8 ms·

During ZIRP the incentives for employees were completely disconnected from the underlying business, leading to entire careers being built around and rewarded fo

During ZIRP the incentives for employees were completely disconnected from the underlying business, leading to entire careers being built around and rewarded for the wrong outcomes. People have built entire careers while completely missing/ignoring why they're doing the job and how their work is supposed to fit and contribute to the overall business - because in a lot of cases there was never a viable business to begin with, and the founders themselves were playing the "career startup founder" card and enjoying the mismatched incentives set up by a distorted funding market. Now we're seeing a readjustment as the "free money" is gone and companies realign the incentives to actually make a profit on all that manpower, and are suddenly realizing they either have way too much of it, or ended up with the wrong kind of manpower due to over a decade of mismatched incentives. Thus layoffs and a jobs market flooded with candidates whose skillsets no longer match the current demands. The good times for the career software engineer - the kind that aces LeetCode, optimizes for career growth and collects the right buzzwords on their resume has indeed come to an end, but there's still plenty of good times to be had to if you are a career problem solver. Being able to get machines to do your bidding is still a very useful skill to pretty much all business, and what matters now is delivery and solving the business problem in a profitable manner - how many tech buzzwords you have on your resume is no longer relevant. This isn't to say it's anyone's fault - I don't blame anyone for playing the game and I myself took part in it at one point. But you need to realize it's a game and plan your exit. The danger is that there's an entire generation that started their career in this game and did not realize it was a game at all, and are now caught off-guard.

hobs 2y ago
It's funny because more than anything I would say the people that were most misaligned with the outcomes of the business are actually most of the engineering leaders I have worked with. The amount of short-termism and chasing press releases and caring about what your golf buddies think really clogged up a lot of companies, and it doesn't feel like THAT part is changing anytime soon, zirp or no zirp.
- Nextgrid 2y ago
  It happened at every level - software engineers optimized for career outcomes which meant accumulating the right buzzwords. Managers optimized for their own career outcomes which meant increasing their number of direct reports. Engineering leaders optimized for their own buzzwords which means org-level complexity and a steady stream of (self-inflicted) problems to solve and brag about on their engineering blog to attract even more software engineers, and executives/founders merely optimize for securing the next funding round (because there is no and was never a viable business there to begin with), which is easier to do if you're seen as solving hard problems (even if they are self-inflicted), and investors happily oblige because they had no other choice in this distorted market. Note that incentive mismatch at the middle-management level happens everywhere to this day and isn't strictly a ZIRP-induced phenomenon, but most real businesses that need to earn a profit thus have a natural cap on how much inefficiency they can support. In ZIRP however, the complete lack of any requirement to make profit (in some cases because the business is never viable and its sole purpose is to give a good lifestyle and resume to everyone involved) exacerbated the problem.
- rachofsunshine 2y ago
  It's not just golf buddies - it's investors. Capital often outstrips actual business acumen as a factor in the success of a business. That's partly because we live in a world where word of mouth, reviews, online presence, etc. are all commodified, partly because tech (like the Industrial Revolution before it) has greatly increased the growth potential and concentration of capital, partly because of investors actively intervening to ensure the success of their other investments, partly because of increasing and increasingly-naked corruption, and partly because of the importance of network effects. (I don't know which of these factors is the most important.) The more important capital becomes relative to the actual functioning of a product, the more disconnected from reality a business can (perhaps must) get. Their actual business becomes selling a pitch to investors, not selling SaaS, because their actual product is investor returns, not long-term viability or value. And because a big part of that pitch to investors is the rockstar founding team, founders have to (or at least feel they have to) do the golf-buddy shit. It's literally their job, or at least, they think it is. Post-ZIRP doesn't kill that because capital being scarce just increases demand for it even more.
Fraterkes 2y ago
Sorry, but this denigrating about leetcoders just strikes me as delusional in a different way. The people that I know that spend a lot of time doing leetcoding and learning new tech are 1. Also really good at general programming, and 2. In the top 20% of actual enthusiasm for their job. If these people cant find jobs reliably, what should you actually do to have a decent shot at getting hired? We can't just tell everyone "just make sure youre in the top 2%".
- Avicebron 2y ago
  We've been telling plenty of other professions/people that, "make sure you're in the top 2%" as a society forever? That's part of the problem, we need to make sure that if someone is part of the 86% then they also can afford a house, feed themselves and their family etc etc
  - drchickensalad 2y ago
    This is a really good point that honestly I've been neglecting considering. I try to help and push my friends to be better than most (because honestly most are quite lazy and entitled) but still you can't ignore the societal ramifications of most people getting less than they expect.
    - borgdefenser 2y ago
      If you read Capitalism, Socialism and Democracy by Schumpeter, published at the end of the depression and during WW2, most of his predictions were spot on economically besides solving the housing problem. There was a housing problem then too that he thought would be solved in time by the market. He thought we would see something like assembly line, prefabricated housing at some point that would drive down prices. What I suspect is that once people own real estate, the last thing they want is something that drives prices down and everyone making the decisions needed to solve this problem owns real estate. That plus the margins won't be that high so you have to do large volume and the red tape is too much to be able to do that at scale. So instead of we do nothing and we will keep doing nothing for another 100 years.
loevborg 2y ago
A truth bomb if I ever saw one - thanks for articulating this so clearly
bob1029 2y ago
> the incentives for employees were completely disconnected from the underlying business I've found that even when we were incentivized via direct & simple profit sharing mechanisms, we still struggled with the appropriate focus and urgency. You'd think additional piles of money based upon # of customers coming in the door would provoke substantially more activity. Money is a huge distraction. The most successful phases of my career have involved putting the customer absolutely first and looking at the money as a causal event based upon a job well done. I've never looked at a direct deposit into my bank account and felt the kind of rush of happiness I get when I see a customer reply that an issue is resolved to their satisfaction.
- parpfish 2y ago
  Stock and equity just aren’t great at motivating employees. If you’re at a small and pre-public startup, your decisions and effort can directly affect product success BUT the equity is only theoretically valuable someday in the distant future so you ignore it. If you’re public and getting stock/rsus, your company is likely large enough that there’s nothing you can do single-handedly to affect the price.
  - ryandrake 2y ago
    Plus, stock price doesn't necessarily reflect (or isn't directly proportional to) positive business outcomes. Even if it was a great motivating tool, you would only motivate employees to do whatever pumped the stock price, not necessarily to solve underlying business problems.
  - dzhiurgis 2y ago
    More money to spend - less time at work. I’d rather spend all my time sailing than coding.
  - rrrrrrrrrrrryan 2y ago
    Stock and equity aren't really formotivating employees. They're for attracting employees, and then aligning their goals with those of the shareholders. The first software startup I worked at didn't give out equity, and when the sales guys closed big deals with aggressive delivery timelines we hated it because it just meant more work for us. Many of my teammates passive aggressively dragged their feet, but if we'd had equity we would've been high-fiving the sales guys after landing big clients.
snapetom 2y ago
Totally believe in this in my current company. It’s allegedly tech but it’s in a blue collar field and led my domain people, not tech people. Since its inception, the company was subsidized by the parent company. Now that PE owns it and there’s a mandate to make money, it can’t. A major, major problem are engineers that have zero vision of the big picture. I get a ticket, I work on it, I go home. My most senior engineer on the team never met a deadline in his life. I own an integration product and found out last week two other products I integrate with were about to ship without testing my product. They tested on laptops. I dove in to an analysts ticket with him to figure out why he blew the timeline he committed to. Turns out he was trying to reverse engineer a database instead of just asking another team. “You think I’m going to get any answers from those fuckers?” He asked me when I drilled him. All these people are still, to this day, protected be the President. He views domain knowledge as being more important than shipping products.
- saithound 2y ago
  > My most senior engineer on the team never met a deadline in his life. I went over this sentence a few times before it started making sense. Noting this for others who run into it. What's meant is that the most senior engineer fails to complete tasks on time, as opposed to never having to deal with deadlines (cf. "I never met a problem I couldn't solve").
  - Glawen 2y ago
    Deadlines is always about time, or i'm missing something? Did you maybe confuse with dead end?
    - snpbudhia 2y ago
      I initially read "has never met a deadline in his life" as meaning they had never had a task with a deadline. I'm assuming they also read it that way at first, so they're clarifying for anyone else who did the same.
      - 2y ago
intelVISA 2y ago
I like to play both sides: I solve the problem I create. :)
- Nextgrid 2y ago
  You're joking but with the layoffs and all, there must be pressure to clean up the (self-inflicted) problems created by previous teams of architecture astronauts and get the complexity down to a level that the new, reduced headcount can wrangle.
  - xnx 2y ago
    I've done exactly this. Got a 5-figure AWS bill down to 3-figure, and 40 devs down to 2. Didn't happen soon enough though.
ryandrake 2y ago
> The good times for the career software engineer - the kind that aces LeetCode, optimizes for career growth and collects the right buzzwords on their resume has indeed come to an end, but there's still plenty of good times to be had to if you are a career problem solver. But are companies adjusting their hiring process to find career problem solvers? Or are they still looking for buzzword-spewing leetcode solvers? If you ask candidates who have interviewed recently, they'll probably tell you that companies are going even more extreme towards the leetcode side.
- Nextgrid 2y ago
  Is anyone actually hiring, or succeeding in hiring? I see the hiring market being completely fucked for the past couple years with lots of fraud happening on both sides - whether it's ghost positions that are never intended to be filled, or monkeys LLM'ing (or I guess we call it "vibe coding" now) their way through interviews, which just makes the interviews even harder to a level even seasoned engineers now need to cheat or be left behind. It's become a market for lemons, with no good solutions. The problem is that it fundamentally requires a lot of manpower to accurately assess someone's experience (whether you use LC or just an open-ended whiteboard exercise) and companies who hire have only so many engineer-hours to dedicate to interviewing and the amount of inbound candidates exceeds that by orders of magnitude. The way I see it, a lot of companies realized they have the staff they need and hiring more through "normal" channels is impossible due to the above - so either they don't need to hire more, or they hire informally through back-channels and word of mouth (because the front door is being DDoS'd). The only way to win is not to play - the "front door" and typical hiring process is no longer possible unless you are a big name and have somehow publicly demonstrated your skills (past product launch, etc) in a way that can be verified in 5 minutes. For the rest of us, it's mostly a sales and networking game, and leveraging human & in-person relationships that are (for now) still immune to LLMs and hordes of boiler rooms spamming every single job with fake (but plausible) resumes.
hintymad 2y ago
The end of ZIRP is necessary for us to return to economic reality. As Henry Hazlitt explains in "Economics in One Lesson," proper capital allocation is fundamental to a healthy economy. During the ZIRP era, market signals were distorted, which led companies to invest in frivolous projects, creating enormous bureaucracies and god knows how many bullshit jobs. Real economic growth requires solving meaningful problems, which in turn creates genuinely meaningful work for us techies. So, I guess it's good that "good times" are over.
deleted 2y ago
[deleted]

hobs 2y ago

It's funny because more than anything I would say the people that were most misaligned with the outcomes of the business are actually most of the engineering leaders I have worked with. The amount of short-termism and chasing press releases and caring about what your golf buddies think really clogged up a lot of companies, and it doesn't feel like THAT part is changing anytime soon, zirp or no zirp.

Nextgrid 2y ago
It happened at every level - software engineers optimized for career outcomes which meant accumulating the right buzzwords. Managers optimized for their own career outcomes which meant increasing their number of direct reports. Engineering leaders optimized for their own buzzwords which means org-level complexity and a steady stream of (self-inflicted) problems to solve and brag about on their engineering blog to attract even more software engineers, and executives/founders merely optimize for securing the next funding round (because there is no and was never a viable business there to begin with), which is easier to do if you're seen as solving hard problems (even if they are self-inflicted), and investors happily oblige because they had no other choice in this distorted market. Note that incentive mismatch at the middle-management level happens everywhere to this day and isn't strictly a ZIRP-induced phenomenon, but most real businesses that need to earn a profit thus have a natural cap on how much inefficiency they can support. In ZIRP however, the complete lack of any requirement to make profit (in some cases because the business is never viable and its sole purpose is to give a good lifestyle and resume to everyone involved) exacerbated the problem.
rachofsunshine 2y ago
It's not just golf buddies - it's investors. Capital often outstrips actual business acumen as a factor in the success of a business. That's partly because we live in a world where word of mouth, reviews, online presence, etc. are all commodified, partly because tech (like the Industrial Revolution before it) has greatly increased the growth potential and concentration of capital, partly because of investors actively intervening to ensure the success of their other investments, partly because of increasing and increasingly-naked corruption, and partly because of the importance of network effects. (I don't know which of these factors is the most important.) The more important capital becomes relative to the actual functioning of a product, the more disconnected from reality a business can (perhaps must) get. Their actual business becomes selling a pitch to investors, not selling SaaS, because their actual product is investor returns, not long-term viability or value. And because a big part of that pitch to investors is the rockstar founding team, founders have to (or at least feel they have to) do the golf-buddy shit. It's literally their job, or at least, they think it is. Post-ZIRP doesn't kill that because capital being scarce just increases demand for it even more.

Fraterkes 2y ago

Sorry, but this denigrating about leetcoders just strikes me as delusional in a different way. The people that I know that spend a lot of time doing leetcoding and learning new tech are 1. Also really good at general programming, and 2. In the top 20% of actual enthusiasm for their job. If these people cant find jobs reliably, what should you actually do to have a decent shot at getting hired? We can't just tell everyone "just make sure youre in the top 2%".

Avicebron 2y ago
We've been telling plenty of other professions/people that, "make sure you're in the top 2%" as a society forever? That's part of the problem, we need to make sure that if someone is part of the 86% then they also can afford a house, feed themselves and their family etc etc
- drchickensalad 2y ago
  This is a really good point that honestly I've been neglecting considering. I try to help and push my friends to be better than most (because honestly most are quite lazy and entitled) but still you can't ignore the societal ramifications of most people getting less than they expect.
  - borgdefenser 2y ago
    If you read Capitalism, Socialism and Democracy by Schumpeter, published at the end of the depression and during WW2, most of his predictions were spot on economically besides solving the housing problem. There was a housing problem then too that he thought would be solved in time by the market. He thought we would see something like assembly line, prefabricated housing at some point that would drive down prices. What I suspect is that once people own real estate, the last thing they want is something that drives prices down and everyone making the decisions needed to solve this problem owns real estate. That plus the margins won't be that high so you have to do large volume and the red tape is too much to be able to do that at scale. So instead of we do nothing and we will keep doing nothing for another 100 years.

loevborg 2y ago

A truth bomb if I ever saw one - thanks for articulating this so clearly

bob1029 2y ago

> the incentives for employees were completely disconnected from the underlying business I've found that even when we were incentivized via direct & simple profit sharing mechanisms, we still struggled with the appropriate focus and urgency. You'd think additional piles of money based upon # of customers coming in the door would provoke substantially more activity. Money is a huge distraction. The most successful phases of my career have involved putting the customer absolutely first and looking at the money as a causal event based upon a job well done. I've never looked at a direct deposit into my bank account and felt the kind of rush of happiness I get when I see a customer reply that an issue is resolved to their satisfaction.

parpfish 2y ago
Stock and equity just aren’t great at motivating employees. If you’re at a small and pre-public startup, your decisions and effort can directly affect product success BUT the equity is only theoretically valuable someday in the distant future so you ignore it. If you’re public and getting stock/rsus, your company is likely large enough that there’s nothing you can do single-handedly to affect the price.
- ryandrake 2y ago
  Plus, stock price doesn't necessarily reflect (or isn't directly proportional to) positive business outcomes. Even if it was a great motivating tool, you would only motivate employees to do whatever pumped the stock price, not necessarily to solve underlying business problems.
- dzhiurgis 2y ago
  More money to spend - less time at work. I’d rather spend all my time sailing than coding.
- rrrrrrrrrrrryan 2y ago
  Stock and equity aren't really formotivating employees. They're for attracting employees, and then aligning their goals with those of the shareholders. The first software startup I worked at didn't give out equity, and when the sales guys closed big deals with aggressive delivery timelines we hated it because it just meant more work for us. Many of my teammates passive aggressively dragged their feet, but if we'd had equity we would've been high-fiving the sales guys after landing big clients.

snapetom 2y ago

Totally believe in this in my current company. It’s allegedly tech but it’s in a blue collar field and led my domain people, not tech people. Since its inception, the company was subsidized by the parent company. Now that PE owns it and there’s a mandate to make money, it can’t. A major, major problem are engineers that have zero vision of the big picture. I get a ticket, I work on it, I go home. My most senior engineer on the team never met a deadline in his life. I own an integration product and found out last week two other products I integrate with were about to ship without testing my product. They tested on laptops. I dove in to an analysts ticket with him to figure out why he blew the timeline he committed to. Turns out he was trying to reverse engineer a database instead of just asking another team. “You think I’m going to get any answers from those fuckers?” He asked me when I drilled him. All these people are still, to this day, protected be the President. He views domain knowledge as being more important than shipping products.

saithound 2y ago
> My most senior engineer on the team never met a deadline in his life. I went over this sentence a few times before it started making sense. Noting this for others who run into it. What's meant is that the most senior engineer fails to complete tasks on time, as opposed to never having to deal with deadlines (cf. "I never met a problem I couldn't solve").
- Glawen 2y ago
  Deadlines is always about time, or i'm missing something? Did you maybe confuse with dead end?
  - snpbudhia 2y ago
    I initially read "has never met a deadline in his life" as meaning they had never had a task with a deadline. I'm assuming they also read it that way at first, so they're clarifying for anyone else who did the same.
    - 2y ago

intelVISA 2y ago

I like to play both sides: I solve the problem I create. :)

Nextgrid 2y ago
You're joking but with the layoffs and all, there must be pressure to clean up the (self-inflicted) problems created by previous teams of architecture astronauts and get the complexity down to a level that the new, reduced headcount can wrangle.
- xnx 2y ago
  I've done exactly this. Got a 5-figure AWS bill down to 3-figure, and 40 devs down to 2. Didn't happen soon enough though.

ryandrake 2y ago

> The good times for the career software engineer - the kind that aces LeetCode, optimizes for career growth and collects the right buzzwords on their resume has indeed come to an end, but there's still plenty of good times to be had to if you are a career problem solver. But are companies adjusting their hiring process to find career problem solvers? Or are they still looking for buzzword-spewing leetcode solvers? If you ask candidates who have interviewed recently, they'll probably tell you that companies are going even more extreme towards the leetcode side.

Nextgrid 2y ago
Is anyone actually hiring, or succeeding in hiring? I see the hiring market being completely fucked for the past couple years with lots of fraud happening on both sides - whether it's ghost positions that are never intended to be filled, or monkeys LLM'ing (or I guess we call it "vibe coding" now) their way through interviews, which just makes the interviews even harder to a level even seasoned engineers now need to cheat or be left behind. It's become a market for lemons, with no good solutions. The problem is that it fundamentally requires a lot of manpower to accurately assess someone's experience (whether you use LC or just an open-ended whiteboard exercise) and companies who hire have only so many engineer-hours to dedicate to interviewing and the amount of inbound candidates exceeds that by orders of magnitude. The way I see it, a lot of companies realized they have the staff they need and hiring more through "normal" channels is impossible due to the above - so either they don't need to hire more, or they hire informally through back-channels and word of mouth (because the front door is being DDoS'd). The only way to win is not to play - the "front door" and typical hiring process is no longer possible unless you are a big name and have somehow publicly demonstrated your skills (past product launch, etc) in a way that can be verified in 5 minutes. For the rest of us, it's mostly a sales and networking game, and leveraging human & in-person relationships that are (for now) still immune to LLMs and hordes of boiler rooms spamming every single job with fake (but plausible) resumes.

hintymad 2y ago

The end of ZIRP is necessary for us to return to economic reality. As Henry Hazlitt explains in "Economics in One Lesson," proper capital allocation is fundamental to a healthy economy. During the ZIRP era, market signals were distorted, which led companies to invest in frivolous projects, creating enormous bureaucracies and god knows how many bullshit jobs. Real economic growth requires solving meaningful problems, which in turn creates genuinely meaningful work for us techies. So, I guess it's good that "good times" are over.

deleted 2y ago

[deleted]