8 ms·

GitLab themselves have this issue too. They openly publish their formula for calculating salaries [0], but it is very strongly weighted against the local rent i

by fyfy18 8y ago

GitLab themselves have this issue too. They openly publish their formula for calculating salaries [0], but it is very strongly weighted against the local rent index. If you spent all of your salary on rent, then yes it would be fair, but if you want to buy a car, new iPhone or go on a Caribbean cruise, it's going to cost the same whether you live in the Bay Area or Belarus. For example in the UK if you live in London and earned £60k, according to GitLab's 'Move Calculator' in Bristol you would earn £42k, or in Brighton £38k. Yes there is a difference between the living costs, but there is not that much difference. A 1br apartment close to the center of Bristol is around £900/mo, and in London zone 2 around £1200/mo. I've seen a lot of remote startups offering salaries around $100k USD, independent of location. For most of the US (outside hot areas like SF or NYC) and Europe that's a good salary, but what if the person you want to hire likes living in the middle of SF and doesn't want to move? For them that salary is going to be too low. I'm not really sure what is the middle ground here. [0] https://about.gitlab.com/handbook/people-operations/global-compensation/ https://about.gitlab.com/handbook/people-operations/global-c...

Tade0 8y ago
> in Brighton £38k Interesting. This is roughly the amount they're offering contractors in Poland. Everywhere in Poland on top of that, because it's considered a single region, so you could possibly live in a small town where rent is ~£250 and other expenses proportional to that.
sschueller 8y ago
I don't think adding a location factor for anything that is less than 100% of the companies core location is fair. You are doing the exact same job and have the same skill level, you should be paid the same. If you decide to move somewhere where living is cheaper then that is up to you and should not affect your earnings. This is how you keep poor countries / states poor. Instead of paying people the same which would result in larger taxes paid and more spent in those locations you are keeping status quo.
- donaltroddyn 8y ago
  > You are doing the exact same job and have the same skill level, you should be paid the same. Colocated employees at the same skill level performing the same job aren't paid the same - employers and employees negotiate compensation individually.
- eeZah7Ux 8y ago
  There is no "core location", and also you can't demand remote companies to implement completely equal salaries while in-situ jobs (and rents) vary wildly. It's a double standard.
- jedberg 8y ago
  Location is a factor though. If you live in the middle of nowhere, your chances of finding another job are low. If you live in SF, your chances of finding another job are high (because most jobs are still in person jobs). That is why location matters. It has nothing to do with your value and everything to do with what the company has to pay to get the talent it wants.
  - chii 8y ago
    Then let it be enforced via competition and market forces - rather than just using location to lowball somebody. If lots of people are applying from a low-cost country, the employer is free to choose and thus, would be able to offer a lower salary. But from my understanding, employers want the same level of quality as they would get from the bay area, but insists on paying 3rd world wages if the remote is at a low cost of living location, even though there are very few other candidates suitable!
    - SamReidHughes 8y ago
      Well, it is enforced by competition. Not every market player is going to be rational, though. And it was rational for the CEO to try to pay lower than SFBay pay, but maybe not to bail on the negotiation entirely.
  - chooseaname 8y ago
pm 8y ago
Is there a fair way to adjust based on living costs - within certain bounds - that isn't based on rent index, or at least weighted in favour of lower cost areas? Paying Bay Area salaries for every employee just isn't feasible for most startups.
- dasmoth 8y ago
  Paying Bay Area salaries for every employee just isn't feasible for most startups. How does that explain the large number of Bay Area, on-site-only startups?
  - tybit 8y ago
    It probably implies that only certain types of start ups are well suited there. E.g well funded VC startups that are looking to go big or go bust where paying lots for talent is worth if for access to many more employees and VCs.
  - lmm 8y ago
    On-site-only is a lot more productive, we just like to pretend otherwise because we wish it wasn't?
    - ricardobeat 8y ago
      As evidenced by?
      - lmm 8y ago
        I'm offering it as a possible explanation for why onsite-only Bay Area startups could be a success but remote startups not be able to afford Bay Area salaries.
  - pm 8y ago
    I'm talking about startups that are outside the Bay Area, and outside the US.
- avar 8y ago
esotericn 8y ago
It's been discussed before on here. In the UK it's particularly comical because a good number of people commute that far; I've had colleagues (Central London) living in places that according to GitLab should earn half as much.
- ownagefool 8y ago
  Indeed but it's weird even when you're not remote. I live in Guildford, and companies unashamedly offer <50% of your average London pay. The train takes 35 minutes to get into Waterloo... Commuting sucks, but it doesn't suck that much.
  - jon-wood 8y ago
    This is why I've exclusively worked for London based companies for the last decade or so, even though I now live about two hours outside of London. All the similar jobs around here would as you've seen result in me taking a 50% pay cut, and because I work remote 80% of the week, spending more time commuting into the office.
  - francis-io 8y ago
    The difference is so high inside of London compared to an hours train away that it's not even on my radar any more to even look for jobs in the UK outside of London. I sat a jump of 2/3rds in salary when moving to london.
    - ownagefool 8y ago
      There are some higher paying roles outside of London. Farnborough has defence companies, Swindon has Nationwide, Bath/Bristol has DVSA, Edinburgh has RBS, but yeah, you're generally right. Live in London, if someone offers you "fuck you" money to go elsewhere, you can always rent it out. :)
deleted 8y ago
[deleted]
setquk 8y ago
Ugh that's awful price disparity as well. It's pretty expensive here in the UK. You should always pay me for what I can do not where I live.
barry-cotter 8y ago
> I'm not really sure what is the middle ground here. The middle ground is irrelevant. The market price will be determined by supply, demand, and the differences in productivity and other factors of remote programmers. They’ll meet somewhere in the middle between the current local labour market model and one where collaboration software and practices are so perfect that there’s only one market for programmers, the global one. But we don’t know where yet.
- humanrebar 8y ago
  Right. If you want to hire people who live in the bay area, you should pay enough for them to at least live sustainably there. If that's too expensive, adjust your recruiting or hiring strategy. Maybe recruit bay area programmers that realize their current salary isn't sustainable since they need to plan for illness, retirement, saving up to launch an idea, etc.
nstart 8y ago
It's even more expensive in some locations. A car in Sri Lanka costs more than buying the same model in Canada. In Canada the Yaris Hatchback for example is half the current selling price in Sri Lanka. iPhones and other electronics are also priced at rates that are almost double or even more because of shipping and super high tax rates (the latter is there to keep foreign currency from flowing out of the country reserves). Rent and basic living costs is a very poor estimate indeed for calculating spending power within a country.
Novashi 8y ago
If you gave Gitlab a PO Box address in the Bay Area as your address, wouldn't they have to pay you Bay Area salaries without you paying Bay Area rent? If not a PO Box, some other proxy by which you aren't genuinely living there. Maybe just a short-term roommate lease situation?
- vanattab 8y ago
  If you lie to your company saying you live in SF when you live in Asia your going to have a hard time explaining why your never available during the middle of the day, what are you going to do when your asked to travel to somewhere in the continental US and you try and submit a travel expense for a flight from asia, etc...
  - throw-remote1 8y ago
    Throw away account, believe it or not, I've been doing exactly that for the past 3 years - operating a consulting business out of the Bay Area (virtual office) while actually living in Thailand/India/Kenya, etc. I'm always available and working till 7pm PST no matter where I am (Google Fi/Google Voice numbers). It's actually pretty easy to pull off. It's almost a no brainer to me. If I can charge 3-4x more for the same skills that I have, why not. I'm not gonna take a huge pay cut just because my location changed. And there's almost no explaining involved. At times when you can't go somewhere physically, sometimes you can tell your clients you're traveling this month. If something is important, you can take a flight. The amount that you're saving, the flight costs are negligible.
    - csomar 8y ago
      How can I reach you? I have a few questions. (ps. you can reach me i have my email in my profile. Thank you).
    - beatgammit 8y ago
      I've been thinking of doing something similar, but I need to build up a client base first. Did you build that up before you left, or did you do it while remote? Also, do you have any tips for building up a client base?
eegoran 8y ago
What if the person you want to hire likes crashing Lamborghinis and doesn’t want to stop? Living in the middle of SF is a luxury good.
- phamilton 8y ago
  Then don't hire them. If there were sufficient alternatives to hiring SF engineers, nobody would hire them. But they do, which suggest there aren't sufficient alternatives. Hiring is hard.
nnd 8y ago
> I've seen a lot of remote startups offering salaries around $100k USD, independent of location. As long as it's within US?
csomar 8y ago
> but what if the person you want to hire likes living in the middle of SF I think, the idea, is that in SF he'll have no problems finding jobs. They are looking remote because of shortage in SF. I mean according to them.
ultrasaurus 8y ago
There are some interesting arbitrage opportunities in that data[0]. Even if the average for a province is $X, there will be plenty of cheaper towns in it. [0] https://gitlab.com/gitlab-com/www-gitlab-com/blob/master/data/location_factors.yml https://gitlab.com/gitlab-com/www-gitlab-com/blob/master/dat...

by fyfy18 8y ago

Tade0 8y ago

> in Brighton £38k Interesting. This is roughly the amount they're offering contractors in Poland. Everywhere in Poland on top of that, because it's considered a single region, so you could possibly live in a small town where rent is ~£250 and other expenses proportional to that.

sschueller 8y ago

I don't think adding a location factor for anything that is less than 100% of the companies core location is fair. You are doing the exact same job and have the same skill level, you should be paid the same. If you decide to move somewhere where living is cheaper then that is up to you and should not affect your earnings. This is how you keep poor countries / states poor. Instead of paying people the same which would result in larger taxes paid and more spent in those locations you are keeping status quo.

donaltroddyn 8y ago
> You are doing the exact same job and have the same skill level, you should be paid the same. Colocated employees at the same skill level performing the same job aren't paid the same - employers and employees negotiate compensation individually.
eeZah7Ux 8y ago
There is no "core location", and also you can't demand remote companies to implement completely equal salaries while in-situ jobs (and rents) vary wildly. It's a double standard.
jedberg 8y ago
Location is a factor though. If you live in the middle of nowhere, your chances of finding another job are low. If you live in SF, your chances of finding another job are high (because most jobs are still in person jobs). That is why location matters. It has nothing to do with your value and everything to do with what the company has to pay to get the talent it wants.
- chii 8y ago
  Then let it be enforced via competition and market forces - rather than just using location to lowball somebody. If lots of people are applying from a low-cost country, the employer is free to choose and thus, would be able to offer a lower salary. But from my understanding, employers want the same level of quality as they would get from the bay area, but insists on paying 3rd world wages if the remote is at a low cost of living location, even though there are very few other candidates suitable!
  - SamReidHughes 8y ago
    Well, it is enforced by competition. Not every market player is going to be rational, though. And it was rational for the CEO to try to pay lower than SFBay pay, but maybe not to bail on the negotiation entirely.
- chooseaname 8y ago

pm 8y ago

Is there a fair way to adjust based on living costs - within certain bounds - that isn't based on rent index, or at least weighted in favour of lower cost areas? Paying Bay Area salaries for every employee just isn't feasible for most startups.

dasmoth 8y ago
Paying Bay Area salaries for every employee just isn't feasible for most startups. How does that explain the large number of Bay Area, on-site-only startups?
- tybit 8y ago
  It probably implies that only certain types of start ups are well suited there. E.g well funded VC startups that are looking to go big or go bust where paying lots for talent is worth if for access to many more employees and VCs.
- lmm 8y ago
  On-site-only is a lot more productive, we just like to pretend otherwise because we wish it wasn't?
  - ricardobeat 8y ago
    As evidenced by?
    - lmm 8y ago
      I'm offering it as a possible explanation for why onsite-only Bay Area startups could be a success but remote startups not be able to afford Bay Area salaries.
- pm 8y ago
  I'm talking about startups that are outside the Bay Area, and outside the US.
avar 8y ago

esotericn 8y ago

It's been discussed before on here. In the UK it's particularly comical because a good number of people commute that far; I've had colleagues (Central London) living in places that according to GitLab should earn half as much.

ownagefool 8y ago
Indeed but it's weird even when you're not remote. I live in Guildford, and companies unashamedly offer <50% of your average London pay. The train takes 35 minutes to get into Waterloo... Commuting sucks, but it doesn't suck that much.
- jon-wood 8y ago
  This is why I've exclusively worked for London based companies for the last decade or so, even though I now live about two hours outside of London. All the similar jobs around here would as you've seen result in me taking a 50% pay cut, and because I work remote 80% of the week, spending more time commuting into the office.
- francis-io 8y ago
  The difference is so high inside of London compared to an hours train away that it's not even on my radar any more to even look for jobs in the UK outside of London. I sat a jump of 2/3rds in salary when moving to london.
  - ownagefool 8y ago
    There are some higher paying roles outside of London. Farnborough has defence companies, Swindon has Nationwide, Bath/Bristol has DVSA, Edinburgh has RBS, but yeah, you're generally right. Live in London, if someone offers you "fuck you" money to go elsewhere, you can always rent it out. :)

deleted 8y ago

[deleted]

setquk 8y ago

Ugh that's awful price disparity as well. It's pretty expensive here in the UK. You should always pay me for what I can do not where I live.

barry-cotter 8y ago

> I'm not really sure what is the middle ground here. The middle ground is irrelevant. The market price will be determined by supply, demand, and the differences in productivity and other factors of remote programmers. They’ll meet somewhere in the middle between the current local labour market model and one where collaboration software and practices are so perfect that there’s only one market for programmers, the global one. But we don’t know where yet.

humanrebar 8y ago
Right. If you want to hire people who live in the bay area, you should pay enough for them to at least live sustainably there. If that's too expensive, adjust your recruiting or hiring strategy. Maybe recruit bay area programmers that realize their current salary isn't sustainable since they need to plan for illness, retirement, saving up to launch an idea, etc.

nstart 8y ago

It's even more expensive in some locations. A car in Sri Lanka costs more than buying the same model in Canada. In Canada the Yaris Hatchback for example is half the current selling price in Sri Lanka. iPhones and other electronics are also priced at rates that are almost double or even more because of shipping and super high tax rates (the latter is there to keep foreign currency from flowing out of the country reserves). Rent and basic living costs is a very poor estimate indeed for calculating spending power within a country.

Novashi 8y ago

If you gave Gitlab a PO Box address in the Bay Area as your address, wouldn't they have to pay you Bay Area salaries without you paying Bay Area rent? If not a PO Box, some other proxy by which you aren't genuinely living there. Maybe just a short-term roommate lease situation?

vanattab 8y ago
If you lie to your company saying you live in SF when you live in Asia your going to have a hard time explaining why your never available during the middle of the day, what are you going to do when your asked to travel to somewhere in the continental US and you try and submit a travel expense for a flight from asia, etc...
- throw-remote1 8y ago
  Throw away account, believe it or not, I've been doing exactly that for the past 3 years - operating a consulting business out of the Bay Area (virtual office) while actually living in Thailand/India/Kenya, etc. I'm always available and working till 7pm PST no matter where I am (Google Fi/Google Voice numbers). It's actually pretty easy to pull off. It's almost a no brainer to me. If I can charge 3-4x more for the same skills that I have, why not. I'm not gonna take a huge pay cut just because my location changed. And there's almost no explaining involved. At times when you can't go somewhere physically, sometimes you can tell your clients you're traveling this month. If something is important, you can take a flight. The amount that you're saving, the flight costs are negligible.
  - csomar 8y ago
    How can I reach you? I have a few questions. (ps. you can reach me i have my email in my profile. Thank you).
  - beatgammit 8y ago
    I've been thinking of doing something similar, but I need to build up a client base first. Did you build that up before you left, or did you do it while remote? Also, do you have any tips for building up a client base?

eegoran 8y ago

What if the person you want to hire likes crashing Lamborghinis and doesn’t want to stop? Living in the middle of SF is a luxury good.

phamilton 8y ago
Then don't hire them. If there were sufficient alternatives to hiring SF engineers, nobody would hire them. But they do, which suggest there aren't sufficient alternatives. Hiring is hard.

nnd 8y ago

> I've seen a lot of remote startups offering salaries around $100k USD, independent of location. As long as it's within US?

csomar 8y ago

> but what if the person you want to hire likes living in the middle of SF I think, the idea, is that in SF he'll have no problems finding jobs. They are looking remote because of shortage in SF. I mean according to them.

ultrasaurus 8y ago

There are some interesting arbitrage opportunities in that data[0]. Even if the average for a province is $X, there will be plenty of cheaper towns in it. [0] https://gitlab.com/gitlab-com/www-gitlab-com/blob/master/data/location_factors.yml https://gitlab.com/gitlab-com/www-gitlab-com/blob/master/dat...