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Isn't part of the bimodality here just a "Silicon Valley Effect", where a few companies in a few very expensive areas compete for talent that has to pay ever more for housing?

If one factors out the major tech hubs and only look at e.g. any random city, is the bimodality there too?

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This is the most perceptive comment in the thread. Based on moving from NYC to a much smaller metro area without any major tech companies I think you're right. Compensation here is roughly half of NYC compensation. The big tech firms are driving the high salaries.

I'm sure you'd see the same pattern if you looked at finance grads. The top ones who went to work for investment banks, hedge funds, etc. are pulling down large salaries, the rest are making much less working for small to medium size companies.

I believe the article addressed this with the Madison WI example. The high paying company in Madison was still Google, but if they are paying above average salaries to 100 engineers in a city that may only have 1000 that's still a significant spike in a "random city"

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