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At least one reason is that the stock has done so well. A typical software engineer hired 4 years ago is incredibly well compensated at Amazon because of this.
by spenczar5 9y ago
At least one reason is that the stock has done so well. A typical software engineer hired 4 years ago is incredibly well compensated at Amazon because of this.
Consider a mid-level software engineer hired 4 years ago, on April 16 2014, with a salary of $100k. A typical stock grant at hiring for a mid-level software engineer in 2014 might be $400k over 4 years, backloaded so most of it comes at the end; on April
16 2014 the share price was $323, so the grant would have looked something this:
Apr 16 2015: 154 shares @ $323 = $50k = $150k total comp
Apr 16 2016: 248 shares @ $323 = $80k = $180k total comp
Apr 16 2017: 371 shares @ $323 = $120k = $220k total comp
Apr 16 2018: 464 shares @ $323 = $150k = $250k total comp
But the share price has gone through the roof since then, so things look more like this:
Apr 16 2015: 154 shares @ $383 = $59k = $159k total comp
Apr 16 2016: 248 shares @ $625 = $155k = $255k total comp
Apr 16 2017: 371 shares @ $901 = $334k = $434k total comp
Apr 16 2018: 464 shares @ $1,440 = $668k = $768k total comp
That mid-level, totally normal software engineer is making more than $750k this year because the stock price has gone up so much since 2014. They're likely to put up with a lot of bullshit to get that kind of financial security - that's not just a down payment on a house, it can be the whole thing in cash in the east side suburbs, with great school districts.
Amazon (and Seattle in general) could be in big trouble if the stock price turns around. I don't think that's likely, but it's kind of scary to me.
- skookumchuck 9y agoAmazon is minting millionaires like crazy. Of course people want to work there.
- YetAnotherNick 9y agoAnyone could have bought this stock if they would have known the price. Yes, the decision to join amazon turned out to be great money wise, but still doesn't explain why the top talent works there.
- spenczar5 9y agoHm, I don't understand what purchasing stock has to do with it. If someone bought the stock then they would own it. But that's not what happens when a company grants you stock - it's a promise to deliver you shares later. If this hypothetical employee quit on April 10th, 2018, they would not get the 464 shares (== $668k) on April 16th, 2018. They also would probably not get a comparable offer if they quit to join Facegooglesoft. So, if they quit, they lose out on hundreds of thousands of dollars. That's enough to keep many people even if the work is unpleasant.
- YetAnotherNick 9y agoI am saying you could not anticipate which company's share will rise above the rest.
- codedokode 9y agoThe contrast between payout to engineers and unqualified workers is impressive. Especially if those workers live in a place like California with high living costs. I think growing housing costs are much more scarier for a worker than an idea that some engineer gets 200-300k less.
- techsupporter 9y agoAre those numbers real? As in, does (did?) Amazon really do $400,000 in stock grants for routine (I don't mean that to sound harsh, I just mean "not as a super-exceptional process to land a world-famous developer") software engineer hires? If they are, holy shit. I thought the meteoric rise in housing prices around here was almost entirely due to the influx of people compounded by this region's seeming inhospitable allergy to building housing stock at anywhere near a reasonable rate. But, damn, if your table is even within 80% of reality, I am floored. No wonder it's virtually impossible to rent or buy anything for a "realistic" (for me, and I make a pretty good income, or so I thought) price anywhere between Edmonds and Auburn. The rest of us, even those employed in the technology industry, simply cannot compete with that kind of cash on the barrel.
- spenczar5 9y agoYes, this is typical, more or less. Amazon tends to pay with a low base salary and high stock component. What I described would be somewhere between “pretty competent developer” and “tech lead on a team of 8,” not anything unusual like hiring a superstar principal engineer.