Is developer compensation becoming bimodal? • Hacker News Board

Re: Is developer compensation becoming bimodal?

#121

Post by kamaal » Fri, Feb 09, 2018, 2:00 PM UTC

gaius wrote: post #23

kenhwang wrote: post #7

I'm partial to the O-ring explanation. Software engineering is uniquely multiplicative because it's possible for a software engineer to create software that does software engineering. Chemical/electrical/mechanical engineers can't use their field to automate their field. Doctors and lawyers are almost exclusively service jobs, unlike the manufacturing nature of engineering. Automation is a force multiplier, and softw…

Chemical/electrical/mechanical engineers can't use their field to automate their field. A mechanical engineer designing a new manufacturing technique or robot is most certainly using their field to automate their field. Most of computing exists because electronic engineers used their field to automate their field. Software is not unique in this respect.

Not in the same way, or in the same ball park.

Mechanical engineering didn't have its Lisp. We do.

Re: Is developer compensation becoming bimodal?

#122

Post by YPCrumble » Fri, Feb 09, 2018, 2:00 PM UTC

A good answer to why software pays more than industries like law or medicine is that profit per employee in software is enormous. Of the 12 American companies on this chart of the highest profit per employee, 6 are software companies: http://www.businessinsider.com/apple-facebook-alphabet-most-...

I would love to hear an economist explain why this might or might not lead to higher salaries. My hypothesis is there is an element of human nature: if you're rolling in cash you don't have to be stingy.

Re: Is developer compensation becoming bimodal?

#123

Post by tboyd47 » Fri, Feb 09, 2018, 2:02 PM UTC

jandrewrogers wrote: post #17

Yes, it is. And the example used in the article of chemical engineering reinforces the point. It ties into computer science quite nicely. To become a chemical engineer, you first have to complete the course work for a degree in chemistry. Chemistry as chemistry is an extremely modular subject matter; you can solve most problems in discrete steps in isolation. In a computer science sense, chemistry is about pure funct…

I thought it was just because the GAFA tech giants are currently in a bidding war for programmers in a very expensive part of the country. I've met and worked with many very talented engineers, fully capable of grokking complex systems, not working in Silicon Valley.

Re: Is developer compensation becoming bimodal?

#124

Post by crdoconnor » Fri, Feb 09, 2018, 2:08 PM UTC

jandrewrogers wrote: post #17

Yes, it is. And the example used in the article of chemical engineering reinforces the point. It ties into computer science quite nicely. To become a chemical engineer, you first have to complete the course work for a degree in chemistry. Chemistry as chemistry is an extremely modular subject matter; you can solve most problems in discrete steps in isolation. In a computer science sense, chemistry is about pure funct…

>Chemical engineering, on the other hand, is about analyzing systems that leak their state everywhere and have effects that feedback into other parts of the system. But it needs to be extremely efficient nonetheless. There is no isolation because it doesn't exist in real-world complex systems.

Is it not possible to engineer in isolation on real world complex chemical engineering system?

I try to do that with software, and most software can certainly benefit from stricter isolation (e.g. looser coupling), but most software teams - even well paid ones - often have an in-built bias against investing in less tangible work which means that you ultimately end up with these complex systems are that hard to reason about.

Not that I feel like I should be complaining about this if it is indeed the reason I'm paid well.

Re: Is developer compensation becoming bimodal?

#125

Post by tzahola » Fri, Feb 09, 2018, 2:09 PM UTC

athenot wrote: post #99

I think the reason for high compensations is that software is the enabling factor for capital. If software can automate, reduce inefficiencies and generally be the means to accomplish the business goal, then it makes sense for the business side to invest heavily into what is essentially a competitive differentiator. The bimodal compensation reflects a growing split between software activities that are seen as an nece…

You meant "increase efficiencies" or "reduce inefficiencies".

Re: Is developer compensation becoming bimodal?

#126

Post by maccard » Fri, Feb 09, 2018, 2:09 PM UTC

vemv wrote: post #58

bjourne wrote: post #38

Earlier quoted context omitted.

Tbt, I haven't seen that much evidence that correlates developer ability with salary. For example, developers living in the Silicon Valley are paid the most. Not because they are the best, but because they are living in the Silicon Valley. Geographical factors play a much bigger role in compensation than developer ability.

But that 'greater' SV salary for a junior developer can give you less purchasing power than a 'lower' salary for a senior somewhere in Europe, due to cost of living. Granted, money is 'absolute' if you use it to e.g travel around the world, but most people don't do that. In general money is 'relative' to one's environment.

Not true. If you're making 120k in SF, after taxes and pay 4k/month on rent, your remaining salary is still greater than most junior engineers gross pay in the UK.

Re: Is developer compensation becoming bimodal?

#127

Post by MagnumOpus » Fri, Feb 09, 2018, 2:09 PM UTC

YPCrumble wrote: post #122

A good answer to why software pays more than industries like law or medicine is that profit per employee in software is enormous. Of the 12 American companies on this chart of the highest profit per employee, 6 are software companies: http://www.businessinsider.com/apple-facebook-alphabet-most-... I would love to hear an economist explain why this might or might not lead to higher salaries. My hypothesis is there is…

High profit per employee leads to a higher divergence in salaries - same as it does for industries like financial trading and research.

If profit per "average" developer is $1 million, then the company is way better off paying $100k extra (i.e. double) to get developers that are 20% more productive than the average - and if the company doesn't do that, then their best people get poached by companies who do.

And while it is impossible to hire the mythical "10x developer", it is not all that hard to find the "1.2x developers" if you are willing to pay double to get them...

Re: Is developer compensation becoming bimodal?

#128

Post by ddorian43 » Fri, Feb 09, 2018, 2:10 PM UTC

expertentipp wrote: post #117

ddorian43 wrote: post #109

Earlier quoted context omitted.

Programmers don't need unemployment benefits. You can always find a job. Maybe unable-to-work (like accidents etc) insurance.

> Programmers don't need unemployment benefits. That's what the person at the (un)employment office said once to me. If you know how to count, count on yourself because most of the insurance contributions simply fall into a black hole.

"Assuming good programmers + assuming you have certain logical thinking skills outside of programming, like, say, don't live paycheck-to-paycheck and credit-lifestyle".. I just stay out of work until I find a better one with my savings. Worst case I find shitty work until better work.

Re: Is developer compensation becoming bimodal?

#129

Post by eli_gottlieb » Fri, Feb 09, 2018, 2:10 PM UTC

tboyd47 wrote: post #123

jandrewrogers wrote: post #17

Yes, it is. And the example used in the article of chemical engineering reinforces the point. It ties into computer science quite nicely. To become a chemical engineer, you first have to complete the course work for a degree in chemistry. Chemistry as chemistry is an extremely modular subject matter; you can solve most problems in discrete steps in isolation. In a computer science sense, chemistry is about pure funct…

I thought it was just because the GAFA tech giants are currently in a bidding war for programmers in a very expensive part of the country. I've met and worked with many very talented engineers, fully capable of grokking complex systems, not working in Silicon Valley.

I'd definitely call that the best explanation. You spend a few years working at a GAFAM, and now you've got a hugely prestigious resume from an expensive, high-cost-of-living area that other companies will shell out for, big time. You spend any time outside that cluster, even doing excellent and difficult work, and you just don't have the prestige.

It's also a matter of scale: the GAFAMs just ship more units in terms of revenue per employee. Sure, that's largely because of monopoly and network effects, but hey.

Re: Is developer compensation becoming bimodal?

#130

Post by ataturk » Fri, Feb 09, 2018, 2:10 PM UTC

The reasons underlying the bi-modality are pretty clear to me. There are a couple of major factors at play:

1) Inflation. My starting salary out of college many years ago was $35K. Today's starting salaries are double that. Double in less than 20 years. A $50K salary in the early 1980s is equivalent to $120K today, not controlling for geographic location--HCOL areas are actually far worse than that. Let that sink in as you plan for retirement. My take is that you are never going to save enough for retirement because inflation is insidious and never sleeps.

2) The mythology of the higher salary range. How do developers get past that second mode? They start their own company! Only a few rarified corporate people and independent consultants can pull down pay in the 200s. Again, I'm not thinking about SV where the pay is so skewed due to the HCOL. So everyone else works a number of years and ends up in the 120s-150s and they think they are doing great, but they really aren't (me included) due to #1.

Any way you look at doing software development as a career you come to see that it stinks. I'm not going to recommend it to my kids. I think it's important to know how computers work and how code works and not to be afraid of tinkering with those things or coming to believe that you have no control over it, but as a business, it's nasty and getting nastier.