Live data from Hacker News

Pricing Programmers

facebook.com

101–110 of 133 posts

Re: Pricing Programmers

#101
I like it because it de-commoditizes programmers. It forces you to evaluate each person and the business role rather than 'the market price for a programmer with X skills' which has always driven me crazy when dealing with large company HR. Human resources, treating people like commodity resources, heh.

Re: Pricing Programmers

#102
post #81
post #78

Earlier quoted context omitted.

It doesn't reflect well on you to say that basically all the projects you worked on failed.

It doesn't reflect well on you to not understand how this works.

Projects fail for all sort of business reasons that have nothing to do with programming. However, that doens't mean that projects never fail because technical folks are not aligned with the business interests.

Sure, if you're just a worker bee, you can be selfish and milk these poorly organised start-ups for all they're worth, but if you wanna step up into those senior roles and actually have a chance of making something of those options, you need to weed out folks who don't care about delivery.

I'm not saying the guy definitely doesn't deliver but there are a number of indicators that suggest that he's not actually suffering from imposter syndrome but is actually just self aware to the point that he knows the companies hiring him are not getting value for money.

Even if that is true, he himself can hardly be blamed for taking the money. Whilst I try to deliver value to my clients, I also bill them as much as I can get away with.

Re: Pricing Programmers

#103
post #41

Earlier quoted context omitted.

> Labor does not receive (or insist on) percent-of-value or percent-of-transaction compensation. This is true of pretty much all engineering jobs, and more broadly, most non-sales jobs. Commission becomes feasible when you can directly attribute sales or billable hours to a specific person. > Initial salaries are good, but there is wage stagnation. This is true for all engineering jobs, and also most jobs in general.…

Well, that bit about management is true but sucks. I saved my previous employer 60k years in running cost on my first three month on the job, and couldn't get a 10% raise out of it. Just promises and nice words. Well guess what? If you pay programmers as blue collars and get them to work as blue collar in a "software factory" paying them blue collar wages, you are in a self fulfilling profecy about their value.

My point of view is that I should cost my company somewhere between 1/5 and 1/3 of the value that I create for them.

Less than 1/5th and there's room to pay me more. More than 1/3rd and I'm at risk of getting into the unstable realm where if I or my team hit a temporary rough patch, that the company would be economically ahead to fire us, especially after you consider the amount of "double counting" that goes on.

(Engineering builds something that saves $100K/yr. Manufacturing deploys that thing to save $100K/yr. What do you want to bet that the total savings claimed is closer to $200K/yr than $100K/yr?)

Re: Pricing Programmers

#104
post #10

For years, from one job in the bay area to the next I worked on products that never made any money and ended up being canceled. Even when I worked on a project that ended up making money I spent a year working on a version that was rebooted from scratch before customers ever saw it. At a couple of startups that never took of afterward I could clearly see the impact that code I wrote was making on sales and value. It…

> I'm not sure why people pay me so much Why is this sentiment in the community common? I can't really find an explanation for it so far.

> I can't really find an explanation for it so far.

He basically hinted at that by saying: "because I get to do what I love (programming,...)"

I believe you and gp (lemevi) are talking from 2 different perspectives. Your perspective is more about "don't sell yourself short" or "don't devalue your skills".

The gp's perspective is more about the "mystery of the universe" as to why an enjoyable job could pay more than a boring one. It's a similar sentiment to the successful novelists, comedians, musicians saying, "I feel lucky that people pay me lots of money for doing what I love to do." (Yes, there are tons of programmers who suffer through boring CRUD coding and treat it as "just a job" but there are also many programmers who truly enjoy the activity.)

I experienced the gp's perspective in my first job out of highschool. I happened to be a decent typist so I got a job to transcribe audio to word processing documents. One day, the business owner was looking at his screen in frustration trying to make something work. I looked over his shoulder and saw things like "DO WHILE" and "DEFINE PROCEDURE" on the screen. I just looked at it and then had one of those Jurassic Park moments[1]. I said, "you need to set a variable here, and move that line there, etc etc." He was totally surprised and said he'd pay me double the hourly rate if I could fix the computer program. I couldn't believe it. I had programmed computers during middle school (age 11 to 13) and treated the whole coding activity as "playing with a toy". I stopped programming during high school and worked at a fast food joint for minimum wage. I had no idea that people paid money for programming. People will pay me more for typing "DO WHILE" than mopping floors and hauling out grease buckets?!? That's absurd!

Yes, on one level, one can do all sorts of economic analysis (supply-vs-demand, marginal utility, productivity multiplier of software) and conclude that it makes perfect sense that programmers are paid $X more than brick layers. However, even with that logical rationalization, there can still be this "mystery" of why a person typing on a keyboard in a pleasant air conditioned office makes more than a brick layer sweating in 100 degree heat. It seems unfair that a "game" from my childhood earns more than back-breaking labor.

[1]https://www.youtube.com/watch?v=dFUlAQZB9Ng

Re: Pricing Programmers

#105
post #89
post #10

For years, from one job in the bay area to the next I worked on products that never made any money and ended up being canceled. Even when I worked on a project that ended up making money I spent a year working on a version that was rebooted from scratch before customers ever saw it. At a couple of startups that never took of afterward I could clearly see the impact that code I wrote was making on sales and value. It…

It's nice to see someone have such a nice experience with their employment history. I actually have the opposite experience. tldr: I am happy you had such good luck; mine sucked. Worked in Tech Support (for a tech-related company), made tools to make mine and colleagues' from the department job easier and faster. This caught some attention from the infrastructure department, which got me "promoted" to junior sys admi…

I also get furious reading this! My advice: Thank them for everything you've learned and explain that you are about too seek other ventures, but you really like working for them, and wish them the best. Then leave as fast as your contract lets you. Take out any semester if you have any left and go on a vacation.

When you have officially quit and your contract is off. You can get hired again and can negotiate a much better contract. Also look for other jobs! And write down everything you've accomplished and the value you add to the company.

And in the future, if you even smell bullshit and think something is unfair, you have to open your voice and argue! You also need to "ventilate" far more often, so that when you "ventilate" it will only be small issues instead of the "huge pile" you just dropped.

Re: Pricing Programmers

#106
post #2

Programmers are worth $0 because programming isn't a job. It's not even a skill; rather, it's more of an active literacy. Asking how much you should pay a programmer is like asking how much you should pay a telephone user, or how much you should pay a pencil user.

You're 10 steps ahead of us all and probably living more than 10 years into the future. Yes, programming is a form of literacy. But in todays world, programming is also a job. Just like being a scribe was a job in ancient times, HTML'er was a job 10 years ago (and still is in some places) and programmer is one today (but assembly programmer is a job that is now in large part taken over by compilers). And that skill h…

Perhaps I'm assuming a casual familiarity with some of pg's earlier essays than no longer exists. Although I think the reason I'm getting downvoted isn't for being unclear, but rather for shitting on people's self-identities.

As for being ahead of my time, if you look at the job market today it's true that you do have a lot of people paid purely for their ability to code. These are mostly W2 employees, who work at the kind of places where you start out as a junior developer making 60 - 80k, and then make double that after 8-10 years. And given the current state of society, this is actually a pretty good career path.

However, we also have consultants who bill on a project basis based on value rather than skill, who might easily make 400k a year even as junior developers. (E.g. c.f. patio11's essays.) And we have entrepreneurs and founding team members who get paid largely in stock, the worth of which is largely determined by how much the market values the product.

It's kind of weird because as an industry we definitely need people who have ridiculously good technical skills, to the exclusion of all else. But for the most part programming is a pink-collar job that just happens to be done mostly by men. (In that it requires education, but there is a lot of downward pressure on salaries because the people involved are perceived as being largely interchangeable.) This is why I'll sometimes describe myself as a software developer, but never as a programmer or a software engineer. Because although I know how to code and I might even spend most of the day coding, I don't ever want to work at a job where I'm paid based on my coding ability.

Re: Pricing Programmers

#107

Earlier quoted context omitted.

Well, that bit about management is true but sucks. I saved my previous employer 60k years in running cost on my first three month on the job, and couldn't get a 10% raise out of it. Just promises and nice words. Well guess what? If you pay programmers as blue collars and get them to work as blue collar in a "software factory" paying them blue collar wages, you are in a self fulfilling profecy about their value.

My point of view is that I should cost my company somewhere between 1/5 and 1/3 of the value that I create for them. Less than 1/5th and there's room to pay me more. More than 1/3rd and I'm at risk of getting into the unstable realm where if I or my team hit a temporary rough patch, that the company would be economically ahead to fire us, especially after you consider the amount of "double counting" that goes on. (En…

I see what you mean, but putting your work value at the company behest is a losing proposition. My work has value even if the company that commissioned it to me is unable to monetize it.

My time has a value which is independent to what the company pays me to actually do. My time would carry the same value even if the company got me to clean bathrooms.

If I had the willingness to start a company and spent my time there, how much money would I make? That's the value of my time, but it carries quite some risk. I am not the best at monetizing software, so I outsource the monetization of my time and associated risks to a third party. They do get a substantial cut of the money, which is fine since I get reduced risk.

If you tie the value of your time to the capability of the company to direct you doing high value tasks you're starting with the losing foot in any negotiation. What if you gave your time to a charity? What if the company needed you to debug some worthless software in the chain as an emergency? Your time has a value even if what you are told to build in your time from your employer has no value - it's the employer loss, not yours.

Re: Pricing Programmers

#109

Earlier quoted context omitted.

In short, the "up or out" policy of banks and consultancies is notorious for having more "out" than "up": https://en.wikipedia.org/wiki/Up_or_out 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 fi…

This is the employment equivalent of Betz' law from wind power. Before you throw that idea out as ridiculous let me explain. Betz' law states that there is an upper limit to the amount of power that you can extract from a given mass of moving air (aka wind). The plainest explanation is that the wind has to go somewhere in order to be able to bring in fresh wind. If you extract all the energy then the air would have t…

[deleted]

Re: Pricing Programmers

#110

Earlier quoted context omitted.

My point of view is that I should cost my company somewhere between 1/5 and 1/3 of the value that I create for them. Less than 1/5th and there's room to pay me more. More than 1/3rd and I'm at risk of getting into the unstable realm where if I or my team hit a temporary rough patch, that the company would be economically ahead to fire us, especially after you consider the amount of "double counting" that goes on. (En…

I see what you mean, but putting your work value at the company behest is a losing proposition. My work has value even if the company that commissioned it to me is unable to monetize it. My time has a value which is independent to what the company pays me to actually do. My time would carry the same value even if the company got me to clean bathrooms. If I had the willingness to start a company and spent my time ther…

Your second paragraph talks about the value of your time to you and in that sense, it's true. From the company's point of view of your time, your second paragraph is somewhere between irrelevant and false.

You hit the nail on the head that we're giving up a lot of the value "pie" in exchange for much lower risk. My mindset takes that one step farther: ensure that everyone's economic goals are aligned and stably pointed to continued employment of me and my team. That requires an exchange of my time for the company's money at a rate low enough that it's obvious to the company they're getting an economic gain from buying it and high enough that it's obvious to me that I'm getting an economic gain from selling it.

If those ranges don't overlap, you have a very unstable situation. When those ranges have large overlap, many different valuations of time are stable and mutually beneficial.

>What if the company needed you to debug some worthless software in the chain as an emergency?

If the software I'm debugging is worthless, it's hard to imagine there's a genuine emergency involving it. The mere fact that there's an emergency involving it means it has some value to someone.

Post reply on HN