| There are vast numbers of people from poorer countries
| working in richer countries so that they can send the money
| home to their families. In the Phillipines (for example)
| it's so normal for parents to work abroad (usually in Arab
| countries) while the grandparents look after the children,
| the whole economy is affected by it.
|
| And FAANG is the ultimate benchmark for salaries because
| they pay so much, not because they're held in high regard.
| In fact, the stories coming out of FAANG (FB and Apple
| especially) seem to show these are dystopian nightmare
| workplaces that you only work in because of the
| ridiculously high salaries.
| mbrooks wrote:
| I guess this is the digital version of a captive audience, i see
| it becoming more popular.
| ummonk wrote:
| The analogy at the end is not accurate. I as the consumer don't
| pay less for a shirt made in Bangladesh - I buy the highest
| quality shirt that is offered at the lowest price, and don't
| factor on the cost of living (or mote accurately cost of labor)
| of where the shirt was manufactured.
|
| Regarding the widespread practice of locale-adjusted pay (it
| generally is not cost of living adjusted e.g. London is paid far
| less than SF despite a similar cost of living), it is a clear
| example of why the argument of "women can't be paid less because
| companies would hire more women if they were cheaper" is simply
| false.
| DanHulton wrote:
| It's heartbreaking to read articles like this where the author
| _almost_ gets it, and then swerves off at the last second into
| "but there's nothing we can do, so shut up in case it gets
| worse."
|
| Absolutely, it's not easy to unionize, organize, and work towards
| change, but we don't have to _just accept_ offensive payment
| practices, working conditions, and side-effects from globalism.
| csallen wrote:
| Salary is a negotiation between parties. Looked at soberly, _you
| 're_ the business, your employer is your customer, and the salary
| they pay you is really the price you charge for your services.
|
| They have no obligation to pay more for your services than they
| think they have to, compared to alternatives on the market. And
| you have no obligation to charge less for your services than you
| can get from other "customers". Either of you can negotiate the
| price up or down, and the other is free to take it or leave it.
|
| It's not about who "deserves" what. It's a simple negotiation,
| like every other business transaction.
|
| The more valuable (and less replaceable) your services are, the
| more pay you can successfully negotiate for. I guarantee you
| there are plenty of people at these "location-based pay"
| companies who've negotiated for considerably higher pay than
| others in their location. Just as there are many businesses (e.g.
| Apple) who've found a way to charge more for their products than
| their competitors have.
|
| So it's worth learning to negotiate. And, perhaps more
| importantly, it's worth learning to provide massive value that's
| hard to replace. Or accepting the tradeoffs if you choose not to.
|
| Let's say you mould your skillset to fit perfectly into a
| commonly-open job description: front-end software engineer. Well
| great, the benefit is you have lots of jobs you can apply for, so
| you can easily "fire" one company to go work at another. The
| downside is you're now in direct competition with a million other
| people who've shaped themselves to have the same common skillset,
| so it's easier for companies to fire you. Competition drives
| prices down and makes you more easily replaceable. But it gives
| you some safety due to redundancy. That's often a reasonable
| tradeoff to make, but you should be aware you're making it. If
| you want the big bucks, it helps to be rarer, and to work at
| places and in roles where it's easier to demonstrate your value.
| ZephyrBlu wrote:
| Did you follow your own advice and negotiate with Stripe when
| they acquired Indie Hackers? :P.
| csallen wrote:
| Of course! I don't claim to be a master negotiator -- far
| from it. But I did negotiate. And, more importantly, I'm
| quite differentiated. There was no other Indie Hackers to
| buy.
| nnp7000 wrote:
| What's missing from these debates is optionality. A company pays
| you not only what it takes for you to do the job, but also their
| perceptions of your options. Two people working the same job on-
| site at the same company can have a substantial pay difference
| even without negotiation because one is self-taught and has only
| high school while another has a master's degree from Stanford.
| Yes, the former's competent and shows drive and ambition and
| that's nice. The company just scored a dark horse. But the
| company also knows the former employee (likely) isn't as
| aggressively courted by other companies which can pay well, so
| they feel they can pay that person less.
|
| If you're the only person in the world who can do what Facebook
| really needs done, they'll pay you $1M+ to do it from anywhere in
| the world.
| snarf21 wrote:
| I agree with you. It will take a while for the adjustment of
| remote to re-settle to a new norm.
|
| There is one other thing that is a small factor in all of this.
| I'm not saying it is unsurmountable or anything but
| local/state/country taxes are a factor. We hired someone remote
| recently who was in Canada. We had to create a new company in
| CA just so we could pay this individual. For salaried/W2 style
| employment, there can be a non-trivial amount of extra
| legal/finance work for the company. Hiring local-ish avoids
| this. Obviously, having everyone on a 1099/Contractor style
| employment would avoid this too but most people want salary
| plus provided benefits. Again, a larger company may easily be
| able to absorb these costs but they aren't zero.
| Sytten wrote:
| There are SaaS services now that handle this problem, but
| honestly I am glad you did that. Most US company just hire as
| contractor in Canada even if it is not legal per Canadian law
| and it will get workers in trouble pretty soon I think. The
| CRA will crack down on that loophole and employees will be in
| trouble.
| um_ya wrote:
| The underlying principle here is competition.
|
| A worker sells their labor and a company purchases it.
|
| When everyone lived in SF, a worker wouldn't accept a job
| paying below $100k because they wouldn't be able to afford to
| live. That same person in a cheaper state could negotiate a
| lower price, but most of the talent was saturated in SF. Now
| that everyone has left SF, there's no point in paying those
| prices if they can still retain you for a lower wage.
| lotsofpulp wrote:
| > A company pays you not only what it takes for you to do the
| job,
|
| This is the same thing as:
|
| >but also their perceptions of your options.
| biztos wrote:
| If you're that one person who can do that one Facebook thing
| I'm sure you can get way more that $1M and I think that's good.
|
| But I don't think that's about optionality. That's about the
| actual value of your skill, and its scarcity.
|
| Optionality is more like: Google would probably hire you do
| CRUD apps because you went to Stanford and passed our Google-
| like interview when we hired you to do CRUD apps, so we will
| pay you what we think it costs for you to not go do that at
| Google. Dave over here went to SF State and was hired before
| the algo-interview craze; no chance Google will hire him, so we
| can and will pay him less even if he makes better CRUD apps
| than you do.
|
| If I, your hiring manager, also went to Stanford I will pay you
| even more because I sure think _I_ have high optionality! And
| if _my_ manager went to Stanford then all the better because he
| will immediately understand why you need more than Dave. Which,
| in the end, is true: Dave 's still here, right?
| ehnto wrote:
| Someone else alluded to it as well, you could just as easily
| view pay as a measure of how much it will take to get you to
| work for them, rather than a measurement of how much value you
| will provide the company. From that lens, location based pay
| almost makes sense.
|
| But it's still a stupid and arbitrary mechanism, and if you're
| negotiating you should treat it that way. It sounds very
| systematic and regulatory, but it's not. Just ask them for what
| you think they're willing to pay you, just like any other
| negotiation.
| bradleyjg wrote:
| > But the company also knows the former employee (likely) isn't
| as aggressively courted by other companies which can pay well,
| so they feel they can pay that person less.
|
| The corollary is that if you can reliably find and hire such
| people you'll have a massive competitive advantage.
| ip26 wrote:
| You are right of course, but as far as we know no one has
| figured out how to do that.
| aurelianito wrote:
| I think it shows that employers are a cartelized oligopsony.
| That's why they can get away with paying different salaries based
| on anything but performance (in this case, location)
| astura wrote:
| It's SOP that relocations in neatspace comes with a cost of
| living adjustment, it makes sense that remote employees would
| follow.
| k4ch0w wrote:
| I think we will see a shift where some companies continue paying
| current salaries, and others will do location-based. The
| companies who keep paying current salaries will see people with
| skill move to them.
|
| If you're a great employee, you will still have people competing
| for you and I don't think this should concern you.
| praptak wrote:
| So just because capitalism exploits some people harder than you
| this somehow casts doubt on your right to complain?
|
| I honestly don't see any other argument in the article, so
| apologies if this sounds like a strawman or a nitpick - this is
| definitely not intentional.
| spoonjim wrote:
| Virtually even doing software engineering is thriving from
| location based pay. If you are in a rural mud hut in a poor
| country you don't even get to write code and if you are in the US
| you get six figures absolute minimum. People only get offended
| when one company pays two salaries across locations --- not when
| two different companies set up entirely different businesses
| based on locational wage, keeping software engineering in San
| Francisco and sweatshops in the Philippines.
| jdashg wrote:
| Calls for location-blind "pay based on my value" share a
| remarkable parallel with the desire for house prices that track a
| house's uninflated intrinsic value: The market doesn't care what
| you think it should pay.
| CapitalistCartr wrote:
| If I ask for a raise because I just had a kid, my boss rightly
| tells me my personal life is the company's respinsibility, my
| personal life isn't a basis for my pay.
| Spooky23 wrote:
| When he whines about how difficult it will be to replace you
| when you leave, remind him that management's failure to plan
| isn't your personal responsibility.
| Jabbles wrote:
| Maybe not, but this is reasonably similar to expecting paid
| paternity leave, something that is common (and mandatory) in
| many countries.
| CapitalistCartr wrote:
| I was more aiming for, "If my personal life isn't a basis for
| a pay raise, it's damn sure isn't a basis for a pay cut".
| the_gipsy wrote:
| Company doesn't pay based on the "value of your work" - it pays
| based on what other companies would pay you.
|
| Local candidates are scarcer than remote.
|
| Personally, I hate the resulting dynamic. Move to SF and the
| company basically subsidizes a million dollar mortgage. Move to
| Manila and your subsidized mansion could be $10k, 100 times less
| (maybe I'm exaggerating, I have no idea about real estate in the
| Philippines - but you get the idea). That's insane!
|
| The worst part is that landlords get a huge cut of this, and I
| don't think they add a fraction of that value to society.
|
| I hope that in the end, with the pandemic, it all balances out to
| two tiers: on-site and remote. I get that many companies still
| value attendance, whatever. I just hope that all remote positions
| balance out globally. It doesn't make sense to pay some guy in
| Utah twice as much as some guy from Honduras, if neither come
| into the office.
| Tade0 wrote:
| > I just hope that all remote positions balance out globally.
|
| I've been working remotely since 2015 and the market has been
| gradually moving in this direction(at least in eastern Europe
| where I come from) - COVID-19 only speeded things up.
| jorblumesea wrote:
| > It doesn't make sense to pay some guy in Utah twice as much
| as some guy from Honduras, if neither come into the office.
|
| This assumes equal education, skill level, cultural norms and
| infrastructure. But these are often not equal. If your clients
| are in the US, hiring developers US side greatly reduces the
| chance of cultural misunderstanding and communication problems.
| Also timezone issues here too, for clients based on North
| America.
|
| US higher education system is fairly strong, and not all
| countries are equal on that front. India for example, is known
| for degree mills and ways to "cheat" the system. Which is why
| US masters degrees are required for the most part. That is not
| to say there aren't incredibly smart people in every country,
| but it's not an even playing field and some countries have
| risks associated with hiring.
|
| Another good example is infrastructure. I'm not sure how many
| times a developing world coworker has been blocked because of
| shoddy internet or inconsistent utilities.
|
| These asymmetries will persist, remote or otherwise.
| the_gipsy wrote:
| Assume "someone who moved from SF to Utah or Honduras"
| coldtea wrote:
| > _The label in my shirt says Made in China. Likewise for my
| jacket, and my jeans were made in Bangladesh. "Equal pay for
| equal work" is a nice idea, but I don't think we apply it
| universally._
|
| Well, seen from one aspect we should. Clothes, gadgets, etc,
| should become more expensive, and those workers more well paid
| (let's ignore atm whether they'll still be given those jobs -
| perhaps jobs would move closer to the buyers in that case, though
| I doubt it).
|
| This will discourage planet/society killing conspicuous or
| mechanical consumption of BS, and things like "fast fashion".
|
| https://www.monbiot.com/2012/12/10/the-gift-of-death/
| maxk42 wrote:
| Throughout my career I've had recruiters attempt to get me to
| produce a "salary history". My polite way of telling them to go
| fuck themselves is to say "It's none of your business and it
| doesn't matter: This is my price and if you're not willing to pay
| it then we're done here." Still get the job offer probably four
| times out of five. There is no world in which telling them this
| info can be used for any purpose other than to attempt to
| pursuade you to take an offer for less money. Location-based pay
| is the same thing in a different wrapper and my response to it is
| the same.
| ljm wrote:
| If I was asked for that kind of info I'd hang up the phone.
| Recruiters (in the UK here) may ask what you're currently
| getting paid, but you'll never be asked to prove it. That's
| when you inflate the number to what you expect, or something in
| line with the market, taking some care not to be completely
| ridiculous about it.
|
| A good recruiter will try and negotiate up on your behalf,
| especially if their agency's fee and their commission is based
| on a percentage.
| maxk42 wrote:
| Yep. But not one recruiter in ten is good.
| teddyh wrote:
| The author argues against fair and equal salaries because...
| T-shirts made in Bangladesh might become more expensive? Because
| people in foreign nations might be paid more? This feels _very_
| similar to the common arguments against raising the minimum wage,
| and I really don't buy it.
| Smaug123 wrote:
| I didn't read it as arguing against or for anything. Rather, I
| read it as "I really want <this>; extended to its logical
| conclusion, that would also suggest <this> which I don't want.
| Conundrum!"
|
| It even says at the end, "I'm not here to make any grand
| pronouncements about globalisation... My only point is that,
| when it comes to "location-based pay", maybe we should be
| careful what we wish for." I take that as a pretty explicit
| "hey, this is difficult and I don't have a good answer".
| imtringued wrote:
| The value of a T-Shirt is pretty low and manual labor can only
| produce a few T-shirts per hour. That forces T-Shirt production
| to go to low cost labor countries. If you could somehow train
| those workers to produce 10x as many T-Shirts they would also
| get paid 10x as much.
|
| There simply isn't enough value to pay them more. Software is
| the opposite. Each worker produces a lot of value so companies
| can afford to pay them more.
|
| A few decades ago western countries were worried that Japan
| would take over the electronics market because they could
| produce much cheaper there. In reality Japan went up the value
| chain and Japanese products are just as expensive as in any
| other western nation.
| tralarpa wrote:
| If you doubled the hourly wage of the workers in Asia or
| Africa, the price of a 20 Euro T-shirt sold in Europe would
| increase by.... 20 cents (incl. VAT).
|
| Companies do this because they are not hold liable for the
| environmental damage done locally and by the transport, not
| even mentioning the low safety standards etc.
| teddyh wrote:
| > _There simply isn 't enough value to pay them more._
|
| Why? If your answer is "Because a T-shirt isn't valuable",
| then that's a circular argument.
| sokoloff wrote:
| Mass market T-shirts are worth some maximum amount to
| consumers. It's a circular argument with its center rooted
| in this fact.
|
| A T-shirt manufacturing employee's wage is capped as some
| fraction as the value of that shirt to an end consumer
| times the number of shirts they can make in a year.
| teddyh wrote:
| A thing is "worth" whatever people are willing to pay for
| it. T-shirts are cheap because they are cheap. Diamonds
| are expensive because they are expensive. But perceptions
| can be changed, and circles can be broken. These things
| are not unalterable.
| nicoburns wrote:
| But how much would consumers pay for clothing if mass-
| market clothing (which is only possible due to low wage
| labour) wasn't available? What with clothing being pretty
| essential to everyday living, I'd guess quite a bit more
| than the current market value of a t-shirt.
| sokoloff wrote:
| If you're going to charge $100 for a shirt, I'm sure not
| going to have drawers and drawers full of your shirts.
| The first reactions will be sharply reduced consumption,
| increased repair and secondhand purchasing, long before
| people are going topless.
| hackissimo123 wrote:
| I can't find it now but I read an article once with a
| title like "The $10,000 Shirt" or something like that,
| which argued that in medieval times, the amount of labour
| that it took to produce a single shirt would cost about
| $10,000 at modern minimum wage.
|
| If you were a peasant back then you might have owned two
| shirts: your regular one that you wore every day, and a
| 'fancy' one for church, weddings etc.. When your shirt
| got too ragged you cut it up and tailored it into clothes
| for your children, or used the material to patch up holes
| in other clothing. When even those got too decrepit you'd
| use them as kitchen rags etc. until they literally
| disintegrated. Cloth was too valuable to waste!
|
| We truly do live in a world of abundant excess in the
| modern era, and we should appreciate it.
| nicoburns wrote:
| > We truly do live in a world of abundant excess in the
| modern era, and we should appreciate it.
|
| We do, as in you and I, sure. But isn't the point here
| that those making things like mass-market t-shirt for
| very low wages are not sharing in that world of excess.
| At least not in an equitable manner.
|
| Why is it that these people should work for low wages so
| that you and I can enjoy cheap T-shirts, but I'm not
| expected to produce websites and computer programs for
| low wages so that people can enjoy cheap business tools?
| sokoloff wrote:
| Scarcity of people who can create websites and computer
| programs as compared to the demand for that vs the lack
| of scarcity of people capable to make T-shirts vs the
| demand for makers of T-shirts.
|
| This is in large part driven by most website development
| being semi or entirely custom. (People who use Shopify to
| make storefronts or Facebook to make company landing
| pages don't make the same amount as Shopify or Facebook
| devs.)
| nicoburns wrote:
| It seems to me that much like remote workers often get
| location-based pay which is lower than that for someone
| for doing the same work in a location like San Francisco
| or NYC, it's less that there is oversupply of t-shirt
| makers, and more that the pay rates of their local market
| are lower overall which puts them in a weaker bargaining
| position.
|
| And when you start looking at why that is you get pretty
| awkward answers like: because of selectively enforced
| free market ideals where capital is free to move across
| borders but labour isn't. Which are ultimately backed up
| by military power.
| golemiprague wrote:
| What does it even mean "fair"? You get payed whatever you can
| negotiate, your skills, location or contribution doesn't matter.
| There are no rules, just get the most you can, if you can shop
| get a better salary, if not get what you offered. There is no
| point complaining.
| allenu wrote:
| It's ridiculous to me that a company can say, "Hey, where you
| live requires less pay for a baseline standard of living,
| therefore we'll pay you less" but they would never, ever consider
| saying, "Oh, you live in a town with fewer opportunities and less
| pay? Well, we'll charge you less for our product then."
| HNJE wrote:
| While it isn't due to less economic opportunities necessarily,
| price discrimination is absolutely a thing:
|
| https://en.wikipedia.org/wiki/Price_discrimination
| growmn wrote:
| Lol
| fishnchips wrote:
| From my perspective as an employer the pay is primarily a
| function of scarcity. Location-based pay would make perfect sense
| for roles where supply is abundant and location is irrelevant.
| Example: simple data entry jobs of the kind you can outsource to
| Upwork. When looking for senior software engineers the supply is
| very limited relative to demand, and as a startup [0] we don't
| have the luxury to discriminate based on location other than
| timezone (though we're somewhat flexible there, too). Hence,
| we'll pay the right candidate the right salary, regardless of
| whether they're physically located in the Bay Area or in rural
| Vietnam. Because if we don't, someone else will.
|
| [0] Yes, we're hiring - https://spacelift.io/careers.html
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