5 ms·

> if engineers in America are ridiculously overpaid, or why do you only compare to Japan and EU? American engineers get paid more than anyone else (except for

by nsonha 5y ago

> if engineers in America are ridiculously overpaid, or why do you only compare to Japan and EU? American engineers get paid more than anyone else (except for EU outliers). I make slightly above 100k in Australia, it's a bit tight with the housing situation and cost of living but it's liveable. Cost of living in the US is lower except for maybe healthcare but engineers get companies pay for them anyway. I don't have insights into other engineering, but I think software engineers are overpaid. Would I enjoy being overpaid? Of course, but it's hard to say it's fair pay considering what people in other professions are making.

hardwaresofton 5y ago
> why do you only compare to Japan and EU? American engineers get paid more than anyone else (except for EU outliers). I make slightly above 100k in Australia, it's a bit tight with the housing situation and cost of living but it's liveable. Cost of living in the US is lower except for maybe healthcare but engineers get companies pay for them anyway. Well those are just the biggest/most relevant tech labor markets I could think of, roughly by GDP. I don't know much about Australia but couldn't comment there, thanks for the insight. > I don't have insights into other engineering, but I think software engineers are overpaid. Would I enjoy being overpaid? Of course, but it's hard to say it's fair pay considering what people in other professions are making. I don't think comparing pay across professions makes sense -- why compare a plumber or doctor to what a software engineer does? the outcomes are completely different, the risks are completely different, the upside/profit potential is completely different. I lean towards considering software engineers as underpaid because the power of automation (whether software or hardware -- because you generally need some kind of soft/firmware to make robots move) is insane. If software engineers were ever paid a percentage of the revenue impact they generate (which is not how markets work, but I digress), software engineers would be paid much much more. I think it might be possible to compare across professions if you think of % of value creation captured let's say but it gets tenuous. In the end the only "fair" determination is what supply and demand based markets dictate. They're not perfect, but they approximate other forces/influences decently enough. When those aren't enough, governments may need to step in to enact policy.
- nsonha 5y ago
  fair enough, fyi my line of thought is a bit Marxist, you should get paid based on your labour, time, mental energy etc put in the work as much as the result. When you pay people according to only "impacts" you create an incentive to make "viral" things. In software these days even without such incentive taking full effect, over abstraction, one-size-fits-all, github star counting are becoming bigger problems. > you generally need some kind of soft/firmware to make robots move) is insane The fact that you completely ignore the hardware is very telling. CPU has been improved according to Moore's law in the past few decades, if anything modern software engineering failed to live up to that potential and has been free riding on top of progress in hardware. It's insane to make robots move but software is a small part of that, there is also mechanical/electrical engineering, battery techs etc. Software sitting at the top of that stack shouldn't takes all the credit. It's very hard to innovate on the lower layers with all the lab work and physical constrains.
  - hardwaresofton 5y ago
    > fair enough, fyi my line of thought is a bit Marxist, you should get paid based on your labour, time, mental energy etc put in the work as much as the result. When you pay people according to only "impacts" you create an incentive to make "viral" things. In software these days even without such incentive taking full effect, over abstraction, one-size-fits-all, github star counting are becoming bigger problems. Hmnn but doing it that way feels like it would devalue doing things smarter which seems to be more beneficial to society. Single-mindedly incentivizing labor seems like it would skewer efficiency -- I guess like most things the right answer is in the middle. I'm not sure what you mean by "viral" things but I'm trying to discuss only about work output. If the work output is virality (let's say a social media manager), then it makes sense to measure that way, but usually businesses don't deal in that currency -- they deal in product shipped out or contracts landed, etc. That said, I'm well aware that systems that think themselves to be closest to the capitalist ideal are pretty brutal on the cogs in the machine. As a side note, it's a red flag for me when I see github projects that are too concerned with stars/going viral, or even when I see presentations about projects that mention stars. Everyone thinks it's silly but everyone keeps doing it -- if only we'd stop then people would start judging projects on things other than adoption. Then again, adoption is the biggest metric for most people, because it generally is a proxy for "availability of free support/feature development", and in that sense I'm guilty of the same. > The fact that you completely ignore the hardware is very telling. CPU has been improved according to Moore's law in the past few decades, if anything modern software engineering failed to live up to that potential and has been free riding on top of progress in hardware. > It's insane to make robots move but software is a small part of that, there is also mechanical/electrical engineering, battery techs etc. Software sitting at the top of that stack shouldn't takes all the credit. It's very hard to innovate on the lower layers with all the lab work and physical constrains. Agreed! There is more than enough value to go around to be shared between all those kinds of engineering -- just because I didn't mention lithography engineers or materials science engineers or people who smelt silicon doesn't mean they don't exist and don't deserve to be paid.
judge2020 5y ago
Simply looking at the number value might be too surface level for this. The bay area has high wages because of the cost of living - due to the housing crisis and overall pay required to live in the area, FAANG and non-FAANG alike pay more simply in order to have employees that can actually afford living somewhere within an hour of the city - and with remote work, companies are docking employee pay to more competitive rates if they move out of SF[0] (although, with Covid, every metropolitan area has began gravitating towards this issue[1]). While this might mean an overall higher standard of living and nicer cars, it isn't crazy and, after the mortgage, chances are it's closer to the SoL in other cities and possibly Australia. 0: https://www.businessinsider.com/tech-companies-cutting-salaries-outside-bay-area-twitter-facebook-vmware-2020-9 https://www.businessinsider.com/tech-companies-cutting-salar... 1: https://www.zillow.com/home-values/ https://www.zillow.com/home-values/ (12% YoY for two years is scary).
- s17n 5y ago
  This is backwards, the high cost of living in the bay area is a result of the high salaries (and the barriers to expanding the housing supply).
  - bobthepanda 5y ago
    It's not really backwards, it's a cycle that reinforces itself. House expensive -> salaries jump -> people have more money to pay for house -> house becomes more expensive. This is like arguing about the chicken or the egg. More housing supply would help to a point but it would take an order of magnitude change to make a dent in the current self-reinforcing cycle, and probably would need that level of increased production for a period of time.
    - hardwaresofton 5y ago
      I'm no expert on the history of SV or your housing (I've never lived there, probably never will), but I thought the general story was something like this: 0. California existed 1. Government investment comes to the valley during the cold war in early SV companies 2. Innovation happens in leaps and bounds thanks to the government checkbook 3. Profit is made hand over fist by some people/groups/entities 4. People/groups/entities from (3) buy more of everything 5. More People & entities come in search of interesting ideas/cutting edge technology/profit/fame/etc 6. return to (3)
ZephyrBlu 5y ago
> I make slightly above 100k in Australia, it's a bit tight with the housing situation and cost of living but it's liveable 100k USD (So ~130k AUD)? Even if that's 100k AUD, it's a bit odd to hear that it's "tight" when you're on 100k. I didn't think Aussie's COL was that high.
- nsonha 5y ago
  it's USD, with mortgage and the need to save and invest, not tight in the literal sense. COL is higher than most countries in the world. It being a remote continent, that should not come as a surprise. Average house price in Melbourne is now AUD 1m or USD 775k
matwood 5y ago
> but I think software engineers are overpaid. I'm curious why you would think this. In some ways software is a trade, but what makes it unique to nearly any other profession is its multiplicative effect. One software engineer can write a program that improves the productivity of thousands or more people. What would you pay the person who invented the lever? Now, what you would the pay the person who invents the lever every couple weeks? If anything, many software engineers are still underpaid.
- nsonha 5y ago
  I'm sorry a typical software developer doesn't do anything innovative. At the current stage, the majority of the industry does works like porting things from lang X to lang Y or mapping between convoluted systems that they themselves created (for "DX"), making skins around databases, again and again. Another hughe chunk of developers works in the attention economy: ads, game, streaming, whatever, the things that I doubt have a net positive contribution to society. They give people nonsense to do and watch and take away their time, sounds like mutiplier of negative productivity if anything. There are indeed developers working on useful things to society, but they usually work on top of amazing intercom and hardware infrastructures that drive more innovation and deserve more credit than their crappy software. Speaking as a web developer.
- ridaj 5y ago
  I think the issue there, to continue your analogy, is that some carpenters are busy creating new levers, while others are busy repeating the same carpentry over and over again. Same trade, different aims. The "multiplicative effect" is easy to translate to economic factors: it's what allows software-based companies to have very high marginal profit. The average net profit margin of a small business in the US is less than 10%, but in scaled, software-centered businesses it's not unusual to be above 30% or 50% due to the zero marginal cost of production. But for every company like Facebook, Amazon, Oracle, Google etc which understand this and plays to it to shoot for sky-high unit margins, there are N companies like Tata Consultancy, Accenture, Capgemini (or in-house IT departments) which effectively employ software engineers to do non-reusable "glue" tasks where the margin expectation is topping out somewhere between around 10%. These folks cannot pay as much for talent, in part because their stock isn't valued nearly as much, whereas it is a relatively cheap source of compensation for tech companies. A key to understanding the difference between US and other markets is the 1:N ratio. Software engineers in the Bay Area are gifted with very low ratios, and places where the ratio is higher in my experience have much more depressed software engineering compensation because there are not enough high margin software businesses to drive them.

by nsonha 5y ago

hardwaresofton 5y ago

> why do you only compare to Japan and EU? American engineers get paid more than anyone else (except for EU outliers). I make slightly above 100k in Australia, it's a bit tight with the housing situation and cost of living but it's liveable. Cost of living in the US is lower except for maybe healthcare but engineers get companies pay for them anyway. Well those are just the biggest/most relevant tech labor markets I could think of, roughly by GDP. I don't know much about Australia but couldn't comment there, thanks for the insight. > I don't have insights into other engineering, but I think software engineers are overpaid. Would I enjoy being overpaid? Of course, but it's hard to say it's fair pay considering what people in other professions are making. I don't think comparing pay across professions makes sense -- why compare a plumber or doctor to what a software engineer does? the outcomes are completely different, the risks are completely different, the upside/profit potential is completely different. I lean towards considering software engineers as underpaid because the power of automation (whether software or hardware -- because you generally need some kind of soft/firmware to make robots move) is insane. If software engineers were ever paid a percentage of the revenue impact they generate (which is not how markets work, but I digress), software engineers would be paid much much more. I think it might be possible to compare across professions if you think of % of value creation captured let's say but it gets tenuous. In the end the only "fair" determination is what supply and demand based markets dictate. They're not perfect, but they approximate other forces/influences decently enough. When those aren't enough, governments may need to step in to enact policy.

nsonha 5y ago
fair enough, fyi my line of thought is a bit Marxist, you should get paid based on your labour, time, mental energy etc put in the work as much as the result. When you pay people according to only "impacts" you create an incentive to make "viral" things. In software these days even without such incentive taking full effect, over abstraction, one-size-fits-all, github star counting are becoming bigger problems. > you generally need some kind of soft/firmware to make robots move) is insane The fact that you completely ignore the hardware is very telling. CPU has been improved according to Moore's law in the past few decades, if anything modern software engineering failed to live up to that potential and has been free riding on top of progress in hardware. It's insane to make robots move but software is a small part of that, there is also mechanical/electrical engineering, battery techs etc. Software sitting at the top of that stack shouldn't takes all the credit. It's very hard to innovate on the lower layers with all the lab work and physical constrains.
- hardwaresofton 5y ago
  > fair enough, fyi my line of thought is a bit Marxist, you should get paid based on your labour, time, mental energy etc put in the work as much as the result. When you pay people according to only "impacts" you create an incentive to make "viral" things. In software these days even without such incentive taking full effect, over abstraction, one-size-fits-all, github star counting are becoming bigger problems. Hmnn but doing it that way feels like it would devalue doing things smarter which seems to be more beneficial to society. Single-mindedly incentivizing labor seems like it would skewer efficiency -- I guess like most things the right answer is in the middle. I'm not sure what you mean by "viral" things but I'm trying to discuss only about work output. If the work output is virality (let's say a social media manager), then it makes sense to measure that way, but usually businesses don't deal in that currency -- they deal in product shipped out or contracts landed, etc. That said, I'm well aware that systems that think themselves to be closest to the capitalist ideal are pretty brutal on the cogs in the machine. As a side note, it's a red flag for me when I see github projects that are too concerned with stars/going viral, or even when I see presentations about projects that mention stars. Everyone thinks it's silly but everyone keeps doing it -- if only we'd stop then people would start judging projects on things other than adoption. Then again, adoption is the biggest metric for most people, because it generally is a proxy for "availability of free support/feature development", and in that sense I'm guilty of the same. > The fact that you completely ignore the hardware is very telling. CPU has been improved according to Moore's law in the past few decades, if anything modern software engineering failed to live up to that potential and has been free riding on top of progress in hardware. > It's insane to make robots move but software is a small part of that, there is also mechanical/electrical engineering, battery techs etc. Software sitting at the top of that stack shouldn't takes all the credit. It's very hard to innovate on the lower layers with all the lab work and physical constrains. Agreed! There is more than enough value to go around to be shared between all those kinds of engineering -- just because I didn't mention lithography engineers or materials science engineers or people who smelt silicon doesn't mean they don't exist and don't deserve to be paid.

judge2020 5y ago

Simply looking at the number value might be too surface level for this. The bay area has high wages because of the cost of living - due to the housing crisis and overall pay required to live in the area, FAANG and non-FAANG alike pay more simply in order to have employees that can actually afford living somewhere within an hour of the city - and with remote work, companies are docking employee pay to more competitive rates if they move out of SF[0] (although, with Covid, every metropolitan area has began gravitating towards this issue[1]). While this might mean an overall higher standard of living and nicer cars, it isn't crazy and, after the mortgage, chances are it's closer to the SoL in other cities and possibly Australia. 0: https://www.businessinsider.com/tech-companies-cutting-salaries-outside-bay-area-twitter-facebook-vmware-2020-9 https://www.businessinsider.com/tech-companies-cutting-salar... 1: https://www.zillow.com/home-values/ https://www.zillow.com/home-values/ (12% YoY for two years is scary).

s17n 5y ago
This is backwards, the high cost of living in the bay area is a result of the high salaries (and the barriers to expanding the housing supply).
- bobthepanda 5y ago
  It's not really backwards, it's a cycle that reinforces itself. House expensive -> salaries jump -> people have more money to pay for house -> house becomes more expensive. This is like arguing about the chicken or the egg. More housing supply would help to a point but it would take an order of magnitude change to make a dent in the current self-reinforcing cycle, and probably would need that level of increased production for a period of time.
  - hardwaresofton 5y ago
    I'm no expert on the history of SV or your housing (I've never lived there, probably never will), but I thought the general story was something like this: 0. California existed 1. Government investment comes to the valley during the cold war in early SV companies 2. Innovation happens in leaps and bounds thanks to the government checkbook 3. Profit is made hand over fist by some people/groups/entities 4. People/groups/entities from (3) buy more of everything 5. More People & entities come in search of interesting ideas/cutting edge technology/profit/fame/etc 6. return to (3)

ZephyrBlu 5y ago

> I make slightly above 100k in Australia, it's a bit tight with the housing situation and cost of living but it's liveable 100k USD (So ~130k AUD)? Even if that's 100k AUD, it's a bit odd to hear that it's "tight" when you're on 100k. I didn't think Aussie's COL was that high.

nsonha 5y ago
it's USD, with mortgage and the need to save and invest, not tight in the literal sense. COL is higher than most countries in the world. It being a remote continent, that should not come as a surprise. Average house price in Melbourne is now AUD 1m or USD 775k

matwood 5y ago

> but I think software engineers are overpaid. I'm curious why you would think this. In some ways software is a trade, but what makes it unique to nearly any other profession is its multiplicative effect. One software engineer can write a program that improves the productivity of thousands or more people. What would you pay the person who invented the lever? Now, what you would the pay the person who invents the lever every couple weeks? If anything, many software engineers are still underpaid.

nsonha 5y ago
I'm sorry a typical software developer doesn't do anything innovative. At the current stage, the majority of the industry does works like porting things from lang X to lang Y or mapping between convoluted systems that they themselves created (for "DX"), making skins around databases, again and again. Another hughe chunk of developers works in the attention economy: ads, game, streaming, whatever, the things that I doubt have a net positive contribution to society. They give people nonsense to do and watch and take away their time, sounds like mutiplier of negative productivity if anything. There are indeed developers working on useful things to society, but they usually work on top of amazing intercom and hardware infrastructures that drive more innovation and deserve more credit than their crappy software. Speaking as a web developer.
ridaj 5y ago
I think the issue there, to continue your analogy, is that some carpenters are busy creating new levers, while others are busy repeating the same carpentry over and over again. Same trade, different aims. The "multiplicative effect" is easy to translate to economic factors: it's what allows software-based companies to have very high marginal profit. The average net profit margin of a small business in the US is less than 10%, but in scaled, software-centered businesses it's not unusual to be above 30% or 50% due to the zero marginal cost of production. But for every company like Facebook, Amazon, Oracle, Google etc which understand this and plays to it to shoot for sky-high unit margins, there are N companies like Tata Consultancy, Accenture, Capgemini (or in-house IT departments) which effectively employ software engineers to do non-reusable "glue" tasks where the margin expectation is topping out somewhere between around 10%. These folks cannot pay as much for talent, in part because their stock isn't valued nearly as much, whereas it is a relatively cheap source of compensation for tech companies. A key to understanding the difference between US and other markets is the 1:N ratio. Software engineers in the Bay Area are gifted with very low ratios, and places where the ratio is higher in my experience have much more depressed software engineering compensation because there are not enough high margin software businesses to drive them.