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Last week there was discussion either here or on reddit that Amazon has a hard cap for salary compensation at ~160k in the Seattle area. Dropping the threshold

Last week there was discussion either here or on reddit that Amazon has a hard cap for salary compensation at ~160k in the Seattle area. Dropping the threshold from 180k to 100k would cause everyone who has maxed out their salary at Amazon to have enforceable non-competes. I'd be curious what types of jobs at Amazon were immediately under the 100k threshold, and what percent of the total Washington state Amazon workforce has a salary of 100k+?

flattone 6y ago
Im curious about 100+ distribution too. Live in amazon area, cant imagine a single employee making under 100k, even 5 years ago
- amznthrwaway 6y ago
  Non-tech roles.
throwawaygh 6y ago
$100K isn't what it used to be. In addition to inflation^1, the death of pensions means that salary and other liquid compensation is now a much larger percentage of total compensation. For example, in our state, teachers and government employees receive a full pension after 20 years of service. That pension pays out 1/2 of some average of their previous few year's salary. Even if you retire making a relatively modest $60K/yr, that pension is still worth north of $50K/yr over those 20 years. Salaries that don't include pensions aren't nearly as generous as they sound. $100K/yr without a pension is comparable to $40K/yr with a pension. -- 1. Including absolutely incredible housing price inflation in major cities like Seattle which typical measures of inflation don't properly capture).
- xur17 6y ago
  This begs the question - wouldn't it be advantageous (recruiting wise) for governments to stop offering pensions, and instead increase base pay?
  - cbhl 6y ago
    That's politically tricky -- if the rank and file are paid less than government workers, then it's easy to make ad hominem attacks on the government employees for living a cushy life / excessive spending.
  - a_humean 6y ago
    These are advantages in public sector recruitment. The public sector is never going to be able to compete with the private sector on pay, but for many people the promise of steady and reliable income and benefits combinded with a good retirement plan is very attractive.
    - lotsofpulp 6y ago
      > The public sector is never going to be able to compete with the private sector on pay Why? I’d rather pay government employees in cash rather than with future tax money from my kids as the politicians and government employee unions will undoubtably understated benefit costs and underfund it.
      - freeone3000 6y ago
        They're also paid with tax money now -- which is much harder to sell, since that's money now instead of later.
      - syshum 6y ago
        > I’d rather pay government employees in cash rather than with future tax money from my kids well 2 factors.. 1. Most people care about TODAY not tomorrow, this is reflective in all kinds of metrics related to personal fiance 2. Many people do not have kids, including myself, so I am not sure if I care they paying with things with YOUR kids tax money instead of my tax money
  - shkkmo 6y ago
    "begging the question" means to assume the truth of the proposition you are arguing for in the process of arguing for it. You seem to instead mean something like "prompts the question" or "brings to mind the question"
- crispyporkbites 6y ago
  So you’re saying if I put 60k/year away for 20 years, it won’t be worth more than a teacher on 40k/year’s pension? I think with 1.2mn you can get a better annuity than 20k/year It’s probably more like a 100k job with no pension is comparable to 60-70k with a final salary pension
  - throwawaygh 6y ago
    $1.2mm/20 years = $60K. So, max out your 401(K). Your before-tax income is now $80K. Of that, you have to save $40K to reach $1.2mm in 20 years. So your pre-tax income that doesn't go to retirement is $40K. Sure, there might be an employer match, and your money will maybe grow over those 20 years, but unless there's a generous match and your portfolio grows, a lot of that gets eaten up by the 20%-30% taxes you're paying on that extra $40K you need to save. I mean, market returns were good between 2009 and 2019, but beating that tax burden of 20%-30% a year is pretty damn hard. Also, your money might now grow over those 20 years. Especially the next 20 years. I don't think anyone has high hopes. "Past performance is no guarantee of future results". C.f. public sector pensions, which receive extraordinary protections and pay out the same whether the market is up 5% or down 30%.
    - rayhendricks 6y ago
      That market independence is the major benefit of a pension. The other not talked-about benefit is that a public pension is doing the investing and maintaining the financial discipline for you. Most people in the United States are not capable of this, as the savings rate has only been approximately 7%[https://fred.stlouisfed.org/series/PSAVERT https://fred.stlouisfed.org/series/PSAVERT], and 5 years down the road Once the Covid vaccine is developed and the economy has recovered it will probably return to those levels. Which brings me to the point that it is almost impossible for 99% of people in the United States to save 40k/yr. At a 10% savings rate this is someone making 400k/yr which is way above average even for FAANG companies. So government work might not be so bad afterall.
      - PacketPaul 6y ago
- seanmcdirmid 6y ago
  401k contributions are tax deductible, and they are often matched to some percentage, so it isn’t that bad. You get to sock away around $30k/year pretax, and that grows (or shrinks) with the market.
  - Retric 6y ago
    You’re still paying Social Security on that ‘tax deductible‘ income. 401k’s also cap out at 19,500$/year unless your close to retirement. Further where compound interest limits the impact of savings very close to retirement, pensions are more closely linked to your final salary. Early on compound interest often wins, but at 40 getting a government job can be a very good financial decision.
    - joshuamorton 6y ago
      Social security is capped (and it isn't a tax, really). So someone making $150k really isn't taxed on their 401k contributions.
      - Retric 6y ago
        Uhh, in what way is mandatory payments to the government not a tax? If your unlikely to live to retirement age your still stuck making SS payments. The cap is also 137,700$ so it depends on how close you are to retirement age and if your making catch-up payments. Also, medicare doesn’t have a cap and is also ignores your 401k.
        bosie 6y ago
        deleted
        lazyasciiart 6y ago
        Plenty of taxes have predefined limited usage - that's irrelevant. E.g WA gas tax: https://www.king5.com/article/news/local/take-5/deep-dive-where-does-your-gas-tax-money-go-washington-state/281-a0ecc6e5-d242-412f-a5a0-54d8aa7c9ae4 https://www.king5.com/article/news/local/take-5/deep-dive-wh...
- csa 6y ago
  I think that you would be shocked to find out how little an annuity costs that pays out starting at age 62 (common US federal government minimum retirement age). I don’t know the specifics of the examples you are thinking of, but pricing the pension value/cost at $50k a year probably posits some extreme assumptions (e.g., start and retire at lowest age, end with a very high salary, take pension with full value immediately, and live a very long time).
  - MagnumOpus 6y ago
    > I think that you would be shocked to find out how little an annuity costs that pays out starting at age 62 I think you would be shocked how much an annuity costs that pays out starting at <50 years (like police or other workers with very strong unions get). One million dollars saved up might get an annuity of $30,000 per year.
    - csa 6y ago
      Completely not shocked. The post my original reply was to was for teachers and “general government workers”. I gave a typical retirement age for those folks. Military, police, firefighters, and (iirc) prison employees are a completely different cup of tea. Unions are a part of it, but the element of danger is also supposed to be factored into their pensions (rightly or wrongly). They also can start getting paid as soon as they retire without regard for age (unlike many/most other pensions). All that said, the reality is actually worse. Structurally those positions tend to give members of those groups a relatively-easy-to-get disability component to their retirement (which can often be huge). They also have functionally similar jobs with higher pay that are designed to goose up their salaries for the last x years that is used to determine their pension. These pensions are completely out of control, imho. That said, the politics and optics around those jobs make them tough to change to a more reasonable level. These types of pensions are completely different than that of a typical government worker that doesn’t work in these types of jobs — a complete apples and oranges comparison, imho.
- jldugger 6y ago
  >1. Including absolutely incredible housing price inflation in major cities like Seattle which typical measures of inflation don't properly capture). I'm sorry, but what? Rent or Rent equivalent is absolutely a part of US regional inflation measures. edit: The BLS publishes a Consumer Price Index published by for Seattle metro area^1. The breakdown^2 quite literally includes housing as part of the basket of goods, listing about a 3 percent increase for that section yoy, and I believe the weighting is typically 1/3 of the total index. Seems like it's capturing it just fine? ^1 https://www.bls.gov/regions/west/news-release/consumerpriceindex_seattle.htm https://www.bls.gov/regions/west/news-release/consumerpricei... ^2 https://www.bls.gov/regions/west/news-release/consumerpriceindex_seattle.htm#table1 https://www.bls.gov/regions/west/news-release/consumerpricei...
  - lazyasciiart 6y ago
    I've never seen a regional measure used.
    - jldugger 6y ago
      The union contract I was party to with a state university used one; seems like a no brainer when your staff is regionally concentrated. EDIT: And rent is part of the national CPI as well. It just doesn't reflect narrow regional trends because why would it? Those are outliers, and not particularly relevant national news media, and even those news stories that do cover it would use the more specific Case-Shiller indecies to tell the story.
- jldugger 6y ago
  >Salaries that don't include pensions aren't nearly as generous as they sound. $100K/yr without a pension is comparable to $40K/yr with a pension. I don't know how to square this with 12 percent of salary I was contributing towards the state pension. Care to share your math? I agree that pensions are worth something, but not 150% of salary.
  - CydeWeys 6y ago
    The state ends up paying a lot more than your contribution to it.
    - scarface74 6y ago
      Are you sure? Have you calculated the cost of an immediate lifetime annuity? https://www.immediateannuities.com/information/annuity-rates-step-1.html https://www.immediateannuities.com/information/annuity-rates...
  - throwawaygh 6y ago
    https://news.ycombinator.com/item?id=23519601 https://news.ycombinator.com/item?id=23519601 assumes no emplyoee contributions, so adjust the math accordingly. Anyways, even if it were equivalent to $30K, as others have suggested, I think that still speaks to my original point. That doesn't exactly hit my threshold for "wow you're definitely super duper well-paid so we should exempt you from non-compete rules because you're making so much damn money".
  - Spooky23 6y ago
    You were probably in a later pension tier and stuck paying for the richer benefits of people from the 70s. Or the employer stiffed the pension fund in the past.
  - PacketPaul 6y ago
    Every job in the US saves 15% of your income for retirement. It is called social security. The problem is the politicians control it instead of the individual so the money is not invested but spent. If people were allowed to have private retirement accounts with that Social Security money, everyone would be able to retire comfortably.
- qppo 6y ago
  It may not be what it used to, but it's still $40k above the median household income in the country.
  - throwawaygh 6y ago
    Again, I think that number is probably considerably lower when you include pensions in the calculation. And especially when you include CoL differences between Seattle and the rest of the country. Even then, sure, it's above median. My point is that it's still "normal middle-class average joe" money, not "basically an executive so there should be different special non-compete rules" money.
    - qppo 6y ago
      Most people do not have pensions in the United States, and those that do don't have it worth 2/3rds their yearly salary. It's not average joe money either, a six figure salary is firmly in the upper middle class everywhere in the country. Including the Bay Area. It may not "feel like it" but to be alleviated of financial burden and put away meaningful savings puts you above half the country outright.
      - deleted 6y ago
        [deleted]
      - ClumsyPilot 6y ago
        This isn't the right yardstick, middle class does not mean 'median income'. Its a cultural idea. Non-conpetes should be reserved for select few in the firm that know the secret sauce, and are paid well enough that a year on the beach will hardly affect their cash flow. Basically executive level compensation and responsibility. This clearly does not qualify.
  - Spooky23 6y ago
    The $40k median income is low too, as it doesn’t meaningfully value benefits.
- jacobwilliamroy 6y ago
  But will the pension even be there? Is the pension even there now? Has anyone gone and checked on the pension fund to make sure it's still there?
  - throwawaygh 6y ago
    Depends on the state, but yes, generally public pension funds receive extraordinary (literally, as in "more than the ordinary") protection. It's certainly going to be a hell of a lot harder for a city/state to stop paying their pension than it is for your 401k to simply shrink and/or stop paying out 4% YoY. Just ask anyone who's checked their 401k balance this year.
    - jacobwilliamroy 6y ago
      Interesting. So hard to find trustworthy people, up to the task of supervising such a large sum of money. Extraordinary protections are certainly needed.
    - dantheman 6y ago
      Except that they don't follow the rules necessary for private pensions - they expect that there is always tax money to top it off when it can't get paid. We'll see if that happens.
- scarface74 6y ago
  Just to put some real numbers on the value of a pension. A lifetime annuity of $30K a year (1/2 of $60K) is worth about $600K if you retire at 60. You can play with different numbers here. https://www.immediateannuities.com/information/annuity-rates-step-1.html https://www.immediateannuities.com/information/annuity-rates... I’ll leave it as an exercise for the reader to calculate how much you would have to save in a 401K over 20 years to have that much at retirement.
  - throwawaygh 6y ago
    > I’ll leave it as an exercise for the reader to calculate how much you would have to save in a 401K over 20 years to have that much at retirement. When making these calculations, remember: - lifetime annuity - include death protection (at least in my state, surviving spouses continue receiving pension payments). - Everything above $19,500 is fully taxed (...and, in fact, not including tax on that $19.5K isn't even an apples-to-apples comparison). Anyways, you can add or subtract many tens of thousands to the annual salary equivalent and the point remains the same: without a pension, $100K is not "special person who doesn't need non-compete" money.
    - scarface74 6y ago
      The website I posted does let you calculate an annuity based on both you and your spouse.
- Spooky23 6y ago
  For a civilian employee, the pension basically equates to about a 20% premium on top of salary. Usually pensions are 60% of salary after 25-30 years. It’s not worth as much as you’re estimating, unless those employees get free healthcare or something else. The crazy benefits that people nag about are for uniformed folks only, as they tend to get overtime based on seniority, and don’t have aggressive caps. Most civilian employees like teachers don’t get anything like that.
  - SiNiquity 6y ago
    US federal civilian pension (FERS) is 1.1% per year after 20 years, so roughly 27-33% of your final 3 years of salary. They also took out the hacks for overtime, bonuses, etc. to prevent the games you sometimes see with state and local pensions. The caveat to that is as of today you contribute 4.4% of your salary / year into the pension fund, in addition to 401K savings + social security. The Obama administration raised it from 0.8%.
- fortran77 6y ago
  The flip side of this is there are a lot of teachers who claim (and probably believe!) they are poorly compensated, but are actually paid well if you factor in the cost of the pension.
chrisseaton 6y ago
>Last week there was discussion either here or on reddit that Amazon has a hard cap for salary compensation at ~160k in the Seattle area. I don't understand - are you saying that Amazon pays nobody in Seattle more than $160k? I can't believe that's true. How are they employing competent senior people for so little? Are they paying their corporate lawyers that low?
- monocasa 6y ago
  Lots of stock grants and bonuses. It's only base salary that's capped.
  - chrisseaton 6y ago
    Does that not cause people cash-flow problems? In my experience things like mortgages are based on how much you're guaranteed to be paid and if you just say you hope to get a bonus and you hope your shares are worth something they won't be happy. If your total compensation is something like a quarter of a million as an Amazon engineer does that mean you have to live much more frugally for your first year until you get your bonus and shares?
    - freyr 6y ago
      Yes, but this is offset by Amazon's sign-on bonus. According to online sources, Amazon's stock vesting schedule is: 5% in year 1, 15% in year 2, 40% in year 3, 40% in year 4. This is unfavorable compared to other top-paying tech companies, however Amazon may offer a sign-on bonus for years 1 and 2 to help even out the total annual comp.
      - chrisseaton 6y ago
        > Yes, but this is offset by Amazon's sign-on bonus. Aaah, I see how it all works together then.
        sdhrnrhbrt 6y ago
seanmcdirmid 6y ago
Amazon likes to pay more comp in stock, rather than salary, so that hard limit isn’t really meaningful to most Amazonians who are doing well there. Stock comp wouldn’t be excluded in any kind of limit anyways.
- sdhrnrhbrt 6y ago
  I've heard from a few former Amazonians the same story: Amazon puts a hard cap on stock grants too, so if the stocks grow and you're due to a stock refresher, that stock refresher is withdrawn on the grounds of "your current stock has grown enough already". The total comp numbers are just OK in Amazon too.
  - amzn-throw 6y ago
    From reading Blind, total comp ranges for a Sr. SDE (~10-15% of the company) is 250-400k In what world is that "just ok"?
    - rootsudo 6y ago
      1. Everyone on Blind lies. 2. People who are there previous five years are quoting their TC w/ current stock prices, people who recently onboarded do not have the same strike price and will be less. 3. Golden handcuffs, and apparently non-compete. It sounds nice on paper, but spend some time in Downtown and go to a few Amazonian bars and you'll figure out alot of the downsides. Especially if you're at any of Amazon projects that aren't really..working e.g. Blue Origin.
      - Thorrez 6y ago
        levels.fyi estimates Sr. SDE has $304,787 total comp. But I'm not sure whether the stock component is at vest price or grant price. https://www.levels.fyi/SE/Amazon/Google/Facebook# https://www.levels.fyi/SE/Amazon/Google/Facebook#
        urda 6y ago
grogenaut 6y ago
As you go up the pay scale they actually try and move your base down towards 90k.
- dbish 6y ago
  This is not true (current 5+ year amazonian)
- sukilot 6y ago
  Is that a joke about Bezos's $81K salary?

flattone 6y ago

Im curious about 100+ distribution too. Live in amazon area, cant imagine a single employee making under 100k, even 5 years ago

amznthrwaway 6y ago
Non-tech roles.

throwawaygh 6y ago

$100K isn't what it used to be. In addition to inflation^1, the death of pensions means that salary and other liquid compensation is now a much larger percentage of total compensation. For example, in our state, teachers and government employees receive a full pension after 20 years of service. That pension pays out 1/2 of some average of their previous few year's salary. Even if you retire making a relatively modest $60K/yr, that pension is still worth north of $50K/yr over those 20 years. Salaries that don't include pensions aren't nearly as generous as they sound. $100K/yr without a pension is comparable to $40K/yr with a pension. -- 1. Including absolutely incredible housing price inflation in major cities like Seattle which typical measures of inflation don't properly capture).

xur17 6y ago
This begs the question - wouldn't it be advantageous (recruiting wise) for governments to stop offering pensions, and instead increase base pay?
- cbhl 6y ago
  That's politically tricky -- if the rank and file are paid less than government workers, then it's easy to make ad hominem attacks on the government employees for living a cushy life / excessive spending.
- a_humean 6y ago
  These are advantages in public sector recruitment. The public sector is never going to be able to compete with the private sector on pay, but for many people the promise of steady and reliable income and benefits combinded with a good retirement plan is very attractive.
  - lotsofpulp 6y ago
    > The public sector is never going to be able to compete with the private sector on pay Why? I’d rather pay government employees in cash rather than with future tax money from my kids as the politicians and government employee unions will undoubtably understated benefit costs and underfund it.
    - freeone3000 6y ago
      They're also paid with tax money now -- which is much harder to sell, since that's money now instead of later.
    - syshum 6y ago
      > I’d rather pay government employees in cash rather than with future tax money from my kids well 2 factors.. 1. Most people care about TODAY not tomorrow, this is reflective in all kinds of metrics related to personal fiance 2. Many people do not have kids, including myself, so I am not sure if I care they paying with things with YOUR kids tax money instead of my tax money
- shkkmo 6y ago
  "begging the question" means to assume the truth of the proposition you are arguing for in the process of arguing for it. You seem to instead mean something like "prompts the question" or "brings to mind the question"
crispyporkbites 6y ago
So you’re saying if I put 60k/year away for 20 years, it won’t be worth more than a teacher on 40k/year’s pension? I think with 1.2mn you can get a better annuity than 20k/year It’s probably more like a 100k job with no pension is comparable to 60-70k with a final salary pension
- throwawaygh 6y ago
  $1.2mm/20 years = $60K. So, max out your 401(K). Your before-tax income is now $80K. Of that, you have to save $40K to reach $1.2mm in 20 years. So your pre-tax income that doesn't go to retirement is $40K. Sure, there might be an employer match, and your money will maybe grow over those 20 years, but unless there's a generous match and your portfolio grows, a lot of that gets eaten up by the 20%-30% taxes you're paying on that extra $40K you need to save. I mean, market returns were good between 2009 and 2019, but beating that tax burden of 20%-30% a year is pretty damn hard. Also, your money might now grow over those 20 years. Especially the next 20 years. I don't think anyone has high hopes. "Past performance is no guarantee of future results". C.f. public sector pensions, which receive extraordinary protections and pay out the same whether the market is up 5% or down 30%.
  - rayhendricks 6y ago
    That market independence is the major benefit of a pension. The other not talked-about benefit is that a public pension is doing the investing and maintaining the financial discipline for you. Most people in the United States are not capable of this, as the savings rate has only been approximately 7%[https://fred.stlouisfed.org/series/PSAVERT https://fred.stlouisfed.org/series/PSAVERT], and 5 years down the road Once the Covid vaccine is developed and the economy has recovered it will probably return to those levels. Which brings me to the point that it is almost impossible for 99% of people in the United States to save 40k/yr. At a 10% savings rate this is someone making 400k/yr which is way above average even for FAANG companies. So government work might not be so bad afterall.
    - PacketPaul 6y ago
seanmcdirmid 6y ago
401k contributions are tax deductible, and they are often matched to some percentage, so it isn’t that bad. You get to sock away around $30k/year pretax, and that grows (or shrinks) with the market.
- Retric 6y ago
  You’re still paying Social Security on that ‘tax deductible‘ income. 401k’s also cap out at 19,500$/year unless your close to retirement. Further where compound interest limits the impact of savings very close to retirement, pensions are more closely linked to your final salary. Early on compound interest often wins, but at 40 getting a government job can be a very good financial decision.
  - joshuamorton 6y ago
    Social security is capped (and it isn't a tax, really). So someone making $150k really isn't taxed on their 401k contributions.
    - Retric 6y ago
      Uhh, in what way is mandatory payments to the government not a tax? If your unlikely to live to retirement age your still stuck making SS payments. The cap is also 137,700$ so it depends on how close you are to retirement age and if your making catch-up payments. Also, medicare doesn’t have a cap and is also ignores your 401k.
      - bosie 6y ago
        deleted
        lazyasciiart 6y ago
        Plenty of taxes have predefined limited usage - that's irrelevant. E.g WA gas tax: https://www.king5.com/article/news/local/take-5/deep-dive-where-does-your-gas-tax-money-go-washington-state/281-a0ecc6e5-d242-412f-a5a0-54d8aa7c9ae4 https://www.king5.com/article/news/local/take-5/deep-dive-wh...
csa 6y ago
I think that you would be shocked to find out how little an annuity costs that pays out starting at age 62 (common US federal government minimum retirement age). I don’t know the specifics of the examples you are thinking of, but pricing the pension value/cost at $50k a year probably posits some extreme assumptions (e.g., start and retire at lowest age, end with a very high salary, take pension with full value immediately, and live a very long time).
- MagnumOpus 6y ago
  > I think that you would be shocked to find out how little an annuity costs that pays out starting at age 62 I think you would be shocked how much an annuity costs that pays out starting at <50 years (like police or other workers with very strong unions get). One million dollars saved up might get an annuity of $30,000 per year.
  - csa 6y ago
    Completely not shocked. The post my original reply was to was for teachers and “general government workers”. I gave a typical retirement age for those folks. Military, police, firefighters, and (iirc) prison employees are a completely different cup of tea. Unions are a part of it, but the element of danger is also supposed to be factored into their pensions (rightly or wrongly). They also can start getting paid as soon as they retire without regard for age (unlike many/most other pensions). All that said, the reality is actually worse. Structurally those positions tend to give members of those groups a relatively-easy-to-get disability component to their retirement (which can often be huge). They also have functionally similar jobs with higher pay that are designed to goose up their salaries for the last x years that is used to determine their pension. These pensions are completely out of control, imho. That said, the politics and optics around those jobs make them tough to change to a more reasonable level. These types of pensions are completely different than that of a typical government worker that doesn’t work in these types of jobs — a complete apples and oranges comparison, imho.
jldugger 6y ago
>1. Including absolutely incredible housing price inflation in major cities like Seattle which typical measures of inflation don't properly capture). I'm sorry, but what? Rent or Rent equivalent is absolutely a part of US regional inflation measures. edit: The BLS publishes a Consumer Price Index published by for Seattle metro area^1. The breakdown^2 quite literally includes housing as part of the basket of goods, listing about a 3 percent increase for that section yoy, and I believe the weighting is typically 1/3 of the total index. Seems like it's capturing it just fine? ^1 https://www.bls.gov/regions/west/news-release/consumerpriceindex_seattle.htm https://www.bls.gov/regions/west/news-release/consumerpricei... ^2 https://www.bls.gov/regions/west/news-release/consumerpriceindex_seattle.htm#table1 https://www.bls.gov/regions/west/news-release/consumerpricei...
- lazyasciiart 6y ago
  I've never seen a regional measure used.
  - jldugger 6y ago
    The union contract I was party to with a state university used one; seems like a no brainer when your staff is regionally concentrated. EDIT: And rent is part of the national CPI as well. It just doesn't reflect narrow regional trends because why would it? Those are outliers, and not particularly relevant national news media, and even those news stories that do cover it would use the more specific Case-Shiller indecies to tell the story.
jldugger 6y ago
>Salaries that don't include pensions aren't nearly as generous as they sound. $100K/yr without a pension is comparable to $40K/yr with a pension. I don't know how to square this with 12 percent of salary I was contributing towards the state pension. Care to share your math? I agree that pensions are worth something, but not 150% of salary.
- CydeWeys 6y ago
  The state ends up paying a lot more than your contribution to it.
  - scarface74 6y ago
    Are you sure? Have you calculated the cost of an immediate lifetime annuity? https://www.immediateannuities.com/information/annuity-rates-step-1.html https://www.immediateannuities.com/information/annuity-rates...
- throwawaygh 6y ago
  https://news.ycombinator.com/item?id=23519601 https://news.ycombinator.com/item?id=23519601 assumes no emplyoee contributions, so adjust the math accordingly. Anyways, even if it were equivalent to $30K, as others have suggested, I think that still speaks to my original point. That doesn't exactly hit my threshold for "wow you're definitely super duper well-paid so we should exempt you from non-compete rules because you're making so much damn money".
- Spooky23 6y ago
  You were probably in a later pension tier and stuck paying for the richer benefits of people from the 70s. Or the employer stiffed the pension fund in the past.
- PacketPaul 6y ago
  Every job in the US saves 15% of your income for retirement. It is called social security. The problem is the politicians control it instead of the individual so the money is not invested but spent. If people were allowed to have private retirement accounts with that Social Security money, everyone would be able to retire comfortably.
qppo 6y ago
It may not be what it used to, but it's still $40k above the median household income in the country.
- throwawaygh 6y ago
  Again, I think that number is probably considerably lower when you include pensions in the calculation. And especially when you include CoL differences between Seattle and the rest of the country. Even then, sure, it's above median. My point is that it's still "normal middle-class average joe" money, not "basically an executive so there should be different special non-compete rules" money.
  - qppo 6y ago
    Most people do not have pensions in the United States, and those that do don't have it worth 2/3rds their yearly salary. It's not average joe money either, a six figure salary is firmly in the upper middle class everywhere in the country. Including the Bay Area. It may not "feel like it" but to be alleviated of financial burden and put away meaningful savings puts you above half the country outright.
    - deleted 6y ago
      [deleted]
    - ClumsyPilot 6y ago
      This isn't the right yardstick, middle class does not mean 'median income'. Its a cultural idea. Non-conpetes should be reserved for select few in the firm that know the secret sauce, and are paid well enough that a year on the beach will hardly affect their cash flow. Basically executive level compensation and responsibility. This clearly does not qualify.
- Spooky23 6y ago
  The $40k median income is low too, as it doesn’t meaningfully value benefits.
jacobwilliamroy 6y ago
But will the pension even be there? Is the pension even there now? Has anyone gone and checked on the pension fund to make sure it's still there?
- throwawaygh 6y ago
  Depends on the state, but yes, generally public pension funds receive extraordinary (literally, as in "more than the ordinary") protection. It's certainly going to be a hell of a lot harder for a city/state to stop paying their pension than it is for your 401k to simply shrink and/or stop paying out 4% YoY. Just ask anyone who's checked their 401k balance this year.
  - jacobwilliamroy 6y ago
    Interesting. So hard to find trustworthy people, up to the task of supervising such a large sum of money. Extraordinary protections are certainly needed.
  - dantheman 6y ago
    Except that they don't follow the rules necessary for private pensions - they expect that there is always tax money to top it off when it can't get paid. We'll see if that happens.
scarface74 6y ago
Just to put some real numbers on the value of a pension. A lifetime annuity of $30K a year (1/2 of $60K) is worth about $600K if you retire at 60. You can play with different numbers here. https://www.immediateannuities.com/information/annuity-rates-step-1.html https://www.immediateannuities.com/information/annuity-rates... I’ll leave it as an exercise for the reader to calculate how much you would have to save in a 401K over 20 years to have that much at retirement.
- throwawaygh 6y ago
  > I’ll leave it as an exercise for the reader to calculate how much you would have to save in a 401K over 20 years to have that much at retirement. When making these calculations, remember: - lifetime annuity - include death protection (at least in my state, surviving spouses continue receiving pension payments). - Everything above $19,500 is fully taxed (...and, in fact, not including tax on that $19.5K isn't even an apples-to-apples comparison). Anyways, you can add or subtract many tens of thousands to the annual salary equivalent and the point remains the same: without a pension, $100K is not "special person who doesn't need non-compete" money.
  - scarface74 6y ago
    The website I posted does let you calculate an annuity based on both you and your spouse.
Spooky23 6y ago
For a civilian employee, the pension basically equates to about a 20% premium on top of salary. Usually pensions are 60% of salary after 25-30 years. It’s not worth as much as you’re estimating, unless those employees get free healthcare or something else. The crazy benefits that people nag about are for uniformed folks only, as they tend to get overtime based on seniority, and don’t have aggressive caps. Most civilian employees like teachers don’t get anything like that.
- SiNiquity 6y ago
  US federal civilian pension (FERS) is 1.1% per year after 20 years, so roughly 27-33% of your final 3 years of salary. They also took out the hacks for overtime, bonuses, etc. to prevent the games you sometimes see with state and local pensions. The caveat to that is as of today you contribute 4.4% of your salary / year into the pension fund, in addition to 401K savings + social security. The Obama administration raised it from 0.8%.
fortran77 6y ago
The flip side of this is there are a lot of teachers who claim (and probably believe!) they are poorly compensated, but are actually paid well if you factor in the cost of the pension.

chrisseaton 6y ago

>Last week there was discussion either here or on reddit that Amazon has a hard cap for salary compensation at ~160k in the Seattle area. I don't understand - are you saying that Amazon pays nobody in Seattle more than $160k? I can't believe that's true. How are they employing competent senior people for so little? Are they paying their corporate lawyers that low?

monocasa 6y ago
Lots of stock grants and bonuses. It's only base salary that's capped.
- chrisseaton 6y ago
  Does that not cause people cash-flow problems? In my experience things like mortgages are based on how much you're guaranteed to be paid and if you just say you hope to get a bonus and you hope your shares are worth something they won't be happy. If your total compensation is something like a quarter of a million as an Amazon engineer does that mean you have to live much more frugally for your first year until you get your bonus and shares?
  - freyr 6y ago
    Yes, but this is offset by Amazon's sign-on bonus. According to online sources, Amazon's stock vesting schedule is: 5% in year 1, 15% in year 2, 40% in year 3, 40% in year 4. This is unfavorable compared to other top-paying tech companies, however Amazon may offer a sign-on bonus for years 1 and 2 to help even out the total annual comp.
    - chrisseaton 6y ago
      > Yes, but this is offset by Amazon's sign-on bonus. Aaah, I see how it all works together then.
      - sdhrnrhbrt 6y ago

seanmcdirmid 6y ago

Amazon likes to pay more comp in stock, rather than salary, so that hard limit isn’t really meaningful to most Amazonians who are doing well there. Stock comp wouldn’t be excluded in any kind of limit anyways.

sdhrnrhbrt 6y ago
I've heard from a few former Amazonians the same story: Amazon puts a hard cap on stock grants too, so if the stocks grow and you're due to a stock refresher, that stock refresher is withdrawn on the grounds of "your current stock has grown enough already". The total comp numbers are just OK in Amazon too.
- amzn-throw 6y ago
  From reading Blind, total comp ranges for a Sr. SDE (~10-15% of the company) is 250-400k In what world is that "just ok"?
  - rootsudo 6y ago
    1. Everyone on Blind lies. 2. People who are there previous five years are quoting their TC w/ current stock prices, people who recently onboarded do not have the same strike price and will be less. 3. Golden handcuffs, and apparently non-compete. It sounds nice on paper, but spend some time in Downtown and go to a few Amazonian bars and you'll figure out alot of the downsides. Especially if you're at any of Amazon projects that aren't really..working e.g. Blue Origin.
    - Thorrez 6y ago
      levels.fyi estimates Sr. SDE has $304,787 total comp. But I'm not sure whether the stock component is at vest price or grant price. https://www.levels.fyi/SE/Amazon/Google/Facebook# https://www.levels.fyi/SE/Amazon/Google/Facebook#
      - urda 6y ago

grogenaut 6y ago

As you go up the pay scale they actually try and move your base down towards 90k.

dbish 6y ago
This is not true (current 5+ year amazonian)
sukilot 6y ago
Is that a joke about Bezos's $81K salary?