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Good, this should be standard. I don't understand how you can have a labor market where only one side has information on what the salaries are for an industry

Good, this should be standard. I don't understand how you can have a labor market where only one side has information on what the salaries are for an industry through a team that does market research. It depresses wages, mostly for internal employees who aren't paying attention bc they're content with their jobs. Price transparency leads to more efficient markets, no reason the labor market is any different. A company hiring an employee under market rate, because the employee doesn't know what market rate is, is a failure. EDIT: Wanted to add that this hits closer to home for me b/c I've personally experienced this. Went out and jumped companies and got a 300% raise b/c I was underpaid at the prev, only know that thanks to levels.fyi. New hires at my level were making almost double what I was. When other engineers at my current company talk about salary, or total comp more generally, they vastly underestimate the state of the market.

rapind 5y ago
Yes, the biggest impact will be on cheap companies who relied on a candidate’s ignorance of their worth. We don’t even need most states to pass bills like this (would be nice though). We just need some of them and the cat’s out of the bag.
WalterBright 5y ago
- mattnewton 5y ago
  Googling crowdsourced data like levels.fyi or Glassdoor has way more noise and sampling bias than the data companies can buy from places like TWN by Equifax. Even if you had access to the same data, you don't have access to their business information so you have no good way of understanding what you would be worth or the value you are expected to generate.
  - WalterBright 5y ago
    > you don't have access to their business information And they don't have access to accurate information on what value you can generate, either. It's a crapshoot for both parties.
    - lotsofpulp 5y ago
      It is far more of a crapshoot for one party than the other.
      - WalterBright 5y ago
        Not at all. Consider the perennial topic on HN on how to accurately evaluate a candidate's suitability for a particular job. It's impossible.
        pessimizer 5y ago
        An applicant has as much job-related gambling when they take a job as the employer, especially when the job can just fire you. When applying, you have no idea if the management is terrible, if your particular manager is terrible, if the projects you're going to work on are terrible, if the procedures and standards for working on a project within the organization are stupid or will penalize your style of work, if the job will have high expectations and skimp on resources, whether your new company sucks at hiring and all your coworkers are going to be terrible... Calling it a crapshoot on both sides is a pretty empty statement. When it comes specifically to compensation, the applicant is David and the company is Goliath.
        lotsofpulp 5y ago
        If this was true, then labor prices would not have severely stagnated over the past 5 decades, relative to the wealth increases for the equity owners.
        WalterBright 5y ago
        Employee compensation is based on the value they provide to the company. Equity owners are compensated for the risk they take. I don't see any essential correlation between the two. For example, if you pay Bob $10 to go to the store and buy a lottery ticket for you, and you win the $1m jackpot, do you owe anything more to Bob than $10 worth of value he provided? Let's say the ticket was a dud. Do you therefore owe Bob less than the $10 you promised him?
  - Zaheer 5y ago
    Zaheer from Levels.fyi here. Note that companies struggle with data as well. There's dozens of companies that solely exist to provide better data to companies around salaries (Radford, OptionImpact, etc.). All of these have limitations as well (title matching, recency of data, etc.) and generally companies subscribe to multiple providers to get a better picture of what the market pays. Companies in fact purchase data from us as well (the same data you see on site but formatted in a way that's easier for comp analysts to use). The reality is that there is tons of nuance that goes into pricing a job / candidate effectively. Each candidate has unique skills even if two candidates have the same title, level, etc. That's why it's almost never a fixed number and often a range.
    - mattnewton 5y ago
      Thank you for the context! I recently discovered that many employers share exact salary and level information with Equifax and assumed that those kinds of solutions were commonplace.
- programmer_dude 5y ago
  That's a good one Walter, thanks for the laugh.
  - WalterBright 5y ago
    Do you think that companies don't google salary ranges?
    - programmer_dude 5y ago
      Sure they can but it is not the only thing they do. It is well known that companies often collude with each other and engage in "salary fixing". For example: https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L... Also they have the money to buy information from various information aggregation companies which collect salary information from more reliable sources. They do not have to rely on (inherently unreliable) self reported figures from glassdoor etc.
      - WalterBright 5y ago
        > It is well known that companies often collude with each other and engage in "salary fixing". That has nothing to do with the topic at hand, which is the candidate doing some research to get a feel for salary ranges. > They do not have to rely on (inherently unreliable) self reported figures from glassdoor etc. Salary figures are inherently inaccurate, just like googling for the market price of your car can never be accurate, because the price you actually get is dependent on the individual characteristics of your car, and how much the other party needs to buy it, and how much you need to sell it. The fact is, if you're going in blind to deal for a car, or a job, you're shooting yourself in the foot. Information isn't hard to come by for either. You don't need the government to hold your hand.
        programmer_dude 5y ago
        I believe the topic being discussed is asymmetry of information between employees and employers (with respect to salary). Salary fixing demonstrates this asymmetry pretty well, so it is on topic. > Salary figures are inherently inaccurate, just like googling for the market price of your car can never be accurate, I don't think this has got anything to do with the topic under discussion. > Information isn't hard to come by for either. I disagree. IMO it is harder to come by for individuals than large companies. I have explained why in my previous response.
- hemloc_io 5y ago
  Snark aside, yeah levels.fyi does have data and so do other sites. (Although levels is the standard in tech imo). Still is incorrect though, b/c those sites are biased against older consistent data vs new data. Example: Look at averages for FAANG engineers that are poached from other companies, vs ones with years at that company. If you just looked at the average then it wouldn't work since you're a new applicant you should probably ask for 20-30% more than if you currently worked there. Also saying Google/Levels is good enough puts aside the problem of what market rate is for smaller companies. How much should a well funded web3 company pay you? What about companies outside of tech where salary sharing is less common? All of the info available to the candidate on Google also pales in comparison to the asymmetry of one person versus an entire department of people who make these deals for a living, and have actual research on what's going on with the market instead of randomly reported crowdsourced data.
- gotoeleven 5y ago
  We now apparently live in a bizzaro fantasy world where legislation is required to spare people the discomfort of negotiating a salary or asking for a raise. If a company offered to pay you X and you agreed, whose fault is this? We used to call dealing with these kinds of situations "being an adult."
  - triceratops 5y ago
    > If a company offered to pay you X and you agreed, whose fault is this? If you were forced to trade stocks for a living but had only second-hand access to price information ("My cousin bought some TSLA at $200/share last year") while all the brokerages share order flows in real time, would you say you're getting hosed? Or that it's a fair market?
    - WalterBright 5y ago
      > If you were forced to trade stocks for a living Since you're not, the rest doesn't follow. For example, I played poker when I was younger. I routinely did much worse than mathematically expected. I suspect I was being cheated by the other players, but I wasn't savvy enough to know how they were cheating me. My solution was to stop playing poker. I know that when I trade stocks, I'm getting chiseled. So I don't day trade. I buy and hold, and rarely make a trade. Hence, the chiseling doesn't amount to much.
      - triceratops 5y ago
        > Since you're not, the rest doesn't follow. It's an analogy. "Trading stocks" is an analogy for "negotiating salary". Nearly everyone has to negotiate salary. > I wasn't savvy enough to know how they were cheating me. My solution was to stop playing poker. So you're saying people's options are to a) be cheated on salary or b) not work in paid employment? I respect that you have an opinion, but it's not an opinion that I have any respect for. > Hence, the chiseling doesn't amount to much Because we have open price sharing today and it's not possible to cheat you too much. You're benefiting from this even though you don't day trade. If we didn't have that, you and every other buy-and-holder would be shafted severely. Sidenote: I notice in many of your posts that you're a big proponent of free markets (which I mostly agree with). How do you square that belief with this one where one party, by design, has far less market information than the other? I'm genuinely curious about this, because it seems contradictory. (And yes, you might say "Companies choosing to share/not share salary is actually them competing on a free market", but that's an awfully limited viewpoint when we have other markets where prices are required to be open - such as real estate, and securities - without there being any suggestion that they aren't free markets)
bitsnbytes 5y ago
Exactly. Also with all the talk of racism and sexism in the work place , especially by the Big Tech companies, they should have done this long ago. Well they would have if they had truly cared about minorities versus creating a bigger labor pool to drop pay rates or create faux PR for their companies and industries.
- qualudeheart 5y ago
  Salary numbers should also be available through a standard API in a machine readable format. Data could be sorted by years of experience, education levels, race, gender and so on.
barry-cotter 5y ago
Pay transparency is great for business owners and other large employers. It makes it much easier to compress pay. > Recent decades have witnessed a growing focus on two distinct income patterns: persistent pay inequity, particularly a gender pay gap, and growing pay inequality. Pay transparency is widely advanced as a remedy for both. Yet we know little about the systemic influence of this policy on the evolution of pay practices within organizations. To address this void, we assemble a dataset combining detailed performance, demographic and salary data for approximately 100,000 US academics between 1997 and 2017. We then exploit staggered shocks to wage transparency to explore how this change reshapes pay practices. We find evidence that pay transparency causes significant increases in both the equity and equality of pay, and significant and sizeable reductions in the link between pay and individually measured performance. https://www.nature.com/articles/s41562-022-01288-9 https://www.nature.com/articles/s41562-022-01288-9
- corpdronejuly 5y ago
  Then those of us able to get more might be pushed into taking the risk of making our own company and competing against the major players who are currently controlling the market by paying more than God to keep talent focused on selling ads instead of creating value?
- allturtles 5y ago
  > Pay transparency is great for business owners and other large employers. If this is true, why aren't large employers already publishing salary data? i.e. why do they have to be forced to do it by law?
  - pid-1 5y ago
    I'm also not following this argument. Understanding job markets requires leg work and is definitely part of the competitive advantage of many businesses.
  - Spooky23 5y ago
    Because they screw people over. See my other comment in the thread. I spent most of my career as a public employee, most years salary are searchable on the internet. It’s nice because it eliminates a lot of drama about salary, who has what formal title, etc. When I was in sales, the smart salespeople were following their peer/competitors performance. The notion that “professionals” are above such things as compensation is just stupid.
slg 5y ago
>It depresses wages, mostly for internal employees who aren't paying attention bc they're content with their jobs. It is just wild to me that this is where society landed. Imagine you are a business owner. Wouldn't employees who are loyal and happy to come to work be the exact people you want to keep long term? These are people who know your industry, your business, your customers, and your product. They are your institutional knowledge. They are drastically more valuable than a new hire who has to spend years learning this all. But instead of rewarding that loyalty, we use it to squeeze out an extra few dollars of profit regardless of the consequences. It is bizarre.
- powerslacker 5y ago
  If I had to guess, I'd imagine this is the result of perverse incentives combined with the Peter principle. Consider a manager or corporate recruiter receiving a bonus for keeping down costs.
  - slg 5y ago
    >If I had to guess, I'd imagine this is the result of perverse incentives I think it is simply short term profit maximalization. Why give an employee a dollar more than you have to give them? Whether giving them an extra dollar now might generate an extra two dollars down the road is rarely even considered.
- whimsicalism 5y ago
  People who you have recently formally evaluated the competency of are priced upwards. That sort of makes sense to me.
  - slg 5y ago
    What is the interview process like at your company if you think that is a better evaluation of an employee's ability to do their job compared to act of actually doing that job?
- sangnoir 5y ago
  > Wouldn't employees who are loyal and happy to come to work be the exact people you want to keep long term? You do, but you can achieve this by one of 2 ways: frequently adjusting salaries to match market rates, or rely on momentum, and hide information from them by strongly discouraging salary discussions among employees[1]. The latter approach results in more profits. 1. but sharing this information with fellow employers behind paywalls, like the work number.
Spooky23 5y ago
I worked for a software company many years ago that also operated call centers for customers who didn’t want to run their own. My colleague was an immigrant who had moved up the ranks from a call center agent to a senior technical role. I found out when fixing a technical problem that she made $25k, while I made $65k. Basically, they gave her a 25% raise from a call center supervisor to be a Unix SA, and in lieu of raises “gave” her comp time for 24x7 on-call.

rapind 5y ago

Yes, the biggest impact will be on cheap companies who relied on a candidate’s ignorance of their worth. We don’t even need most states to pass bills like this (would be nice though). We just need some of them and the cat’s out of the bag.

WalterBright 5y ago

mattnewton 5y ago
Googling crowdsourced data like levels.fyi or Glassdoor has way more noise and sampling bias than the data companies can buy from places like TWN by Equifax. Even if you had access to the same data, you don't have access to their business information so you have no good way of understanding what you would be worth or the value you are expected to generate.
- WalterBright 5y ago
  > you don't have access to their business information And they don't have access to accurate information on what value you can generate, either. It's a crapshoot for both parties.
  - lotsofpulp 5y ago
    It is far more of a crapshoot for one party than the other.
    - WalterBright 5y ago
      Not at all. Consider the perennial topic on HN on how to accurately evaluate a candidate's suitability for a particular job. It's impossible.
      - pessimizer 5y ago
        An applicant has as much job-related gambling when they take a job as the employer, especially when the job can just fire you. When applying, you have no idea if the management is terrible, if your particular manager is terrible, if the projects you're going to work on are terrible, if the procedures and standards for working on a project within the organization are stupid or will penalize your style of work, if the job will have high expectations and skimp on resources, whether your new company sucks at hiring and all your coworkers are going to be terrible... Calling it a crapshoot on both sides is a pretty empty statement. When it comes specifically to compensation, the applicant is David and the company is Goliath.
      - lotsofpulp 5y ago
        If this was true, then labor prices would not have severely stagnated over the past 5 decades, relative to the wealth increases for the equity owners.
        WalterBright 5y ago
        Employee compensation is based on the value they provide to the company. Equity owners are compensated for the risk they take. I don't see any essential correlation between the two. For example, if you pay Bob $10 to go to the store and buy a lottery ticket for you, and you win the $1m jackpot, do you owe anything more to Bob than $10 worth of value he provided? Let's say the ticket was a dud. Do you therefore owe Bob less than the $10 you promised him?
- Zaheer 5y ago
  Zaheer from Levels.fyi here. Note that companies struggle with data as well. There's dozens of companies that solely exist to provide better data to companies around salaries (Radford, OptionImpact, etc.). All of these have limitations as well (title matching, recency of data, etc.) and generally companies subscribe to multiple providers to get a better picture of what the market pays. Companies in fact purchase data from us as well (the same data you see on site but formatted in a way that's easier for comp analysts to use). The reality is that there is tons of nuance that goes into pricing a job / candidate effectively. Each candidate has unique skills even if two candidates have the same title, level, etc. That's why it's almost never a fixed number and often a range.
  - mattnewton 5y ago
    Thank you for the context! I recently discovered that many employers share exact salary and level information with Equifax and assumed that those kinds of solutions were commonplace.
programmer_dude 5y ago
That's a good one Walter, thanks for the laugh.
- WalterBright 5y ago
  Do you think that companies don't google salary ranges?
  - programmer_dude 5y ago
    Sure they can but it is not the only thing they do. It is well known that companies often collude with each other and engage in "salary fixing". For example: https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L... Also they have the money to buy information from various information aggregation companies which collect salary information from more reliable sources. They do not have to rely on (inherently unreliable) self reported figures from glassdoor etc.
    - WalterBright 5y ago
      > It is well known that companies often collude with each other and engage in "salary fixing". That has nothing to do with the topic at hand, which is the candidate doing some research to get a feel for salary ranges. > They do not have to rely on (inherently unreliable) self reported figures from glassdoor etc. Salary figures are inherently inaccurate, just like googling for the market price of your car can never be accurate, because the price you actually get is dependent on the individual characteristics of your car, and how much the other party needs to buy it, and how much you need to sell it. The fact is, if you're going in blind to deal for a car, or a job, you're shooting yourself in the foot. Information isn't hard to come by for either. You don't need the government to hold your hand.
      - programmer_dude 5y ago
        I believe the topic being discussed is asymmetry of information between employees and employers (with respect to salary). Salary fixing demonstrates this asymmetry pretty well, so it is on topic. > Salary figures are inherently inaccurate, just like googling for the market price of your car can never be accurate, I don't think this has got anything to do with the topic under discussion. > Information isn't hard to come by for either. I disagree. IMO it is harder to come by for individuals than large companies. I have explained why in my previous response.
hemloc_io 5y ago
Snark aside, yeah levels.fyi does have data and so do other sites. (Although levels is the standard in tech imo). Still is incorrect though, b/c those sites are biased against older consistent data vs new data. Example: Look at averages for FAANG engineers that are poached from other companies, vs ones with years at that company. If you just looked at the average then it wouldn't work since you're a new applicant you should probably ask for 20-30% more than if you currently worked there. Also saying Google/Levels is good enough puts aside the problem of what market rate is for smaller companies. How much should a well funded web3 company pay you? What about companies outside of tech where salary sharing is less common? All of the info available to the candidate on Google also pales in comparison to the asymmetry of one person versus an entire department of people who make these deals for a living, and have actual research on what's going on with the market instead of randomly reported crowdsourced data.
gotoeleven 5y ago
We now apparently live in a bizzaro fantasy world where legislation is required to spare people the discomfort of negotiating a salary or asking for a raise. If a company offered to pay you X and you agreed, whose fault is this? We used to call dealing with these kinds of situations "being an adult."
- triceratops 5y ago
  > If a company offered to pay you X and you agreed, whose fault is this? If you were forced to trade stocks for a living but had only second-hand access to price information ("My cousin bought some TSLA at $200/share last year") while all the brokerages share order flows in real time, would you say you're getting hosed? Or that it's a fair market?
  - WalterBright 5y ago
    > If you were forced to trade stocks for a living Since you're not, the rest doesn't follow. For example, I played poker when I was younger. I routinely did much worse than mathematically expected. I suspect I was being cheated by the other players, but I wasn't savvy enough to know how they were cheating me. My solution was to stop playing poker. I know that when I trade stocks, I'm getting chiseled. So I don't day trade. I buy and hold, and rarely make a trade. Hence, the chiseling doesn't amount to much.
    - triceratops 5y ago
      > Since you're not, the rest doesn't follow. It's an analogy. "Trading stocks" is an analogy for "negotiating salary". Nearly everyone has to negotiate salary. > I wasn't savvy enough to know how they were cheating me. My solution was to stop playing poker. So you're saying people's options are to a) be cheated on salary or b) not work in paid employment? I respect that you have an opinion, but it's not an opinion that I have any respect for. > Hence, the chiseling doesn't amount to much Because we have open price sharing today and it's not possible to cheat you too much. You're benefiting from this even though you don't day trade. If we didn't have that, you and every other buy-and-holder would be shafted severely. Sidenote: I notice in many of your posts that you're a big proponent of free markets (which I mostly agree with). How do you square that belief with this one where one party, by design, has far less market information than the other? I'm genuinely curious about this, because it seems contradictory. (And yes, you might say "Companies choosing to share/not share salary is actually them competing on a free market", but that's an awfully limited viewpoint when we have other markets where prices are required to be open - such as real estate, and securities - without there being any suggestion that they aren't free markets)

bitsnbytes 5y ago

Exactly. Also with all the talk of racism and sexism in the work place , especially by the Big Tech companies, they should have done this long ago. Well they would have if they had truly cared about minorities versus creating a bigger labor pool to drop pay rates or create faux PR for their companies and industries.

qualudeheart 5y ago
Salary numbers should also be available through a standard API in a machine readable format. Data could be sorted by years of experience, education levels, race, gender and so on.

barry-cotter 5y ago

Pay transparency is great for business owners and other large employers. It makes it much easier to compress pay. > Recent decades have witnessed a growing focus on two distinct income patterns: persistent pay inequity, particularly a gender pay gap, and growing pay inequality. Pay transparency is widely advanced as a remedy for both. Yet we know little about the systemic influence of this policy on the evolution of pay practices within organizations. To address this void, we assemble a dataset combining detailed performance, demographic and salary data for approximately 100,000 US academics between 1997 and 2017. We then exploit staggered shocks to wage transparency to explore how this change reshapes pay practices. We find evidence that pay transparency causes significant increases in both the equity and equality of pay, and significant and sizeable reductions in the link between pay and individually measured performance. https://www.nature.com/articles/s41562-022-01288-9 https://www.nature.com/articles/s41562-022-01288-9

corpdronejuly 5y ago
Then those of us able to get more might be pushed into taking the risk of making our own company and competing against the major players who are currently controlling the market by paying more than God to keep talent focused on selling ads instead of creating value?
allturtles 5y ago
> Pay transparency is great for business owners and other large employers. If this is true, why aren't large employers already publishing salary data? i.e. why do they have to be forced to do it by law?
- pid-1 5y ago
  I'm also not following this argument. Understanding job markets requires leg work and is definitely part of the competitive advantage of many businesses.
- Spooky23 5y ago
  Because they screw people over. See my other comment in the thread. I spent most of my career as a public employee, most years salary are searchable on the internet. It’s nice because it eliminates a lot of drama about salary, who has what formal title, etc. When I was in sales, the smart salespeople were following their peer/competitors performance. The notion that “professionals” are above such things as compensation is just stupid.

slg 5y ago

>It depresses wages, mostly for internal employees who aren't paying attention bc they're content with their jobs. It is just wild to me that this is where society landed. Imagine you are a business owner. Wouldn't employees who are loyal and happy to come to work be the exact people you want to keep long term? These are people who know your industry, your business, your customers, and your product. They are your institutional knowledge. They are drastically more valuable than a new hire who has to spend years learning this all. But instead of rewarding that loyalty, we use it to squeeze out an extra few dollars of profit regardless of the consequences. It is bizarre.

powerslacker 5y ago
If I had to guess, I'd imagine this is the result of perverse incentives combined with the Peter principle. Consider a manager or corporate recruiter receiving a bonus for keeping down costs.
- slg 5y ago
  >If I had to guess, I'd imagine this is the result of perverse incentives I think it is simply short term profit maximalization. Why give an employee a dollar more than you have to give them? Whether giving them an extra dollar now might generate an extra two dollars down the road is rarely even considered.
whimsicalism 5y ago
People who you have recently formally evaluated the competency of are priced upwards. That sort of makes sense to me.
- slg 5y ago
  What is the interview process like at your company if you think that is a better evaluation of an employee's ability to do their job compared to act of actually doing that job?
sangnoir 5y ago
> Wouldn't employees who are loyal and happy to come to work be the exact people you want to keep long term? You do, but you can achieve this by one of 2 ways: frequently adjusting salaries to match market rates, or rely on momentum, and hide information from them by strongly discouraging salary discussions among employees[1]. The latter approach results in more profits. 1. but sharing this information with fellow employers behind paywalls, like the work number.

Spooky23 5y ago

I worked for a software company many years ago that also operated call centers for customers who didn’t want to run their own. My colleague was an immigrant who had moved up the ranks from a call center agent to a senior technical role. I found out when fixing a technical problem that she made $25k, while I made $65k. Basically, they gave her a 25% raise from a call center supervisor to be a Unix SA, and in lieu of raises “gave” her comp time for 24x7 on-call.