6 ms·

> Location based salaries are discriminatory I used to feel this way, but largely grown out of it. In the end, you're asking for SF salaries, and those in Ind

> Location based salaries are discriminatory I used to feel this way, but largely grown out of it. In the end, you're asking for SF salaries, and those in India are asking for NL salaries(or SF salaries). You'd largely find a race to the bottom, I think. The simple fact is you made a good living for your area, and they made a good living for theirs. If you want more, move. If you won't move, there's likely a reason why. Everyone wants a SF salary with an Indiana or even India cost of living. For obvious reasons, that can't work.

rldjbpin 3y ago
the issue comes when the pay does not match the living standards. despite having the least in absolute terms, it is possible to have a great life with the mid-to-high level income in IT there. can't say the same with what most people earn in europe.
gbil 3y ago
Big discussion, let me touch another point >It doesn't matter whether you're paying somebody in the Bay Area $100 000 per year, or somebody in the Philippines, because the cost for you as a business is the same. The cost for you as business is NOT the same. Start from the taxes part, that 100k is what the employee gets but the cost for the business is higher depending on the country/area because they also pay tax on top, social benefits etc. Also need to have in many cases a local business, doesn't matter if that is virtual etc, since they need to adhere to local laws thus having resources supporting that etc. So while I'm on the employee side here as I'm also working on a multinational coorp with global role yet paid with local standards, there is more than meets the eye
- mjr00 3y ago
  yep. People vastly underestimate how difficult the logistics of "pay an employee for services" can be, particularly when you don't have a legal corporate presence in the country where the employee resides. There are services that handle this for you and they charge a 30-40% premium on top of the employee's salary. And sometimes this is still worth it, because many countries charge an absolutely obscene incorporation fee for foreign-owned businesses.
  - bmitc 3y ago
    > People vastly underestimate how difficult the logistics of "pay an employee for services" can be That's the company's problem.
    - skrebbel 3y ago
      It’s not. If I have to pay some service or agency a lot of money to be able to employ you, there’s less money left to pay you. Employers at distributed companies don’t look at your take-home salary, they look at the total cost to employ you. Fees and taxes differ wildly per country, there’s no other way to compare. So if a large % of that total cost goes to middle men, then that makes you a more costly employee at no benefit to either you or the company. If I’m considering two people for a job but one is in a place where paying them well means I spend a huge amount on fees (or “employer-side taxes” for that matter, looking at you Austria), I might well choose the other.
    - MattPalmer1086 3y ago
      Yep, and they choose not to have it unless there's some compelling reason to. We've got staff in many countries, but it's not a blanket "work from wherever you like".
  - skrebbel 3y ago
    Fwiw companies like Remote and Deel charge a fixed fee of substantially less than 30-40%. IIRC we pay about 600 euros per employee per month to Remote. That’s a lot of money that I’d rather give to the employees themselves, but it’s much much less than 30-40%.
  - mejutoco 3y ago
    Having a freelancer registered in another country paid is not as complicated as people make it to be (pay an employee for services). As contractors. The complication is the company prefers to work in one/a few jurisdictions only and have "proper" employees. It simplifies a lot for the company.
- sitharus 3y ago
  so why not set a “total remuneration package” as it’s known where I live. It’s the total value, inclusive of compulsory payroll deductions and taxes, and set the salary to match that. The cost to the company is the same, but your take-home depends on where you live.
  - em-bee 3y ago
    in many areas salaries must be specified as the take-home part (including the taxes you pay as employee, but not including the part that the employers pay, which is not part of your remuneration), because doing otherwise would be confusing and could be considered deceptive.
    - Reimersholme 3y ago
      [dead]
    - Solvency 3y ago
      Why is this downvoted? What's wrong about it?
Scarblac 3y ago
Yes, the result would be that they wouldn't have any employees in the Netherlands, let alone in the Bay area.
hiAndrewQuinn 3y ago
From the other angle: There exist companies that do not do location based pay. If you're hired, you get a US level salary, whether you're in San Francisco or Poland or Indonesia. These positions are phenomenally competitive. You have swung open the doors to the world, and said "Give me what you got!", and you reap the benefits by having a much, much larger pool of applications and talent to sift through, with a lot of truly exceptional people in there - mostly very intelligent, very driven people from poorer countries. That's how supply and demand works. If you are offer to pay people more, you usually end up hiring a higher quality candidate.
- ako 3y ago
  You also know that companies are looking to optimize margin, so those US level salaries are only temporarily. Given enough good people in India, or other low-income countries, that pay level will drop significantly.
  - jojobas 3y ago
    Good enough people from India move elsewhere in no time. You still get what you pay for.
    - northern-lights 3y ago
      Not necessarily. There are costs and obstacles to moving (for example moving from India to US is extremely difficult these days).
      - jojobas 3y ago
        There sure are, but there's Australia, Canada, Europe and Middle East. Results of offshoring to Bangalore is a stereotype, but it wasn't born from nothing.
        andrewaylett 3y ago
        No -- it's born of attempts to cut costs. I've worked with teams from Bangalore who were staff of the bank I was contracting for -- they were amazing, but also not appreciably (if at all) cheaper than employing someone in London or New York. Several well-known banks had large offices, and competition for talent was high. No race for the bottom there. It doesn't particularly matter where you employ people, if you're trying to save costs by paying people less then you're going to have a bad time.
xiaq 3y ago
The approach taken by Igalia (a co-op) is quite interesting: https://wingolog.org/archives/2013/06/25/time-for-money https://wingolog.org/archives/2013/06/25/time-for-money. Basically they target equal pay but adjust it for cost of living, rather than cost of hiring.
em-bee 3y ago
in general i agree, but the problem with location based salaries is that they are working for locals, but not for expats. expats everywhere have higher living costs than locals, in part because they will get more expensive housing that is more up to the standard they are used to, and they also may have kids that they can't or don't want to send to a local school, and they will buy more imported food that they are used from home. when i looked at their salariy calculator i figured that i could not live on the salary they would offer for my location. school costs alone for each child are as much as i pay for rent.
- deleted 3y ago
  [deleted]
- lazyasciiart 3y ago
  Why is that a problem?
  - em-bee 3y ago
    it's a problem because it means that many expats can't work for gitlab because they can't afford to live on that salary. if i am working for gitlab in my home country, i can't move into the home country of my wife because my salary would be reduced below what we need to live there
    - lazyasciiart 3y ago
      But there’s no benefit to Gitlab or to society in general for Gitlab to subsidize people to move to countries where they can be rich compared to the locals. It’s a personal obstacle to working at Gitlab, not a problem with the setup.
      - em-bee 3y ago
        strongly disagree. there is a big benefit to have cultures mix and help with integration into an international company, both to gitlab and to society. that's why i moved to china.
stavros 3y ago
If I work for you, and you're willing to double my salary to subsidize my moving to an area that has wildly more opportunities for me (which is precisely why the salary is higher there), don't mind if I do move there. You just need to ask yourself if offering incentives to get your employees to move to hot job markets is in your benefit.
manmal 3y ago
> If you won't move, there's likely a reason why Kids would have to leave school and all their friends behind, wife hasn’t finished education here - there’s those reasons as well.
foofie 3y ago
> you're asking for SF salaries, and those in India are asking for NL salaries(or SF salaries) No. You got it all wrong. You're asking for equal pay for equal work. If all your team members are paid in full but you, in spite of doing the exact same work, are paid a fraction of what they are paid, then something is terribly off. Your contribution to your team does not depend on where you're currently located. How much time you waste on commute does not change the expectation placed on your output. If your office location is prohibitively expensive that means your company needs to sort their mess and work on a location that's more affordable. It makes no sense that you need to subsidize your employer's bad office location.
- intothemild 3y ago
  The problem with this line of thinking is that cost of living is the same everywhere. It is not.
  - tock 3y ago
    Why does it matter? Salaries should depend on the value you deliver. I don't think companies limit their profits depending on the location. Apple devices are often more expensive outside the US.
    - mejutoco 3y ago
      While I can empathize with this, this is a moral judgement. Price is not determined by fairness, but by offer and demand (and other factors). Otherwise teachers might earn more than football players. I think one could argue they should.
      - tock 3y ago
        I agree. It's just supply and demand. I just disagree with people saying salaries are somehow pegged to living standards. No it isn't. Companies don't care about your living standards. They pay what the market commands thats all.
    - 3y ago
northern-lights 3y ago
Same here. The reality is that what company chooses to pay is the minimal amount they can get a candidate to accept for that location. If the candidate had other better offers, then they can either reject the offer or propose a higher counter-offer. If the company received a counter-offer and chose to accept it, then this amount becomes the new minimal amount. Over a period of time, if there are enough counter-offers (or rejections), this continues to increase. Since, the two (or however many) locations don't necessarily have the same demand or supply, it's inevitable that some location will end up with much higher compensation than others. It's the nature of free market and why some companies engage/d in hiring collusion (see https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...)
chrisco255 3y ago
This suggests that cost of living in SF is the cause of high salaries but in fact the only reason SF/Bay Area has high cost of living is because of the high concentration of highly capital efficient businesses with strong skilled labor demand coupled with the complete unwillingness to build high rise density most places in the Valley area. I know quite a few people who make SF level salaries working remote in random states across the country. Of course it can work. And SF should not get too cocky. Detroit used to be the Motor City, Music City, and a cultural and technological force in the world, but then its core competencies got disrupted by cheaper, more efficient labor elsewhere.
bmitc 3y ago
> For obvious reasons, that can't work. Why is that? It isn't obvious to me. It seems like an excuse companies use to pay people less, especially if the company is based in a high-paying city.
DeathArrow 3y ago
>Everyone wants a SF salary with an Indiana or even India cost of living. For obvious reasons, that can't work. For some lucky people that does work.
intellectronica 3y ago
There are two ways to evaluate salaries / compensation packages: 1. What is your price in the market? 2. How much money do you need to be able to focus on your work and not worry about money. Most companies use a mix of both approaches, depending on the role and the individual. For most employees, the second perspective makes for a better experience. As long as you get enough each month to make the money problem a non-issue, you get to focus on the work itself, which can be a very positive experience. Some people (or the same people at different phases of their lives) want to optimise for getting the highest price they can get in the market. That's a valid choice, but one that in many cases results in a suboptimal work experience.
MikusR 3y ago
If they also don't have regional pricing then it's discriminatory.
tkiolp4 3y ago
By that logic, the only one who wins is the company. I would like to believe that most of us, employees, want what’s best for us, employees. If company X was paying N for a SF engineer, and suddenly it finds out that it can pay N/2 for an engineer that’s as good as the SF one (but lives, let’s say, in Mexico)… well, jackpot for company X.
nickjj 3y ago
> Everyone wants a SF salary with an Indiana or even India cost of living. For obvious reasons, that can't work. Why should someone living in Indiana make less money than someone living in NYC for a remote tech job? Both are located in the US separated by a 2 hour flight. Both are in the same timezone too. For a remote company where you have employees spread around the US, there's no difference to anything here.
- doktorhladnjak 3y ago
  > Why should someone living in Indiana make less money than someone living in NYC for a remote tech job? Because on average they'll accept less money. Someone in NYC is more likely to have other options with higher pay. If a business wants to hire them, they have to offer more. Simple as that.
- starkparker 3y ago
  > Why should someone living in Indiana make less money than someone living in NYC for a remote tech job? There's no moral reason to satisfy "why _should_", but let's be honest. A company with equal salaries regardless of geo is more likely to cut the salaries of people in expensive places to live than raise the salaries of people in less-expensive places. This is especially true in places where both salary and fundamental necessities like health coverage are included in compensation, like the US. Such companies then lose the employees who prefer to live in expensive places, to companies who _will_ pay them more to live in more expensive places. Whether accepting that result produces a more efficient staff for a company is the more indicative question IMO. Or asking why some places are so much more expensive to live in.
dilipdasilva 3y ago
Salaries are based on the market economy of supply and demand. Salaries for a specific role are different in one location over another because that is what the market is in each location. If you want developer salaries to be the same in all locations for the same level of work for reasons of fairness and anti-discrimination, you should ask why salaries of developers are higher or lower than other roles. Developers get paid highly because of supply and demand. Why not advocate for all workers, regardless of role, be paid the same - this would also be fair and anti-discriminatory. It seems we want to benefit from the market economy on one side and then want fairness on the other side. The logical conclusion of this kind of reasoning is communism where all workers at a company are paid the same, regardless of role. We know how that worked out. If all developers, regardless of location, were paid the same, companies would much rather hire all their developers in a single location. Why bother hiring in locations far away? Jobs would have never flowed out of high paying locations to lower paying locations. The Bay Area has the highest salaries because Silicon Valley has had many years to develop and the vast majority of tech companies are based in the Bay Area. Many companies are started in the Bay Area because people who work together in one company often break off and start another company. Many people at these successful companies have become wealthy and this has driven up home prices. This has made the Bay Area one of the most expensive places to live. Other workers cannot afford to live in the Bay Area and so there is a shortage of labor. This drives up the cost of every thing, including restaurants, groceries, and personal services. If the Bay Area does not add substantial housing, it will continue to see companies move to other metros. In the US, salaries are different based on metro and state and are based on the market economy. Companies move to offices to particular metros if they is a healthy supply of workers and supply is greater than demand so that it is more cost effective. This location competition is healthy. The role of any government, whether it is metro, state or country, is to create thriving economies so people want to move to that location. This means investing in critical mass in particular industries so many companies in that industry want to locate there. It also means ensuring other costs are low. In the US, health care insurance cost between $24k and $36k/year for anyone with a family. This is higher than the full salary in other countries. If the US does not figure out how to solve its health care costs, it will continue to see jobs leave for lower cost locations.
- 3y ago

rldjbpin 3y ago

the issue comes when the pay does not match the living standards. despite having the least in absolute terms, it is possible to have a great life with the mid-to-high level income in IT there. can't say the same with what most people earn in europe.

gbil 3y ago

Big discussion, let me touch another point >It doesn't matter whether you're paying somebody in the Bay Area $100 000 per year, or somebody in the Philippines, because the cost for you as a business is the same. The cost for you as business is NOT the same. Start from the taxes part, that 100k is what the employee gets but the cost for the business is higher depending on the country/area because they also pay tax on top, social benefits etc. Also need to have in many cases a local business, doesn't matter if that is virtual etc, since they need to adhere to local laws thus having resources supporting that etc. So while I'm on the employee side here as I'm also working on a multinational coorp with global role yet paid with local standards, there is more than meets the eye

mjr00 3y ago
yep. People vastly underestimate how difficult the logistics of "pay an employee for services" can be, particularly when you don't have a legal corporate presence in the country where the employee resides. There are services that handle this for you and they charge a 30-40% premium on top of the employee's salary. And sometimes this is still worth it, because many countries charge an absolutely obscene incorporation fee for foreign-owned businesses.
- bmitc 3y ago
  > People vastly underestimate how difficult the logistics of "pay an employee for services" can be That's the company's problem.
  - skrebbel 3y ago
    It’s not. If I have to pay some service or agency a lot of money to be able to employ you, there’s less money left to pay you. Employers at distributed companies don’t look at your take-home salary, they look at the total cost to employ you. Fees and taxes differ wildly per country, there’s no other way to compare. So if a large % of that total cost goes to middle men, then that makes you a more costly employee at no benefit to either you or the company. If I’m considering two people for a job but one is in a place where paying them well means I spend a huge amount on fees (or “employer-side taxes” for that matter, looking at you Austria), I might well choose the other.
  - MattPalmer1086 3y ago
    Yep, and they choose not to have it unless there's some compelling reason to. We've got staff in many countries, but it's not a blanket "work from wherever you like".
- skrebbel 3y ago
  Fwiw companies like Remote and Deel charge a fixed fee of substantially less than 30-40%. IIRC we pay about 600 euros per employee per month to Remote. That’s a lot of money that I’d rather give to the employees themselves, but it’s much much less than 30-40%.
- mejutoco 3y ago
  Having a freelancer registered in another country paid is not as complicated as people make it to be (pay an employee for services). As contractors. The complication is the company prefers to work in one/a few jurisdictions only and have "proper" employees. It simplifies a lot for the company.
sitharus 3y ago
so why not set a “total remuneration package” as it’s known where I live. It’s the total value, inclusive of compulsory payroll deductions and taxes, and set the salary to match that. The cost to the company is the same, but your take-home depends on where you live.
- em-bee 3y ago
  in many areas salaries must be specified as the take-home part (including the taxes you pay as employee, but not including the part that the employers pay, which is not part of your remuneration), because doing otherwise would be confusing and could be considered deceptive.
  - Reimersholme 3y ago
    [dead]
  - Solvency 3y ago
    Why is this downvoted? What's wrong about it?

Scarblac 3y ago

Yes, the result would be that they wouldn't have any employees in the Netherlands, let alone in the Bay area.

hiAndrewQuinn 3y ago

From the other angle: There exist companies that do not do location based pay. If you're hired, you get a US level salary, whether you're in San Francisco or Poland or Indonesia. These positions are phenomenally competitive. You have swung open the doors to the world, and said "Give me what you got!", and you reap the benefits by having a much, much larger pool of applications and talent to sift through, with a lot of truly exceptional people in there - mostly very intelligent, very driven people from poorer countries. That's how supply and demand works. If you are offer to pay people more, you usually end up hiring a higher quality candidate.

ako 3y ago
You also know that companies are looking to optimize margin, so those US level salaries are only temporarily. Given enough good people in India, or other low-income countries, that pay level will drop significantly.
- jojobas 3y ago
  Good enough people from India move elsewhere in no time. You still get what you pay for.
  - northern-lights 3y ago
    Not necessarily. There are costs and obstacles to moving (for example moving from India to US is extremely difficult these days).
    - jojobas 3y ago
      There sure are, but there's Australia, Canada, Europe and Middle East. Results of offshoring to Bangalore is a stereotype, but it wasn't born from nothing.
      - andrewaylett 3y ago
        No -- it's born of attempts to cut costs. I've worked with teams from Bangalore who were staff of the bank I was contracting for -- they were amazing, but also not appreciably (if at all) cheaper than employing someone in London or New York. Several well-known banks had large offices, and competition for talent was high. No race for the bottom there. It doesn't particularly matter where you employ people, if you're trying to save costs by paying people less then you're going to have a bad time.

xiaq 3y ago

The approach taken by Igalia (a co-op) is quite interesting: https://wingolog.org/archives/2013/06/25/time-for-money https://wingolog.org/archives/2013/06/25/time-for-money. Basically they target equal pay but adjust it for cost of living, rather than cost of hiring.

em-bee 3y ago

in general i agree, but the problem with location based salaries is that they are working for locals, but not for expats. expats everywhere have higher living costs than locals, in part because they will get more expensive housing that is more up to the standard they are used to, and they also may have kids that they can't or don't want to send to a local school, and they will buy more imported food that they are used from home. when i looked at their salariy calculator i figured that i could not live on the salary they would offer for my location. school costs alone for each child are as much as i pay for rent.

deleted 3y ago
[deleted]
lazyasciiart 3y ago
Why is that a problem?
- em-bee 3y ago
  it's a problem because it means that many expats can't work for gitlab because they can't afford to live on that salary. if i am working for gitlab in my home country, i can't move into the home country of my wife because my salary would be reduced below what we need to live there
  - lazyasciiart 3y ago
    But there’s no benefit to Gitlab or to society in general for Gitlab to subsidize people to move to countries where they can be rich compared to the locals. It’s a personal obstacle to working at Gitlab, not a problem with the setup.
    - em-bee 3y ago
      strongly disagree. there is a big benefit to have cultures mix and help with integration into an international company, both to gitlab and to society. that's why i moved to china.

stavros 3y ago

If I work for you, and you're willing to double my salary to subsidize my moving to an area that has wildly more opportunities for me (which is precisely why the salary is higher there), don't mind if I do move there. You just need to ask yourself if offering incentives to get your employees to move to hot job markets is in your benefit.

manmal 3y ago

> If you won't move, there's likely a reason why Kids would have to leave school and all their friends behind, wife hasn’t finished education here - there’s those reasons as well.

foofie 3y ago

> you're asking for SF salaries, and those in India are asking for NL salaries(or SF salaries) No. You got it all wrong. You're asking for equal pay for equal work. If all your team members are paid in full but you, in spite of doing the exact same work, are paid a fraction of what they are paid, then something is terribly off. Your contribution to your team does not depend on where you're currently located. How much time you waste on commute does not change the expectation placed on your output. If your office location is prohibitively expensive that means your company needs to sort their mess and work on a location that's more affordable. It makes no sense that you need to subsidize your employer's bad office location.

intothemild 3y ago
The problem with this line of thinking is that cost of living is the same everywhere. It is not.
- tock 3y ago
  Why does it matter? Salaries should depend on the value you deliver. I don't think companies limit their profits depending on the location. Apple devices are often more expensive outside the US.
  - mejutoco 3y ago
    While I can empathize with this, this is a moral judgement. Price is not determined by fairness, but by offer and demand (and other factors). Otherwise teachers might earn more than football players. I think one could argue they should.
    - tock 3y ago
      I agree. It's just supply and demand. I just disagree with people saying salaries are somehow pegged to living standards. No it isn't. Companies don't care about your living standards. They pay what the market commands thats all.
  - 3y ago

northern-lights 3y ago

Same here. The reality is that what company chooses to pay is the minimal amount they can get a candidate to accept for that location. If the candidate had other better offers, then they can either reject the offer or propose a higher counter-offer. If the company received a counter-offer and chose to accept it, then this amount becomes the new minimal amount. Over a period of time, if there are enough counter-offers (or rejections), this continues to increase. Since, the two (or however many) locations don't necessarily have the same demand or supply, it's inevitable that some location will end up with much higher compensation than others. It's the nature of free market and why some companies engage/d in hiring collusion (see https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...)

chrisco255 3y ago

This suggests that cost of living in SF is the cause of high salaries but in fact the only reason SF/Bay Area has high cost of living is because of the high concentration of highly capital efficient businesses with strong skilled labor demand coupled with the complete unwillingness to build high rise density most places in the Valley area. I know quite a few people who make SF level salaries working remote in random states across the country. Of course it can work. And SF should not get too cocky. Detroit used to be the Motor City, Music City, and a cultural and technological force in the world, but then its core competencies got disrupted by cheaper, more efficient labor elsewhere.

bmitc 3y ago

> For obvious reasons, that can't work. Why is that? It isn't obvious to me. It seems like an excuse companies use to pay people less, especially if the company is based in a high-paying city.

DeathArrow 3y ago

>Everyone wants a SF salary with an Indiana or even India cost of living. For obvious reasons, that can't work. For some lucky people that does work.

intellectronica 3y ago

There are two ways to evaluate salaries / compensation packages: 1. What is your price in the market? 2. How much money do you need to be able to focus on your work and not worry about money. Most companies use a mix of both approaches, depending on the role and the individual. For most employees, the second perspective makes for a better experience. As long as you get enough each month to make the money problem a non-issue, you get to focus on the work itself, which can be a very positive experience. Some people (or the same people at different phases of their lives) want to optimise for getting the highest price they can get in the market. That's a valid choice, but one that in many cases results in a suboptimal work experience.

MikusR 3y ago

If they also don't have regional pricing then it's discriminatory.

tkiolp4 3y ago

By that logic, the only one who wins is the company. I would like to believe that most of us, employees, want what’s best for us, employees. If company X was paying N for a SF engineer, and suddenly it finds out that it can pay N/2 for an engineer that’s as good as the SF one (but lives, let’s say, in Mexico)… well, jackpot for company X.

nickjj 3y ago

> Everyone wants a SF salary with an Indiana or even India cost of living. For obvious reasons, that can't work. Why should someone living in Indiana make less money than someone living in NYC for a remote tech job? Both are located in the US separated by a 2 hour flight. Both are in the same timezone too. For a remote company where you have employees spread around the US, there's no difference to anything here.

doktorhladnjak 3y ago
> Why should someone living in Indiana make less money than someone living in NYC for a remote tech job? Because on average they'll accept less money. Someone in NYC is more likely to have other options with higher pay. If a business wants to hire them, they have to offer more. Simple as that.
starkparker 3y ago
> Why should someone living in Indiana make less money than someone living in NYC for a remote tech job? There's no moral reason to satisfy "why _should_", but let's be honest. A company with equal salaries regardless of geo is more likely to cut the salaries of people in expensive places to live than raise the salaries of people in less-expensive places. This is especially true in places where both salary and fundamental necessities like health coverage are included in compensation, like the US. Such companies then lose the employees who prefer to live in expensive places, to companies who _will_ pay them more to live in more expensive places. Whether accepting that result produces a more efficient staff for a company is the more indicative question IMO. Or asking why some places are so much more expensive to live in.

dilipdasilva 3y ago

Salaries are based on the market economy of supply and demand. Salaries for a specific role are different in one location over another because that is what the market is in each location. If you want developer salaries to be the same in all locations for the same level of work for reasons of fairness and anti-discrimination, you should ask why salaries of developers are higher or lower than other roles. Developers get paid highly because of supply and demand. Why not advocate for all workers, regardless of role, be paid the same - this would also be fair and anti-discriminatory. It seems we want to benefit from the market economy on one side and then want fairness on the other side. The logical conclusion of this kind of reasoning is communism where all workers at a company are paid the same, regardless of role. We know how that worked out. If all developers, regardless of location, were paid the same, companies would much rather hire all their developers in a single location. Why bother hiring in locations far away? Jobs would have never flowed out of high paying locations to lower paying locations. The Bay Area has the highest salaries because Silicon Valley has had many years to develop and the vast majority of tech companies are based in the Bay Area. Many companies are started in the Bay Area because people who work together in one company often break off and start another company. Many people at these successful companies have become wealthy and this has driven up home prices. This has made the Bay Area one of the most expensive places to live. Other workers cannot afford to live in the Bay Area and so there is a shortage of labor. This drives up the cost of every thing, including restaurants, groceries, and personal services. If the Bay Area does not add substantial housing, it will continue to see companies move to other metros. In the US, salaries are different based on metro and state and are based on the market economy. Companies move to offices to particular metros if they is a healthy supply of workers and supply is greater than demand so that it is more cost effective. This location competition is healthy. The role of any government, whether it is metro, state or country, is to create thriving economies so people want to move to that location. This means investing in critical mass in particular industries so many companies in that industry want to locate there. It also means ensuring other costs are low. In the US, health care insurance cost between $24k and $36k/year for anyone with a family. This is higher than the full salary in other countries. If the US does not figure out how to solve its health care costs, it will continue to see jobs leave for lower cost locations.

3y ago