5 ms·

I think you'll find that "tech" has embedded itself into every business down to the very core. If anything what we'll see are companies that never made any econ

I think you'll find that "tech" has embedded itself into every business down to the very core. If anything what we'll see are companies that never made any economic or legal sense (uber, airbnb, coinbase) go under with simply churn in the social media space (bytedance supplanting meta). I think tech workers who can actually engineer/code will always have a strong place in the market, though I do bet that we will see an end to offers over $200k for all but exceptional ICs

Despegar 4y ago
Tech might be "embedded" but that doesn't mean their stocks had reasonable valuations. Small/mid cap tech is down 50-75% because they weren't. Every Apple employee is watching their stock portfolios melt down and AAPL holding up relatively well. Bargaining power is shifting from employees to Apple in real time. Suddenly job security is more important than WFH. VC will follow the public markets, as it always does. Valuations will tank and funding will dry up.
hderms 4y ago
What would make you think that tech offers will go down? Why would a company making X revenue per engineer not offer a maximum of something like 80% of X? Not to mention inflation and low unemployment numbers. even if what you're saying is true, how could it stay that way for longer than a year or so
- missedthecue 4y ago
  Because they might be able to get the labor they want for less than 80%?
- cannaceo 4y ago
  Because revenue doesn't matter right now. Net income after taxes (NIAT) does. Engineer salaries have been subsidized by VC and low interest rates. Now that that's drying up layoffs are coming and under-funded companies will start folding. Labor will (hopefully) be efficiently reallocated towards companies that can actually generate profits from that labor. The number of tech companies that can do that are few.
rch 4y ago
The ratio of hands on ICs to sales/managerial "mouths to feed" is going to be under pressure.
bushbaba 4y ago
57k in 1980 dollars is the same as 200k in 2022 dollars. Also median american wages have gone down over time when inflation adjusted. I think this is the end to the 450-500k IC offer
- aetherson 4y ago
  Median real wages have not declined since 1980, certainly.
  - jonathankoren 4y ago
    Yes they have. Real wage stagnation and declining real wages for lower wage earners, especially among men, has been the economic story for the past 40 years, thanks to deregulation and deindustrialization. This isn't even a controversial idea. It's just data. https://sgp.fas.org/crs/misc/R45090.pdf https://sgp.fas.org/crs/misc/R45090.pdf From the first bullet point of the summary: "By contrast, middle (50th percentile) and bottom (10th percentile) wages grew to a lesser degree (e.g., women) or declined in real terms (e.g., men)."
    - aetherson 4y ago
      To be clear, in the paper you cite, it says that median wage has decreased 3% for men and increased 28% for women. Overall, clearly an increase. Here's the chart that most people cite when taking about wage stagnation: https://www.weforum.org/agenda/2019/04/50-years-of-us-wages-in-one-chart/ https://www.weforum.org/agenda/2019/04/50-years-of-us-wages-... That chart (which isn't actually median wage, it's excluding supervisory workers) shows flat wages between 1973 and 2019. But it shows rising wages between 1980 and 2019. It is important to note when people talk about wage stagnation that median wages have risen pretty steadily since 1997, with an extended period of decline or stagnation before that.
      - bushbaba 4y ago
        1980 median family wages was 21,020, or 73,341 in 2022 dollars. Current median household income is 74,099. But! 53% of households have dual income in 2022. Up from 51.8% in 1980. The net is wages are then depressed from 1980 levels. https://www.census.gov/library/publications/1982/demo/p60-132.html https://www.census.gov/library/publications/1982/demo/p60-13...

Despegar 4y ago

Tech might be "embedded" but that doesn't mean their stocks had reasonable valuations. Small/mid cap tech is down 50-75% because they weren't. Every Apple employee is watching their stock portfolios melt down and AAPL holding up relatively well. Bargaining power is shifting from employees to Apple in real time. Suddenly job security is more important than WFH. VC will follow the public markets, as it always does. Valuations will tank and funding will dry up.

hderms 4y ago

What would make you think that tech offers will go down? Why would a company making X revenue per engineer not offer a maximum of something like 80% of X? Not to mention inflation and low unemployment numbers. even if what you're saying is true, how could it stay that way for longer than a year or so

missedthecue 4y ago
Because they might be able to get the labor they want for less than 80%?
cannaceo 4y ago
Because revenue doesn't matter right now. Net income after taxes (NIAT) does. Engineer salaries have been subsidized by VC and low interest rates. Now that that's drying up layoffs are coming and under-funded companies will start folding. Labor will (hopefully) be efficiently reallocated towards companies that can actually generate profits from that labor. The number of tech companies that can do that are few.

rch 4y ago

The ratio of hands on ICs to sales/managerial "mouths to feed" is going to be under pressure.

bushbaba 4y ago

57k in 1980 dollars is the same as 200k in 2022 dollars. Also median american wages have gone down over time when inflation adjusted. I think this is the end to the 450-500k IC offer

aetherson 4y ago
Median real wages have not declined since 1980, certainly.
- jonathankoren 4y ago
  Yes they have. Real wage stagnation and declining real wages for lower wage earners, especially among men, has been the economic story for the past 40 years, thanks to deregulation and deindustrialization. This isn't even a controversial idea. It's just data. https://sgp.fas.org/crs/misc/R45090.pdf https://sgp.fas.org/crs/misc/R45090.pdf From the first bullet point of the summary: "By contrast, middle (50th percentile) and bottom (10th percentile) wages grew to a lesser degree (e.g., women) or declined in real terms (e.g., men)."
  - aetherson 4y ago
    To be clear, in the paper you cite, it says that median wage has decreased 3% for men and increased 28% for women. Overall, clearly an increase. Here's the chart that most people cite when taking about wage stagnation: https://www.weforum.org/agenda/2019/04/50-years-of-us-wages-in-one-chart/ https://www.weforum.org/agenda/2019/04/50-years-of-us-wages-... That chart (which isn't actually median wage, it's excluding supervisory workers) shows flat wages between 1973 and 2019. But it shows rising wages between 1980 and 2019. It is important to note when people talk about wage stagnation that median wages have risen pretty steadily since 1997, with an extended period of decline or stagnation before that.
    - bushbaba 4y ago
      1980 median family wages was 21,020, or 73,341 in 2022 dollars. Current median household income is 74,099. But! 53% of households have dual income in 2022. Up from 51.8% in 1980. The net is wages are then depressed from 1980 levels. https://www.census.gov/library/publications/1982/demo/p60-132.html https://www.census.gov/library/publications/1982/demo/p60-13...