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Programmer salaries are only especially high in the U.S. and a few other countries. In most countries, programmers don't get paid anywhere close to what SV engi
by JDiculous 7y ago
Programmer salaries are only especially high in the U.S. and a few other countries. In most countries, programmers don't get paid anywhere close to what SV engineers make. In the U.K. for example, programmers start at ~$32k/yr.
I think the reason for high programmer salaries in the U.S. is due to:
1. Culture that values engineers
In Silicon Valley and in many tech companies, the culture is that high quality engineers are highly valued and respected, and thus command high salaries. Companies like Google, Facebook, and Microsoft were founded by ex-programmers / ex-CS majors, so they understand the value that high quality engineers bring to the table and are willing to pay for them. Whatsapp was bought for $20b and only had 50 employees, 70% of whom were engineers.
In non-tech companies where tech is seen merely as a cost center, programmers don't make that much (eg. fashion companies). For the record there's nothing wrong a non-tech company not wanting to pay top dollar for engineers, some random ecommerce store probably doesn't need world class engineers, just like a semiconductor manufacturer doesn't need the best graphic designers.
I'm not very familiar with the UK so I don't know firsthand why UK engineer salaries are so much lower than in the U.S., but if I were to guess I'd say it's largely because their culture just doesn't value engineering talent like in SV.
2. Tech companies have a lot of money.
The big tech companies have very high margins. Facebook's market cap is $20m/employee, profit is $684k/employee and has a profit margin over 40%. Apple's market cap is $9m/employee, revenue is $2m/employee, gross profit margin is 38%, and they have $245b in cash. Even unicorns that bleed money (eg. Uber) are flush with cheap capital from VCs, with Uber having raised $20b to date.
Looking at it from this metric, it would seem that engineers are underpaid relative to the value they create. Not only just engineers, but labor as a whole.
- throwthisaway2 7y agoIts a crap shoot, in sf your taxes are higher and quality of living is higher. I would say the reality is more like 60k adjusted
- viggity 7y agothe UK thing blew my mind. I started at 53k/year in 2004, at lower than market rate because I loved the company and didn't negotiate harder. I'm at almost 4x that now and I live in a stupidly cheap metro with a scant half a million people. When I verified "Junior software dev" in london, jaw practically hit the floor.
- mcguire 7y agoI suspect your number 2 is the most important factor. Outside of big tech companies and those who have to compete with them, salaries are much lower. Possibly not low enough, given the lack of barrier to entry as in the original article, but still.
- perl4ever 7y agoPeople on HN look at everything not just from a regional perspective, but that of a very small clique out of all of the professional programmers. FAANG companies have plenty of work that is beneath their SWEs, which they outsource, in some cases, to American companies that have a mix of American employees and offshore. They hire people in the US around $40-60K and increase pay very slowly. Nobody gets paid $100K, because (a) if you switch jobs, you only get an incremental bump in salary, due to not having the right kind of title and pedigree, and (b) you're competing with much lower paid offshore employees. Best case is $80-90K after ten years and/or relocating to a major metro area.
- JDiculous 7y agoInteresting. Any examples of this kind of lower valued work?
- perl4ever 7y agoI mean, it's not precisely lower valued. It's valued low enough by the in-house SWEs, that they aren't going to do a good enough job to prevent embarrassing headlines.[1] Therefore, the outsourcing company isn't going to charge much less.[2] At the same time, they provide insulation from responsibility if something does go wrong. So they can pay much less and capture the difference. The cultural gap[3] prevents their employees from working directly for companies like their clients so competition doesn't equalize wages. [1]This is a reference to particular events of which I'm aware. [2]e.g. an hourly rate equating to $250K/year, maybe more. [3]I mean nerd culture, not "real" culture.
- darekkay 7y ago3rd reason: Difference in the net income, i.e., the money after taxes, the cost of living, different insurance structure per country. The 100k in the US is not comparable to the same amount in Germany, without taking everything into account.