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Despite not making any sense, cost of living adjustments based on your location seem to be the trend that we are heading toward. If you contribute the same wor

Despite not making any sense, cost of living adjustments based on your location seem to be the trend that we are heading toward. If you contribute the same work, it seems that it shouldn't matter where you are located, but companies are sociopathic by nature and will reduce costs anywhere they can get away with it. This opens the door to the next step of having salaries match the lowest common denominator - if you can get good enough devs at a quarter of the cost, the salary will be that rate no matter where you live. Regarding not being able to tell whether someone is contributing if they aren't in person - this manager is just plain dumb, as they aren't measuring the right criteria.

birdyrooster 5y ago
I find it interesting how well this tracks: From each according to [their] ability, to each according to [their] needs.
eloff 5y ago
I don't think that's guaranteed. I work remotely and I just exclude companies that do cost-of-living adjustments. Those companies might end up paying less, but they also have fewer applicants to choose from. You tend to get what you pay for in life. Hiring is really difficult right now, it's not wise to make it more difficult by driving away applicants.
cottager2 5y ago
Have you heard of supply and demand? Suppliers have a price point at which their willing to supply a good. That price point is dependent on the input costs of producing the good. For knowledge workers, the input cost is your cost of living. It’s not so much that it “makes sense” to lower the salary of people in low cost of living areas, but it’s very likely the supply curve has shifted.
- thewakalix 5y ago
  Paying employees more or less depending on where they live is an instance of price discrimination, in a sense. This isn’t necessarily good or bad, but it does mean that it’s not inevitable. Laws against certain forms of price discrimination already exist.
  - lotsofpulp 5y ago
    The typical use of price discrimination (or price segmentation) is when a seller of goods or services sells the same goods/services to entities that can afford to pay more at a higher price than to entities that can only afford to pay a lower price. The objective is to maximize sales by getting more money from people who want to spend more money, while also getting some money from people who want to spend less money. Offering people less money because you think they will accept less money because they are not likely to get a higher offer due to where they live is more accurately described as arbitrage.
    - thewakalix 5y ago
      No, it’s not more accurately described as arbitrage. Arbitrage involves buying something and then selling it for a higher price in a different market. That might describe something like a temp agency, which buys labor from employees and then essentially sells it to other companies. It does not describe most businesses, which directly use the labor provided by their employees rather than reselling it. I agree that “price discrimination” isn’t quite right; it’s more of a metaphor. It works if you imagine that companies are selling money that is bought for the price of labor. In different markets, people will accept more or less money for the same labor, or equivalently spend less or more labor for the same money, which allows for price discrimination.
justapassenger 5y ago
> Despite not making any sense, cost of living adjustments based on your location seem to be the trend that we are heading toward It's not a trend we're heading toward, but it's well established practice in the economy. People working in Asia or Eastern Europe, for USA companies, make less, and they do the same job. Fact that it's going to be applied to people working remotely, not at the office, is just an implementation detail.
ChrisMarshallNY 5y ago
In my experience, it's very easy to see how a software engineer works. Just look at the commit logs. Sheesh. I managed an SWE group for years. It was easy-peasy to unobtrusively keep an eye on things.
- Arcuru 5y ago
  That is an extremely poor way to view the work output of a SWE. I sincerely hope that is not how you actually determined productivity for your team.
- dekhn 5y ago
  As I grew more experienced at my job, I submitted fewer and fewer CLs, with fewer lines. Eventually, I was just making config changes. You probably would have thought I wasn't very effective but the reality is the small number of changes I made were in exactly the right place at exactly the right time. I've seen other folks who are commit fiends and a lot of their code just didn't stand the test of time, or lacked good tests, or failed at scale, or were just copies of something elsewhere with the class names changed. I reserve my greatest praise for those who delete code without visible regressions or increased complexity.
  - ChrisMarshallNY 5y ago
    I really enjoyed the read. Thanks! Personally, I agree with you. I work somewhat differently, but am highly effective. I managed a team of very high-functioning C++ programmers, for one of the top imaging companies in the world, for 25 years. I kept employees for decades, and that’s no secret. I mention it frequently, here, and my entire career is an open book. I've been an active software engineer for over 35 years, and shipping software, that entire time. There's a [vanishingly small, I know] chance that I used a couple more techniques than simply counting CIs.
  - colordrops 5y ago
    The dao of programming right here
- ChrisMarshallNY 5y ago
lotsofpulp 5y ago
> cost of living adjustments based on your location seem to be the trend that we are heading toward. I disagree. Buyers of labor (or buyers of anything) will continue doing what they always have, offer the least amount of money that they think sellers of labor will accept. “Cost of living adjustment” is just fluffy language to hide the underlying bet by the buyer of labor that the seller of labor residing in a particular area will not be able to find a buyer offering a higher price.
tzs 5y ago
I think the eventual outcome will be that each company will have N+1 salary scales where N is the number of locations in which they have offices. Each office location will have a pay scale for jobs that the company requires be done in that location, and there will be one pay scale for all remote workers.
sorry_outta_gas 5y ago
If you're a consultant that makes sense, for comapnies it's just what you need to pay to fill cost of living is one of the main factors in that need
erosenbe0 5y ago
Why should companies subsidize landlords in Bay Area? The Bay Area has manipulated zoning and land use for a century for profiteering as well as race exclusion.
tick_tock_tick 5y ago
> if you can get good enough devs at a quarter of the cost, the salary will be that rate no matter where you live. If full remote stays around or gets bigger then this is the end state. Everyone arguing against COL based pay seems to think they'd get to keep there high salary rather then everyone getting payed less.
- astura 5y ago
  Yeah, and in the long term it has the potential to depress wages really, really low, because someone in, say, Costa Rica is willing to do the job for $30,000/year without benefits. At the start of my career, 16 years ago, I spent some time abroad in a small country with some very distant family. When the topic of my career came up in conversation I remember multiple people saying that software engineer simply didn't exist as a profession in that country because there were no software jobs available there.
refurb 5y ago
If you are shopping for a used car do you expect the price to be the same across the entire country? No. Each region will have its own supply and demand that affect prices. Employees are no different. If Google can find enough qualified people in Ohio for 80% of the salary, that’s the cost of an employee in Ohio. Just because it’s more in CA doesn’t change that.
- colordrops 5y ago
  The reason car prices differ based on location is because it's resource intensive to buy a cheaper car from a distant location, so you only compete with locals on price. This is not the case with developers. Once a worker is remote, there is not much difference if they are 80 miles away or 3000 miles away. The reason for the salary difference is because the company can get away with it, rather than a factor of the local market.
  - refurb 5y ago
    There can certainly be frictions with hiring in different locales. 3,000 miles away can mean a 3-4 hr time difference. But regardless, there are plenty of engineers in the mid-west willing (and happy!) to work for 50% of what a FAANG is paid in the Bay Area. So it's win-win, the employer gets a cheaper employee and the employee gets a better salary than before.
shagie 5y ago
You remember complaints about the busses in San Francisco? There are lots of areas that are having difficulty with gentrification and the associated difficulty of actually being able to hire people to work the service jobs in those areas. A company that is paying significantly more than exacerbates the inequities in those areas. A big tech company having remote workers living like royalty in places as the cost of housing there goes beyond what the regular person who lives there makes can become a PR nightmare.
- colordrops 5y ago
  Sounds reasonable but I highly doubt that this is the reason for lower pay in low cost of living locations.

birdyrooster 5y ago

I find it interesting how well this tracks: From each according to [their] ability, to each according to [their] needs.

eloff 5y ago

I don't think that's guaranteed. I work remotely and I just exclude companies that do cost-of-living adjustments. Those companies might end up paying less, but they also have fewer applicants to choose from. You tend to get what you pay for in life. Hiring is really difficult right now, it's not wise to make it more difficult by driving away applicants.

cottager2 5y ago

Have you heard of supply and demand? Suppliers have a price point at which their willing to supply a good. That price point is dependent on the input costs of producing the good. For knowledge workers, the input cost is your cost of living. It’s not so much that it “makes sense” to lower the salary of people in low cost of living areas, but it’s very likely the supply curve has shifted.

thewakalix 5y ago
Paying employees more or less depending on where they live is an instance of price discrimination, in a sense. This isn’t necessarily good or bad, but it does mean that it’s not inevitable. Laws against certain forms of price discrimination already exist.
- lotsofpulp 5y ago
  The typical use of price discrimination (or price segmentation) is when a seller of goods or services sells the same goods/services to entities that can afford to pay more at a higher price than to entities that can only afford to pay a lower price. The objective is to maximize sales by getting more money from people who want to spend more money, while also getting some money from people who want to spend less money. Offering people less money because you think they will accept less money because they are not likely to get a higher offer due to where they live is more accurately described as arbitrage.
  - thewakalix 5y ago
    No, it’s not more accurately described as arbitrage. Arbitrage involves buying something and then selling it for a higher price in a different market. That might describe something like a temp agency, which buys labor from employees and then essentially sells it to other companies. It does not describe most businesses, which directly use the labor provided by their employees rather than reselling it. I agree that “price discrimination” isn’t quite right; it’s more of a metaphor. It works if you imagine that companies are selling money that is bought for the price of labor. In different markets, people will accept more or less money for the same labor, or equivalently spend less or more labor for the same money, which allows for price discrimination.

justapassenger 5y ago

> Despite not making any sense, cost of living adjustments based on your location seem to be the trend that we are heading toward It's not a trend we're heading toward, but it's well established practice in the economy. People working in Asia or Eastern Europe, for USA companies, make less, and they do the same job. Fact that it's going to be applied to people working remotely, not at the office, is just an implementation detail.

ChrisMarshallNY 5y ago

In my experience, it's very easy to see how a software engineer works. Just look at the commit logs. Sheesh. I managed an SWE group for years. It was easy-peasy to unobtrusively keep an eye on things.

Arcuru 5y ago
That is an extremely poor way to view the work output of a SWE. I sincerely hope that is not how you actually determined productivity for your team.
dekhn 5y ago
As I grew more experienced at my job, I submitted fewer and fewer CLs, with fewer lines. Eventually, I was just making config changes. You probably would have thought I wasn't very effective but the reality is the small number of changes I made were in exactly the right place at exactly the right time. I've seen other folks who are commit fiends and a lot of their code just didn't stand the test of time, or lacked good tests, or failed at scale, or were just copies of something elsewhere with the class names changed. I reserve my greatest praise for those who delete code without visible regressions or increased complexity.
- ChrisMarshallNY 5y ago
  I really enjoyed the read. Thanks! Personally, I agree with you. I work somewhat differently, but am highly effective. I managed a team of very high-functioning C++ programmers, for one of the top imaging companies in the world, for 25 years. I kept employees for decades, and that’s no secret. I mention it frequently, here, and my entire career is an open book. I've been an active software engineer for over 35 years, and shipping software, that entire time. There's a [vanishingly small, I know] chance that I used a couple more techniques than simply counting CIs.
- colordrops 5y ago
  The dao of programming right here
ChrisMarshallNY 5y ago

lotsofpulp 5y ago

> cost of living adjustments based on your location seem to be the trend that we are heading toward. I disagree. Buyers of labor (or buyers of anything) will continue doing what they always have, offer the least amount of money that they think sellers of labor will accept. “Cost of living adjustment” is just fluffy language to hide the underlying bet by the buyer of labor that the seller of labor residing in a particular area will not be able to find a buyer offering a higher price.

tzs 5y ago

I think the eventual outcome will be that each company will have N+1 salary scales where N is the number of locations in which they have offices. Each office location will have a pay scale for jobs that the company requires be done in that location, and there will be one pay scale for all remote workers.

sorry_outta_gas 5y ago

If you're a consultant that makes sense, for comapnies it's just what you need to pay to fill cost of living is one of the main factors in that need

erosenbe0 5y ago

Why should companies subsidize landlords in Bay Area? The Bay Area has manipulated zoning and land use for a century for profiteering as well as race exclusion.

tick_tock_tick 5y ago

> if you can get good enough devs at a quarter of the cost, the salary will be that rate no matter where you live. If full remote stays around or gets bigger then this is the end state. Everyone arguing against COL based pay seems to think they'd get to keep there high salary rather then everyone getting payed less.

astura 5y ago
Yeah, and in the long term it has the potential to depress wages really, really low, because someone in, say, Costa Rica is willing to do the job for $30,000/year without benefits. At the start of my career, 16 years ago, I spent some time abroad in a small country with some very distant family. When the topic of my career came up in conversation I remember multiple people saying that software engineer simply didn't exist as a profession in that country because there were no software jobs available there.

refurb 5y ago

If you are shopping for a used car do you expect the price to be the same across the entire country? No. Each region will have its own supply and demand that affect prices. Employees are no different. If Google can find enough qualified people in Ohio for 80% of the salary, that’s the cost of an employee in Ohio. Just because it’s more in CA doesn’t change that.

colordrops 5y ago
The reason car prices differ based on location is because it's resource intensive to buy a cheaper car from a distant location, so you only compete with locals on price. This is not the case with developers. Once a worker is remote, there is not much difference if they are 80 miles away or 3000 miles away. The reason for the salary difference is because the company can get away with it, rather than a factor of the local market.
- refurb 5y ago
  There can certainly be frictions with hiring in different locales. 3,000 miles away can mean a 3-4 hr time difference. But regardless, there are plenty of engineers in the mid-west willing (and happy!) to work for 50% of what a FAANG is paid in the Bay Area. So it's win-win, the employer gets a cheaper employee and the employee gets a better salary than before.

shagie 5y ago

You remember complaints about the busses in San Francisco? There are lots of areas that are having difficulty with gentrification and the associated difficulty of actually being able to hire people to work the service jobs in those areas. A company that is paying significantly more than exacerbates the inequities in those areas. A big tech company having remote workers living like royalty in places as the cost of housing there goes beyond what the regular person who lives there makes can become a PR nightmare.

colordrops 5y ago
Sounds reasonable but I highly doubt that this is the reason for lower pay in low cost of living locations.