Ask HN: How do SMBs afford such expensive software engineers in the US?

#1

Post by mnming » Sun, Jul 04, 2021, 12:07 PM UTC

According the multiple sources, software engineers in the US earns, on average, $100K per year. Software engineers in all other major countries earns about $30K - $60K on average. These countries include: Japan, China, Australia, Germany, Canada.

However, if we looked up average household income, these countries aren't too different from the US. And I don't believe American coders are twice the better than coders in the other countries.

I can understand that FAAG pull up the average salaries and they can easily afford it. My question is how do SMBs in the US hire engineers under this type of fierce salary competition?

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#2

Post by PaulHoule » Sun, Jul 04, 2021, 12:19 PM UTC

In the same town I have seen programmers doing similar work can have an 2x or 3x difference in pay. I’ve even seen some working w/o health insurance (turned down a job offer years ago over that) although the AHA helps with that.

Also the offshore devs are at a disadvantage because of distance, different time zones, language familiarity (not only for client comms but to read the docs), cultural familiarity, agency problems, etc. (I don’t like working for an outsourcer if it means I can’t tell the client the truth about why the project is late - the truth might be less bad than what the client imagines but it still could be bad for the relationship.)

The south Asian miracle comes from liberal application of management, more people, lots of documentation - it can work wonders but doesn’t always and adds overhead.

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#3

Post by mardiyah » Sun, Jul 04, 2021, 12:21 PM UTC

What is SMB

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#4

Post by NonEUCitizen » Sun, Jul 04, 2021, 12:23 PM UTC

mardiyah wrote: post #3

What is SMB

"small and medium-sized business"

https://www.salesforce.com/blog/what-is-an-smb/

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#5

Post by mooreds » Sun, Jul 04, 2021, 12:39 PM UTC

I have worked for a few of these. Some things they do:

   * have smaller staffs
   * hire younger/entry/intern level staff
   * outsource to cheap freelancers
   * outsource to agencies (onshore, nearshore, offshore)
   * buy saas solutions and glue things together with tools like Zapier
   * use no-code tools like Excel rather than building software
   * skimp on software process (no staging, no version control, etc)

If the average is 100k, and there is one FAANG developer making $500k, you could have 10 folks making 50k and still have the average work out.

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#6

Post by GianFabien » Sun, Jul 04, 2021, 12:52 PM UTC

In my experience, SMBs don't hire expensive software engineers.

Medium businesses use Excel and packaged software and consultants. Small businesses use Excel, cheap packages, open source and SaaS solutions. Basically their focus is on their business. To them computers and programs are an expense to be minimised.

Most small business owners I've met would rather buy a new car for themselves than update the office computer or software.

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#7

Post by SonOfKyuss » Sun, Jul 04, 2021, 1:19 PM UTC

Your average non-tech SMB will hire consultants as-needed or go with off the shelf products. Tech-focused companies (assuming they are startups) use VC money and stock options to try and compete for talent.

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#8

Post by omarhaneef » Sun, Jul 04, 2021, 1:23 PM UTC

Do SMBs hire software engineers?

Software is the ultimate scaleable write once and run everywhere resource. An SMB just runs software already written.

The one exception is an SMB that specializes in writing software aka the startup and they usually have to hand out equity and/or pay reasonably well.

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#9

Post by H8crilA » Sun, Jul 04, 2021, 1:36 PM UTC

omarhaneef wrote: post #8

Do SMBs hire software engineers? Software is the ultimate scaleable write once and run everywhere resource. An SMB just runs software already written. The one exception is an SMB that specializes in writing software aka the startup and they usually have to hand out equity and/or pay reasonably well.

A ~250 people company is still medium sized, and a lot of those would have some (small) IT staff.

Re: Ask HN: How do SMBs afford such expensive software engineers in the US?

#10

Post by ozim » Sun, Jul 04, 2021, 1:36 PM UTC

Funny thing is that now US corporations are reaching out to hire developers in other countries as well.

Pay for devs in EU is going up as well because of that. Local software houses are loosing devs because of that. US based companies with VC money are showering devs with cash.

They don't do that to cut costs anymore but to just have developers.