5 ms·

Do Canadian companies make that much less money than American ones? Why should they get to pad their profit margins because 120k CAD is "good income"?

badpun 8y ago
A lot of the tech industry is about burning through investors' money in search of new profitable ideas. I'm guessing there's much less investor money in Canada.
- s2g 8y ago
  Lots less, but the big problem is a lack of competition. We don't have the big companies sucking up devs at an insane rate, or startups doing the same. So they just pay what it takes to fill the spot. Of course they are also incredibly resistant to changing this, preferring to complain about how we need to fix brain drain and/or make immigration easier.
  - pm90 8y ago
    > Lots less, but the big problem is a lack of competition. We don't have the big companies sucking up devs at an insane rate, or startups doing the same. So it seems like they're not losing devs at a fast enough pace to warrant increasing dev salaries? Or perhaps there are just enough developers for the Canadian market, to not have to increase compensation to attract better talent? From what I've seen, American based companies with offices in Canada do seem to pay very well, but Canadian companies are unabashedly poorly compensating. I talked with a few hiring managers at some Canadian startups and what they were offering would be less than what I made right out of college. It left me wondering how talented folks can continue to work for Canadian firms?
- pembrook 8y ago
  "Burning through investors money in search of profitable ideas" has nothing to do with it. There's this huge misconception on HN about the size of the venture capital market. Start-ups are a miniscule portion of the tech economy by any measure of value. The reason engineers make so much money in the US is the public market giants like Facebook, Apple, Amazon, Netflix, Google, etc. The combined market cap of FAANG is fluctuating around $3 trillion right now. That's about 2X the entire GDP of Canada...in just 5 American companies. No large-ish tech company in Canada is near that level of profitability or size. Combine that with currency fluctuations and with the greater tax/regulatory burden of having a full-time employee in Canada, and you will never have a Canadian company that can afford to pay engineers $250K+ en masse like FAANG can.
  - vonmoltke 8y ago
    FAANG can only hire so many engineers, the positions tend to be highly competitive, they pull them from all over the world, and the drop-off in compensation at the next level is pretty significant.
    - xeromal 8y ago
      But they push other tech firms to make their offerings more palatable.
    - TulliusCicero 8y ago
      They have an anchoring effect.
    - netheril96 8y ago
      Can Canadian programmers good enough to be hired by FAANG be paid similar salaries in Canada?
      - jonny_eh 8y ago
        No, that's the whole point of this discussion.
        netheril96 8y ago
        It's a rhetorical question.
      - querulous 8y ago
        they can work for FAANG in canada at a 30-40% discount (well not FN, but AAG)
  - minwcnt5 8y ago
    I have a hard time understanding the comparison of aggregate market cap (a valuation) to GDP (an annual output). These seem like two very different quantities, with different units. How do you intend for us to interpret that comparison? Wouldn't it make more sense to compare the aggregate revenues of those companies? (I'm not an economist, so I'm not sure those two quantities are comparable either, but they seem closer at least.)
NathanCH 8y ago
It really depends, but if a Canadian company operates in the US market and charges US prices, that puts them at a huge advantage.
- vkou 8y ago
  The primary source of revenue for every Canadian software company I worked for came from the US.
ido 8y ago
You can replace "Canadian" with almost every other country on earth and the question stays the same. I live in Germany, which has similar wages for software engineers as Canada. And in a 2 hours train ride I can be in Poland, where software engineers earn 1/3 their German counterparts.
- netheril96 8y ago
  I guess that Germany and Poland do have problems similar to Canada, except that their brains are harder to be drained by America due to the distance.
  - EduardoBautista 8y ago
    Also Canadians have a much easier visa to get.
- burfog 8y ago
  This isn't due to any failure in Poland. It takes money to make a person choose Germany over Poland. Poland is really really nice.
firstplacelast 8y ago
Engineer/technical/science-type people tend to have this belief that wanting to reap the value they create makes them "bad people" or at the very least not a "good engineer/scientist/etc." Apparently, only business and finance people are allowed to want money because they provide a useful service or just because they want money. I personally believe that in a capitalistic society, it is imperative that everyone tries their best to extract as much of the value that they create. Otherwise we end up with massive inequality.

badpun 8y ago

A lot of the tech industry is about burning through investors' money in search of new profitable ideas. I'm guessing there's much less investor money in Canada.

s2g 8y ago
Lots less, but the big problem is a lack of competition. We don't have the big companies sucking up devs at an insane rate, or startups doing the same. So they just pay what it takes to fill the spot. Of course they are also incredibly resistant to changing this, preferring to complain about how we need to fix brain drain and/or make immigration easier.
- pm90 8y ago
  > Lots less, but the big problem is a lack of competition. We don't have the big companies sucking up devs at an insane rate, or startups doing the same. So it seems like they're not losing devs at a fast enough pace to warrant increasing dev salaries? Or perhaps there are just enough developers for the Canadian market, to not have to increase compensation to attract better talent? From what I've seen, American based companies with offices in Canada do seem to pay very well, but Canadian companies are unabashedly poorly compensating. I talked with a few hiring managers at some Canadian startups and what they were offering would be less than what I made right out of college. It left me wondering how talented folks can continue to work for Canadian firms?
pembrook 8y ago
"Burning through investors money in search of profitable ideas" has nothing to do with it. There's this huge misconception on HN about the size of the venture capital market. Start-ups are a miniscule portion of the tech economy by any measure of value. The reason engineers make so much money in the US is the public market giants like Facebook, Apple, Amazon, Netflix, Google, etc. The combined market cap of FAANG is fluctuating around $3 trillion right now. That's about 2X the entire GDP of Canada...in just 5 American companies. No large-ish tech company in Canada is near that level of profitability or size. Combine that with currency fluctuations and with the greater tax/regulatory burden of having a full-time employee in Canada, and you will never have a Canadian company that can afford to pay engineers $250K+ en masse like FAANG can.
- vonmoltke 8y ago
  FAANG can only hire so many engineers, the positions tend to be highly competitive, they pull them from all over the world, and the drop-off in compensation at the next level is pretty significant.
  - xeromal 8y ago
    But they push other tech firms to make their offerings more palatable.
  - TulliusCicero 8y ago
    They have an anchoring effect.
  - netheril96 8y ago
    Can Canadian programmers good enough to be hired by FAANG be paid similar salaries in Canada?
    - jonny_eh 8y ago
      No, that's the whole point of this discussion.
      - netheril96 8y ago
        It's a rhetorical question.
    - querulous 8y ago
      they can work for FAANG in canada at a 30-40% discount (well not FN, but AAG)
- minwcnt5 8y ago
  I have a hard time understanding the comparison of aggregate market cap (a valuation) to GDP (an annual output). These seem like two very different quantities, with different units. How do you intend for us to interpret that comparison? Wouldn't it make more sense to compare the aggregate revenues of those companies? (I'm not an economist, so I'm not sure those two quantities are comparable either, but they seem closer at least.)

NathanCH 8y ago

It really depends, but if a Canadian company operates in the US market and charges US prices, that puts them at a huge advantage.

vkou 8y ago
The primary source of revenue for every Canadian software company I worked for came from the US.

ido 8y ago

You can replace "Canadian" with almost every other country on earth and the question stays the same. I live in Germany, which has similar wages for software engineers as Canada. And in a 2 hours train ride I can be in Poland, where software engineers earn 1/3 their German counterparts.

netheril96 8y ago
I guess that Germany and Poland do have problems similar to Canada, except that their brains are harder to be drained by America due to the distance.
- EduardoBautista 8y ago
  Also Canadians have a much easier visa to get.
burfog 8y ago
This isn't due to any failure in Poland. It takes money to make a person choose Germany over Poland. Poland is really really nice.

firstplacelast 8y ago

Engineer/technical/science-type people tend to have this belief that wanting to reap the value they create makes them "bad people" or at the very least not a "good engineer/scientist/etc." Apparently, only business and finance people are allowed to want money because they provide a useful service or just because they want money. I personally believe that in a capitalistic society, it is imperative that everyone tries their best to extract as much of the value that they create. Otherwise we end up with massive inequality.