5 ms·

Kind of strange to see no mention of outsourcing in an otherwise detailed analysis

deleted 2y ago
[deleted]
yolovoe 2y ago
I don't mean to spread FUD, but as an interviewer at a FAANG in the US, I have mostly been interviewing candidates in LATAM (Brazil and Mexico). Same for some of my other coworkers. It's happening, and happening fast.
- jprokay13 2y ago
  Many of the founders I know (who started companies in the past 3 years) are primarily hiring in LATAM too.
  - yolovoe 2y ago
    That's a good point. I used to work at a SF startup before the FAANG about 4-5 years back. All the engineers there have unfortunately been replaced with those in LATAM too. LATAM engineers were making like $80-$90K in USD, which is apparently really good money there, whereas US engineer asked for base pay twice that. So it seems like a win-win deal for the cofounders and LATAM engineers. Just not so great for those of us in the US.
    - addicted 2y ago
      This was unsurprising when American employees decided to use the significant power they gained over the pandemic to insist on WFH. Whether working collaboratively in an office was beneficial or not, employers certainly believed it to be so. They believed it so much that employers, pre pandemic, were willing to hire employees a single time zone away from SF, and then pay them a significant one time amount along with a much higher annual salary to relocate them to SF. This belief in higher productivity when teams were geographically collocated was the entire basis for which employers were willing to pay American employees several multiples of what they would pay employees abroad. But the same employees who were benefiting from this decided they didn’t want to keep that advantage anymore. And now since WFH has become the norm in the US, employers are realizing there’s no need to pay to keep employees in the U.S. and outsourcing to significantly cheaper locations instead.
      - potamic 2y ago
        That doesn't explain why many execs were keen on RTO. If it was reducing costs, you would thing they would've wanted to draw out WFH for as long as possible. But there a clear rush to end WFH as soon as possible and implement unilateral mandates to get everyone back to office.
        inemesitaffia 2y ago
        I'm the end the point is : if it can be done anywhere it will be done anywhere else
        lazide 2y ago
        It’s really hard to see what a team/people on it is actually doing if people are remote. It’s also much harder in general to communicate less formally and form deep relationships. For execs and managers, this can be a big problem. If it isn’t possible to do it the ‘old way’, remote work can and does work (albeit in different ways and with different constraints). But if doing remote work, why not do it somewhere else?
        crooked-v 2y ago
        > It’s really hard to see what a team/people on it is actually doing if people are remote. If you're totally disconnected from the work, sure. But for someone actually paying, it shouldn't be that hard to see whether the list of priorities for this month is actually getting finished or not.
        lazide 2y ago
        Beyond the most trivial work, that really isn’t simple or straightforward without watching everything like a hawk. Outsourcing manufacturing had the same problem - people thought they could send drawings to China, and with some straightforward checks, could get what they wanted cheaper. That was not at all the case, however, and there is a LOT of QA, additional checks, additional data leakage and competitive risks, etc. For instance, if in the US people might actually follow the law around things like NDAs and non-competes most of the time, what about the jurisdiction you’re outsourcing too? How would you even know? How would you enforce consequences? How about data security?
    - CalRobert 2y ago
      Incidentally 80-90k is pretty normal pay in Europe too. High, even, for southern Europe.
      - lnsru 2y ago
        Exactly. That’s around salary for senior engineer at big corp according union tables in Germany. If you’re really good or a manager, 110k is in there. More is doable at senior manager/director level or in key position in a company led by owner. US faang salaries sound here like science fiction.
        f1shy 2y ago
        Yes, 90 to 110k is pretty much TOP. A lot of seniority and experience. If you want to go higher, you have to go management path (even lower management is included in the union) If you look at the table of salaries of a big union [1], you can multiply that number by about 13.5 to get the annual salary. Can vary a little %, but a good estimation. The salaries in the EU stagnated in the last years, whereas in USA they were moving. [1] https://www.igmetall.de/download/20240809_Metall_Elektroindustrie_ERA_Tabellen_d6bef241cbb5abb6e85c8b754105c229691c6237.pdf https://www.igmetall.de/download/20240809_Metall_Elektroindu...
      - kavalg 2y ago
        Currently the going annual salary for a senior developer in Bulgaria (Eastern Europe) is somewhere between EUR 50k - 75 EUR net, with 25-30 days of paid time off. The gross will be about 25% more (income tax is 10%, social security around 40%, but there is a cap on the salary base, so effectively it is less). For freelance senior developer, the (B2B) daily rate is in the range EUR 350 to EUR 550, depending on the technology and project complexity. Of course, there are rare examples outside of these ranges (e.g. top talent in ML, BigData etc). Leadership roles are usually at 10-20% premium.
        menaerus 2y ago
        Wow, income tax seems to be pretty low in Bulgaria compared to other European countries? For 50k net per year, or ~4k per month, in most other countries you need to earn ~80k EUR per year (gross). In Bulgaria, you need ~57k EUR. For 75k net per year, or ~6k per month, in most other countries you need to earn ~130k EUR per year (gross). In Bulgaria, you need ~85k EUR. Go figure, these are really large differences and that very well might be the reason why we see a lot of big companies there. Tax is unusually low.
- nitwit005 2y ago
  It's been happening for half a century or so. The boring reality is that the price of labor roughly reflects the productivity companies typically get. Because if there is ever some clear win in some location, people start hiring there, and things start to balance out again.
sisisbdhc 2y ago
Our company just let go of all our remote LATAM hires. We paid high end in their LCOL areas. They were somewhere between ok and not good. Felt like we got about what we paid for - their cost was about 50% of a US dev. They were as productive as a low end US dev, so in some cases ok value but since hiring low performers tends to hurt a team overall they weren’t worth it. We’re a mid range company (decent cash comp, not much else since startup). I’m sure if you’re paying more you can do better. But that’s how it’s always been hasn’t it?
- astone26 2y ago
  Interesting… 50% of US dev cost is like what if you don’t mind saying? 100k? I found the biggest issue with these engagements is the trust with remote developers.
  - esaym 2y ago
    I would think $40k-$50k
    - lazyasciiart 2y ago
      Remember that employee cost is usually estimated at twice their salary.
      - 0_____0 2y ago
        Does that scale neatly with salary? I would expect it not to, with things like benefits and other costs being relatively fixed regardless of salary
        saagarjha 2y ago
        I assume people who are paid more also typically receive better benefits
        acdha 2y ago
        Until you’re over the many hundreds of thousands of dollars per year range, it works pretty well as a rule of thumb. If your company wants the cost of working in an office, they’re probably not paying high salaries to work in a rundown shack and the people making those high incomes also want better quality benefits (especially in the United States where healthcare is so expensive and cheaper plans mean more time having to argue with someone whose bonus is based on denying care).
spike021 2y ago
My workplace is mostly hiring LATAM and parts of Europe at this point. Occasionally NA but mostly for higher level engineering positions to backfill roles for people who left.
Tade0 2y ago
Hailing from a popular outsourcing destination I can attest to the fact that layoffs happened here as well, but now the same people are being rehired for 10-15% less. No growth whatsoever though.
2-3-7-43-1807 2y ago
everything provided by offshoring to india is just an expensive tech debt full of spaghetti code. it simply doesn't work and causes harm to the customers. but because cheap it keeps getting sold. working with indians is a nightmare bar none. and i'm saying this as someone who has been to india and is also personally intrigued by its culture. but it's conway's law all the way - visit places like mumbai or delhi and this is what you'll get ... chaos that kind of works.
- beAbU 2y ago
  I think this is a bit unfair and biased to make such broad statements as you are doing here. From my experience, the outsourcing company rarely takes the time to properly onboard outsourced workers, they are not treated as part of the team, and the really shitty work that no-one else wants to do is the work that gets outsourced. I reckon there's a lot of "garbage in garbage out" going on, and if an org took the time and effort to actually treat Indian (or any outsourced team) devs like their own, things will be much better. But when you do that the overhead shoots up, and that cost/benefit analysis you did during the proposal to offshore flies out the window.
the_real_cher 2y ago
Amen no one wants to talk about it for some reason.
aprilthird2021 2y ago
Because it doesn't really play a big factor. India has been around forever with an educated, cheap workforce that knows English really well. Outsourcing is a cost savings measure. It's a symptom, not the cause of the issue

deleted 2y ago

[deleted]

I don't mean to spread FUD, but as an interviewer at a FAANG in the US, I have mostly been interviewing candidates in LATAM (Brazil and Mexico). Same for some of my other coworkers. It's happening, and happening fast.

jprokay13 2y ago
Many of the founders I know (who started companies in the past 3 years) are primarily hiring in LATAM too.
- yolovoe 2y ago
  That's a good point. I used to work at a SF startup before the FAANG about 4-5 years back. All the engineers there have unfortunately been replaced with those in LATAM too. LATAM engineers were making like $80-$90K in USD, which is apparently really good money there, whereas US engineer asked for base pay twice that. So it seems like a win-win deal for the cofounders and LATAM engineers. Just not so great for those of us in the US.
  - addicted 2y ago
    This was unsurprising when American employees decided to use the significant power they gained over the pandemic to insist on WFH. Whether working collaboratively in an office was beneficial or not, employers certainly believed it to be so. They believed it so much that employers, pre pandemic, were willing to hire employees a single time zone away from SF, and then pay them a significant one time amount along with a much higher annual salary to relocate them to SF. This belief in higher productivity when teams were geographically collocated was the entire basis for which employers were willing to pay American employees several multiples of what they would pay employees abroad. But the same employees who were benefiting from this decided they didn’t want to keep that advantage anymore. And now since WFH has become the norm in the US, employers are realizing there’s no need to pay to keep employees in the U.S. and outsourcing to significantly cheaper locations instead.
    - potamic 2y ago
      That doesn't explain why many execs were keen on RTO. If it was reducing costs, you would thing they would've wanted to draw out WFH for as long as possible. But there a clear rush to end WFH as soon as possible and implement unilateral mandates to get everyone back to office.
      - inemesitaffia 2y ago
        I'm the end the point is : if it can be done anywhere it will be done anywhere else
      - lazide 2y ago
        It’s really hard to see what a team/people on it is actually doing if people are remote. It’s also much harder in general to communicate less formally and form deep relationships. For execs and managers, this can be a big problem. If it isn’t possible to do it the ‘old way’, remote work can and does work (albeit in different ways and with different constraints). But if doing remote work, why not do it somewhere else?
        crooked-v 2y ago
        > It’s really hard to see what a team/people on it is actually doing if people are remote. If you're totally disconnected from the work, sure. But for someone actually paying, it shouldn't be that hard to see whether the list of priorities for this month is actually getting finished or not.
        lazide 2y ago
        Beyond the most trivial work, that really isn’t simple or straightforward without watching everything like a hawk. Outsourcing manufacturing had the same problem - people thought they could send drawings to China, and with some straightforward checks, could get what they wanted cheaper. That was not at all the case, however, and there is a LOT of QA, additional checks, additional data leakage and competitive risks, etc. For instance, if in the US people might actually follow the law around things like NDAs and non-competes most of the time, what about the jurisdiction you’re outsourcing too? How would you even know? How would you enforce consequences? How about data security?
  - CalRobert 2y ago
    Incidentally 80-90k is pretty normal pay in Europe too. High, even, for southern Europe.
    - lnsru 2y ago
      Exactly. That’s around salary for senior engineer at big corp according union tables in Germany. If you’re really good or a manager, 110k is in there. More is doable at senior manager/director level or in key position in a company led by owner. US faang salaries sound here like science fiction.
      - f1shy 2y ago
        Yes, 90 to 110k is pretty much TOP. A lot of seniority and experience. If you want to go higher, you have to go management path (even lower management is included in the union) If you look at the table of salaries of a big union [1], you can multiply that number by about 13.5 to get the annual salary. Can vary a little %, but a good estimation. The salaries in the EU stagnated in the last years, whereas in USA they were moving. [1] https://www.igmetall.de/download/20240809_Metall_Elektroindustrie_ERA_Tabellen_d6bef241cbb5abb6e85c8b754105c229691c6237.pdf https://www.igmetall.de/download/20240809_Metall_Elektroindu...
    - kavalg 2y ago
      Currently the going annual salary for a senior developer in Bulgaria (Eastern Europe) is somewhere between EUR 50k - 75 EUR net, with 25-30 days of paid time off. The gross will be about 25% more (income tax is 10%, social security around 40%, but there is a cap on the salary base, so effectively it is less). For freelance senior developer, the (B2B) daily rate is in the range EUR 350 to EUR 550, depending on the technology and project complexity. Of course, there are rare examples outside of these ranges (e.g. top talent in ML, BigData etc). Leadership roles are usually at 10-20% premium.
      - menaerus 2y ago
        Wow, income tax seems to be pretty low in Bulgaria compared to other European countries? For 50k net per year, or ~4k per month, in most other countries you need to earn ~80k EUR per year (gross). In Bulgaria, you need ~57k EUR. For 75k net per year, or ~6k per month, in most other countries you need to earn ~130k EUR per year (gross). In Bulgaria, you need ~85k EUR. Go figure, these are really large differences and that very well might be the reason why we see a lot of big companies there. Tax is unusually low.
nitwit005 2y ago
It's been happening for half a century or so. The boring reality is that the price of labor roughly reflects the productivity companies typically get. Because if there is ever some clear win in some location, people start hiring there, and things start to balance out again.

sisisbdhc 2y ago

Our company just let go of all our remote LATAM hires. We paid high end in their LCOL areas. They were somewhere between ok and not good. Felt like we got about what we paid for - their cost was about 50% of a US dev. They were as productive as a low end US dev, so in some cases ok value but since hiring low performers tends to hurt a team overall they weren’t worth it. We’re a mid range company (decent cash comp, not much else since startup). I’m sure if you’re paying more you can do better. But that’s how it’s always been hasn’t it?

astone26 2y ago
Interesting… 50% of US dev cost is like what if you don’t mind saying? 100k? I found the biggest issue with these engagements is the trust with remote developers.
- esaym 2y ago
  I would think $40k-$50k
  - lazyasciiart 2y ago
    Remember that employee cost is usually estimated at twice their salary.
    - 0_____0 2y ago
      Does that scale neatly with salary? I would expect it not to, with things like benefits and other costs being relatively fixed regardless of salary
      - saagarjha 2y ago
        I assume people who are paid more also typically receive better benefits
      - acdha 2y ago
        Until you’re over the many hundreds of thousands of dollars per year range, it works pretty well as a rule of thumb. If your company wants the cost of working in an office, they’re probably not paying high salaries to work in a rundown shack and the people making those high incomes also want better quality benefits (especially in the United States where healthcare is so expensive and cheaper plans mean more time having to argue with someone whose bonus is based on denying care).

spike021 2y ago

My workplace is mostly hiring LATAM and parts of Europe at this point. Occasionally NA but mostly for higher level engineering positions to backfill roles for people who left.

Tade0 2y ago

Hailing from a popular outsourcing destination I can attest to the fact that layoffs happened here as well, but now the same people are being rehired for 10-15% less. No growth whatsoever though.

2-3-7-43-1807 2y ago

everything provided by offshoring to india is just an expensive tech debt full of spaghetti code. it simply doesn't work and causes harm to the customers. but because cheap it keeps getting sold. working with indians is a nightmare bar none. and i'm saying this as someone who has been to india and is also personally intrigued by its culture. but it's conway's law all the way - visit places like mumbai or delhi and this is what you'll get ... chaos that kind of works.

beAbU 2y ago
I think this is a bit unfair and biased to make such broad statements as you are doing here. From my experience, the outsourcing company rarely takes the time to properly onboard outsourced workers, they are not treated as part of the team, and the really shitty work that no-one else wants to do is the work that gets outsourced. I reckon there's a lot of "garbage in garbage out" going on, and if an org took the time and effort to actually treat Indian (or any outsourced team) devs like their own, things will be much better. But when you do that the overhead shoots up, and that cost/benefit analysis you did during the proposal to offshore flies out the window.

the_real_cher 2y ago

Amen no one wants to talk about it for some reason.

aprilthird2021 2y ago

Because it doesn't really play a big factor. India has been around forever with an educated, cheap workforce that knows English really well. Outsourcing is a cost savings measure. It's a symptom, not the cause of the issue