21 ms·

In Silicon Valley wages are down for everyone but the top 10 percent

221 points by chollida1 8y ago

crawfordcomeaux 8y ago
Serious question: How would a Post-Capitalist Silicon Valley be different from today? And what if everyone in Silicon Valley started practicing shamanism? And/or anarchism? What things would companies measure instead of or in addition to money & attention? What if tech leaders & workers joined together in saying "We peacefully revoke consent to be governed this way and request immediate transformative justice." (Or something more effectively worded than that)
- nkoren 8y ago
  Serious advice: you're using your brain wrong. Find something better to do with it. Questions which start with "what if everyone <insert verb here>" are bad questions. People will always behave in diverse, contradictory, and conflicting ways. We've been doing that pretty much since the Cambrian explosion, and we're not going to stop any time soon. Asking what would happen if we did is useless -- like asking what would happen if gravity reversed, or if black was white and white was black. If you're vexxed by income inequality and consumerism and environmental degradation and such -- as I am -- then it's best to pursue avenues of enquiry and develop theses which aren't fundamentally impossible from the fifth syllable onwards.
  - joejerryronnie 8y ago
    Good advice, although the original post could be the basis for a sweet fictional novel.
    - crawfordcomeaux 8y ago
      Reality is a sweet fictional novel we're writing together. It's why I ask fanciful questions.
  - KirinDave 8y ago
    > Serious advice: you're using your brain wrong. Find something better to do with it. Questions which start with "what if everyone <insert verb here>" are bad questions. People will always behave in diverse, contradictory, and conflicting ways. Serious advice #1: thought experiments can have value even if the thought experiment does not directly model plausible human behavior. The same is true of statistical, scientific, mathematical, and philosophical inquiry. Many foundation proofs begin with "assume this unlikely thing is true." Heck, laissez-faire capitalism as a concept started as a thought experiment based around the fiction of a prior redistribution of wealth (too bad everyone seems to forget that first part). This is a discussion forum, and the question "what if the majority of folks start doing ______" isn't so absurd a question to ask in all but the most degenerate cases. > like asking what would happen if gravity reversed Ironically written given the front page has a detailed writeup on an experiment looking for signs of anti-gravity in the cosmos. Serious Advice 2: "If you're vexxed by income inequality and consumerism and environmental degradation and such -- as I am" is defining activism of any sort with you as its focal point. Any such activism is doomed, because one need only render you unlikable to derail even unrelated work (as we have seen in the UK's politics these last few years). It's even worse to admonish other people to operate this way. Reconsider it, please.
  - anothergoogler 8y ago
    You're assuming parent wasn't going for the top comment. In addition to the open-ended hypothetical, popular tactics include prefacing with "This is an unpopular opinion" and "My theory is". Depending on the goal, they might be using their brain correctly. Stacking open-ended hypotheticals is a savvy move.
    - crawfordcomeaux 8y ago
      I wasn't, but now I'm going to experiment with it as a means of building a following for my design-your-own-religion religion!
      - anothergoogler 8y ago
        I think you're onto something. Perhaps it's best to focus on the design of the design though. A further derivative of subjectivity ought to fit the bill! :)
        crawfordcomeaux 8y ago
        I started by working on a theory of design. The religion is an artistic packaging of a programming framework for the human self. It's all centered around hacking my perceptions. Does that seem to address what you're talking about? Cause now I'm intrigued by whatever other thoughts you might have.
  - crawfordcomeaux 8y ago
    I see I wasn't clear because I used absolute terms. Please insert your own desired population percentages for the questions where I've implied 100%. In the meantime, I'll still consider the ideas because I find it useful. There are no bad questions, just people who find it useful to judge others and their questions. I've found it transformationally useful to minimize my judgment, so I don't count myself among that crowd anymore and I don't judge others who do. If it's the absolute terms I used, like "everyone," that's put you off, cool. Let's instead imagine what would happen if a majority chose to. Or 25%. Or 3.5%. Just as you chose to answer a question I didn't ask, you could've easily modified my questions to fit your standards. Serious advice: Responding with judgment isn't typically conducive to learning unless the recipient has learned to let go of other people's judgments. Here's a paper on the subject I find useful. https://queue.acm.org/detail.cfm?id=3068754 https://queue.acm.org/detail.cfm?id=3068754
    - nkoren 8y ago
      This is a good reply, and I apologise for the judgemental reaction. We probably actually share much of the same ethos. Personally I think it would be absolutely if everybody dropped mushrooms and spent a week in the wilderness coming to terms with the unity of consciousness of all beings and the absurdity of building a society based on false economies of wage labour and conspicuous consumption, etc. Worked wonders for me, and no doubt it would be groovy if everybody else did that too. The severity my reaction is due to the fact that I've seen too many people hit this wavelength and then get lost in the daydream of what would happen if literally everybody else got on this wavelength too. And then spend -- and please believe that I mean this very very literally -- the entire rest of their lives lost in that daydream. I find this to be tragic, because I think that such people have something to contribute to the world, and pursuing this question explicitly degrades their ability to do so. And thus I actually do think it's a bad question. If you're interested in changing the world, then becoming attached to any kind of theory whose initial predicate is fundamentally impossible means that you are not going to change the world. A far better starting point is: "how can I change the world without anybody noticing at all"? Followed closely by: "how can I change the world if I get one in a million people to see things my way?" Work your way up from there. Starting from the other direction is a mind-killer.
- KirinDave 8y ago
  > How would a Post-Capitalist Silicon Valley be different from today? What's interesting is that I don't think the day-to-day of it would look very different. Extremely hierarchical corporate structures don't work very well in small scale unless you have phenomenally charismatic (or even rarer, actual top-of-field domain expert) leaders. As an incentive to bring folks into the space, varying degrees of group ownership and power are offered to the founding set (and founding investors, which are often an integral part of the early business). In a very real sense but perhaps to a lesser total degree, this is (as the syndicalists love to put it) "the workers owning the mill they operate." What's also interesting is that as the company scales, this approach is considered increasingly untenable (mostly from a profit-generation standpoint) and a more absolutely hierarchical system emerges. But nearly everyone has the opinion that these corporate structures are awful, inefficient beasts that create incentives for parasitic management, outsized rewards for C-sets who may or may not provide actual value, and a constant conflict within the workforce to avoid being trivialized by the desire to increase efficiency over product quality or market share. There was a pair of papers recently that I really enjoyed investigating what "fractal" community (and by obvious extension, corporate) structures could look like by De Florio & then Pajaziti: https://onlinelibrary.wiley.com/doi/pdf/10.1002/sres.2242 https://onlinelibrary.wiley.com/doi/pdf/10.1002/sres.2242 https://arxiv.org/abs/1509.05112 https://arxiv.org/abs/1509.05112 These delve into how one can build service organizations around non-traditional (e.g., not-straight-line-to-the-top-always-centralized) structures and how these can actually have deceptively better efficiency even if their outcomes are only statistically predictable. It's worth noting that these sorts of organization styles are not untested in the valley. The biggest success for such an organization I can think of off the top of my head is Google's technical support and loaner laptop system, which is semi-fractal and horizontal and despite looking like it'd be a huge money pit (from the traditional "control outcomes and limit loss" school of IT management), is actually dramatically cheaper than traditional IT departments at its scale. Data driven organizations often naturally push towards open and relatively flat org structures, with the understanding that the overhead of abuse of such system's leniency is much less expensive than the total expense of minimizing said abuse. This isn't isn't exactly new, we see echos of the "actually the chaotic version of this over resources that are infinite in principle but constrained in a time domain is not much worse than the perfectly scheduled system" principle in lots of fields. Market economics likes this outcome (although not when you start making them own "externalities" like environmental damage). Network engineers have long ago made their peace with this truth, as well. A randomly scheduled network is only about 1/3 worse than an optimally scheduled network!
- 13of40 8y ago
  If you think about it, Silicon Valley is what you get when you mix two parts new age culture with three parts IBM and let it ripen for a few decades.
- drb91 8y ago
  If you're asking seriously.... I think there's serious potential for co-ops. There's no reason services like Yelp need to be designed around a hockey stick revenue curve.
- egypturnash 8y ago
  A Silicon Valley that counted its value in the amount of happiness it created for people using its products (and perhaps even for people who don't use their products) instead of the amount of financial value it extracted from them would be a very different place indeed. The older I get the more I feel like capitalism is a system for turning human misery into profits for a lucky few.
skybrian 8y ago
Note that this report is in terms of percentages, which don't track what's happening to individuals. Population growth and turnover (as people move, retire, or join the workforce) mean that it's possible for average wages to decrease largely due to new low wage jobs filled by newcomers, rather than wage decreases for people already working in Silicon Valley. Someone would need to dig deeper to figure it out. This trend towards inequality is still not good. The percentages do show that.
- UncleEntity 8y ago
  Or the mid-range jobs move out of the Bay Area because of the high cost of living? I grew up in the Bay Area but there's a snowball's chance in hell I could ever go back due to what it costs to live there...just to rent a bedroom from some homeowner would cost more than the two bedroom apartment I currently live in.
- OnlyRepliesToBS 8y ago
  weird balance of paragraph to 2 sentences
friedman23 8y ago
If you are a Software Engineer you are likely in the top 10%. Just mentioning this because I saw a thread in /r/programming the other day and some Software Engineers actually thought they were not in the top 10% of Americans when it comes to salary.
- CalRobert 8y ago
  It can be frustrating to read HN sometimes when it feels like you're the only one making under 200k. I do wonder how many engineers realize how astonishingly well paid they are compared to, say, their kid's teacher.
  - anothergoogler 8y ago
    Teachers being criminally underpaid doesn't change the fact that most engineers are underpaid. A good engineer can generate multiples of their salary in revenue.
    - BurningFrog 8y ago
      And a bad engineer can destroy as much. One fun thing about humans is that almost all think they're underpaid. This says a lot about people and nothing about wages.
      - anothergoogler 8y ago
        We may have different experiences, but in a long career the worst I've seen are useless engineers. Are you seriously claiming that the population of engineers destroying multiples of their salary (sabotage/gross negligence) is comparable to the population who create multiples (and are exploited)? Silicon Valley lore is filled with stories of fortunes earned on the backs of engineers being paid market rates. You don't have to look hard to find them, start with Apple, or look at any modern "unicorn."
        BurningFrog 8y ago
chasing 8y ago
As a relatively high-earning person in tech, let me say again: Please tax me and people like me (or wealthier) more. Please, please, please. I'm a greedy capitalist, but income disparity hurts everyone and our country would be such a more pleasant and productive place if those at the top would express just a shade more generosity by supporting their fellow citizens.
- meddlepal 8y ago
  Yes tax us more so it can be spent just as inefficiently. Throwing more money at our problems is not the solution.
  - chasing 8y ago
    Throwing money at it would solve all sorts of problems. It'd let us pay teachers more. It'd let us provide more healthcare opportunities to people. It'd help us improve our infrastructure like roads and public transportation. It'd help our libraries. It'd make education less expensive, allowing more people access. Fewer people in economic distress means less crime. Better parks. Better maintenance of natural spaces. Etc. Government isn't perfect. But neither is private industry. We need both. And both need money to function well.
    - claydavisss 8y ago
      In most Bay Area communities education bond measures pass with ease. Same with open space measures. Mid Peninsula Open Space is swimming in money, they buy land faster than they can open it. Bay Area voters just recently approved major funding boosts for Mid Peninsula...why would they do so again so soon? Seems like HN readers would do well to survey what has passed in the last ten years...
    - meddlepal 8y ago
      More money == things are better is just too simple of a model to make a decision like this. You add more money to the system and where does it go? It's not automatically allocated to your causes, some of it gets siphoned off in administrative overhead. Some of it gets reallocated. Some of it is just used for cronyism or lost in the bureaucracy of doing business (e.g. paying lawyer fees to fight NIMBY's who are using environmental review to prevent the development of transportation or public housing). On a tangential note, there is nothing stopping you and a group of like-minded individuals from just paying more taxes to the government.
humanrebar 8y ago
If middle class means the choice to own your own home, then the maybe tech workers stayed middle class and everyone else dropped right out of it. I'm concerned that homeownership and retiring locally are luxuries now. American culture is already far too fractious these days. We don't need to jeer at people for being able to afford roots in their local communities.
- dunpeal 8y ago
  > If middle class means the choice to own your own home, then the maybe tech workers stayed middle class The average tech worker has not been able to afford a house in SV for at least a decade now. So by this definition, the average tech worker in SV is lower class. > I'm concerned that homeownership and retiring locally are luxuries now. I don't know about retiring, but home ownership is certainly still widely possible outside of SF, LA, and the other usual suspects. > We don't need to jeer at people for being able to afford roots in their local communities. If it's any comfort, I don't think the majority of residents of SF/Bay currently were born and raised there. More likely, they moved there for work. How many people were actually born and raised in places like Palo Alto, MTV, or even SF a generation ago? Remember, MTV before the tech boom was a rather sleepy little suburb...
  - justboxing 8y ago
    MTV = Mountain View? Had to think about that for a few seconds... ( flashback to 80s )
    - evasote 8y ago
      It still throws me, and I live and work out here. I see buses with this marked on them, I always think they're buses the to TV network, then I go 'Duh'
- dublidu 8y ago
  People are not reading the cited article, which proposes lowering the cost of basic needs (such as housing) as the main solution to this problem.
jt2190 8y ago
The original report: “STILL WALKING THE LIFELONG TIGHTROPE: TECHNOLOGY, INSECURITY AND THE FUTURE OF WORK” by Chris Benner, Gabriela Giusta, Louise Auerhahn, Bob Brownstein, Jeffrey Buchanan http://www.everettprogram.org/main/wp-content/uploads/TIGHTROPE-2018-REPORT.pdf http://www.everettprogram.org/main/wp-content/uploads/TIGHTR...
akhilcacharya 8y ago
I don’t know if this is has evidence in data but is the income distribution for SWEs becoming increasingly bimodal? A range for individuals outside of elite tech companies and a range for individuals within it who have reaped the rewards of appreciating tech stock?
- dunpeal 8y ago
  Are you seeing any evidence of that? If anything, I'm seeing the opposite: non-"elite" tech pay is increasing to rival "elite" tech pay (since that's the only way you can hire a decent engineer in any of the major tech hubs in the US).
  - toomuchtodo 8y ago
    > If anything, I'm seeing the opposite: non-"elite" tech pay is increasing to rival "elite" tech pay (since that's the only way you can hire a decent engineer in any of the major tech hubs in the US). I'm seeing the same in the Central Florida area. Postings open for months, the pay scale slowly increasing at the same time. I've even worked with recruiters to help drag those salaries up, explaining how to go back to their clients and explain their expectations are unrealistic. A rising tide lifts all boats.
  - Bahamut 8y ago
    At least in the Valley, this is very much not true. Very few companies are willing to match the compensation from the tech giants. I work for a non-Amazon FAANG and I'll be surprised if a company was willing to match almost $300k of unvested stock (after 1 review cycle & 1 year of vesting), a healthy salary on top of my existing one, and comparable annual refresh grants - only companies I see really doing so would be another FAANG and VC firms.
- jefftk 8y ago
  > is the income distribution for SWEs becoming increasingly bimodal? Dan Luu has written some about this: https://danluu.com/bimodal-compensation/ https://danluu.com/bimodal-compensation/
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paulsutter 8y ago
Not just a nit, profits aren’t paid as salaries. The high profitability of the big tech cos is /despite/ the high salaries they pay. > increasing concentration of company profits going toward the salaries of a select few
- dgoldstein0 8y ago
  True, but really high profits also enable them to pay higher salaries. Obviously they don't put all their profits into salaries.
  - paulsutter 8y ago
    High margins allow high salaries. Any money put into salaries is not profits it’s an expense. This may sound like a nit but it’s important because they have high profits despite high salaries. It shows the lopsided value of well managed network effects businesses.
- liftbigweights 8y ago
  You are correct. Salaries are actually liabilities for companies. Profits are used to pay dividends to shareholders, not to pay the salaries.
dunpeal 8y ago
This article is terrible: > Tech companies are spending a large portion of their capital toward paying a limited number of research and development staff to design new products and software, but not toward maintenance and service staff like factory and maintenance workers The entire article and everyone it quotes then proceed to argue that this wealth should be redistributed downwards. This is not just unfair - it will also never work. Because some roles (like "low-skilled maintenance and factory work") have far more candidates than openings, while other roles (like high-skilled engineering) have the opposite supply/demand curve. Now, suppose every single company starts artificially inflating the wages of low-skilled roles, and suppressing the wages for high-skilled roles, to keep everyone "equal" just like this article suggests. What will happen? Nobody will invest the huge amount of time and effort required to become engineers, since that investment won't pay off. Why waste 4 expensive years in college, if I can get the same pay as a janitor, straight out of highschool and without the student debt? All tech companies will become desperately starved for high-skilled talent. Eventually, one of these companies will realize it can fill its many vacancies by decreasing the wages for the low-skilled work (with huge surplus of candidates, it will still have plenty to choose from) and increasing the wages for high-skilled work, where candidates are scarce. This company will fill all its openings, poach the best engineers, increase its profits, and destroy its competition. At that point, all other companies will have to increase high-skilled pay to match... And we'll be back where we are right now. In fact, that's how we got here in the first place.
- alcio 8y ago
  Not only is it terrible, but misleading too. Google has 88k employees and had a $32B revenue last quarter. Let's assume 25% of employees are R&D, each paid $250k/y: Google would spend $5.5B a year on R&D, or 4.2% of revenues ; not quite a "large portion of their capital".
  - chrisseaton 8y ago
    > Let's assume 25% of employees are R&D 25% of people are researchers at Google? Are you saying that's what you think it is at the moment or hypothetically? Research is a tiny tiny proportion of Google's work.
dirkdk 8y ago
Silicon Valley is not a geographical area, it is the tech industry within a geographical area. The tech industry wages have been going up, but the wages of the people around our industry have been stagnant. Sensationalist title.
closeparen 8y ago
As a software engineer, I make approximately the median income for my county. I don’t know who these top-10% tech workers are, but they’re certainly not my colleagues.
- aidenn0 8y ago
  You are likely wildly underpaid then. I live in a fairly affluent area and right out of college I started above the median income for my city, which was considerably higher than the median income for my county.
  - deleted 8y ago
    [deleted]
- djrogers 8y ago
  You clearly don’t work in the area the article is about them, do you? It sounds like you likely don’t even live in the same country, let alone that specific region of that specific state.
  - closeparen 8y ago
    I do work in the Bay Area. Santa Clara, San Mateo, and San Francisco counties all have median household incomes over $100k. It’s not at all unusual for a single software engineer to be in that ballpark. Look at college graduate incomes and you will find software engineering compensation even less exceptional. At the national level, anyway, personal college graduate incomes around the same as overall household incomes.
    - mamon 8y ago
      Living in California recently I actually met a few software engineers that were driving Uber as their second job, because their SWE salary was not enough. This really shocked me.
      - 8y ago
deleted 8y ago
[deleted]

221 points by chollida1 8y ago

Serious question: How would a Post-Capitalist Silicon Valley be different from today? And what if everyone in Silicon Valley started practicing shamanism? And/or anarchism? What things would companies measure instead of or in addition to money & attention? What if tech leaders & workers joined together in saying "We peacefully revoke consent to be governed this way and request immediate transformative justice." (Or something more effectively worded than that)

nkoren 8y ago
Serious advice: you're using your brain wrong. Find something better to do with it. Questions which start with "what if everyone <insert verb here>" are bad questions. People will always behave in diverse, contradictory, and conflicting ways. We've been doing that pretty much since the Cambrian explosion, and we're not going to stop any time soon. Asking what would happen if we did is useless -- like asking what would happen if gravity reversed, or if black was white and white was black. If you're vexxed by income inequality and consumerism and environmental degradation and such -- as I am -- then it's best to pursue avenues of enquiry and develop theses which aren't fundamentally impossible from the fifth syllable onwards.
- joejerryronnie 8y ago
  Good advice, although the original post could be the basis for a sweet fictional novel.
  - crawfordcomeaux 8y ago
    Reality is a sweet fictional novel we're writing together. It's why I ask fanciful questions.
- KirinDave 8y ago
  > Serious advice: you're using your brain wrong. Find something better to do with it. Questions which start with "what if everyone <insert verb here>" are bad questions. People will always behave in diverse, contradictory, and conflicting ways. Serious advice #1: thought experiments can have value even if the thought experiment does not directly model plausible human behavior. The same is true of statistical, scientific, mathematical, and philosophical inquiry. Many foundation proofs begin with "assume this unlikely thing is true." Heck, laissez-faire capitalism as a concept started as a thought experiment based around the fiction of a prior redistribution of wealth (too bad everyone seems to forget that first part). This is a discussion forum, and the question "what if the majority of folks start doing ______" isn't so absurd a question to ask in all but the most degenerate cases. > like asking what would happen if gravity reversed Ironically written given the front page has a detailed writeup on an experiment looking for signs of anti-gravity in the cosmos. Serious Advice 2: "If you're vexxed by income inequality and consumerism and environmental degradation and such -- as I am" is defining activism of any sort with you as its focal point. Any such activism is doomed, because one need only render you unlikable to derail even unrelated work (as we have seen in the UK's politics these last few years). It's even worse to admonish other people to operate this way. Reconsider it, please.
- anothergoogler 8y ago
  You're assuming parent wasn't going for the top comment. In addition to the open-ended hypothetical, popular tactics include prefacing with "This is an unpopular opinion" and "My theory is". Depending on the goal, they might be using their brain correctly. Stacking open-ended hypotheticals is a savvy move.
  - crawfordcomeaux 8y ago
    I wasn't, but now I'm going to experiment with it as a means of building a following for my design-your-own-religion religion!
    - anothergoogler 8y ago
      I think you're onto something. Perhaps it's best to focus on the design of the design though. A further derivative of subjectivity ought to fit the bill! :)
      - crawfordcomeaux 8y ago
        I started by working on a theory of design. The religion is an artistic packaging of a programming framework for the human self. It's all centered around hacking my perceptions. Does that seem to address what you're talking about? Cause now I'm intrigued by whatever other thoughts you might have.
- crawfordcomeaux 8y ago
  I see I wasn't clear because I used absolute terms. Please insert your own desired population percentages for the questions where I've implied 100%. In the meantime, I'll still consider the ideas because I find it useful. There are no bad questions, just people who find it useful to judge others and their questions. I've found it transformationally useful to minimize my judgment, so I don't count myself among that crowd anymore and I don't judge others who do. If it's the absolute terms I used, like "everyone," that's put you off, cool. Let's instead imagine what would happen if a majority chose to. Or 25%. Or 3.5%. Just as you chose to answer a question I didn't ask, you could've easily modified my questions to fit your standards. Serious advice: Responding with judgment isn't typically conducive to learning unless the recipient has learned to let go of other people's judgments. Here's a paper on the subject I find useful. https://queue.acm.org/detail.cfm?id=3068754 https://queue.acm.org/detail.cfm?id=3068754
  - nkoren 8y ago
    This is a good reply, and I apologise for the judgemental reaction. We probably actually share much of the same ethos. Personally I think it would be absolutely if everybody dropped mushrooms and spent a week in the wilderness coming to terms with the unity of consciousness of all beings and the absurdity of building a society based on false economies of wage labour and conspicuous consumption, etc. Worked wonders for me, and no doubt it would be groovy if everybody else did that too. The severity my reaction is due to the fact that I've seen too many people hit this wavelength and then get lost in the daydream of what would happen if literally everybody else got on this wavelength too. And then spend -- and please believe that I mean this very very literally -- the entire rest of their lives lost in that daydream. I find this to be tragic, because I think that such people have something to contribute to the world, and pursuing this question explicitly degrades their ability to do so. And thus I actually do think it's a bad question. If you're interested in changing the world, then becoming attached to any kind of theory whose initial predicate is fundamentally impossible means that you are not going to change the world. A far better starting point is: "how can I change the world without anybody noticing at all"? Followed closely by: "how can I change the world if I get one in a million people to see things my way?" Work your way up from there. Starting from the other direction is a mind-killer.
KirinDave 8y ago
> How would a Post-Capitalist Silicon Valley be different from today? What's interesting is that I don't think the day-to-day of it would look very different. Extremely hierarchical corporate structures don't work very well in small scale unless you have phenomenally charismatic (or even rarer, actual top-of-field domain expert) leaders. As an incentive to bring folks into the space, varying degrees of group ownership and power are offered to the founding set (and founding investors, which are often an integral part of the early business). In a very real sense but perhaps to a lesser total degree, this is (as the syndicalists love to put it) "the workers owning the mill they operate." What's also interesting is that as the company scales, this approach is considered increasingly untenable (mostly from a profit-generation standpoint) and a more absolutely hierarchical system emerges. But nearly everyone has the opinion that these corporate structures are awful, inefficient beasts that create incentives for parasitic management, outsized rewards for C-sets who may or may not provide actual value, and a constant conflict within the workforce to avoid being trivialized by the desire to increase efficiency over product quality or market share. There was a pair of papers recently that I really enjoyed investigating what "fractal" community (and by obvious extension, corporate) structures could look like by De Florio & then Pajaziti: https://onlinelibrary.wiley.com/doi/pdf/10.1002/sres.2242 https://onlinelibrary.wiley.com/doi/pdf/10.1002/sres.2242 https://arxiv.org/abs/1509.05112 https://arxiv.org/abs/1509.05112 These delve into how one can build service organizations around non-traditional (e.g., not-straight-line-to-the-top-always-centralized) structures and how these can actually have deceptively better efficiency even if their outcomes are only statistically predictable. It's worth noting that these sorts of organization styles are not untested in the valley. The biggest success for such an organization I can think of off the top of my head is Google's technical support and loaner laptop system, which is semi-fractal and horizontal and despite looking like it'd be a huge money pit (from the traditional "control outcomes and limit loss" school of IT management), is actually dramatically cheaper than traditional IT departments at its scale. Data driven organizations often naturally push towards open and relatively flat org structures, with the understanding that the overhead of abuse of such system's leniency is much less expensive than the total expense of minimizing said abuse. This isn't isn't exactly new, we see echos of the "actually the chaotic version of this over resources that are infinite in principle but constrained in a time domain is not much worse than the perfectly scheduled system" principle in lots of fields. Market economics likes this outcome (although not when you start making them own "externalities" like environmental damage). Network engineers have long ago made their peace with this truth, as well. A randomly scheduled network is only about 1/3 worse than an optimally scheduled network!
13of40 8y ago
If you think about it, Silicon Valley is what you get when you mix two parts new age culture with three parts IBM and let it ripen for a few decades.
drb91 8y ago
If you're asking seriously.... I think there's serious potential for co-ops. There's no reason services like Yelp need to be designed around a hockey stick revenue curve.
egypturnash 8y ago
A Silicon Valley that counted its value in the amount of happiness it created for people using its products (and perhaps even for people who don't use their products) instead of the amount of financial value it extracted from them would be a very different place indeed. The older I get the more I feel like capitalism is a system for turning human misery into profits for a lucky few.

skybrian 8y ago

Note that this report is in terms of percentages, which don't track what's happening to individuals. Population growth and turnover (as people move, retire, or join the workforce) mean that it's possible for average wages to decrease largely due to new low wage jobs filled by newcomers, rather than wage decreases for people already working in Silicon Valley. Someone would need to dig deeper to figure it out. This trend towards inequality is still not good. The percentages do show that.

UncleEntity 8y ago
Or the mid-range jobs move out of the Bay Area because of the high cost of living? I grew up in the Bay Area but there's a snowball's chance in hell I could ever go back due to what it costs to live there...just to rent a bedroom from some homeowner would cost more than the two bedroom apartment I currently live in.
OnlyRepliesToBS 8y ago
weird balance of paragraph to 2 sentences

friedman23 8y ago

If you are a Software Engineer you are likely in the top 10%. Just mentioning this because I saw a thread in /r/programming the other day and some Software Engineers actually thought they were not in the top 10% of Americans when it comes to salary.

CalRobert 8y ago
It can be frustrating to read HN sometimes when it feels like you're the only one making under 200k. I do wonder how many engineers realize how astonishingly well paid they are compared to, say, their kid's teacher.
- anothergoogler 8y ago
  Teachers being criminally underpaid doesn't change the fact that most engineers are underpaid. A good engineer can generate multiples of their salary in revenue.
  - BurningFrog 8y ago
    And a bad engineer can destroy as much. One fun thing about humans is that almost all think they're underpaid. This says a lot about people and nothing about wages.
    - anothergoogler 8y ago
      We may have different experiences, but in a long career the worst I've seen are useless engineers. Are you seriously claiming that the population of engineers destroying multiples of their salary (sabotage/gross negligence) is comparable to the population who create multiples (and are exploited)? Silicon Valley lore is filled with stories of fortunes earned on the backs of engineers being paid market rates. You don't have to look hard to find them, start with Apple, or look at any modern "unicorn."
      - BurningFrog 8y ago

chasing 8y ago

As a relatively high-earning person in tech, let me say again: Please tax me and people like me (or wealthier) more. Please, please, please. I'm a greedy capitalist, but income disparity hurts everyone and our country would be such a more pleasant and productive place if those at the top would express just a shade more generosity by supporting their fellow citizens.

meddlepal 8y ago
Yes tax us more so it can be spent just as inefficiently. Throwing more money at our problems is not the solution.
- chasing 8y ago
  Throwing money at it would solve all sorts of problems. It'd let us pay teachers more. It'd let us provide more healthcare opportunities to people. It'd help us improve our infrastructure like roads and public transportation. It'd help our libraries. It'd make education less expensive, allowing more people access. Fewer people in economic distress means less crime. Better parks. Better maintenance of natural spaces. Etc. Government isn't perfect. But neither is private industry. We need both. And both need money to function well.
  - claydavisss 8y ago
    In most Bay Area communities education bond measures pass with ease. Same with open space measures. Mid Peninsula Open Space is swimming in money, they buy land faster than they can open it. Bay Area voters just recently approved major funding boosts for Mid Peninsula...why would they do so again so soon? Seems like HN readers would do well to survey what has passed in the last ten years...
  - meddlepal 8y ago
    More money == things are better is just too simple of a model to make a decision like this. You add more money to the system and where does it go? It's not automatically allocated to your causes, some of it gets siphoned off in administrative overhead. Some of it gets reallocated. Some of it is just used for cronyism or lost in the bureaucracy of doing business (e.g. paying lawyer fees to fight NIMBY's who are using environmental review to prevent the development of transportation or public housing). On a tangential note, there is nothing stopping you and a group of like-minded individuals from just paying more taxes to the government.

humanrebar 8y ago

If middle class means the choice to own your own home, then the maybe tech workers stayed middle class and everyone else dropped right out of it. I'm concerned that homeownership and retiring locally are luxuries now. American culture is already far too fractious these days. We don't need to jeer at people for being able to afford roots in their local communities.

dunpeal 8y ago
> If middle class means the choice to own your own home, then the maybe tech workers stayed middle class The average tech worker has not been able to afford a house in SV for at least a decade now. So by this definition, the average tech worker in SV is lower class. > I'm concerned that homeownership and retiring locally are luxuries now. I don't know about retiring, but home ownership is certainly still widely possible outside of SF, LA, and the other usual suspects. > We don't need to jeer at people for being able to afford roots in their local communities. If it's any comfort, I don't think the majority of residents of SF/Bay currently were born and raised there. More likely, they moved there for work. How many people were actually born and raised in places like Palo Alto, MTV, or even SF a generation ago? Remember, MTV before the tech boom was a rather sleepy little suburb...
- justboxing 8y ago
  MTV = Mountain View? Had to think about that for a few seconds... ( flashback to 80s )
  - evasote 8y ago
    It still throws me, and I live and work out here. I see buses with this marked on them, I always think they're buses the to TV network, then I go 'Duh'
dublidu 8y ago
People are not reading the cited article, which proposes lowering the cost of basic needs (such as housing) as the main solution to this problem.

jt2190 8y ago

The original report: “STILL WALKING THE LIFELONG TIGHTROPE: TECHNOLOGY, INSECURITY AND THE FUTURE OF WORK” by Chris Benner, Gabriela Giusta, Louise Auerhahn, Bob Brownstein, Jeffrey Buchanan http://www.everettprogram.org/main/wp-content/uploads/TIGHTROPE-2018-REPORT.pdf http://www.everettprogram.org/main/wp-content/uploads/TIGHTR...

akhilcacharya 8y ago

I don’t know if this is has evidence in data but is the income distribution for SWEs becoming increasingly bimodal? A range for individuals outside of elite tech companies and a range for individuals within it who have reaped the rewards of appreciating tech stock?

dunpeal 8y ago
Are you seeing any evidence of that? If anything, I'm seeing the opposite: non-"elite" tech pay is increasing to rival "elite" tech pay (since that's the only way you can hire a decent engineer in any of the major tech hubs in the US).
- toomuchtodo 8y ago
  > If anything, I'm seeing the opposite: non-"elite" tech pay is increasing to rival "elite" tech pay (since that's the only way you can hire a decent engineer in any of the major tech hubs in the US). I'm seeing the same in the Central Florida area. Postings open for months, the pay scale slowly increasing at the same time. I've even worked with recruiters to help drag those salaries up, explaining how to go back to their clients and explain their expectations are unrealistic. A rising tide lifts all boats.
- Bahamut 8y ago
  At least in the Valley, this is very much not true. Very few companies are willing to match the compensation from the tech giants. I work for a non-Amazon FAANG and I'll be surprised if a company was willing to match almost $300k of unvested stock (after 1 review cycle & 1 year of vesting), a healthy salary on top of my existing one, and comparable annual refresh grants - only companies I see really doing so would be another FAANG and VC firms.
jefftk 8y ago
> is the income distribution for SWEs becoming increasingly bimodal? Dan Luu has written some about this: https://danluu.com/bimodal-compensation/ https://danluu.com/bimodal-compensation/

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paulsutter 8y ago

Not just a nit, profits aren’t paid as salaries. The high profitability of the big tech cos is /despite/ the high salaries they pay. > increasing concentration of company profits going toward the salaries of a select few

dgoldstein0 8y ago
True, but really high profits also enable them to pay higher salaries. Obviously they don't put all their profits into salaries.
- paulsutter 8y ago
  High margins allow high salaries. Any money put into salaries is not profits it’s an expense. This may sound like a nit but it’s important because they have high profits despite high salaries. It shows the lopsided value of well managed network effects businesses.
liftbigweights 8y ago
You are correct. Salaries are actually liabilities for companies. Profits are used to pay dividends to shareholders, not to pay the salaries.

dunpeal 8y ago

This article is terrible: > Tech companies are spending a large portion of their capital toward paying a limited number of research and development staff to design new products and software, but not toward maintenance and service staff like factory and maintenance workers The entire article and everyone it quotes then proceed to argue that this wealth should be redistributed downwards. This is not just unfair - it will also never work. Because some roles (like "low-skilled maintenance and factory work") have far more candidates than openings, while other roles (like high-skilled engineering) have the opposite supply/demand curve. Now, suppose every single company starts artificially inflating the wages of low-skilled roles, and suppressing the wages for high-skilled roles, to keep everyone "equal" just like this article suggests. What will happen? Nobody will invest the huge amount of time and effort required to become engineers, since that investment won't pay off. Why waste 4 expensive years in college, if I can get the same pay as a janitor, straight out of highschool and without the student debt? All tech companies will become desperately starved for high-skilled talent. Eventually, one of these companies will realize it can fill its many vacancies by decreasing the wages for the low-skilled work (with huge surplus of candidates, it will still have plenty to choose from) and increasing the wages for high-skilled work, where candidates are scarce. This company will fill all its openings, poach the best engineers, increase its profits, and destroy its competition. At that point, all other companies will have to increase high-skilled pay to match... And we'll be back where we are right now. In fact, that's how we got here in the first place.

alcio 8y ago
Not only is it terrible, but misleading too. Google has 88k employees and had a $32B revenue last quarter. Let's assume 25% of employees are R&D, each paid $250k/y: Google would spend $5.5B a year on R&D, or 4.2% of revenues ; not quite a "large portion of their capital".
- chrisseaton 8y ago
  > Let's assume 25% of employees are R&D 25% of people are researchers at Google? Are you saying that's what you think it is at the moment or hypothetically? Research is a tiny tiny proportion of Google's work.

dirkdk 8y ago

Silicon Valley is not a geographical area, it is the tech industry within a geographical area. The tech industry wages have been going up, but the wages of the people around our industry have been stagnant. Sensationalist title.

closeparen 8y ago

As a software engineer, I make approximately the median income for my county. I don’t know who these top-10% tech workers are, but they’re certainly not my colleagues.

aidenn0 8y ago
You are likely wildly underpaid then. I live in a fairly affluent area and right out of college I started above the median income for my city, which was considerably higher than the median income for my county.
- deleted 8y ago
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djrogers 8y ago
You clearly don’t work in the area the article is about them, do you? It sounds like you likely don’t even live in the same country, let alone that specific region of that specific state.
- closeparen 8y ago
  I do work in the Bay Area. Santa Clara, San Mateo, and San Francisco counties all have median household incomes over $100k. It’s not at all unusual for a single software engineer to be in that ballpark. Look at college graduate incomes and you will find software engineering compensation even less exceptional. At the national level, anyway, personal college graduate incomes around the same as overall household incomes.
  - mamon 8y ago
    Living in California recently I actually met a few software engineers that were driving Uber as their second job, because their SWE salary was not enough. This really shocked me.
    - 8y ago

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