China Mines Silicon Valley for Tech Talent | Hacker News Reader

China Mines Silicon Valley for Tech Talent

wsj.com

50 pointsraleighm56 comments

And simultaneously the US mines Europe for tech and science talent. 15.000 Germans work in Silicon Valley. Imagine the boost they would give Germany if they returned or stayed home. It could result in 3000 highly qualified persons for each of the 5 biggest cities in Germany. It's a well known problem for Europe:

> Studies of the best physicists in the world show that the Europeans working in North America are some of the most renowned in their fields. In 2014, an expert panel warned German Chancellor Angela Merkel that the country was losing its best scientists, and a recent report from the Institut Montaigne, a French think tank, argues, “The academics who leave France for the United States are the best, the most prolific and the best integrated on an international scale.”

Source: https://www.foreignaffairs.com/articles/europe/2016-01-05/eu...

It's a well known problem for Europe

No, it’s a meta-problem. The real problem is the structural underpaying of STEM workers in Europe. I mean we can go down the path of “sacrifice your own interests for the good of your country” but no one, particularly Germany wants that. So pay is the only lever. And every business manager actually knows this.

So it is not really a "problem" for workers after all.

It is. Having to choose between a competitive salary or leaving your country sucks.

Are wages in Germany not competitive? Are software engineers in Germany going hungry because they don't get paid enough?

If people want to be greedy and run to the country where they get paid the most that's their prerogative, but they aren't starving back home.

I left my home country in search of riches, but that was a choice. It's not like I wasn't living a comfortable life back in the motherland. I don't think that (employed) software engineers anywhere in the world are going hungry.

I didn’t go hungry but I didn’t feel like I was getting ahead. I felt like assets and capital were getting returns, like my cost of living was going up but my wages weren’t. I left (not Germany and not to the U.S).

People already well off were fine but people who had to work for a living were not being rewarded.

There are many reasons not to leave a place (family and security paramount) but if multinational companies are perfectly happy to move jobs around I think workers should feel equally free to vote with their feet in the much more limited way we are able.

Yes, obviously they aren't competitive. And the word "problem" had no requirement for starving last I checked.

If people want to be greedy

Why are engineers “greedy” for wanting a fair wage but European managers not “greedy” for underpaying Workers and keeping the value produced for themselves?

In my limited experience, European managers don't keep the value to themselves, they are just worse at obtaining it in the first place (lower revenue per employee).

I have heard stories...

Large company X has hundreds of people working on software that could be done by a team 1/20th the size in 1/2 of the time. Lower / middle managers want to expand their influence by having more people working for them, so they try to impede efficiency as much as possible(!!!).

So, upper management wants to increase the size of the money bag (mostly a good incentive), lower / middle management only wants to take as much as possible out of that bag. Upper management doesn't know enough about software to reign in middle management. Because if you are going to tell people how to do their work, you better know very well what you are talking about.

It's only not a problem, if you are willing to move to Silly Valley. I am not, so I do "suffer" from my compensation being lower than international market rate.

Is it a structural underpayment of tech workers in Europe, or a structural overpayment in the USA?

Software engineers in the USA are paid an abnormally high amount compared to similarly qualified professionals in different fields. The median wage for a software engineer in the USA is about $20k higher than that of a mechanical engineer, despite having the same level of qualification and a similar qualification (in my opinion, mechanical engineering actually is a lot harder than software).

If you're a software engineer in Western or Northern Europe, it's not like you're hard done by and struggle to make ends meet. You make a perfectly acceptable wage, similar to any other professional. You also get the benefit of superior social services, more time off, and job security, which are certainly not to be sniffed at. One of my friends was offered a year of salary to leave her job (not in tech) because they couldn't make her redundant. I know of plenty of Europeans who have been able to take anywhere from 6 to 18 months off work for a sabbatical/backpacking trip around the world, knowing that their job will be waiting for them when they come back.

Income disparity is just a lot lower in Europe than in the USA. German mechanical engineers make similar wages to software engineers. German software engineers make roughly twice the median income, compared to 3 times the median for the USA. In Australia, software engineers only make roughly 1.5x the median income, as Australia is a high wage economy.

The reason software engineers are so valuable in the US, is because the homogenous US market enables a massive, rapid catapult scaling into the rest of the global economy. Europe has nothing even remotely like that to offer. It's why the US has over 100 tech companies worth $10b+, and Europe has so few. The US market alone would be more than considerable, it's far easier to scale into/across that one $20.5 trillion market (~$22.3t with Canada), than it is to scale across all of Europe in a comparable fashion.

US software engineers are worth so much, because of that concept. They're underpaid if anything.

Software engineer compensation is the extreme example. When you compare other technical jobs, the difference is less extreme, but it is still there. I can only talk about Germany, but here we see that all types of highly qualified employees get lower compensation across the board.

It's not enough of a difference to make me unhappy and it's nowhere close enough of a difference to make want to emmigrate to the US. But it's a significant difference that is one of the driving factors behind tens of thousands of highly qualified Germans leaving the country every year.

It's also a huge issue for us "on the ground", because we are starved for qualified applicants. Our entire industry is running into trouble trying to do ever more with a workforce that grows rather slowly. Unfortunately, managers seem to be unwilling to offer more to get the best people. Instead they fight tooth and nail to pay as little as possible.

In software it's not only the salaries, but also the rarity of European companies that are good at software.

Generally speaking, engineers want to achieve results and hate inefficiency. Jobs in companies that really understand software are somewhat rare in Europe - usually you have to find a small to medium sized company, and the pay there is usually below the large companies. You pay for the privilege of being productive(!). In the US, if you join any of the famous large ones, you'll be in an environment where you can get stuff done and expand your skills in work time while getting some of the highest salaries.

A phenomenon that I've seen a few times is highly skilled Eastern Europeans coming to Germany, then leaving for the US 1-4 years later. If they leave their home countries for a much higher salary anyway, why not move again and triple the salary another time?

Very well written, I was just from curiousity recently talking to recruiter and I need to accept 20% salary cut to work in smaller company where I could be more productive. I rather take money and Udacity courses when idle. But there is another point: $100k in Germany is a top limit for skilled engineers. There are some geniuses with patents, papers and fame, they still make <$150k. I imagine, skilled engineer could earn more and retire earlier in the US.

$100k is less than half of what a good engineer makes in SV, right out of school. Of course, too much of that goes straight into rent...

as seen earlier

Families earning $117,000 now qualify as “low income” in California's Bay Area - https://news.ycombinator.com/item?id=17405375

This is a very good summary. I have experience with quite a few german DAX 50 companies, and they do not get software, at all. They don't understand that hiring the best is much more economical, don't want to pay for them, basically they "acquire" software and talent as if it was a commodity like stell screws or something.

All this may be true, however, it may also be one of the reasons that Europe has not been a bigger player in the software revolution. The specialness and associated pay that Silicon Valley places on software engineers is at least partially because of the explosion of innovation possible in the field right now, which perhaps Europe has been slow to recognize.

>or a structural overpayment in the USA?

No, because those tech companies in the USA are still seeing massive profits. Software engineers are still getting paid much less than the value they provide to the company.

> The median wage for a software engineer in the USA is about $20k higher than that of a mechanical engineer, despite having the same level of qualification and a similar qualification (in my opinion, mechanical engineering actually is a lot harder than software).

It's not about the level of your qualification or the difficulty of your job. It's about whether the business can make a margin on your time.

I disagree with your sentiment enough that I want to downvote you (but won't as that's not what downvotes are for).

STEM workers are absolutely underpaid in the EU for their level of qualification - a non-CS PhD grad is "lucky" to earn £30k~ GBP after they move into industry.

£30k pa buys you sweet FA - meanwhile, someone quantitative/techy can go do trading or make webapps to earn 2-5x more

I'd argue that software engineers aren't overpaid, everyone else is underpaid - structural wage stagnation is well documented.

The British government famously says that technical people should be “on tap, not on top” and that attitude permeates the entire country, with just a very few exceptions

It's more about experts to be kept on tap and not on top. And it makes sense.

https://hbr.org/2012/07/keep-experts-on-tap-not-on-top

Magazine for MBAs says MBAs are brilliant and everyone else is just a resource. Not very convincing.

regardless of the magazine, it was not largely about technical people but about experts. It's the first time i'm hearing of 'on tap and not on top' and after reading on what it refers to it made a bit of sense to me. Experts are brilliant in their narrow field but they are not suitable to be at the top level. As to who should be on top is very debatable.. There are generally more examples of bad leadership...

That is not what is meant by the government. They mean Oxford PPE or STFU.

In Denmark PhD. salary is about 45k GBP, that is the salary you get while writing your PhD.

It's might be higher if employed by a company, these number were from the education guide.

Europe is big, and it wouldn't surprise me if some parts have low wages.

In this case the discrepancy is probably larger because GBP has fallen compared to EUR/DKK post brexit.

Lol in London you usually get 18k for living expenses as a PhD student.

Meanwhile, undergrad halls can cost as much as £200 pw in London

does not compute

I totally agree with you.

I myself made my entry into "big tech" with a web dev gig at $84k. At the time I was just another jQuery monkey whose only sellable skill was making mind bending (and CPU melting) javascript animations which were proudly called "web 2.0"

At the same time, I had an alternative "entry level" embedded developer gig at $50k and $65k after 1 year.

Thank god I went for a hipsterized web dev position. It was like gliding in butter for a year.

Only later, I finally managed to get things straight and come into engineering consulting on my own terms.

There's no such thing as being overpaid if you're not an executive (i.e., you have no real control over the business, you're just a paid employee). The business is paying you based on market conditions, and if they could get away with it, they'd pay you less. They're paying software engineers that much because that's what the market demands: there's not enough qualified talent to meet the employers' demand.

SW engineers are paid more than other engineers in the US because there just isn't that much work, or demand, for other engineering disciplines here. A lot of the work has gone offshore: as an engineer with a EE degree, I don't do EE work because there just isn't that much of it here. All the electronics work has gone to Asia, except in the defense sector. What the US is still really good at is software: look at all our highest-valued tech companies, and all the other companies in Silicon Valley: an overwhelming number of them are doing software work. Smartphones, all the apps running on them, etc., are all software, and are a huge part of the economy now. Not to mention all the other places software is now used, such as finance, where it's used by non-tech companies to enhance their business. If it weren't for software, the US economy probably would have collapsed some time ago.

Therefore, with software being a driving force in the US economy, and a shortage of qualified talent compared to demand (plus a lot of workers that are incompetent...), wages have been driven up compared to other engineers.

Finally, if you look at real engineering wages compared to the past, inflation-adjusted, engineers were paid more back in the 60s or 70s or so, and had more job security too. So it's become a less attractive career than it was in the past, so software engineering is really just a holdout.

As for Europe, AFAICT, engineers are just horribly underpaid there, and they try to make up for it some with extra perks like job security.

I think there is such a thing as overpaid when you have the janitor working for $15 per hour and minimal benefits [1] and you have your engineers getting paid $200k with all sorts of benefits and perks.

This kind of income disparity is completely unfair, and we haven't seen such high income and wealth disparity in the USA since the 1920s.

[1] https://www.theguardian.com/technology/2017/sep/26/facebook-...

Sorry, no. Anyone with half a brain can be a janitor; it takes almost zero skills and little training. Engineers need many years of education, and get more valuable with experience, and that's in addition to needing the raw aptitude in the first place. There's no way to create new engineers from the general population in a short timescale, just like you can't create new proficient musicians in week from a group of random people. Anyone can be taught to clean toilets and empty trash bins in 10 minutes.

The income disparity is just a product of that reality.

Outside of Silicon Valley, engineers don't get paid that much; the really high-income people are various executives, managers, finance people, business owners, etc. Engineers do pretty well for paid grunts, but compared to the ownership and executive classes, it's not that great.

If both being a janitor and a software engineer paid the same amount of money, I'd still rather be a software engineer.

Obviously in a capitalist society it makes perfect sense to pay your staff the minimum possible while still retaining them. But it doesn't make it a fair system. Just because I had the privilege of being born into a good family with a good head on my shoulders doesn't mean that I deserve to get paid between 5 and 8 times more than the janitor (the income disparity between a janitor on $15 and a software engineer making 6 figures).

In Australia I make roughly double what the cleaners make. I think that's a much more equitable number.

If you want to set aside 7/8 of your income and run around handing it out to janitors, you're free to do so.

It’s not only the pay by the way. I study and worked a bit abroad and the difference with my country’s labs are noticeable: there is way less battleling with accounting do get things done abroad. In France you need ton of papers to get your money back for professional spending and if you got it at all it comes months after the fact. I did some work for a professor there and it take a year to get the money in my pocket. I also worked for someone in Japan and I had my money two weeks after and in one case on the spot. So it makes a huge difference when working on any project that need a bit of money. Imagine having to wait a year to get a domain paid by the university or having to send a student take a whiteboard marker from another room at the beginning of each class because there are not enough for every room. That’s how shitty it is working in public research in France.

But European companies regularly play the national interest card and block foreign takeovers.

France famously used that with Dannone a yogurt maker to block a take over :-)

To Americans reading the parent comment: don't get too full of yourselves, there are smart people in abundance in Europe, no cry fest necessary ;)

The title is "China Mines Silicon Valley for Tech Talent" but according to the article, they are recruiting Chinese engineers working in USA. That's an important distinction.

From my experience it's true, unless you are ethnic Chinese, most of the Chinese companies won't be interested in hiring you

As much as I dislike the Chinese government I'm struggling to see an issue in this. Chinese companies are not the only ones recruiting abroad and in this particular case they seem to be only targeting Mandarin speakers. If people are concerned about a brain drain shouldn't they be more concerned with companies in countries that are actively going after English speakers? I'm a software dev in Japan, domestic tech companies here are beginning to do just that.

http://archive.is/5jGgO

I worry that measures by the US government aimed at stopping the sale of companies and IP undermine property rights. When the government says “they are stealing our technology,” it implies that the tech, companies, and IP are owned by the state rather than the company and inventor.

I don't think it's a binary. The state claims some power over over it, and it claims a fraction of the profit. But not all of it. So you don't fully own it, but you kind of own it. Same goes for real estate where they reserve the right to tax it and impose restrictions on what you can do with it.

Are you implying that there are property rights beyond those permitted by the few individuals who control the organizations whose names are sewn onto the shoulder patches worn by the men in black uniforms with automatic weapons?

China has been doing this for a long time now.

To get a leg up in the solar industry China provided research grants to the very best in the field as a way to lure them over. Chinese investments in science and tech has skyrocketed in the last two decades.

* I was one of those people who moved to China for a few years to work in software over a decade ago.

How, if ever, you felt the lack of information freedom? Is it so polluted as it looks?

> How, if ever, you felt the lack of information freedom?

Never really thought about it except those times I forgot to pay my VPN

> Is it so polluted as it looks?

Cleaner than my home town in Scandinavia. Was living in South part of China.

Had a personal VPN back then so I never had any problem there.

Felt very polluted in Shanghai when I first moved there. Lived in Dalian which is one of the cleaner cities and had no issues. Moved to Beijing (before the olympics) and experienced no real issues either. I've lived in much more polluted cities since then.

Just back to Canada from China a week ago.Commercial VPN providers like StrongVPN, PureVPN are blocked now. But there's no problem using your own VPN or any private company VPN if that's an option.

Environment is improving in general. Now local governments would give up economic benefit in exchange for environment protection which is quite different mindset than a decade ago.

Where would you advise someone to search for a software role in China? I figure Shanghai would be the central hub but I am curious if you had more specific advice!

A company I used to work for several years ago (technically American, but effectively a Chinese company), offered very tempting and lucrative “work in China for 6 months” incentives. Like US salary and subsidized housing in Shanghai. If I wasn’t married with a kid, I’d have jumped at the chance.

The case of Qian Xuesen instantly comes to mind:

https://www.pri.org/stories/2017-02-06/us-trained-scientist-...

X mines Y for talent [ IS EQUAL TO ] X pays much better than Y.

Bypass the paywall: http://facebook.com/l.php?u=https://www.wsj.com/articles/chi...

Open that link in a private tab to insure that it works.

Reply on news.ycombinator.com