If the scenario you're describing happens, some startups will appear and pay SWEs 160k/year to live wherever they want, and the good engineers will leave to wor

If the scenario you're describing happens, some startups will appear and pay SWEs 160k/year to live wherever they want, and the good engineers will leave to work at those startups. The fundamental problem (for the cost-cutting employer) is that good engineering orgs really do generate that much value. This happened with the wage-collusion attempts in the valley. Facebook was willing to give more raises than Google or Apple. In the latest roll of the dice, AirBnB, Uber, Lyft, and friensd were willing to pay more. It's the cycle of business.