6 ms·

> Save on compensation due to hiring in lower cost regions Pay people what they're worth regardless of where they live. If you have a developer in Nigeria or U

by allday 8y ago

> Save on compensation due to hiring in lower cost regions Pay people what they're worth regardless of where they live. If you have a developer in Nigeria or Ukraine or Vietnam that is as equally capable as a developer in the Bay Area, they should be paid the same. Doing otherwise, at best, perpetuates Western hegemony, and at worst is simply racism.

sushisource 8y ago
This is a bit ridiculous. It's not hegemony or racism. It's how markets work. People in those markets have fewer opportunities for highly paid employment. As a result, employers have more leverage in negotiations. It's as simple as that.
- ludston 8y ago
  His is a moralistic argument. I expect he understands the mechanism at play here.
  - 52-6F-62 8y ago
    This is correct. Simplified, the counter argument appears to be: "If a company has the leverage in any capacity to exercise its dominance over a potential employee—to extract as much value from them at the lowest possible financial liability—it should in any case attempt to do so. It would be absurd to do otherwise." Personally, I can't abide by that—especially when the only basis is locale—and no matter if they bring the same value to the company as a local six-figure-salary employee.
    - ryan-allen 8y ago
      That's pretty much a company's MO no matter where you go. It's always about leverage and market forces. If an employer could pay you 75% less to do the same work they'd do it in a heartbeat. It's better to know the rules of the game otherwise you'll just end up being played.
      - 52-6F-62 8y ago
        Yes and no, I think. Like some other commenters implied, I think it's short sighted. The outcome of working employees like that can end up being of lower quality, so the product suffers, and loses market traction. I've been witness to this first-hand. Of course, it's only anecdotal, but just the same it's informed my opinions. Though you're right about your last point absolutely— it's often pretty safe to assume they're (especially larger companies) operating under the pretense we're both referring to.
- kgodey 8y ago
  People in those markets usually aren't comparing their offer with local competition, the job market for remote workers is worldwide. Many companies do pay remote employees based on the value they bring to the company regardless of where they live so they are the competition.
  - AstralStorm 8y ago
    The problem with this is that a remote worker will have problems finding opportunities or getting found, especially because the competition is so huge. It is like the problems contractors face taken to some non small power.
- ehnto 8y ago
  Ah yes, the ever ethical and humanist market. I don't think it's wise to look for cues on how to be ethical from the market. You're right about the mechanisms at play though.
- jasonkester 8y ago
  It's how markets work. Markets work by paying for value created. I’ve tested extensively, and found that I’m equally capable of writing code on a beach in Thailand as in a felt cube in California. I’ll grant that there is a Cost of Living difference between those places, but I would prefer that difference to be captured by me rather than somebody else’s company. It’s me doing the work and creating the value, so that seems reasonable. If you want to purchase my services, you get to pay my market rate. End of story. Never drop your rate when working remote. That should probably be written in the article we’re discussing.
  - AstralStorm 8y ago
    Unfortunately, you will get outpriced by people doing "the same" work for less. Since you cannot know the global prices, you cannot even meet them, much less compete. Lowest bidder often wins.
    - jasonkester 8y ago
      I know, right? I've lost track of all the money I've lost from clients going with the lowest bidder over the years. I must be literally hundreds of dollars by now. A bit of advice: Those cheap guys are not your competition, and those bargain hunter clients are not the ones you're trying to land. Let them all race to the bottom all they want. Maybe one of them will find a dev who doesn't know his value yet, but the rest will get their money's worth. It doesn't concern you. There is only one of you, and your rate is the same whether you're onsite in the Bay Area or working remote from anywhere else you choose to be. That mindset has served me well over the years. I'd recommend taking it on board.
    - deleted 8y ago
      [deleted]
  - Nimitz14 8y ago
    > Markets work by paying for value created. That is not completely true. Market pay also depends on demand and supply. When I was 19 I got 20 Euro an hour (tax free!) doing some CAD work not because of my skills (they were pathetic), but because a large project of a small company depended on some CAD work being done and he (the boss) couldn't find anyone to do it (part-time, for half a year only, very simple work on a shitty laptop were some reasons why I can imagine he had problems). As a test I was asked to draw a line and give it a specific colour in AutoCAD, that was it!
- tom_mellior 8y ago
  > It's how markets work. The "labor market" is a pretty good example of how markets don't work. Workers are pretty much forced to participate in the "market" because they have to eat. This alone is a ridiculous distortion of market mechanisms. There are also huge information asymmetries regarding salary levels.
- pennaMan 8y ago
  What if you are a nomad, changing locations month after month? What is your employment market? Is getting hired while in a high income place then moving to a low income place immediately after regarded as a good move in this game? A remote only company playing the local income game is a major red flag for me. It's basically an employee caste system at that point, with second class employees based solely on their physical location.
alter_eco123 8y ago
> Pay people what they're worth regardless of where they live. Note that people are fine with getting a lower salary in exchange for being able to work remotely. You could turn it around and say remote employees are "paying their employer what working remotely is worth".
- yosito 8y ago
  Personally, if a company uses remote work as an excuse to pay less, that's a red flag for me. Pay should represent the value you offer to the company, period.
  - alter_eco123 8y ago
    > Pay should represent the value you offer to the company, period. Sure, but value works both ways. "Your salary should represent the value working remotely offers to you" If it's reasonable for you to think that way, why wouldn't it be reasonable for companies too?
jameslk 8y ago
I guess we'll have to throw purchasing power out the window to discuss this one. So pay the developer $20k per year or pay them $100k? If the former, I guess those US developers are just screwed and will probably make more money flipping burgers. If the latter, or anywhere between, then we'll just see developers move to the cheapest, lowest tax countries to arbitrage the artificial market inefficiency. Or are you suggesting we force developers to stay where they are too?
- mkl 8y ago
  I'm not saying I disagree with you, but why exactly would it be bad if people moved to places with cheaper cost of living or less tax?
  - jameslk 8y ago
    Nothing wrong with it per se. As a developer, I would love to move somewhere cheap and still be paid a Bay Area salary, so I could come back to the US and buy several houses after saving up a truckload of money. But I don't think that was the OP's goal.
- tom_mellior 8y ago
  > So pay the developer $20k per year or pay them $100k? If they bring you $20k worth of value, pay them $20k. If they bring you $100k worth of value, pay them $100k. Would it suck to be a developer in San Francisco on the same salary as your colleague in India? Sure, but nobody forces you to live in San Francisco. > If the latter, or anywhere between, then we'll just see developers move to the cheapest, lowest tax countries to arbitrage the artificial market inefficiency. So? What does that have to do with your company? Does it have a moral obligation to contribute to global inequality? Wouldn't it be better for the world if good hard money for taxes and locally sourced goods and services were flowing into less developed countries?
  - AstralStorm 8y ago
    > Nobody forces you to live in San Francisco Spoken like a person without a family or property who is fine with moving to India in a heartbeat. Do you even know Indian culture? Languages? How to actually acquire a decent living place in there? It is an existential risk. A pretty big one. You could end up on street or worse. Alleviating this risk takes negligible resources and quite a lot of time.
toomanybeersies 8y ago
Salary should be scaled in part by cost of living, otherwise it's unfair to people in high COL countries. Gitlab does this when calculating salary [1] for their employees. It seems only fair to me. [1] https://about.gitlab.com/handbook/people-operations/global-compensation/#compensation-calculator https://about.gitlab.com/handbook/people-operations/global-c...
- jaggederest 8y ago
  Why is it fair to subsidize people to live in high cost of living locations?
  - toomanybeersies 8y ago
    Because otherwise, after COL, you might only save $10k per year in a developed country, and $30k per year in a developing country. That would be just as lopsided and unfair to your remote workers as paying them all market rate, so that your employees in developed countries get paid $80k per year and your employees in India get paid $8k per year. Or do you expect your developers in America to relocate to India?
    - jaggederest 8y ago
      Why not subsidize everyone's lifestyle so they all save the same amount of money, regardless of spending? Would you pay more money for the exact same product made in a different city? How is hiring developers different?
      - toomanybeersies 8y ago
        Well, I think the idea is meant to be that you get the best developers possible, regardless of where they are, while still trying to keep expenses minimal.
      - rodw 8y ago
        If you've identified the "best" candidate for a position and want to hire or retain that person, you're now competing with the other offers available to that candidate (which include CoL-adjusted offers), not with the salaries you're paying other employees.
bufferoverflow 8y ago
It's not racism, it's simple market forces. Supply and demand and the local cost of living. Someone living in Ukraine will do just fine on 10% of what a Bay Area dev gets paid.

by allday 8y ago

sushisource 8y ago

This is a bit ridiculous. It's not hegemony or racism. It's how markets work. People in those markets have fewer opportunities for highly paid employment. As a result, employers have more leverage in negotiations. It's as simple as that.

ludston 8y ago
His is a moralistic argument. I expect he understands the mechanism at play here.
- 52-6F-62 8y ago
  This is correct. Simplified, the counter argument appears to be: "If a company has the leverage in any capacity to exercise its dominance over a potential employee—to extract as much value from them at the lowest possible financial liability—it should in any case attempt to do so. It would be absurd to do otherwise." Personally, I can't abide by that—especially when the only basis is locale—and no matter if they bring the same value to the company as a local six-figure-salary employee.
  - ryan-allen 8y ago
    That's pretty much a company's MO no matter where you go. It's always about leverage and market forces. If an employer could pay you 75% less to do the same work they'd do it in a heartbeat. It's better to know the rules of the game otherwise you'll just end up being played.
    - 52-6F-62 8y ago
      Yes and no, I think. Like some other commenters implied, I think it's short sighted. The outcome of working employees like that can end up being of lower quality, so the product suffers, and loses market traction. I've been witness to this first-hand. Of course, it's only anecdotal, but just the same it's informed my opinions. Though you're right about your last point absolutely— it's often pretty safe to assume they're (especially larger companies) operating under the pretense we're both referring to.
kgodey 8y ago
People in those markets usually aren't comparing their offer with local competition, the job market for remote workers is worldwide. Many companies do pay remote employees based on the value they bring to the company regardless of where they live so they are the competition.
- AstralStorm 8y ago
  The problem with this is that a remote worker will have problems finding opportunities or getting found, especially because the competition is so huge. It is like the problems contractors face taken to some non small power.
ehnto 8y ago
Ah yes, the ever ethical and humanist market. I don't think it's wise to look for cues on how to be ethical from the market. You're right about the mechanisms at play though.
jasonkester 8y ago
It's how markets work. Markets work by paying for value created. I’ve tested extensively, and found that I’m equally capable of writing code on a beach in Thailand as in a felt cube in California. I’ll grant that there is a Cost of Living difference between those places, but I would prefer that difference to be captured by me rather than somebody else’s company. It’s me doing the work and creating the value, so that seems reasonable. If you want to purchase my services, you get to pay my market rate. End of story. Never drop your rate when working remote. That should probably be written in the article we’re discussing.
- AstralStorm 8y ago
  Unfortunately, you will get outpriced by people doing "the same" work for less. Since you cannot know the global prices, you cannot even meet them, much less compete. Lowest bidder often wins.
  - jasonkester 8y ago
    I know, right? I've lost track of all the money I've lost from clients going with the lowest bidder over the years. I must be literally hundreds of dollars by now. A bit of advice: Those cheap guys are not your competition, and those bargain hunter clients are not the ones you're trying to land. Let them all race to the bottom all they want. Maybe one of them will find a dev who doesn't know his value yet, but the rest will get their money's worth. It doesn't concern you. There is only one of you, and your rate is the same whether you're onsite in the Bay Area or working remote from anywhere else you choose to be. That mindset has served me well over the years. I'd recommend taking it on board.
  - deleted 8y ago
    [deleted]
- Nimitz14 8y ago
  > Markets work by paying for value created. That is not completely true. Market pay also depends on demand and supply. When I was 19 I got 20 Euro an hour (tax free!) doing some CAD work not because of my skills (they were pathetic), but because a large project of a small company depended on some CAD work being done and he (the boss) couldn't find anyone to do it (part-time, for half a year only, very simple work on a shitty laptop were some reasons why I can imagine he had problems). As a test I was asked to draw a line and give it a specific colour in AutoCAD, that was it!
tom_mellior 8y ago
> It's how markets work. The "labor market" is a pretty good example of how markets don't work. Workers are pretty much forced to participate in the "market" because they have to eat. This alone is a ridiculous distortion of market mechanisms. There are also huge information asymmetries regarding salary levels.
pennaMan 8y ago
What if you are a nomad, changing locations month after month? What is your employment market? Is getting hired while in a high income place then moving to a low income place immediately after regarded as a good move in this game? A remote only company playing the local income game is a major red flag for me. It's basically an employee caste system at that point, with second class employees based solely on their physical location.

alter_eco123 8y ago

> Pay people what they're worth regardless of where they live. Note that people are fine with getting a lower salary in exchange for being able to work remotely. You could turn it around and say remote employees are "paying their employer what working remotely is worth".

yosito 8y ago
Personally, if a company uses remote work as an excuse to pay less, that's a red flag for me. Pay should represent the value you offer to the company, period.
- alter_eco123 8y ago
  > Pay should represent the value you offer to the company, period. Sure, but value works both ways. "Your salary should represent the value working remotely offers to you" If it's reasonable for you to think that way, why wouldn't it be reasonable for companies too?

jameslk 8y ago

I guess we'll have to throw purchasing power out the window to discuss this one. So pay the developer $20k per year or pay them $100k? If the former, I guess those US developers are just screwed and will probably make more money flipping burgers. If the latter, or anywhere between, then we'll just see developers move to the cheapest, lowest tax countries to arbitrage the artificial market inefficiency. Or are you suggesting we force developers to stay where they are too?

mkl 8y ago
I'm not saying I disagree with you, but why exactly would it be bad if people moved to places with cheaper cost of living or less tax?
- jameslk 8y ago
  Nothing wrong with it per se. As a developer, I would love to move somewhere cheap and still be paid a Bay Area salary, so I could come back to the US and buy several houses after saving up a truckload of money. But I don't think that was the OP's goal.
tom_mellior 8y ago
> So pay the developer $20k per year or pay them $100k? If they bring you $20k worth of value, pay them $20k. If they bring you $100k worth of value, pay them $100k. Would it suck to be a developer in San Francisco on the same salary as your colleague in India? Sure, but nobody forces you to live in San Francisco. > If the latter, or anywhere between, then we'll just see developers move to the cheapest, lowest tax countries to arbitrage the artificial market inefficiency. So? What does that have to do with your company? Does it have a moral obligation to contribute to global inequality? Wouldn't it be better for the world if good hard money for taxes and locally sourced goods and services were flowing into less developed countries?
- AstralStorm 8y ago
  > Nobody forces you to live in San Francisco Spoken like a person without a family or property who is fine with moving to India in a heartbeat. Do you even know Indian culture? Languages? How to actually acquire a decent living place in there? It is an existential risk. A pretty big one. You could end up on street or worse. Alleviating this risk takes negligible resources and quite a lot of time.

toomanybeersies 8y ago

Salary should be scaled in part by cost of living, otherwise it's unfair to people in high COL countries. Gitlab does this when calculating salary [1] for their employees. It seems only fair to me. [1] https://about.gitlab.com/handbook/people-operations/global-compensation/#compensation-calculator https://about.gitlab.com/handbook/people-operations/global-c...

jaggederest 8y ago
Why is it fair to subsidize people to live in high cost of living locations?
- toomanybeersies 8y ago
  Because otherwise, after COL, you might only save $10k per year in a developed country, and $30k per year in a developing country. That would be just as lopsided and unfair to your remote workers as paying them all market rate, so that your employees in developed countries get paid $80k per year and your employees in India get paid $8k per year. Or do you expect your developers in America to relocate to India?
  - jaggederest 8y ago
    Why not subsidize everyone's lifestyle so they all save the same amount of money, regardless of spending? Would you pay more money for the exact same product made in a different city? How is hiring developers different?
    - toomanybeersies 8y ago
      Well, I think the idea is meant to be that you get the best developers possible, regardless of where they are, while still trying to keep expenses minimal.
    - rodw 8y ago
      If you've identified the "best" candidate for a position and want to hire or retain that person, you're now competing with the other offers available to that candidate (which include CoL-adjusted offers), not with the salaries you're paying other employees.

bufferoverflow 8y ago

It's not racism, it's simple market forces. Supply and demand and the local cost of living. Someone living in Ukraine will do just fine on 10% of what a Bay Area dev gets paid.