De-Location Package: Keep Your Career and Live Beyond the Bay Area
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Much like Stripe's "hire a team" experiment - this is an experiment to pay people to "de-locate" from the Bay Area. Don't get us wrong, we absolutely love the Bay Area (I live here) but the cost of living is just outrageous for so many.
We're seeing a lot of candidates talking to Zapier (we're fully remote) about leaving the Bay Area to go "home" (some to start a family, some for other reasons) but want to stay in their tech career.
Happy to answer any questions, and I am sure there are a lot of Zapiens in the thread that could answer questions too.
I mean, it sounds like a win-win situation to me. If a family can save, say, $3,000 a month on rent, and the company can save, say, $1,500 on an engineers salary, both are actually better off.
I guess the risk of moving out of the Bay Area is that you somehow are betting your future on a single company. If you decide to get a new job, you might be too far away from a decent tech hub. Another issue for families is moving both working partners. If the partner works at a company that might not be as flexible or open, moving somewhere else is going to be a tough decision, as it's always going to be better to have 2 jobs in the Bay Area, than just one outside of it.
Are we competitive with Google engineering salaries? Probably not. But most Bay Area startups can't complete with Google on comp anyway.
Are we competitive with other Bay Area startup salaries? Likely. Six-figure engineering salaries, healthcare, retirement package, etc is the norm.
We saw several great teammates move away from the Bay Area and thought there might be others. This experiment is primarily to find people who already want to leave (for good reasons) but feel stuck because they like working for growing tech companies.
My guess is that with all the whining CEOs in the Bay Area do about "how hard it is to find talent", this is the start of a long-term trend. Rents in the Bay Area have gone up about 10%/year for the last five years running (anecdote: my room cost 850/month five years ago, I moved out when it hit 1300/month) and with the new "Affordable housing" mandates (which the SF electorate voted for) coming into play, pretty much all construction is going to stop, because the economics of cross-subsidizing 1/3 of units (the new requirement) with the other two is pushing the unsubsidized units out of reach for all but the highest income-earners.
This place is mortgaging its future, and people are right to want out.
To be clear, I have no issues with divorcing salary from location for a remote company. But it probably means you're paying generous salaries for people living in cheap locations and you'll have trouble hiring anyone who must must must live in SF for... reasons.
Of course, for an all-remote company to adjust salaries by a five or ten thousand bucks based on location if someone moves, like some do, that just seems like they're trying to nickel and dime the person under the guise of being fair.
I understand paying remote workers less than someone on site since there may be productivity gains that come from that. However, remote is remote. Once someone is a remote employee it should make no difference if they're in Manhattan or Milwaukee.
For what it is worth - we're not out to benchmark against "Bay Area rates". We generally will lose in head-to-head compensation with any large, on-site technical organization in the Bay Area (Google, Facebook, Netflix, etc.) - but we try and be consistent and competitive (6 fig eng, health, retire, etc.) anywhere else in the world - no matter where you are (suburbs of Chicago, middle-of-nowhere-Kansas, metro Pittsburgh, Barcelona, etc.). Check out a few of our other comments for more details.
Scenario A: More companies pay equally remote vs. local
Scenario B: cost-of-living adjustments mean companies pay the local prevailing wage of where the employee is located.
My prediction is that we'll get about 80% scenario A and 20% scenario B. Remotes might take a hit but it won't be large, and that's based on elasticity of demand -- I suspect companies have a less elastic demand for talent overall, vs. employee willingness to move.
Manhattan and SV don't have a monopoly on great engineers for the vast majority of engineering roles.
Remotes won't take the hit. It's those who for some reason (family, prestige, other) are stuck in these centres.
This may not be something new for you guys, as you've been running remote agile teams, but how are you planning to deal with time differences? Are you reserving the right to ask remote employees to start their day at a particular time? Are you going to take time zones into consideration when building your teams?
Time differences haven't been a big issue - it can be tricky to get everyone on a call when they need to be - but usually a little flexibility by all parties go a long way. Also, you can arbitrage time differences to knock down annoyance from on-call rotations and the like.
We ask employees to have their own "consistent" hours so that the rest of the team knows when they'll be available or not.
We do consider time zones when hiring - for example, we might explicitly hire Asian/Pacific for support scheduling reasons.
I have no idea what that means.
To be honest - I wish more companies were remote welcome. It is just better in so many ways.
It cuts both ways.
In a way, yes. I am 100% remote and live in a very remote area. I doubt I could get a similar job anywhere in the state, but I did it anyway. Why? First, I love where I work and before moving away and I worked from home long enough to see that it was good. Am I stuck with this company? Yeah, pretty much. Chances of finding remote work are slim, but I accept that. My work/life balance and happiness living where I never thought I could is nearly priceless. It is a trade off, but one that I'm happy with. It may not be for everyone.
When I was younger I'd hop jobs every couple years, get a nice raise, learn something new and move one. Now I just don't care. I found a place I can see my self working at for many more years. When there is a mess in the "office" microwave, I know who to blame and you can't put a price on that.
I mean, yeah if you move to rural South Dakota you won't find much, but there are plenty of growing tech centers like Raleigh, Boulder, Austin, etc. that have much lower cost of living, but still a lot of availability in local tech jobs.
Also to note, the 3-9 month job search should be much more sustainable in Nowheresville, whereas in SF you are going to be screwed if your job search is extended.
Because where I'm sitting, facebook, Google, Amazon, Microsoft, and Apple, which are 5 of the top 6 most valuable US companies, are HQ'd in the Bay Area or Seattle. So if you want that caliber of job, with the opportunities and pay ($200-300k+ for mid-level people), you really do have to live in SF/Seattle.
I don't work a BigCo job for other reasons but the reasoning does seem sound.
Amazon recruiters have also been pinging me for jobs they have in SoCal, although I wouldn't say that LA is significantly cheaper than the Bay Area or Seattle.
while i'm commenting, i'll note that i don't feel boulder really competes with NC's research triangle, or austin. boulder county population is 310k, and a sizable chunk of that is tied up in and around the university and government research facilities that i feel don't impact local tech industry that much.
Home to UNC, Duke, and the somewhat famous Research Triangle Park, a suburban campus containing R&D for Red Hat, IBM, and several big pharmaceutical companies.
The Palo Alto of the South.
I used to live in South Florida, and I bet I could exhaust the search space of "tech jobs south of Orlando" in about two weeks of interviewing. After that, you're looking at a move. It's not like the same companies will interview you over and over until you pass.
https://news.ycombinator.com/item?id=13896328
> We do not adjust salaries when employees move. We try to pay similarly regardless of location.
- offering a perk to some employees that you don't offer to other employees could get you in trouble
- say all delocated employees are from SF are young white males, and an older black woman want a delocation bonus to move from a non-SF city to somewhere else (hint: I bet your lawyer is gonna say you need to cancel the perk, or offer it to everyone, and I would agree with that lawyer)
- as an new employee eligible for your delocation reimbursement, I'd rather it just be a bonus, as I don't wanna have to explain to the company exactly what I spent the money on (why is it any of your business that I spent $8,000 at Kink Movers to relocate my 50 Shades Of Grey Inspired BDSM Dungeon?)
As a perk, you'd only get $4-5k back (30% marginal federal income tax, 9% marginal CA income tax, 6.5% Medicare and social security tax).
One thing I wish is that {insert current employer} would do the same thing and then subsidize Fiber in the new area to ensure high quality VC.
EDIT: My question is why it is hinged on moving away from a city. I think it is a legitimate question. Someone living in NYC or Seattle might have similar issues with the cost of housing.
As an experiment, we wanted to start with the obvious high cost of living center - the Bay Area. In the future, we may open it up to more cities, maybe even a blanket package as you describe.
If the experiment "fails" - we'll just stop offering this for new employees.
This is one of the richest areas in the US and the overwhelming sentiment is, "we need people to stop moving here". You can actually get votes here by making it harder for companies to hire, on the theory that traffic, pollution, etc. won't be that bad.
It's unlike any other place in the US. Truly one-of-a-kind.
They might want the jobs if they were going to the local poor. Not jobs that outsiders move in for.
See Kim-Mai Cutler's brilliant article. https://techcrunch.com/2014/04/14/sf-housing/
I can think of less risky ways to squeeze $10k out of a new employer.
My cynical view on it is that it's more of a marketing ploy. Lots of non-Bay Area folk will be reading this and might make a decision to apply. I don't think they're trying to trap people. They're already a remote company. It's not like they're a major company employing 5,000 SWEs in the Bay Area and offering to relocate them to Northern Michigan where they're setting up a new office, but there won't be other companies around. While you might have more options in San Francisco than Seattle, I think the amount of leverage that more companies give you in your career is probably logarithmically increasing. That is to say, Seattle would have more than enough other companies around that the company couldn't forego raises and equity grants because you don't have other options.
And I think it would be a good thing for our industry to spread out a bit more. Some people have families in certain areas they wish to be close to, some people enjoy the local culture and amenities of certain areas more than others. Having people feel "forced" to live in locations that aren't their cup of tea for economic opportunity isn't really helping anything. The people who do want to live there face increased housing prices and congestion. The people who would rather live somewhere else make a choice for their career that doesn't match what they'd choose for their life. Tying economic opportunity to location isn't a wonderful thing.
This is true, there are other tech hubs in the United States, but they are facing many of the problems that the Bay Area is facing now, with a tightening housing market, increasing cost of living, and long commutes. Places outside of those tech hubs generally have a terrible IT industry, and generally only accept people with a bachelor's degree plus 2+ years experience to get into even a junior role.
Some of the other comments in this thread are a bit insulting, actually--painting outside-the-valley as some kind of hopeless, jobless wasteland.
But it is possible (obviously) for software developers to earn a salary doing a job there.
This is technically true but elides tons of context. "Thriving software scene" does not touch on the quality of the "scene" in question. Places that have software industries with similar perks (e.g. flex time, flexible or absent dress standards, etc.) generally have the same housing and CoL issues that the Bay Area has, relative to the salaries they pay. Places without these perks also have a much higher ratio of employers who tend to offer significantly lower salaries and benefits and have jobs that are of a poorer quality (job titles like "programmer/analyst"). They also generally don't have a sufficiently large employer base to allow the movement we see in SF, Chicago, Austin, etc. Job security in these places is a thing and almost always not in the employees' favor.
A $10k signing bonus in exchange for putting yourself in a more vulnerable position will not change those (unfortunate) facts.
(It's also -- knowing the Zapier history of being aggressive on the employee-friendliness front, and having interacted with them in their earlier days -- somewhat uncharitable as a default position.)
Limiting your job search to 100% remote is a great way to unexpectedly find yourself earning eastern European wages while paying midwestern U.S. living costs. Or, worse, being forced to change geography when the work dries up.
We all know "that guy" who moved his family cross-country, put the kids into new schools etc only to come back to the city a couple years later, when the "perfect" remote gig ended, or the single employer in Nowhere, KS eliminated their local technology group.
The caricatures of Middle America really never top, do they? Good developers in St. Louis, where I'm from, make six figures.
The GDP per capita in Romania (to pick a totally random example (it's literally just the first place I thought to check)) is $9,499. In Missouri it's $42,984.
There's this weird perception that the Midwest is like a third-world country, a perception that's plainly ignorant.
How does that claim not apply equally to moving to a city with a large employee pool like the Bay Area?
There is no guarantee that your competitors on a global market will face the same cost structure. Quite to the contrary -- they are very likely to have lower costs of living.
If you're only after a $10k bonus, you're right, there are more effective ways to get that.
I was worried it'd be tough to move jobs or careers and that getting new jobs would be harder.
It hasn't been. I've been steadily moving up and into new positions at new companies every 2 years just like I was in the Bay Area. My salary is 2.7x higher than it was when I left the Bay Area, and I now have a 5,000 sqft home in a great city that I paid about 1/10th as much for as I would have in the Bay Area.
Can you expand on this? Where are you located now that is richer culturally?
I'm big in theater, ballet, and art. San Francisco is way too expensive for artists to live in anymore and the art scene there is very limited, inorganic, and a bit stale. Further the distance to San Francisco means it's a chore (and a drive) to get there from the South Bay where all the jobs are.
Now I can take public transit to cultural institutions, and walk to a lot too. We have organic arts districts with real artists in residency, regular gallery showings and art walks, and some amazing local musicians.
You might get that in Oakland these days, but even Oakland is getting prohibitively expensive.
Are there downsides to living here? Undeniably. The biggest being sprawl and traffic. However next to Austin's city council actively fighting growth and traffic management investment we're in better shape despite an unfortunate anti-rail mentality.
[1] https://kinder.rice.edu/uploadedFiles/Urban_Research_Center/... [2] https://en.wikipedia.org/wiki/Culture_of_Houston#Arts_and_th...
I think you missed the two biggest that will never change: The weather (105F and 90% humidity for 3 months out of the year, hurricanes) and the politics (Lege doesn't like what you're up to? Prepare to be stomped in the Capitol building like Denton was).
I'm a native Texan who grew up in Dallas with all of the baggage that entails--including an innate dislike of Houston because "rivalry"--so I know where I'm coming from. Ever since moving to Seattle years ago, I've become a lot more of an outdoor person because going outside doesn't physically hurt for six months out of the year. My first job was pushing grocery carts on a blacktop parking lot for Sack 'n' Save and the temperatures haven't gotten any better since. And the politics...oh, the politics. I really love living in a state that doesn't do things to cause it to be openly mocked by the rest of the country.
I love my home state, I visit quite often, and I'm genuinely proud to be a Texan but it truly escapes me how any one can say "hey, y'all come on down, the legislature and the sun won't hurt you that much" because they both really do.
Hopefully the city council here in Seattle can get out of its own way and dezone the city so that it may densify. Height caps and parking minimums are forcing suburban hellscape style infill in Seattle, which is very destructive and guts the neighborhood of its classic charm. Large buildings clustered around transit would be much more productive for our city versus tearing down 100 old homes to replace them with 200 odd 2800sqft boxes on postage stamp size parcels.
Not sure what you're referring to. Living in WA, I'd be asked non-stop by others how the pot was.
The original salary must have been low, no hate.
Different strokes for different folks. If you're working at a company that already pays well and you're not in the Bay Area, then your options for switching are either exciting but very risky startups (< $1 billion) or small satellite offices of big corps that have limited team options and little political influence (bad for advancement in senior positions). These would typically be lateral movements at best.
My new salary is just much higher, I've had several major steps up. I've found salaries in major metro areas to be pretty much the same as a competitive offer in the Bay Area.
> Different strokes for different folks. If you're working at a company that already pays well and you're not in the Bay Area, then your options for switching are either exciting but very risky startups (< $1 billion) or small satellite offices of big corps that have limited team options and little political influence (bad for advancement in senior positions). These would typically be lateral movements at best.
The Bay Area isn't the only place with a tech sector, and there are plenty of companies whose main offices aren't in the Bay Area. Washington DC, Chicago, Austin, Denver, all have tremendous tech industries. I've even had job offers at great places that are further out there.
My "one that got away" was a job offer in Portland I still think about. It was a great opportunity and a fantastic city, but I ultimately went elsewhere primarily based on the desire to bring some of my projects with me.
Let's just talk numbers for a moment, were you earning at least $200k?
I find it very difficult to believe any other metros, especially small cities, could afford to pay a non-senior engineer over $200k in total comp.
Right now I'm head of R&D.
I can tell you starting engineers on my team make about 10% more than their Bay Area counterparts. That's a deliberate decision backed by our Board.
I can respect that.
It sounds like you actually were promoted a couple of times since relocating and now you're in a leadership/director position. I'm not surprised your salary increased.
But honestly, I find it hard to believe you can match a senior level salary here in the Bay Area at a larger company.
A standard offer for someone that is not really "gifted" is $160-$190k base + $100-$150k/yr RSUs.
You're really able to pay people over $250k?
And I'm not even including 401k matching, ESPP, healthcare, discretionary bonuses and annual incentive bonuses.
That's always why I moved in SFO. Wisdom I always received was every 2-3 years it's time to move out and up. It's served me well. I think now I'm "career" as we like where we live and I want to build something in my division.
And yes, we easily offer that. Why is this a surprise? Our costs are lower and our clients are largely the same as they would be in the Bay Area. Our major markets are national and international. We don't discount our enterprise level systems and new tech for having been developed in fly over country, and we have a MUCH lower cost of doing business. Physical plant is CHEAP here as are our taxes. This results in more capital available for HR, and we consider human capital our single most important investment.
Our entire strategy is built on innovation and we do that by hiring the top talent we can. That means offering top tier compensations.
I applaud your approach and would love to one day work for your company as it sounds like a great place to work since you actually appreciate your human capital.
I also agree on the 2-3 years hopping, it's a great strategy.
Side note: SFO is the airport, SF is the city.
I've been looking at sites like weworkremotely.com and remoteok.io.
1) From people I know well who make a solid recommendation.
2) At major tech conferences.
Hiring is a very risky and high stakes proposition. A new hire easily costs us a million or more if it doesn't work out. We are very cautious, and I take our hiring process very seriously.
Junior positions we typically recruit from Univerisities in the region with top CS and ECE programs since they are less likely to be skeptics of fly over country.
It should not surprise anyone that wages in other top-tier cities match the Bay Area.
https://hired.com/blog/candidates/where-engineer-salaries-pa...
Good tech companies know they have to make nationally competitive offers.
You wouldn't guess it if I gave you 20 questions is my bet. When I got the offer for an interview the wife and I almost passed entirely on the opportunity (I didn't apply for it they recruited me) because we thought "We don't want to live there" and I had a solid offer in Seattle and Portland, where we thought we wanted to move.
I flew out anyway as a courtesy to the VP who reached out to me because we had a long history and he told me I needed to come see what they had to offer.
Flew my wife out the next day, she was super skeptical "I'm not going to like it!" (She is also in tech). She fell in love. We bought her dream house a month later. Still in our honeymoon period with this new city, but we have never been in love with a city like this before.
I'd take that bet. ;)
There's only 50 states and we probably can rule out the 15-20 coastal ones and Hawaii and Alaska. If the maize in your name has any relation to your job, we can quickly use five guesses on Iowa, Nebraska, Kansas, Illinois, Indiana.
Guessing about your wonderful city aside, one concern I and many here would have about relocating are the job opportunities. In smaller areas, you may be living in company towns, and if you ever want to change jobs, it would involve moving across the state. Of course if you're being paid a handsome amount, you're in a position to negotiate a generous relocation package.
It shouldn't take long to confuse your salary in these circumstances with the salaries of people working for and around you. Your immediate reference is probably that VP who is also VP :D
If it's in his comment history I figure it's fair game to state it here.
I'm big in theater, ballet, and art. San Francisco is way too expensive for artists to live in anymore and the art scene there is very limited, inorganic, and a bit stale. Further the distance to San Francisco means it's a chore (and a drive) to get there from the South Bay where all the jobs are.
Now I can take public transit to cultural institutions, and walk to a lot too. We have organic arts districts with real artists in residency, regular gallery showings and art walks, and some amazing local musicians.
You might get that in Oakland these days, but even Oakland is getting prohibitively expensive.
Earlier in my career I'd send 150+ applications. The last move I only looked at three positions and got offers from all three.
I'm now somewhere else entirely, and while I don't want to say, I'll just say you'd find it surprising, because I certainly did. We like it, though, and there is a strong science-based economy with big growth in cloud and data, low crime, a highly educated population, and an amazing metro area.
Where we are, house prices have doubled since 2008. We are also trying to think out of the box in terms of where to live. Cheers!
hilariously accurate
"Will my salary be COL adjusted?"
You can take 4-5 hour difference top, that leaves you an afternoon to work together and talk when you need to.
Any link with >8 hour difference is doomed to failure, you can't communicate at all.
On top of that, you need to all be extremely experienced and autonomous, and you need to have regular trips to meet in person.
I can tell you my team just hired a bunch of new engineers and we mad offers 10% above Bay Area offers very much on purpose.
I'm in Texas and looking to relocate to SoCal (specifically Torrance) in the second half of this year, and while I'm hoping my employer will let me either go remote or relocate me to their LA office, I'm terrified that they won't and I'll have to find a new job (I really like my employer, so I'll only leave if I absolutely have to).
We won't be able to compete purely on compensation with Google no matter where you are located.
However, you can expect an experienced engineer in St. Louis proper to be paid similarly well (6 figures, healthcare, retirement) -- equivalent for us to an engineer in small-town-Kansas, Chicago-area, etc.
If Bakersfield becomes a bedroom community for San Francisco with a 25 minute commute, you can count on Bakersfield housing prices converging on Bay Area costs.
This is probably a net win for the community of Bakersfield, but it may not change things very much for you as a pre-existing worker in San Francisco.
And after n years, the place where you start your voyage within the hyperloop is becoming another huge city of its own.
1. Why would Zapier publicize a new policy for existing employees? Cynically, that appears to be a PR opportunity.
2. The new policy is an "experiment" that pays existing employees $10,000 to cover relocation costs to move outside the Bay Area.
3. I assume that the employees' salaries are then adjusted for COL (this is the crux). This presents an arbitrage between the $10k and salary adjustment.
4. Zapier is facilitating a process that, in effect, acquires employees from one location for a cheaper price than competitors, as long as those employees are willing to move outside of the Bay Area.
I don't have a comment on whether I agree or disagree; I guess it's good to support employees living where they want to. But I'd be interested in knowing 1) if employees do have their salaries adjusted for cost of living when they move and 2) where many employees ultimately end up moving to.
There is a face value lens that I can read this announcement through, but there is another lens related to the price of talent in the Bay Area. If I don't take this at face value, it's interesting to me if this carries any signal about real estate or tech salary outlook.
EDIT - Nevermind, salaries aren't adjusted for cost of living.
If it only applies to new hires then that may make salary adjustment easier (if that's part of this).
The bryanh has said they don't adjust salaries post-move, theough I imagine future raises/bonuses might not be as competitive as elsewhere in the bay area e.g. another you might might have taken to stay in the bay area.
I think the idea can apply to many cities, even outside the US. Some European cities are in the midst of a housing (availability) crisis forcing rent prices up and leaving young families to live in small apartments to be within a commutable distance to work.
It doesn't make sense to cram your family in a 700 sq. ft apartment and still pay $3500 rent for it. I like other people was very excited about bay area but after coming here I often wonder whether it is worth it. Also, 30s is where you start saving more for future. giving that money as rent makes my heart cry.
We did raise some money in the early days (when it was much more faith than evidence) but I don't recall any concern about our remote intentions from our investors. Since then - we've reached profitability.
Someday....