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The problem is squashed salaries. I’ll have junior devs or people straight out of code school asking for 75-80% the salary of a solid senior dev. If I have to

The problem is squashed salaries. I’ll have junior devs or people straight out of code school asking for 75-80% the salary of a solid senior dev. If I have to make a bet on who will be easier to manage and get productive 4 seniors vs 5 juniors for the same total expenditure I’ll choose the seniors every time. Even at 2 to 1 I’m taking seniors. Maybe around 3 or 4 to 1 juniors might look better. But that means junior starting salaries around 50k which no one is taking. Salary range is too squashed in the industy.

opportune 9y ago
I've noticed this too. There are only a few rational explanations 1. Senior devs aren't paid enough for the value they bring to the company (or conversely, junior devs are paid too much for that value) 2. Investing in junior devs gives a good enough ROI that it's worth overpaying them for a few years. That is, after e.g. three years, enough junior devs have stuck around that they've accumulated enough org-specific knowledge and general tech competency to justify their initially high salaries 3. Senior devs aren't actually that much more productive than junior devs, they just think they are. They also may be averse to doing productive-but-boring work that feels "beneath" them. 4. New devs are valued for more than just their direct contributions to the software project's code base. For example, they may be valued for their ability to bring fresh perspectives, or for their proximity to formal education and thus their tendency to be knowledgable of relatively cutting-edge tech. I think universities lag behind the vanguard trendsetters by at least 5 years, but there are certainly software companies that are stuck 20 or more years in the past 5. The job market for developers is irrational with respect to experience and reasoning about it is as worthwhile as reasoning about the true value of Bitcoin. I think it's a mixture between 1 and 2, with a little bit of each other explanation too. Worth noting is that senior developers at the big tech companies (AmaGooFaceAppleSoft) get paid a lot more than senior devs at most other tech companies, but most of that compensation is in stock. Full monetary comp (not counting benefits and perks) for a fresh grad might be about $150k/year, but senior developers with >5 years experience are making closer to $250k/year or more
- rplnt 9y ago
  I think it's 2. I don't see why senior dev salaries should go any higher. At that point it would be easier to open office overseas even for smaller shops.
  - alien_at_work 9y ago
    >I don't see why senior dev salaries should go any higher Because they're vastly underpaid compared to the value they produce. >At that point it would be easier to open office overseas even for smaller shops. Which means you're getting junior devs, at best. The entire concept of outsourcing hangs on the idea that the people being outsourced to will behave exactly the opposite of those doing the outsourcing, i.e. not really caring about money. Well they do care: when they get senior they leave and go somewhere they can earn western money.
    - mywittyname 9y ago
      > Well they do care: when they get senior they leave and go somewhere they can earn western money. It seems like the offshore contracting companies have a better grasp on how to maintain tech workers than the companies that hired them do. I've noticed my contracting counterparts get regular performance reviews, decent raises, and title changes actually open up doors for them. I get my regular 2% a annual bump and any title change has no impact on my actual work.
    - rplnt 9y ago
      World doesn't work like that. You are not paid by the value you create, but by supply/demand for the position. The economics of the product only dictate whether something will be done or not. And your second statement is not true. You simply get cheaper workforce in other countries. Even on senior levels.
      - alien_at_work 9y ago
        >You are not paid by the value you create, but by supply/demand for the position. The labor market isn't the greatest place to talk about market forces. Companies do everything they legally (and illegally to an extent) can to ensure that it's not an efficient market. Further, companies have all the power in the relationship: most of us must have work but a company doesn't absolutely have to hire someone. I saw a 4-person startup on this site say they'd been looking for a "rockstar" for 2 years to expand their company. They were willing and able to wait 2 years for a highly skilled person willing to take a low enough salary. Not many people can wait 2 years to get a job. To see what a real labor market would look like, you need to address the power balance. So I think sports teams are a better representation because they have unions to address this issue. And they do capture more of the value they produce (not all of it, obviously). >And your second statement is not true. You simply get cheaper workforce in other countries. Even on senior levels. Oh, I had assumed you meant the typical outsourcing locations. If you mean places like Europe, yes you can get good senior people for lower rates there. But it's a percentage lower, not X times lower, you can't get a truly senior level person on e.g. 7k/yr. I'm sure there's someone somewhere that has, but they'd have done better to buy a lottery ticket with that luck.
skjerns 9y ago
is 50k really such a bad starting salary or is there such a big difference between US and EU?
- rplnt 9y ago
  Correct me if I'm wrong, but when talking US salaries you have to compare it to EU salary before any taxes, deductions, or insurance.
- loup-vaillant 9y ago
  There are 2 differences: first, US devs are paid substantially more. Second, their stated salaries is closer to what their employer spends than our salaries. Our employers pay various taxes before giving us our stated salary, they have private insurances. This is a gross oversimplification, but that's the idea. Third, the cost of living is often higher in the US. To really compare salaries, you need to count what the employer actually pays, and factor in the various costs of living (taxes, insurance, home, food, transportation…).
  - bpicolo 9y ago
    In white collar jobs like software people don't usually have private health insurance (in the US). Employers cover that cost on top of your salary - 90%-100% of cost is typical in the industry, though it depends a biton whether it's just for you / your family.
- lotsofpulp 9y ago
  Depends what caliber person you want. Highly educated, motivated, top 10%, maybe even 20% should be able to earn almost $100k upon earning a Masters, maybe even engineering/science degree. In the bigger cities in the US, I would expect most technical/finance/medical professionals to be making six figures easily by the time they are mid to upper 20s.
  - skjerns 9y ago
    I clearly live on the wrong continent.
bkovacev 9y ago
We've recently started hiring for a junior front-end position and we've stumbled upon code bootcamps graduates asking for 120k with one or two demo projects on their github. NYC Area, which I find absurd. Unsure if it's the mentors at those schools that are telling their students to ask for that much or the students themselves think that companies that want to hire juniors usually have that deep of a pocket.
- brooklyn_ashey 9y ago
  Are these just basic junior devs, or are they specialists in another field with multiple advanced degrees from top tier schools ($$$) and professional experience in that other field? (law, medicine, the arts) and (Yale, Princeton, Juilliard) If so, I'd say they are well worth $120,000, probably have a giant body of work in another field, and are motivated to make back their investment in a mountain of education that has led them over and over again to unemployment or low wage work. If not, my guess is that the math of buying so much schooling over so many years (even mid-tier) and then having to buy tuition at a coding school because the competition is so tight they have no time to waste teaching themselves just doesn't work out, especially when they have to pay $2000 a month in rent plus a 5 month security deposit in NYC, just to attend the "free", "scholarship-supported",or "tuition deferred" bootcamp, that is, if they are new to the city. If they are already New Yorkers, they are probably about to be evicted due to non-payment of same. No one is really talking openly about this with respect to this group of people; the affected must hide their ivy league scholarship homelessness at all costs if they want to ever get a job. It leads to a whole new breed of homeless: living as a homeless person/person-on-the-brink-of-homelessness, well educated, loans to pay, healthcare to pay because they aren't young anymore and really have to get root canals and cancer screenings, middle class props, lunches, and clothes to pay for so they can "pass" as middle class at interviews. It is not sustainable. This wave of unemployed people is exceptionally educated and professionally seasoned (in other fields) in a way that most in previous waves of new job seekers didn't have to be. And on top of all of this, they aren't good at the business of being poor-- they don't know how to get support because they were raised to behave like the middle class. Their families don't understand why they can't get jobs. I remember how little a junior dev had to know just 8 years ago in order to get work. The bootcamps aren't being honest about the lack of interest in bootcamp grads. The online programs aren't getting completed by students. Just a year ago on HN, very few would even recognize the lack of interest in junior devs. Now, we can't ignore it anymore. The tech ecosystem is unhealthy and dishonest with itself about its addictions to certain cultures and practices. It needs to take responsibility for educating newcomers (of all ages and backgrounds) because it is responsible for the fact that these highly skilled people are now useless in this increasingly tech-based society. Mentoring should be a natural part of prepping the soil. It should not matter if devs stay at the company that mentored them. The only reason this is a problem right now is because tech behaves like warring nations not like collaborating artists.
matwood 9y ago
This is the exact same argument I made the last time we hired. If for another 20% I can get a more proven senior dev, that's the decision I will make every time.
mciancia 9y ago
Well, 50k might be a lot or really low depending on the area and CoL there. And don't forget that a lot of interns make twice that...
spicytunacone 9y ago
>But that means junior starting salaries around 50k which no one is taking. Where are these $50k/yr junior positions? I finished undergrad at a time when $60k/yr was a safe starting point for negotiation but recent searches only show me $15.50/hr at best for a junior. I acknowledge the tenuous distinction, if any, between "junior" and "entry-level" may be a factor for the disparity here.

opportune 9y ago

I've noticed this too. There are only a few rational explanations 1. Senior devs aren't paid enough for the value they bring to the company (or conversely, junior devs are paid too much for that value) 2. Investing in junior devs gives a good enough ROI that it's worth overpaying them for a few years. That is, after e.g. three years, enough junior devs have stuck around that they've accumulated enough org-specific knowledge and general tech competency to justify their initially high salaries 3. Senior devs aren't actually that much more productive than junior devs, they just think they are. They also may be averse to doing productive-but-boring work that feels "beneath" them. 4. New devs are valued for more than just their direct contributions to the software project's code base. For example, they may be valued for their ability to bring fresh perspectives, or for their proximity to formal education and thus their tendency to be knowledgable of relatively cutting-edge tech. I think universities lag behind the vanguard trendsetters by at least 5 years, but there are certainly software companies that are stuck 20 or more years in the past 5. The job market for developers is irrational with respect to experience and reasoning about it is as worthwhile as reasoning about the true value of Bitcoin. I think it's a mixture between 1 and 2, with a little bit of each other explanation too. Worth noting is that senior developers at the big tech companies (AmaGooFaceAppleSoft) get paid a lot more than senior devs at most other tech companies, but most of that compensation is in stock. Full monetary comp (not counting benefits and perks) for a fresh grad might be about $150k/year, but senior developers with >5 years experience are making closer to $250k/year or more

rplnt 9y ago
I think it's 2. I don't see why senior dev salaries should go any higher. At that point it would be easier to open office overseas even for smaller shops.
- alien_at_work 9y ago
  >I don't see why senior dev salaries should go any higher Because they're vastly underpaid compared to the value they produce. >At that point it would be easier to open office overseas even for smaller shops. Which means you're getting junior devs, at best. The entire concept of outsourcing hangs on the idea that the people being outsourced to will behave exactly the opposite of those doing the outsourcing, i.e. not really caring about money. Well they do care: when they get senior they leave and go somewhere they can earn western money.
  - mywittyname 9y ago
    > Well they do care: when they get senior they leave and go somewhere they can earn western money. It seems like the offshore contracting companies have a better grasp on how to maintain tech workers than the companies that hired them do. I've noticed my contracting counterparts get regular performance reviews, decent raises, and title changes actually open up doors for them. I get my regular 2% a annual bump and any title change has no impact on my actual work.
  - rplnt 9y ago
    World doesn't work like that. You are not paid by the value you create, but by supply/demand for the position. The economics of the product only dictate whether something will be done or not. And your second statement is not true. You simply get cheaper workforce in other countries. Even on senior levels.
    - alien_at_work 9y ago
      >You are not paid by the value you create, but by supply/demand for the position. The labor market isn't the greatest place to talk about market forces. Companies do everything they legally (and illegally to an extent) can to ensure that it's not an efficient market. Further, companies have all the power in the relationship: most of us must have work but a company doesn't absolutely have to hire someone. I saw a 4-person startup on this site say they'd been looking for a "rockstar" for 2 years to expand their company. They were willing and able to wait 2 years for a highly skilled person willing to take a low enough salary. Not many people can wait 2 years to get a job. To see what a real labor market would look like, you need to address the power balance. So I think sports teams are a better representation because they have unions to address this issue. And they do capture more of the value they produce (not all of it, obviously). >And your second statement is not true. You simply get cheaper workforce in other countries. Even on senior levels. Oh, I had assumed you meant the typical outsourcing locations. If you mean places like Europe, yes you can get good senior people for lower rates there. But it's a percentage lower, not X times lower, you can't get a truly senior level person on e.g. 7k/yr. I'm sure there's someone somewhere that has, but they'd have done better to buy a lottery ticket with that luck.

skjerns 9y ago

is 50k really such a bad starting salary or is there such a big difference between US and EU?

rplnt 9y ago
Correct me if I'm wrong, but when talking US salaries you have to compare it to EU salary before any taxes, deductions, or insurance.
loup-vaillant 9y ago
There are 2 differences: first, US devs are paid substantially more. Second, their stated salaries is closer to what their employer spends than our salaries. Our employers pay various taxes before giving us our stated salary, they have private insurances. This is a gross oversimplification, but that's the idea. Third, the cost of living is often higher in the US. To really compare salaries, you need to count what the employer actually pays, and factor in the various costs of living (taxes, insurance, home, food, transportation…).
- bpicolo 9y ago
  In white collar jobs like software people don't usually have private health insurance (in the US). Employers cover that cost on top of your salary - 90%-100% of cost is typical in the industry, though it depends a biton whether it's just for you / your family.
lotsofpulp 9y ago
Depends what caliber person you want. Highly educated, motivated, top 10%, maybe even 20% should be able to earn almost $100k upon earning a Masters, maybe even engineering/science degree. In the bigger cities in the US, I would expect most technical/finance/medical professionals to be making six figures easily by the time they are mid to upper 20s.
- skjerns 9y ago
  I clearly live on the wrong continent.

bkovacev 9y ago

We've recently started hiring for a junior front-end position and we've stumbled upon code bootcamps graduates asking for 120k with one or two demo projects on their github. NYC Area, which I find absurd. Unsure if it's the mentors at those schools that are telling their students to ask for that much or the students themselves think that companies that want to hire juniors usually have that deep of a pocket.

brooklyn_ashey 9y ago
Are these just basic junior devs, or are they specialists in another field with multiple advanced degrees from top tier schools ($$$) and professional experience in that other field? (law, medicine, the arts) and (Yale, Princeton, Juilliard) If so, I'd say they are well worth $120,000, probably have a giant body of work in another field, and are motivated to make back their investment in a mountain of education that has led them over and over again to unemployment or low wage work. If not, my guess is that the math of buying so much schooling over so many years (even mid-tier) and then having to buy tuition at a coding school because the competition is so tight they have no time to waste teaching themselves just doesn't work out, especially when they have to pay $2000 a month in rent plus a 5 month security deposit in NYC, just to attend the "free", "scholarship-supported",or "tuition deferred" bootcamp, that is, if they are new to the city. If they are already New Yorkers, they are probably about to be evicted due to non-payment of same. No one is really talking openly about this with respect to this group of people; the affected must hide their ivy league scholarship homelessness at all costs if they want to ever get a job. It leads to a whole new breed of homeless: living as a homeless person/person-on-the-brink-of-homelessness, well educated, loans to pay, healthcare to pay because they aren't young anymore and really have to get root canals and cancer screenings, middle class props, lunches, and clothes to pay for so they can "pass" as middle class at interviews. It is not sustainable. This wave of unemployed people is exceptionally educated and professionally seasoned (in other fields) in a way that most in previous waves of new job seekers didn't have to be. And on top of all of this, they aren't good at the business of being poor-- they don't know how to get support because they were raised to behave like the middle class. Their families don't understand why they can't get jobs. I remember how little a junior dev had to know just 8 years ago in order to get work. The bootcamps aren't being honest about the lack of interest in bootcamp grads. The online programs aren't getting completed by students. Just a year ago on HN, very few would even recognize the lack of interest in junior devs. Now, we can't ignore it anymore. The tech ecosystem is unhealthy and dishonest with itself about its addictions to certain cultures and practices. It needs to take responsibility for educating newcomers (of all ages and backgrounds) because it is responsible for the fact that these highly skilled people are now useless in this increasingly tech-based society. Mentoring should be a natural part of prepping the soil. It should not matter if devs stay at the company that mentored them. The only reason this is a problem right now is because tech behaves like warring nations not like collaborating artists.

matwood 9y ago

This is the exact same argument I made the last time we hired. If for another 20% I can get a more proven senior dev, that's the decision I will make every time.

mciancia 9y ago

Well, 50k might be a lot or really low depending on the area and CoL there. And don't forget that a lot of interns make twice that...

spicytunacone 9y ago

>But that means junior starting salaries around 50k which no one is taking. Where are these $50k/yr junior positions? I finished undergrad at a time when $60k/yr was a safe starting point for negotiation but recent searches only show me $15.50/hr at best for a junior. I acknowledge the tenuous distinction, if any, between "junior" and "entry-level" may be a factor for the disparity here.