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It's impossible to earn a high income without others taking a majority of what you "bring in." Engineers get hammered on equity by Founders, who get hammered b

It's impossible to earn a high income without others taking a majority of what you "bring in." Engineers get hammered on equity by Founders, who get hammered by Venture Capitalists, who hand over most of their profits to Institutional funds. It's a food chain thing, but I don't think it's worth getting that upset about. But then again, Institutional Funds put billions at risk to into Venture Capital funds who put millions at risk to founders who take on more risk, and a boat loat more stress and hassle (usually) than their employees. Software salespeople need to bring in 4-5x of what they cost. Lawyers and consultants are often tasked with bringing in 3-4x their cost. Why should engineers be any different? My granddad told me a story a few years ago about a guy who was a fantastically successful oil trader. A buy the whole tanker oil trader kinda guy. One of the reasons he'd been so successful was that he always tried to leave a bit of margin there for other people. I work as a recruiter. I know exactly how much money I've made my company and how much I've personally been paid. I could make more by starting out on my own. But I'd also take on a lot of hassle that I don't really want to bother with at this point in my life. As long as it remains a fairly reasonable trade, I'll be fine with it.

crimsonalucard 8y ago
There should be an economic system set up where all workers get all the fruit of their labor rather than a fraction of it. Communism failed, but there has got to be another way.
- ecolonsmak 8y ago
  employee ownership is a great way to organize. https://rady.ucsd.edu/centers/beyster/employee-ownership/ https://rady.ucsd.edu/centers/beyster/employee-ownership/
- mmt 8y ago
  > workers get all the fruit of their labor rather than a fraction of it Be careful what you wish for. Risk is important, and if the "fruit" is zero, that's undesirable, too. We're seeing this in a microcosm of the "gig economy" with Uber pushing risk (and other externalities) onto drivers. I believe that was part of the parent's point about running a business and "hassle". I think it's debatable whether that necessarily costs the vast majority of labor's output, as the parent contends, but I doubt it can cost zero, as you contend. I'm ignoring capital (tools or even borrowing money) on purpose, in order to avoid the communism tangent.
- AnimalMuppet 8y ago
  One consequence of any such system is that the workers have to pay for all the tools.
mmt 8y ago
> Software salespeople need to bring in 4-5x of what they cost. Lawyers and consultants are often tasked with bringing in 3-4x their cost. Why should engineers be any different? I'm not making the argument, but I suspect the argument is along the lines that (certain) engineers are actually creating the wealth, while the other professions you mention are some form of overhead, merely moving the wealth around (if you'll pardon the oversimplification/potential-strawman). Although I see the merit to arguments of that form, as someone in what is a service profession (IT/Ops, which is even traditionally "overhead" or "cost center"), I'm acutely aware of the value (i.e. wealth) that services provide. That said, I don't think a generalization like "all the professions are the same" (and fractionial-value compensation being fair is merely a matter of degree) is any more valid than engineering exceptionalism. Witness the popularity of terms like "rent seeking" and (earlier) "disintermediation". > I know exactly how much money I've made my company > As long as it remains a fairly reasonable trade, I'll be fine with it. This is probably the crux of the issue. Anyone in a non-sales/transactional role doesn't have this information, which makes it exceedingly difficult even to begin to decide if it's a fairly resonable trade. Besides the information assymetry (not that the company actually knows how much a particular engineer "makes" them), some of the sentiment among engineers may be due to the notion that, for them, the multiple is much larger than the 3-5x that you quoted above. Would any non-service engineers care to comment on what you think your multiple is?
- seem_2211 8y ago
  Yeah, I totally get a lot of these points. Where I get worried with these sort of questions is they mess up incentive structures and get really difficult so quickly! If we say some engineers (or perhaps more accurately, some engineering) creates the wealth, then do we say other types of engineering doesn't create the wealth? Is integrating a customer creating wealth (possibly?), how about developing a feature that no-one uses (hmm). What about engineering that destroys value / wealth? I like sales because I have great information asymmetry, but it does come at its costs. I don't like doing things that aren't revenue generating, especially if they seem like moonshots. It makes you short term minded (to a degree), and focused on the dollars involved. Not that these are bad things, but they do limit the way you think about problems. I think one thing we need to remember is that engineers* have pretty amazing job security. And that's the crux of my point. Should Facebooks engineers have been better compensated for the machine they've built? Possibly. Should they also be on the hook for the havoc they've created? I'd say yes if they're capturing a lot more value (just like Facebooks executives should very much be on the hook). *in my experience knowing engineers, I have never been one

crimsonalucard 8y ago

There should be an economic system set up where all workers get all the fruit of their labor rather than a fraction of it. Communism failed, but there has got to be another way.

ecolonsmak 8y ago
employee ownership is a great way to organize. https://rady.ucsd.edu/centers/beyster/employee-ownership/ https://rady.ucsd.edu/centers/beyster/employee-ownership/
mmt 8y ago
> workers get all the fruit of their labor rather than a fraction of it Be careful what you wish for. Risk is important, and if the "fruit" is zero, that's undesirable, too. We're seeing this in a microcosm of the "gig economy" with Uber pushing risk (and other externalities) onto drivers. I believe that was part of the parent's point about running a business and "hassle". I think it's debatable whether that necessarily costs the vast majority of labor's output, as the parent contends, but I doubt it can cost zero, as you contend. I'm ignoring capital (tools or even borrowing money) on purpose, in order to avoid the communism tangent.
AnimalMuppet 8y ago
One consequence of any such system is that the workers have to pay for all the tools.

mmt 8y ago

> Software salespeople need to bring in 4-5x of what they cost. Lawyers and consultants are often tasked with bringing in 3-4x their cost. Why should engineers be any different? I'm not making the argument, but I suspect the argument is along the lines that (certain) engineers are actually creating the wealth, while the other professions you mention are some form of overhead, merely moving the wealth around (if you'll pardon the oversimplification/potential-strawman). Although I see the merit to arguments of that form, as someone in what is a service profession (IT/Ops, which is even traditionally "overhead" or "cost center"), I'm acutely aware of the value (i.e. wealth) that services provide. That said, I don't think a generalization like "all the professions are the same" (and fractionial-value compensation being fair is merely a matter of degree) is any more valid than engineering exceptionalism. Witness the popularity of terms like "rent seeking" and (earlier) "disintermediation". > I know exactly how much money I've made my company > As long as it remains a fairly reasonable trade, I'll be fine with it. This is probably the crux of the issue. Anyone in a non-sales/transactional role doesn't have this information, which makes it exceedingly difficult even to begin to decide if it's a fairly resonable trade. Besides the information assymetry (not that the company actually knows how much a particular engineer "makes" them), some of the sentiment among engineers may be due to the notion that, for them, the multiple is much larger than the 3-5x that you quoted above. Would any non-service engineers care to comment on what you think your multiple is?

seem_2211 8y ago
Yeah, I totally get a lot of these points. Where I get worried with these sort of questions is they mess up incentive structures and get really difficult so quickly! If we say some engineers (or perhaps more accurately, some engineering) creates the wealth, then do we say other types of engineering doesn't create the wealth? Is integrating a customer creating wealth (possibly?), how about developing a feature that no-one uses (hmm). What about engineering that destroys value / wealth? I like sales because I have great information asymmetry, but it does come at its costs. I don't like doing things that aren't revenue generating, especially if they seem like moonshots. It makes you short term minded (to a degree), and focused on the dollars involved. Not that these are bad things, but they do limit the way you think about problems. I think one thing we need to remember is that engineers* have pretty amazing job security. And that's the crux of my point. Should Facebooks engineers have been better compensated for the machine they've built? Possibly. Should they also be on the hook for the havoc they've created? I'd say yes if they're capturing a lot more value (just like Facebooks executives should very much be on the hook). *in my experience knowing engineers, I have never been one