6 ms·

It doesn’t take illegal back channel coordination to play follow the leader. All it takes is one major company to pull the trigger, then the rest will follow.

by csa 3y ago

It doesn’t take illegal back channel coordination to play follow the leader. All it takes is one major company to pull the trigger, then the rest will follow. The hiring market during covid was wonky in a way that favored applicants, and a lot of folks who got hired were under-qualified, overpaid, or both. This is just a natural reversion to a more balanced state across the industry.

darepublic 3y ago
Same thing with the housing market. Emergent behavior based on everyone doing what is best for themselves
mirekrusin 3y ago
It created playground for people secretly working multiple jobs for sure. Before it was unheard of. Now had to let go some for doing it, cancelled numerous applications and interviews once investigation revealed their scam (applying through fake names, creating multiple deceiving profiles with fake activity etc). It's frankly starts to be quite difficult to hire honest full-time remote programmers now.
jhp123 3y ago
If all large tech employers play follow the leader then it's not natural reversion, it's a textbook example of tacit oligopoly coordination.
- DiggyJohnson 3y ago
  Or the pattern is due to a common cause between the high tech firms, and we know what that common cause is: they overhired 2020-2022.
  - jhp123 3y ago
    Come on. If Google broke ranks and started aggressively poaching people for GCP and going after market share, Amazon would realize in about 5 seconds that it hadn't "overhired" for absurdly-profitable AWS after all. These firms have colluded to drive down wages before (the "Techtopus" case), a fact that we know because they were stupid enough to put it in writing. This time there's no proof and may be no explicit agreement, but a tiger doesn't change their stripes.
    - abhorrence 3y ago
      The way most of these companies are colluding now is by using third party firms that "aggregate industry salary information". So basically company X provides their data, pays some dollars, and get access to what other companies in their "peer set" are paying for different types of levels/experience. Reminds me a lot of the schemes companies will sometimes use to do bribes in other countries -- paying a third party consultancy who they had "no possible way of knowing that they were actually just bribing people".
  - oblio 3y ago
    Look at their revenues in 2019 and in 2023. Except for Failed Metaverse Inc, everyone else has grown revenue proportionally and profits decent enough.
    - shagie 3y ago
      In 2019, Microsoft had about 150k people. Most recently, they have 221k. And while last year was potentially quite good, that isn't the projection. https://i.imgur.com/gUz6AlW.png https://i.imgur.com/gUz6AlW.png Employees went up significantly: https://www.wolframalpha.com/input?i=%28Microsoft+employee+count%29 https://www.wolframalpha.com/input?i=%28Microsoft+employee+c... Revenue leveled off: https://www.wolframalpha.com/input?i=%28Microsoft+revenue%29 https://www.wolframalpha.com/input?i=%28Microsoft+revenue%29 Profits are on a downward slope now: https://www.wolframalpha.com/input?i=%28Microsoft+profits%29 https://www.wolframalpha.com/input?i=%28Microsoft+profits%29 Yes, they're 50% greater than they were in 2019. The staffing is at about 1.5x what it was in 2019 too. So, crystal ball time - what will revenue be a year from now? Will the profit per employee be lower than it was in 2019? https://imgur.com/6QykALS https://imgur.com/6QykALS And if the answer is no, should Microsoft lay people off or hold off on salary increases?
      - oblio 3y ago
        Oh noes! The tragedy! Their revenue and profit per employee will be at their highest points for every year until at least 2020! Who could ever bear that???
pydry 3y ago
Coordination is required to make sure that one company decide to "defect" and start offering pay rises to all the best people at Microsoft. At least, thats what the illegal agreement was about last time this happened (between Apple and Google).
fzeroracer 3y ago
How exactly is it a 'natural reversion' when even high performing employees are now effectively taking a massive pay cut due to the salary freeze and inflation?
- csa 3y ago
  > high performing employees are now effectively taking a massive pay cut due to the salary freeze and inflation? If any “high-performing employee” feels like they are taking a “massive pay cut” merely due to inflation, then something is wrong. Either they were grossly underpaid to begin with (change jobs, it can be done if you’re that good and that low paid), they aren’t actually that good (so total comp package, including RSUs and refreshers, is relatively weak), or they have a warped perception of the value of money. If a dev is pulling in 300k+ (standard, especially the +, at places like MS), and the cost of eggs, rent, or restaurant food is something they actually notice and impacts their day-to-day life, then I wish them the best of luck — they will need it.
  - fzeroracer 3y ago
    A paycut is a paycut no matter how you try to spin it. If someone's earning 150k a year with 5% inflation and doesn't get a raise the next year matching inflation, they are quite literally taking a 5% pay cut in comparison to changing jobs which likely offers salaries starting at the post-inflation level. In this case it's worse because not only are their salaries not going up, but the things nominally used to get around raising salaries (bonuses, stock) is also not going up. You trying to spin it by saying 'well they're earning 300k+ a year anyways' is not helping your point when there are plenty of junior and mid-level engineers earning far below that which are going to be most impacted.
    - csa 3y ago
      My thesis is that many of them, especially at places that grew a lot during covid like MS, were/are overpaid relative to their skill set / ability to add value. Cutting positions was one way to correct this. Freezing salaries is another. If any devs hired during covid think that their salary was totally justified and shouldn’t be cut directly or indirectly, then they are more likely than not delusional. It was a frothy hiring market, and the upward pressure on salaries across the board was not healthy for the overall tech ecology, imho (the smaller companies couldn’t afford competent devs). Note that I am actually an advocate of tech corps sharing more of the spoils with their employees, but not in the way that it happened during the pandemic. Reward competence selectively rather than randomly rewarding just being a warm butt in a seat during a hiring boom. I have no doubt that during this “pay freeze” at MS, the star performers will still be rewarded somehow.
scruple 3y ago
Right. Wealth and power are concentrated and do not need to be coordinated. Their individual actions and self-interests organically merge to maintain the state of affairs that keeps them wealthy and in power.
- pydry 3y ago
  They kind of do. If Facebook and Google suppress their wages and some other company poaches their best people the buying cartel could easily fall apart. OPEC suffered from exactly this problem quite early on. It only takes a few defectors of sufficient size.
  - gtirloni 3y ago
    Shareholders of those companies would demand they do the same.
  - dclowd9901 3y ago
    Ah yes, OPEC, that organization that is poor and enjoys no power whatsoever.

by csa 3y ago

darepublic 3y ago

Same thing with the housing market. Emergent behavior based on everyone doing what is best for themselves

mirekrusin 3y ago

It created playground for people secretly working multiple jobs for sure. Before it was unheard of. Now had to let go some for doing it, cancelled numerous applications and interviews once investigation revealed their scam (applying through fake names, creating multiple deceiving profiles with fake activity etc). It's frankly starts to be quite difficult to hire honest full-time remote programmers now.

jhp123 3y ago

If all large tech employers play follow the leader then it's not natural reversion, it's a textbook example of tacit oligopoly coordination.

DiggyJohnson 3y ago
Or the pattern is due to a common cause between the high tech firms, and we know what that common cause is: they overhired 2020-2022.
- jhp123 3y ago
  Come on. If Google broke ranks and started aggressively poaching people for GCP and going after market share, Amazon would realize in about 5 seconds that it hadn't "overhired" for absurdly-profitable AWS after all. These firms have colluded to drive down wages before (the "Techtopus" case), a fact that we know because they were stupid enough to put it in writing. This time there's no proof and may be no explicit agreement, but a tiger doesn't change their stripes.
  - abhorrence 3y ago
    The way most of these companies are colluding now is by using third party firms that "aggregate industry salary information". So basically company X provides their data, pays some dollars, and get access to what other companies in their "peer set" are paying for different types of levels/experience. Reminds me a lot of the schemes companies will sometimes use to do bribes in other countries -- paying a third party consultancy who they had "no possible way of knowing that they were actually just bribing people".
- oblio 3y ago
  Look at their revenues in 2019 and in 2023. Except for Failed Metaverse Inc, everyone else has grown revenue proportionally and profits decent enough.
  - shagie 3y ago
    In 2019, Microsoft had about 150k people. Most recently, they have 221k. And while last year was potentially quite good, that isn't the projection. https://i.imgur.com/gUz6AlW.png https://i.imgur.com/gUz6AlW.png Employees went up significantly: https://www.wolframalpha.com/input?i=%28Microsoft+employee+count%29 https://www.wolframalpha.com/input?i=%28Microsoft+employee+c... Revenue leveled off: https://www.wolframalpha.com/input?i=%28Microsoft+revenue%29 https://www.wolframalpha.com/input?i=%28Microsoft+revenue%29 Profits are on a downward slope now: https://www.wolframalpha.com/input?i=%28Microsoft+profits%29 https://www.wolframalpha.com/input?i=%28Microsoft+profits%29 Yes, they're 50% greater than they were in 2019. The staffing is at about 1.5x what it was in 2019 too. So, crystal ball time - what will revenue be a year from now? Will the profit per employee be lower than it was in 2019? https://imgur.com/6QykALS https://imgur.com/6QykALS And if the answer is no, should Microsoft lay people off or hold off on salary increases?
    - oblio 3y ago
      Oh noes! The tragedy! Their revenue and profit per employee will be at their highest points for every year until at least 2020! Who could ever bear that???

pydry 3y ago

Coordination is required to make sure that one company decide to "defect" and start offering pay rises to all the best people at Microsoft. At least, thats what the illegal agreement was about last time this happened (between Apple and Google).

fzeroracer 3y ago

How exactly is it a 'natural reversion' when even high performing employees are now effectively taking a massive pay cut due to the salary freeze and inflation?

csa 3y ago
> high performing employees are now effectively taking a massive pay cut due to the salary freeze and inflation? If any “high-performing employee” feels like they are taking a “massive pay cut” merely due to inflation, then something is wrong. Either they were grossly underpaid to begin with (change jobs, it can be done if you’re that good and that low paid), they aren’t actually that good (so total comp package, including RSUs and refreshers, is relatively weak), or they have a warped perception of the value of money. If a dev is pulling in 300k+ (standard, especially the +, at places like MS), and the cost of eggs, rent, or restaurant food is something they actually notice and impacts their day-to-day life, then I wish them the best of luck — they will need it.
- fzeroracer 3y ago
  A paycut is a paycut no matter how you try to spin it. If someone's earning 150k a year with 5% inflation and doesn't get a raise the next year matching inflation, they are quite literally taking a 5% pay cut in comparison to changing jobs which likely offers salaries starting at the post-inflation level. In this case it's worse because not only are their salaries not going up, but the things nominally used to get around raising salaries (bonuses, stock) is also not going up. You trying to spin it by saying 'well they're earning 300k+ a year anyways' is not helping your point when there are plenty of junior and mid-level engineers earning far below that which are going to be most impacted.
  - csa 3y ago
    My thesis is that many of them, especially at places that grew a lot during covid like MS, were/are overpaid relative to their skill set / ability to add value. Cutting positions was one way to correct this. Freezing salaries is another. If any devs hired during covid think that their salary was totally justified and shouldn’t be cut directly or indirectly, then they are more likely than not delusional. It was a frothy hiring market, and the upward pressure on salaries across the board was not healthy for the overall tech ecology, imho (the smaller companies couldn’t afford competent devs). Note that I am actually an advocate of tech corps sharing more of the spoils with their employees, but not in the way that it happened during the pandemic. Reward competence selectively rather than randomly rewarding just being a warm butt in a seat during a hiring boom. I have no doubt that during this “pay freeze” at MS, the star performers will still be rewarded somehow.

scruple 3y ago

Right. Wealth and power are concentrated and do not need to be coordinated. Their individual actions and self-interests organically merge to maintain the state of affairs that keeps them wealthy and in power.

pydry 3y ago
They kind of do. If Facebook and Google suppress their wages and some other company poaches their best people the buying cartel could easily fall apart. OPEC suffered from exactly this problem quite early on. It only takes a few defectors of sufficient size.
- gtirloni 3y ago
  Shareholders of those companies would demand they do the same.
- dclowd9901 3y ago
  Ah yes, OPEC, that organization that is poor and enjoys no power whatsoever.