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It looks like the salary differential of $33k listed in the article is gross earnings. After taxes this would just barely cover the rent differential of $1.5k/mo ($18k/year). Note that this is the best case scenario according to their estimates. What troubles me is the use of median rent to compare housing costs. As rent increases, renters are likely to downsize offsetting some of the rent increase. I'd be willing to…
This article seems to assume you're single and not in a hurry to start a family. I'd be interested to read an article "Does it make sense for a programmer with a wife and kids to move to the bay area". I secretly suspect the answer will be "no", since no matter how you slice it, a 4-bedroom house in the Bay Area won't be reachable until you are well on your way to, say, 40 or so.
I'm somewhat pondering an Evil Scheme where I start a one-to-one "subcontracting" firm, where a plain-bad programmer who would never otherwise make it in a startup environment can hire someone [me] to do all their work for them—and maybe even guide them through their interviews with a concealed earpiece. Basically, the company would have "actually" hired me, and the person in the startup's office would just be serving as a human proxy for my skills.
Of course, that's effectively just a hack to get around the idiotic policies companies have against hiring remote workers for local salaries; and one that would cost quite a bit of salary (the proxy would still have to get paid, after all.) But I bet it would still turn out better than a non-Bay-Area wage.
Interesting that Bay Area hackers make more than local hackers when they relocate outside the Bay Area. FTA: A 2015 report by Hired found that when engineers from the Bay Area relocate to other areas, they out-earn engineers on the local market. Experience in the Bay Area seems to advance careers. Engineers moving from San Francisco to Seattle make an average of $9,000 more than others who get offers in Seattle. This…
Perhaps developers in the Bay Area learn very quickly how much demand there is for their skills and that confidence translates directly to leverage during negotiations, regardless of where they look for a job. There's too many confounding factors to clearly pick out which are significant without much more precise data. On a side note: Calling them hackers when you clearly mean run of the mill corporate programmers se…
Earlier quoted context omitted.
It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. Figure that $150K/year after taxes is about $110K/year, and live on $60K/year. That's eminently doable even in the Bay Area. The problem is that $100K is a very low estimate for a down payment in the Bay Area these days. Most people I know are getting parental help to put down $500K down, because with housing…
> It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. I'm not sure what you think an average salary is. If you think an average engineer can save $50k cash per year out of his/her net income, you're way above the average I had in mind. Let's assume an average salary of $120k per year gross. That's about $6k per month net for a single person who takes the standa…
Whether or not the established places will toss so much money around if the hiring competition from startups dries up if there's a crunch there, well, that's probably a legitimate question, but I'm not sure that job losses of that size would only hit the Bay Area.
Yes it's expensive, but also yes there really are quite a lot of jobs that pay more than well enough to make up for it.
Earlier quoted context omitted.
> It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. I'm not sure what you think an average salary is. If you think an average engineer can save $50k cash per year out of his/her net income, you're way above the average I had in mind. Let's assume an average salary of $120k per year gross. That's about $6k per month net for a single person who takes the standa…
> assuming no 401k contributions. Why? Fully contributing to a 401k (assuming no company match) would put your "take home" at ~$79,200 instead of $72k following your tax rate (which I assume is roughly correct). > That's a net income of $72k per year. If that engineer saves $50k, that leaves only $12k for everything else $72k - $50k = $22k, not $12k. So with no 401k, you'd have to live on $22k to save $50k/year. When…
It looks like the salary differential of $33k listed in the article is gross earnings. After taxes this would just barely cover the rent differential of $1.5k/mo ($18k/year). Note that this is the best case scenario according to their estimates. What troubles me is the use of median rent to compare housing costs. As rent increases, renters are likely to downsize offsetting some of the rent increase. I'd be willing to…
EDIT I incorrectly multiplied the tax rate to the salary difference, and said that this was a 5$ difference. This is totally wrong (as multiple people point out below). I'll leave my original embarrassing comment as a cation to not write stupid things :) == I just added in a mention of the tax difference. But the numbers are 13.3% in CA vs 0% in WA. That's significant, for sure. But 13% tax on $33k is about $5k. I do…
The article is poorly argued. Paragraph 2 -- if you pick a winning startup (uber, etc) then the bay area is great! Well, yes. The problem is picking that winning startup, and really, if you're good at that, stop wasting your life as an engineer and go invest money for a living. We shouldn't expect eng to be able to pick better than vcs, and their hit rate isn't great. It also uses pre-tax salaries, not after tax sala…
If you're an investor, you need a company to succeed in a long-term sense: to pay out at the other end of the bet that started it. That's hard to predict: it's like looking at the fitness of animals in an ecosystem and trying to predict which one will end up with the most great-great-grandchildren.
But if you're an employee, you just need a company to be growing, and to be throwing money around in the process of doing that. You aren't looking for a fit animal, you're looking for a fat animal. Animals might get fat before they get fit, as before puberty in mammals—and investors try to encourage startups to "bulk up" to kickstart their metaphorical puberty. But unhealthy animals also get fat, and to a predator, they're just as edible.
If your goal is to "eat a lot of salary", you just need a company who's known to be throwing their fat around, not a company who will dominate their niche and sire a thousand children.