10 ms·

yes, most companies that allow remote work pay according to cost of living

by suyash 6y ago

ornornor 6y ago
Which is ridiculous. The value of the software produced doesn’t depend on where the code was written.
- bbarnett 6y ago
  Er. Yes, but in SV for example: - housing is literally 4x or 5x or even 10x the pricing elsewhere in the US. Rent is easily in that category too. - food, fuel for your car, electricity, and literally everything including haircuts is more expensive there. Often, several times more expensive. Pay = base needs + retirement savings + extra money for lifestyle/fun + bonus for skill set If base needs + retirement needs + lifestyle/fun costs go up/down, then of course pay will go up/down. Yes, 'skill set' remains static. Unless, of course, there is a surplus in one area (people not willing to move), and a shortage in another. In that case, yup.. guess what! That commodity becomes more valuable. I'm not sure why many people find all of the above confusing.
  - ornornor 6y ago
    What I mean is that if a company can get its software made in SF where office rent and salaries are ridiculously high and still be profitable, it means that the product they make (software in that case) delivers tons of value. With that observation, whether the software is made in SF for one unit of cost or in a cheaper place for 1/4 unit of cost, the company sells it for the same amount and it’s profitable. Ergo, software produced anywhere yields the same amount of money to the company. So why should people get paid less no matter where they live if they produce the same output for the company? Isnt that unfair?
    - bbarnett 6y ago
      No, not even slightly.
      - ornornor 6y ago
        Ok..? I’m not talking within the US where someone could move to the higher COL city and get paid more for the same output (if it made financial sense, after living expenses etc) but about people who can’t move countries because they’ll never get a visa for instance. How is it fair, then, that a SV engineer gets paid 200k to produce software, and her colleague in Turkey gets paid a tenth of that for the same output? It’s not because they’re producing less valuable code, the company sells the product for the same price to anyone anywhere. But the Turkish engineer is basically told by the company that because she’s stuck there and she can’t move elsewhere, then it’s normal to get paid a tenth of her SV colleague. How is that fair?
        bbarnett 6y ago
        Discussing social imbalances, when referring to fiscal concerns of a company in a free-market economy, isn't logical. You're effectively complaining that capitalism isn't entirely fair. Yes? And? You're also saying "The US is wealthy, people are paid more there, that's not fair". Yes? What's you're point? Nothing is entirely fair. Other political and economic systems suck too. So? Don't conflate "companies paying by a logical, sensible, fair means under a free market economy" with "Turkey is a poorer country, due to social, cultural, historical issues, and therefore, someone 1/2 a world away should help. And not help my entire country, but just give me a few random people, software engineers, more wealth." If Turkish law, case history, employment law, market and economics was the same, then likely there would be more upward pressure on wages. In other words, the way to "fix" this, is to make Turkey a 100% clone of the US, along with all of its history, and most importantly, with the cultural outlook many have in the US. But I bet that isn't what a lot of people in Turkey want, is it?
        ornornor 6y ago
        I wouldn’t know what Turkish people want, I’m not Turkish. To put it another way, you’re employing an individual to make you a thing you’ll sell for 1000$, you’re paying that person 10$ because you can get away with it since they live in a poorer country. If that same person was living in the US (for instance), you’d pay them 30$ if they lived somewhere cheap or 200$ if they lived in SV. Same individual, same skills, same output, same product. The only thing that changes is where that person lives which isn’t always a free choice because visas mostly. Framed differently, why is it fair to pay women less than men for the same job? We actually don’t think it’s fair judging from the lip service most companies pay to that issue and the laws written in a lot of countries. In that case, the personal circumstances that influence salary is sex, in what we were discussing before it’s where you live.
  - maccard 6y ago
    > housing is literally 4x or 5x or even 10x the pricing elsewhere in the US. > Rent is easily in that category too. > Food, fuel for your car, electricity, and literally everything including haircuts is more expensive there It still doesn't matter. On a $200k salary in SF your post-tax income is $10667/month. If you spend $4k/month on rent (there are plenty of decent apartments and even houses if you commute a little at that price), $2000 on bills, food, your remaining salary of ~4500 usd is now still greater than a mid level engineers gross pay in the rest of the world, including most of europe.
    - bbarnett 6y ago
      You're referring to imbalances in the equation, not to the premise.
  - ehnto 6y ago
    > If base needs + retirement needs + lifestyle/fun costs go up/down, then of course pay will go up/down. It's a balance, the causation can flow the other way, and I'm pretty sure is currently doing so. The reason SF is so inflated is because (some) people can afford it. That's why locals get angry at tech companies, because the insane wages enabled by the tech bubble have driven the price of everything up, while everyone else's wages aren't catching up. If somehow you picked the bubble up and moved it away, there are no businesses in SF that could match the wages tech companies can, so fewer in SF could afford the inflated prices and they would drop back down to meet the wages that people are now getting. You can see the same thing happen when foreign housing investment is unregulated, and people with far more money than the community they're buying in purchase homes and push the market way up. People who live within the economic bounds of the community the houses are in can't afford it.
- cortesoft 6y ago
  The price paid for labor is only tangentially related to the value of product produced. Wages are set by supply and demand, and the labor market is still very much location dependent. Companies who need local workers are forced to pay the rate required to attract and keep them, and that cost is a lot higher in some places than others. The company doesn't pay someone in San Francisco more than someone in Kansas because the San Francisco worker has a higher cost of living, they do it because the San Francisco worker would go work for someone else for more money if they didn't. The worker in Kansas doesn't have that alternative option. Now, as more and more companies become primarily remote employers, we will likely see the location based variance for workers diminish. However, this is likely to mean that the higher cost of living places see their wages decrease more than lower cost of living places increase.
  - ornornor 6y ago
    I was never able to save as much as I did when working in Switzerland. Both in relative and absolute numbers. And I didn’t change my lifestyle.
    - deleted 6y ago
      [deleted]
  - solidsnack9000 6y ago
    Yeah, I think this is the point people need to recognize -- wages are about clearing costs, which relates to the value of what workers produce (if something is more valuable, people can pay more to compete for the talent to produce it). If developers were literally paid for the value of what they produce, there'd be no profits and the companies wouldn't be good vehicles for investment, wouldn't have funds for R&D, &c.
  - suyash 6y ago
    good point, they justify by saying things like 'cost of living' when in reality it's about many other things like supply/demand, need for local talent who can come to office etc etc.
- deleted 6y ago
  [deleted]
StavrosK 6y ago
In my experience as someone who's worked for US companies and living elsewhere, most of them don't. It's a small minority that do.

yes, most companies that allow remote work pay according to cost of living

by suyash 6y ago

yes, most companies that allow remote work pay according to cost of living

ornornor 6y ago

Which is ridiculous. The value of the software produced doesn’t depend on where the code was written.

bbarnett 6y ago
Er. Yes, but in SV for example: - housing is literally 4x or 5x or even 10x the pricing elsewhere in the US. Rent is easily in that category too. - food, fuel for your car, electricity, and literally everything including haircuts is more expensive there. Often, several times more expensive. Pay = base needs + retirement savings + extra money for lifestyle/fun + bonus for skill set If base needs + retirement needs + lifestyle/fun costs go up/down, then of course pay will go up/down. Yes, 'skill set' remains static. Unless, of course, there is a surplus in one area (people not willing to move), and a shortage in another. In that case, yup.. guess what! That commodity becomes more valuable. I'm not sure why many people find all of the above confusing.
- ornornor 6y ago
  What I mean is that if a company can get its software made in SF where office rent and salaries are ridiculously high and still be profitable, it means that the product they make (software in that case) delivers tons of value. With that observation, whether the software is made in SF for one unit of cost or in a cheaper place for 1/4 unit of cost, the company sells it for the same amount and it’s profitable. Ergo, software produced anywhere yields the same amount of money to the company. So why should people get paid less no matter where they live if they produce the same output for the company? Isnt that unfair?
  - bbarnett 6y ago
    No, not even slightly.
    - ornornor 6y ago
      Ok..? I’m not talking within the US where someone could move to the higher COL city and get paid more for the same output (if it made financial sense, after living expenses etc) but about people who can’t move countries because they’ll never get a visa for instance. How is it fair, then, that a SV engineer gets paid 200k to produce software, and her colleague in Turkey gets paid a tenth of that for the same output? It’s not because they’re producing less valuable code, the company sells the product for the same price to anyone anywhere. But the Turkish engineer is basically told by the company that because she’s stuck there and she can’t move elsewhere, then it’s normal to get paid a tenth of her SV colleague. How is that fair?
      - bbarnett 6y ago
        Discussing social imbalances, when referring to fiscal concerns of a company in a free-market economy, isn't logical. You're effectively complaining that capitalism isn't entirely fair. Yes? And? You're also saying "The US is wealthy, people are paid more there, that's not fair". Yes? What's you're point? Nothing is entirely fair. Other political and economic systems suck too. So? Don't conflate "companies paying by a logical, sensible, fair means under a free market economy" with "Turkey is a poorer country, due to social, cultural, historical issues, and therefore, someone 1/2 a world away should help. And not help my entire country, but just give me a few random people, software engineers, more wealth." If Turkish law, case history, employment law, market and economics was the same, then likely there would be more upward pressure on wages. In other words, the way to "fix" this, is to make Turkey a 100% clone of the US, along with all of its history, and most importantly, with the cultural outlook many have in the US. But I bet that isn't what a lot of people in Turkey want, is it?
        ornornor 6y ago
        I wouldn’t know what Turkish people want, I’m not Turkish. To put it another way, you’re employing an individual to make you a thing you’ll sell for 1000$, you’re paying that person 10$ because you can get away with it since they live in a poorer country. If that same person was living in the US (for instance), you’d pay them 30$ if they lived somewhere cheap or 200$ if they lived in SV. Same individual, same skills, same output, same product. The only thing that changes is where that person lives which isn’t always a free choice because visas mostly. Framed differently, why is it fair to pay women less than men for the same job? We actually don’t think it’s fair judging from the lip service most companies pay to that issue and the laws written in a lot of countries. In that case, the personal circumstances that influence salary is sex, in what we were discussing before it’s where you live.
- maccard 6y ago
  > housing is literally 4x or 5x or even 10x the pricing elsewhere in the US. > Rent is easily in that category too. > Food, fuel for your car, electricity, and literally everything including haircuts is more expensive there It still doesn't matter. On a $200k salary in SF your post-tax income is $10667/month. If you spend $4k/month on rent (there are plenty of decent apartments and even houses if you commute a little at that price), $2000 on bills, food, your remaining salary of ~4500 usd is now still greater than a mid level engineers gross pay in the rest of the world, including most of europe.
  - bbarnett 6y ago
    You're referring to imbalances in the equation, not to the premise.
- ehnto 6y ago
  > If base needs + retirement needs + lifestyle/fun costs go up/down, then of course pay will go up/down. It's a balance, the causation can flow the other way, and I'm pretty sure is currently doing so. The reason SF is so inflated is because (some) people can afford it. That's why locals get angry at tech companies, because the insane wages enabled by the tech bubble have driven the price of everything up, while everyone else's wages aren't catching up. If somehow you picked the bubble up and moved it away, there are no businesses in SF that could match the wages tech companies can, so fewer in SF could afford the inflated prices and they would drop back down to meet the wages that people are now getting. You can see the same thing happen when foreign housing investment is unregulated, and people with far more money than the community they're buying in purchase homes and push the market way up. People who live within the economic bounds of the community the houses are in can't afford it.
cortesoft 6y ago
The price paid for labor is only tangentially related to the value of product produced. Wages are set by supply and demand, and the labor market is still very much location dependent. Companies who need local workers are forced to pay the rate required to attract and keep them, and that cost is a lot higher in some places than others. The company doesn't pay someone in San Francisco more than someone in Kansas because the San Francisco worker has a higher cost of living, they do it because the San Francisco worker would go work for someone else for more money if they didn't. The worker in Kansas doesn't have that alternative option. Now, as more and more companies become primarily remote employers, we will likely see the location based variance for workers diminish. However, this is likely to mean that the higher cost of living places see their wages decrease more than lower cost of living places increase.
- ornornor 6y ago
  I was never able to save as much as I did when working in Switzerland. Both in relative and absolute numbers. And I didn’t change my lifestyle.
  - deleted 6y ago
    [deleted]
- solidsnack9000 6y ago
  Yeah, I think this is the point people need to recognize -- wages are about clearing costs, which relates to the value of what workers produce (if something is more valuable, people can pay more to compete for the talent to produce it). If developers were literally paid for the value of what they produce, there'd be no profits and the companies wouldn't be good vehicles for investment, wouldn't have funds for R&D, &c.
- suyash 6y ago
  good point, they justify by saying things like 'cost of living' when in reality it's about many other things like supply/demand, need for local talent who can come to office etc etc.
deleted 6y ago
[deleted]

StavrosK 6y ago

In my experience as someone who's worked for US companies and living elsewhere, most of them don't. It's a small minority that do.