Pricing Programmers

To put hard numbers on it, McKinsey is one of top management consulting firms. According to an employee, its average tenure among new consultants is 2.5 years. https://www.quora.com/Why-are-employees-loyal-to-McKinsey

That's consistent with the staffing ratios within the firm (Wikipedia suggests thare are ~400 directors compared to about 9000 total consultants). Those are the ones who stuck around for more than a decade.

A single person didn't build any of these billion dollar companies you're referencing; at some point they had to hire more people, who in turn "sold themselves" by your confused logic, to build the company.

Most of these halo companies have non-programmers who were brought in to monetize and grow the value in them. Sheryl Sandberg isn't a programmer nor I think the rest of that board. Eric Schmidt was an electrical engineer.

This is fair / you're right: I was mainly thinking of banking, consulting, law, and buy-side finance. As you say, though, there are plenty of highly-trained professionals who don't experience a 5x earnings increase over 10 years; functional medical roles (e.g., anesthesiologists) come to mind.

Something I was wondering when I wrote the original question -- and I may be way off here -- is whether there are cultural or structural effects in tech-industry programming that cause wage stagnation. For example, there is less wage stagnation for programmers in quant hedge funds than there is in the tech industry; part of this is the clear p&l, of course, but perhaps there is a cultural / structural component as well? I'm not a programmer, but I once heard something that stood out to me: A friend, who was a senior programmer, discovered an inefficient process where he worked. In brief, whenever a certain "event" occurred, the company lost money; the senior programmer noticed this, and built a fix -- no more "events", and hence lots of money saved. From what he told me, my back of the envelope was that by building this (which took him about a week), he saved the company more than $600k a year. I mentioned to him that if he had come in as an outside consultant with a black box solution and offered to charge $100k a year to save the company $600k per year, there was a nonzero chance they would have said "yes"; he laughed and shrugged. This made me wonder whether there is something intrinsically non-value-capturing going on; perhaps (1) tech-industry programming doesn't have a culture of individual-value-capturing, or (2) the role of a programmer doesn't have the structural leverage to reliably capture value. Of course, this story is just anec-data; there may be no conclusions here.

It is much easier to estimate the price of an already hired programmer with a track record known over years and who has knowhow of the company's infrastructure, style, and knows the interactions between people and teams.

Also, it is usually easy to estimate how much it would cost to replace the well-known, skilled programmer with a new hire so I might assume that a careful owner or manager would be eager to re-evaluate his/her price continuously and adjust their salary upwards regularly to basically re-hire the hired programmer, to re-establish the position over and over again.

But large or continuous salary increases are not that common. You generally have to change jobs to get a significant raise to your salary.

It seems to be companies are more careless and flimsy with spending money on new hires and more conservative and thrifty with spending money on their existing hires even if that behaviour is in direct opposition to the amount of betting they are required to do.