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First, it is hard to take this article seriously when the author seems confused by what PG and Y Combinator actually do. For example, consider these sentences:

by hluska 12y ago

First, it is hard to take this article seriously when the author seems confused by what PG and Y Combinator actually do. For example, consider these sentences: One obvious difference between Paul is that he’s an employer and I’m an employee. We have too many people coming out of school who cannot find jobs, and not enough tech types for Y Combinator (or my various employers) to hire. What would happen if a few large companies (let’s start with Apple, Google, Intel, and Adobe from the lawsuit; I’d add Y Combinator, Facebook, Twitter, Microsoft, IBM, and Oracle), all announced they would raise salaries in all H-1B categories by 5%/year for 10 years, while the US reduced H-1B visas by 10% per year for 9 years, ending at 8,500 (10% of current volume)? In light of this severe misunderstanding, it is no wonder that this article makes so little sense. The author seems to make the point that H1-B visas tend to go to more average programmers. And, then argues that if companies want to attract more qualified people, they should start offering higher salaries/more options to top people. The problem is that they already do this and there is still a scarcity of truly amazing programmers. This isn't all that complex, or am I missing something?

skylan_q 12y ago
H-1B visa demand is not high because companies are striving for excellence. The visas are being used to preserve the existing labor market (salary levels) rather than paying higher salaries as dictated by supply and demand. Paul’s suggestion would help US companies find employees, but drain brainpower from the rest of the world, and leave the US workforce uncompetitive for US jobs. It is not a good answer. That's his main driving point. Employees are not all the same, and the immigrants aren't generally excellent programmers. Their purpose is to increase the labor pool size of the "average programmer" variety. This puts downward pressure on wages for average programmer types while also failing to bring in top-level talent.
- hluska 12y ago
  PG said: The anti-immigration people have to invent some explanation to account for all the effort technology companies have expended trying to make immigration easier. So they claim it's because they want to drive down salaries. But if you talk to startups, you find practically every one over a certain size has gone through legal contortions to get programmers into the US, where they then paid them the same as they'd have paid an American. Why would they go to extra trouble to get programmers for the same price? The only explanation is that they're telling the truth: there are just not enough great programmers to go around. There is nothing in this article to contradict what PG said - I'd love to see some well reasoned counter-arguments, but I don't see any in this article. In fact, I get the sense that the author has no idea what Y Combinator even does.
  - sgift 12y ago
    > Why would they go to extra trouble to get programmers for the same price? The only explanation is that they're telling the truth: there are just not enough great programmers to go around. Only if you believe this part. I have another possible answer: Because they'd have to pay even more for the local talent without the option to get more programmers for the same price.
    - skylan_q 12y ago
      This is probably relevant to the topic: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1375082 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1375082 If they can get a 22,000% return on lobbying for tax breaks, how much of a return can they get for lobbying on labor access?
  - skylan_q 12y ago
    There is nothing in this article to contradict what PG said He wasn't trying to contradict him on that point, from what I can see. What he's saying is that he can't trust the process of relocating workers into the US to get the best talent and to not drive down wages. In fact, he proposes: Pay more to hire programmers and tech types away from your competitors. This is one way to improve working conditions for people already in the US.
  - jeremyjh 12y ago
    It is not necessary for companies to under-pay immigrants in order to reduce labor costs through expanded immigration. Just bringing in more programmers of any kind at any cost will increase supply of labor without increasing demand for same.
  - stdgy 12y ago
    The issue, as I see it, is that startups account for a pitiable number of the overall H1B Visa count. For that matter, engineering powerhouses in general account for a small number of H1B Visa use. The majority of the visas are snatched up by multinational consulting firms that are trying to import their foreign labor for domestic work. Firms like Wipro, Infosys and Tata. Here are the numbers: http://www.myvisajobs.com/Reports/2014-H1B-Visa-Sponsor.aspx http://www.myvisajobs.com/Reports/2014-H1B-Visa-Sponsor.aspx I would propose two changes to the current regime in order to make it easier to bring top-tier talent abroad into the country. 1) Impose tougher strictures on pay requirements. This program is supposed to be used to bring in top performers. Top performers should be paid commensurately. As such, this imported labor should be paid a significant multiple of the prevailing wage, say 1.5. This has the added benefit of reducing Visa demand by firms that are simply using the program as a method to funnel their foreign workforce into the country. 2) Impose tougher checks on employee responsibilities. That is, ensure that employees aren't being taken advantage of and are in fact doing the work they were hired to do. Many people are being abused in the current H1B system by being paid below market value, as their actual responsibilities far outweigh the advertised responsibilities. Other H1B holders are promised fake jobs and essentially 'rented out' after they arrive in the country (http://www.nbcbayarea.com/investigations/Silicon-Valleys-Body-Shop-Secret-280567322.html http://www.nbcbayarea.com/investigations/Silicon-Valleys-Bod...).
ojbyrne 12y ago
One could make the argument (and it has been made by others) that company founders are essentially glorified project managers, And VCs and especially incubators are just a mechanism to reduce risk by treating them as independent contractors and paying them well below the market rate, with e promise of some a lottery-type payout if they work every waking hour and are really really lucky.
- hluska 12y ago
  That's one possibility. Another possibility is that founding a company is a tactic on an entirely different career path. Yes, you will likely fail and make below market money in the process. But, after you fail, you'll arrive at your next job with experience that people 20 years older than you could only dream of having. This might just be a sign that I drank the Kool-Aid, but I think it's another way of looking at your excellent point.
- alooPotato 12y ago
  sure everyone is an employee of some kind to someone. The real difference is the level risk/reward you're willing to accept for your employment.
tptacek 12y ago
California tech companies do not pay exorbitant salaries. Evidence: compare the locked-in annual cash compensation of a senior developer at an investment bank to a senior developer at the median California tech startup.
- hluska 12y ago
  Exorbitant was a terrible word. Thanks to catching that.
walshemj 12y ago
he is not paying enough then - you gave to persuade more of the high IQ types to go into Enginering rather than the Law, Medicine and other the other higher status and better paid professions.
- pmelendez 12y ago
  > "you gave to persuade more of the high IQ types to go into Enginering rather than the Law, Medicine " That's under the assumption that anybody can be a good Engineer. I know a lot of excellent medicine doctors (shamelessly including my Dad) that with enough effort would be able to learn programming but they won't be great ones, they just are not passionate enough about programming. Another point is that most of the great developers that I know are not money driven, their wealth is just a nice consequence of doing something that they love.
  - walshemj 12y ago
    Not all but you would be enlarging the pool of potentials that currently go into other fields for financial and status reasons.

by hluska 12y ago

skylan_q 12y ago

H-1B visa demand is not high because companies are striving for excellence. The visas are being used to preserve the existing labor market (salary levels) rather than paying higher salaries as dictated by supply and demand. Paul’s suggestion would help US companies find employees, but drain brainpower from the rest of the world, and leave the US workforce uncompetitive for US jobs. It is not a good answer. That's his main driving point. Employees are not all the same, and the immigrants aren't generally excellent programmers. Their purpose is to increase the labor pool size of the "average programmer" variety. This puts downward pressure on wages for average programmer types while also failing to bring in top-level talent.

hluska 12y ago
PG said: The anti-immigration people have to invent some explanation to account for all the effort technology companies have expended trying to make immigration easier. So they claim it's because they want to drive down salaries. But if you talk to startups, you find practically every one over a certain size has gone through legal contortions to get programmers into the US, where they then paid them the same as they'd have paid an American. Why would they go to extra trouble to get programmers for the same price? The only explanation is that they're telling the truth: there are just not enough great programmers to go around. There is nothing in this article to contradict what PG said - I'd love to see some well reasoned counter-arguments, but I don't see any in this article. In fact, I get the sense that the author has no idea what Y Combinator even does.
- sgift 12y ago
  > Why would they go to extra trouble to get programmers for the same price? The only explanation is that they're telling the truth: there are just not enough great programmers to go around. Only if you believe this part. I have another possible answer: Because they'd have to pay even more for the local talent without the option to get more programmers for the same price.
  - skylan_q 12y ago
    This is probably relevant to the topic: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1375082 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1375082 If they can get a 22,000% return on lobbying for tax breaks, how much of a return can they get for lobbying on labor access?
- skylan_q 12y ago
  There is nothing in this article to contradict what PG said He wasn't trying to contradict him on that point, from what I can see. What he's saying is that he can't trust the process of relocating workers into the US to get the best talent and to not drive down wages. In fact, he proposes: Pay more to hire programmers and tech types away from your competitors. This is one way to improve working conditions for people already in the US.
- jeremyjh 12y ago
  It is not necessary for companies to under-pay immigrants in order to reduce labor costs through expanded immigration. Just bringing in more programmers of any kind at any cost will increase supply of labor without increasing demand for same.
- stdgy 12y ago
  The issue, as I see it, is that startups account for a pitiable number of the overall H1B Visa count. For that matter, engineering powerhouses in general account for a small number of H1B Visa use. The majority of the visas are snatched up by multinational consulting firms that are trying to import their foreign labor for domestic work. Firms like Wipro, Infosys and Tata. Here are the numbers: http://www.myvisajobs.com/Reports/2014-H1B-Visa-Sponsor.aspx http://www.myvisajobs.com/Reports/2014-H1B-Visa-Sponsor.aspx I would propose two changes to the current regime in order to make it easier to bring top-tier talent abroad into the country. 1) Impose tougher strictures on pay requirements. This program is supposed to be used to bring in top performers. Top performers should be paid commensurately. As such, this imported labor should be paid a significant multiple of the prevailing wage, say 1.5. This has the added benefit of reducing Visa demand by firms that are simply using the program as a method to funnel their foreign workforce into the country. 2) Impose tougher checks on employee responsibilities. That is, ensure that employees aren't being taken advantage of and are in fact doing the work they were hired to do. Many people are being abused in the current H1B system by being paid below market value, as their actual responsibilities far outweigh the advertised responsibilities. Other H1B holders are promised fake jobs and essentially 'rented out' after they arrive in the country (http://www.nbcbayarea.com/investigations/Silicon-Valleys-Body-Shop-Secret-280567322.html http://www.nbcbayarea.com/investigations/Silicon-Valleys-Bod...).

ojbyrne 12y ago

One could make the argument (and it has been made by others) that company founders are essentially glorified project managers, And VCs and especially incubators are just a mechanism to reduce risk by treating them as independent contractors and paying them well below the market rate, with e promise of some a lottery-type payout if they work every waking hour and are really really lucky.

hluska 12y ago
That's one possibility. Another possibility is that founding a company is a tactic on an entirely different career path. Yes, you will likely fail and make below market money in the process. But, after you fail, you'll arrive at your next job with experience that people 20 years older than you could only dream of having. This might just be a sign that I drank the Kool-Aid, but I think it's another way of looking at your excellent point.
alooPotato 12y ago
sure everyone is an employee of some kind to someone. The real difference is the level risk/reward you're willing to accept for your employment.

tptacek 12y ago

California tech companies do not pay exorbitant salaries. Evidence: compare the locked-in annual cash compensation of a senior developer at an investment bank to a senior developer at the median California tech startup.

hluska 12y ago
Exorbitant was a terrible word. Thanks to catching that.

walshemj 12y ago

he is not paying enough then - you gave to persuade more of the high IQ types to go into Enginering rather than the Law, Medicine and other the other higher status and better paid professions.

pmelendez 12y ago
> "you gave to persuade more of the high IQ types to go into Enginering rather than the Law, Medicine " That's under the assumption that anybody can be a good Engineer. I know a lot of excellent medicine doctors (shamelessly including my Dad) that with enough effort would be able to learn programming but they won't be great ones, they just are not passionate enough about programming. Another point is that most of the great developers that I know are not money driven, their wealth is just a nice consequence of doing something that they love.
- walshemj 12y ago
  Not all but you would be enlarging the pool of potentials that currently go into other fields for financial and status reasons.