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the underlying point, which isn't explicitly spelled out, is that labor should be priced by the value it accrues to the buyer, regardless of the cost of that la

the underlying point, which isn't explicitly spelled out, is that labor should be priced by the value it accrues to the buyer, regardless of the cost of that labor (locationally in taxes, mortgages, etc.). it's hypocritical of facebook not to price it's own products (advertising rates) on a cost-plus basis, if it believes so strongly that its employees should do so. or, they should accept that labor can be priced on value just as it prices its own products.

drivebycomment 6y ago
You are very much mistaken. No product is priced based on that. It is always primarily about supply and demand, labor market included.
qqqwerty 6y ago
Facebook could probably layoff half their staff without even the tiniest impact on revenues. The vast majority of engineers in these companies are replaceable. The high salaries are largely due to the competitive market and the FAANG obsession of only hiring the best. While some employees have a high enough profile/reputation that they can demand value based salaries, for the average engineer, the pay is essentially a slight premium over what the next lower tier of candidates would cost.
- clairity 6y ago
  not sure what to make of your comment. you're simultaneously asserting that the engineering labor market is cost-plus ("the pay is ... a slight premium"), but with its "high" salaries, it's not. that's incoherent--similarly incoherent to facebook pushing employees into cost-plus pricing while enjoying value-based pricing for itself. absent significant outside influence, markets, including labor markets, will naturally drive prices down to cost-plus levels through competitive dynamics. if a market has outsized value-based pricing, it's a prime signal of inefficiency, and competitors should enter (not being a free market is a significant barrier, but a different issue).
  - qqqwerty 6y ago
    Not everyone makes FAANG level salaries. There is a very steep gradient of salary levels in tech. At the top is FAANG, right below them are unicorns, and a few more tiers down you get to the bottom feeders, underfunded startups offering worthless equity and hopes and dreams instead of salary. FAANG salaries are product of the hiring competition between each other and their self-imposed selectivity. Lowering the interview bar would likely open up the hiring pool enough where they could also get away with lower offers.

drivebycomment 6y ago

You are very much mistaken. No product is priced based on that. It is always primarily about supply and demand, labor market included.

qqqwerty 6y ago

Facebook could probably layoff half their staff without even the tiniest impact on revenues. The vast majority of engineers in these companies are replaceable. The high salaries are largely due to the competitive market and the FAANG obsession of only hiring the best. While some employees have a high enough profile/reputation that they can demand value based salaries, for the average engineer, the pay is essentially a slight premium over what the next lower tier of candidates would cost.

clairity 6y ago
not sure what to make of your comment. you're simultaneously asserting that the engineering labor market is cost-plus ("the pay is ... a slight premium"), but with its "high" salaries, it's not. that's incoherent--similarly incoherent to facebook pushing employees into cost-plus pricing while enjoying value-based pricing for itself. absent significant outside influence, markets, including labor markets, will naturally drive prices down to cost-plus levels through competitive dynamics. if a market has outsized value-based pricing, it's a prime signal of inefficiency, and competitors should enter (not being a free market is a significant barrier, but a different issue).
- qqqwerty 6y ago
  Not everyone makes FAANG level salaries. There is a very steep gradient of salary levels in tech. At the top is FAANG, right below them are unicorns, and a few more tiers down you get to the bottom feeders, underfunded startups offering worthless equity and hopes and dreams instead of salary. FAANG salaries are product of the hiring competition between each other and their self-imposed selectivity. Lowering the interview bar would likely open up the hiring pool enough where they could also get away with lower offers.