Ask HN: Why do managers get paid more than individual contributors? • Hacker News Board

Re: Ask HN: Why do managers get paid more than individual contributors?

#61

Post by taneq » Sun, Jun 24, 2018, 10:50 AM UTC

megamindbrian2 wrote: post #9

fouc wrote: post #2

That's not always true.

I work for a company where the CEO admitted to earning LESS than the top earner. The CEO is still worth more because of other assets, but the VP of Sales earns the most annual take-home in the company.

You have to look out for this one, because sometimes (eg. if the CEO is also the owner of the company) it can be very misleading. I worked at an ISP back in university where everyone, including the managing director, was paid roughly minimum wage. Any time anyone asked for a raise, the answer was "Bob the MD only gets paid $X per hour, are you asking for more than Bob?" ignoring the fact that every dollar on the company's value was a dollar in Bob's pocket.

Re: Ask HN: Why do managers get paid more than individual contributors?

#62

Post by notacoward » Sun, Jun 24, 2018, 12:30 PM UTC

Like others, I'll start by questioning the assumption behind the question. I know I've made more than some of my managers, starting at least ten years ago. Many people get this idea very early in their careers, when it's true because they're just starting out and (obviously) their managers are not, but after only a few years of big raises and easy level advancements it needs to be re-evaluated.

When it is true that managers make more, there's no single reason. On the good side, the effect of a good manager compared to a bad one can be bigger than for an IC. On the bad side, managers get to whisper more in the ears of those who control the money. In between, and most often, let me ask you one simple question.

* Would you want to be a manager?

For me the answer is HELL NO. I got close to it once, and didn't care for it. Many other ICs feel the same way. You'd have to pay us extra to give up what we do now for management work ... and so that's exactly what often happens. Supply and demand, pure and simple.

Re: Ask HN: Why do managers get paid more than individual contributors?

#63

Post by sardonicbryan » Sun, Jun 24, 2018, 2:19 PM UTC

rishirishi wrote: post #20

pbiggar wrote: post #13

In good companies there are two career paths: - a management track - an IC (individual contributor) track There are different levels on the different tracks, and each is paid for that level. A super experienced IC will be paid more than a junior manager, and vice versa. So it doesn't have to be true that a manager earns more than an IC, and for example many ICs at Google are paid millions of $$, much much more than t…

Good perspective, pbiggar. Question for clarification: Do those ICs making "a lot" report to managers that make more, less or equal (generally speaking of course)?

At my company, the most senior ICs (Principal Engineer, Chief Architect) report into the CTO, so the "manager" in this scenario they don't make more than their direct "manager," but likely more than every other manager in the org.

I think this is a pretty common structure for companies that actually have an IC track that goes being senior engineer.

Re: Ask HN: Why do managers get paid more than individual contributors?

#64

Post by jackgolding » Sun, Jun 24, 2018, 2:46 PM UTC

apatters wrote: post #34

To answer this question accurately you have to look at it from the perspective of the person who has the authority to make the hires (e.g., C-level, VP, people with financial control). Aside from the multiplier effect of a good manager which is mentioned in a few other comments, a manager is someone to whom the employer can delegate responsibility. This is usually the most valued skill set an employee can possess --…

yup i agree, find it weird that "delegate authority" is so far down the conversation here.

Re: Ask HN: Why do managers get paid more than individual contributors?

#65

Post by mitchellst » Sun, Jun 24, 2018, 4:03 PM UTC

crb002 wrote: post #4

Supply and demand. They spend all day in meetings gathering requirements, fighting to fund their staff, keeping their staff from being dragged off onto other projects. Few can do it well.

This is the answer. The reason anyone gets paid what they get paid in the free market is supply and demand, whether it be for their labor, for a product they're selling, or for a security they own. It's not about what they deserve— see the oft-quoted idea that teachers do work that's both difficult and important but are not generally well-compensated. What you make is not a function of what you abstractly deserve or how difficult your job is. It's a function of how many people are able and willing to do it, at what price, and how many people are able and willing to pay to have it done, and at what price. This applies to both IC's and managers.

As others have noted in this thread, it's not always true that managers are paid more, but you're right to note that it's normal. There are some dynamics at play to make it happen. Two that spring to mind are (a) managers are often promoted from the ranks of successful IC's. They've probably been around for a few annual raises / promotions as an IC, plus they get a raise for the management promotion. It adds up. (b) A bad manager has more destructive potential than a bad IC. They can make more expensive mistakes, and devote teams of IC's to making those mistakes with them. Their negative attitudes or incompetence can tank morale across lots of people, rather than just their immediate teammates. Their inefficiency can lower the productivity of lots of IC's, rather than just themselves. All the same applies in the positive direction, but the negative is key, because loss-avoidance psychology is a strong force. So if I'm deciding peoples' compensation and I have a good manager, I'm going to pay them enough to keep them. If I don't, and I need to replace them, then I run the risk of making a bad hire, which would make a lot of people miserable and may lead to more attrition, especially among their direct reports, whose work is also valuable to me. If you've been lucky enough to have bad coworkers fired quickly, you know that their (ex) teammates breathe a sigh of relief and thank management for dealing with it. On the flipside, if an IC gets a new manager every few months, (especially a new _bad_ manager) they quickly decide this is a chaotic workplace and take their skills elsewhere.

Re: Ask HN: Why do managers get paid more than individual contributors?

#66

Post by dasil003 » Sun, Jun 24, 2018, 4:10 PM UTC

kamaal wrote: post #54

pbiggar wrote: post #13

In good companies there are two career paths: - a management track - an IC (individual contributor) track There are different levels on the different tracks, and each is paid for that level. A super experienced IC will be paid more than a junior manager, and vice versa. So it doesn't have to be true that a manager earns more than an IC, and for example many ICs at Google are paid millions of $$, much much more than t…

>>Another reason is that managers are multipliers. There is no any such reason. Current day managerial jobs descend directly from days of feudalism and aristocracy. Where the master had to be richer than the slaves to enforce his rule over the serfs. All the best having a underpaid manager exercising control over overpaid ICs, it doesn't start, let alone work well. In short this is social sanction. The reality is any…

Your answer is contradictory: managers are not in any way multipliers, but they must be paid more because pyramid?

Also, your cynical view completely breaks down for knowledge work; you can't simply stand over a room of programmers cracking a whip and expect anything to improve. Maybe you've experienced that, but that's not what skilled managers in productive tech companies are paid to do.

Re: Ask HN: Why do managers get paid more than individual contributors?

#67

Post by dasil003 » Sun, Jun 24, 2018, 4:31 PM UTC

rishirishi wrote: post #22

iandanforth wrote: post #10

Well let's start by noting that there are exceptions to this rule. A principal engineer in a couple companies I've worked for was in a higher bracket than almost all the managerial levels. Next let's explore the ideal case. An engineer is very good at using tools to accomplish work. A good manager should be very good at using/making/helping humans accomplish work. Totally different skill set, but not easy, and potent…

Your machiavellian take holds water, in my opinion. If managers were paid less than (or just as much as) their directs, what would change?

If one company did it they'd lose all their good managers. If all companies did it then all the engineering managers with IC experience would stay in IC roles, and the managers you'd end up with would be much much worse.

Re: Ask HN: Why do managers get paid more than individual contributors?

#68

Post by dasil003 » Sun, Jun 24, 2018, 4:42 PM UTC

notacoward wrote: post #62

Like others, I'll start by questioning the assumption behind the question. I know I've made more than some of my managers, starting at least ten years ago. Many people get this idea very early in their careers, when it's true because they're just starting out and (obviously) their managers are not, but after only a few years of big raises and easy level advancements it needs to be re-evaluated. When it is true that m…

This is true, over my career as my companies have grown I've naturally taken a tech lead and then manager role because it was the most effective way to help the team and it turns out I'm very good at it. But if it wasn't compensated better then I'd simply stay in my lane as an IC, and the companies would suffer due to having to bring in inferior management lacking technical skills.

Re: Ask HN: Why do managers get paid more than individual contributors?

#69

Post by tarboreus » Sun, Jun 24, 2018, 4:51 PM UTC

petermcneeley wrote: post #30

iandanforth wrote: post #10

Well let's start by noting that there are exceptions to this rule. A principal engineer in a couple companies I've worked for was in a higher bracket than almost all the managerial levels. Next let's explore the ideal case. An engineer is very good at using tools to accomplish work. A good manager should be very good at using/making/helping humans accomplish work. Totally different skill set, but not easy, and potent…

I would go even further. Why would you NOT expect the asymmetric power relationship to logically lead to increased compensation?

This. The top people in an organization are, almost by definition, managers. It's not surprising that they compensate managers more in general. In addition, managers are more involved with discussions about compensation and, partly for this reason, tend to be better negotiators.

Re: Ask HN: Why do managers get paid more than individual contributors?

#70

Post by scarface74 » Sun, Jun 24, 2018, 5:59 PM UTC

I left a company where I was the Dev Team lead for a company where I am “just” a Senior Developer. I happen to be getting paid slightly more:

My experience is that I was much more effective as a team lead than an individual contributor. I was able to do and guide research, do proof of concepts that other people productized and had far more accomplishments guiding a team of junior to mid level developers.

Now, trying to implement the same kind of changes as an individual contributor is taking far longer. I have more say so over the architectural direction of my team now just based on my expertise and relationships and no red tape (here I’m an AWS admin, at my prior company I had to go through multiple approvals to get anything done), but since I actually have to do the work instead of directing a team, my accomplishments are a lot slower.

I can see first hand the effectiveness of my manager and his ability to be a force multiplier over my ability to get things done as an individual contributor.

I’m not complaining, when I had a choice when I was looking for a job I could have been hired as an architect/Dev lead making slightly more than I make now using technology I was intimately familiar with but I wouldn’t be able to grow my technical skills and I like development.

But the truth is, I could accomplish a lot more with a team of people reporting to me but I purposefully stay in my lane even though my manager and his manager are both pushing me to take a leadership position. I took this job to learn and improve technically, not to manage.