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Comment by sciencewolf | Hacker News Reader

How many software engineers are truly making over $300k as a rank-and-file? Let's be generous and say there's about a dozen or so companies that routinely pay engineers that well. Each FAANG will have on average, 10k engineers? So that's around 120,000 out of an estimated ~20 million developers (from a quick google search). That's around 0.6% earning pay in a "bubble" situation, the rest being senior folks or executives who would demand high pay everywhere else. So if you're a trained software engineer, you have less than a 1% chance of being in the situation described.

A quick google search finds that law school students have around a 14% chance of making BigLaw (the legal equivalent). The odds of getting into a medical school is between 2-5% on average. So no, I don't think we're in a bubble, the majority in the situation described would simply exist as the elite compensation class elsewhere as well, but maybe with even better odds.

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Let's put it another way: we are looking at the top 1% of software engineers. Is it surprising that they have incomes in the 1% range?

For comparison, in Amazon, Senior and above engineers count for ~20% of the total, and those are the ones pulling +300k regularly. So only the top 20% of one of the top companies are getting such compensation.

And to follow the article, this won't last forever. Whenever the next stock market crash comes, almost half of that compensation (the equity based one) will almost vanish. But maybe on the next bull market we will see a similar situation (remember people in the 90s making 250k?).

> Whenever the next stock market crash comes, almost half of that compensation (the equity based one) will almost vanish.

You're saying the value of (for example) Google stock will plummet to 10% or less and then not recover at all over the following few years?

Wouldn't be the first time (see AOL, Yahoo, Pets.com, etc).

Amazon went down over 90% from peak to valley after the .com bubble. It then took 7 years to recover to peak valuation.

I don't think a 90% drop is common, but I also don't think it's outrageous.

> we are looking at the top 1% of software engineers

Working for a big company that pays well does not mean you're at the top 1% of software engineers. It means you're willing to do what it takes to secure that job and maintain it, including moving somewhere many don't want to live.

It means you're in the top 1% of software engineers in the only metric that matters.

Not really, I rather be paid less but work remote and have more freedom with my time and where I work.

To be explicit, you're saying the only metric that matters (when we're ranking software engineers) is how well-paid a software engineer is?

When we're discussing income, that seems reasonable.

people working on new systems and tech are generally better programmers than people hacking away at enterprise spaghetti at a big corp. big corp jobs like that pay better for less work though.

To be fair - that's not the point he was making. As we were discussing income - that's the only metric that matters in the discussion at hand.

"willing to do what it takes to secure that job and maintain it"

Some (most?) of that is innate ability and intelligence. Sure, there are well-paying jobs that are unpleasant. But for many others the company literally gets to choose 1 out of 100 candidates.

No one has "innate ability" for programming. It's a human construct you have to learn.

Getting a job at these companies largely requires studying up on CS101 trivia and CS basics to pass stupid tests. It's practicing how to pass their interview process. It's not "innate ability and intelligence."

Less. Closer to 10%

> Each FAANG will have on average, 10k engineers?

That's..really low. FB has around that many, Google has like 50k, and from what I've heard Amazon has about the same number or more.

Considering that everyone I know got >= $100k base out of undergrad regardless of location I don't think it's as uncommon as you would think anymore.

>= $100K outside of a major city for a green undergrad doesn't seem typical. Do you hang with grads from big name schools?

No, but I know a lot of those too.

Agree, in the Midwest USA for example even very experienced developers are barely into six figures.

Of course cost of living is a fraction of what it is in SV. And quality of life is (subjectively) better.

Well, Google has offices around the world. In their Warsaw office, for example, the normal salary is definitely way below $100k.

What makes you think that?

Nobody I know did, I suspect most people outside of the USA would say the same.

AMZN Vancouver pays fresh-grad $95k base + sign-on (30-50k) + RSUs (20-30 units)

> Google has like 50k

Does this include the now >50% TVC "non-headcount" as recently reported?

TVCs at Google are not writing software. They are making sandwiches.

Personal, professional, and direct experience informs me otherwise.

No, they have about 100,000 full time employees of which about 50% are engineers. They have another ~100,000 TVC's

You should probably narrow that since you're almost exclusively talking about the US market. There are a few pockets outside the US where you can earn that, it's just quite rare comparatively.

The US has anywhere from one to four million software developers, depending on your source. The BLS lists 1.2 million US software developers, with a $103,560 median pay (excludes benefits) in 2017.

You have closer to a 5% to 10% chance of earning $300,000 in total compensation as a software developer in the US, at some point in your career. Frequently high incomes don't last, there's a relatively high turnover because peak earning power only lasts so long, layoffs happen, specialization changes, job changes, et al.

The giant caveat to this, as everyone here knows, is you have a <1% chance of earning that outside of a small group of markets (ie it's very much not evenly distributed; if you're in New Orleans or El Paso you have almost a zero shot at it; if you're in SF or NY you have a legitimate shot at it).

I live in New Orleans (grad school). I have plenty of friends from college who work at FAANGs. The local market here consists largely of DXC, CGI and IBM paying “data scientists” $90k and junior devs $40k and laughing all the way to the bank.

FAANG companies have engineers staying just 2 years because they made enough money. Your statistics don't account for time.

Sure its not "easy" to get into those companies, but it isn't an outlier to get into them either.

The simple reality is this:

If you are an engineer at a publicly traded tech company, it is customary to get RSUs and Refresher RSUs. These have compounding effects as their vesting schedules start occurring in parallel. By the end of your second year you will have two series of shares unlocking, and this is in conjunction with your salary increases and bonuses.

You should expect and negotiate your RSU grants to be proportional to your salary. Competing offers from other publicly traded tech companies ensures this.

If the share price has also increases, which is the only thing that happened over the last decade, this is enough for a lot of people to quit.

The article did not talk about share price increasing.

People have enough money after two years!?!?!

if you're compensated 300-400k annually, you'll have enough to move somewhere else or take risks if you play your cards right (huge savings, etc).

Or the other options is to jump to a different companies that offer more money or more equities or higher level.

Yes a lot of people are content with their earnings from 2 years at a FAANG. They aren't thinkings its enough to live off of forever, but its enough for:

A house somewhere else and never paying rent again

A downpayment on a home in a high priced area where demand doesn't seem to stop, which is always a low-interest leveraged investment that has cashflow opportunities

"Taking a break" which means years of luxury at every music festival and socialite event while optionally networking and pursuing other fulfilling money-making activities, with almost no opportunity cost of having 'gaps' on your resume

Riding off the resume entry of being an "ex-Googler" to secure advisory roles, raise capital easier, get C-level titles at someone else's startup

Joining another FAANG company at a higher premium

and/or

Leaving the company so you can write covered calls on all those shares you earned, for passive income

There is a bubble on salaries in the Bay area. Only because of the real estate bubble that has been artificially created there. It will eventually burst as more companies will seek to hire in cheaper areas.

There is nothing artificial about the real estate "bubble" in the Bay Area. Prices are set by supply and demand, both in salaries and real estate.

Real estate prices are high, because the Bay Area is a very desirable place to live, there are people who can and will pay the high price, and the supply of housing is low.

Salaries are high because big companies are fighting for talent (demand), and the supply of talent is low.

You missed last week - available housing stock has started to grow.

Yes, it is finally leveling off after years of extreme increases in prices. Demand has cooled as mortgage interest rates have crept up.

The thing that makes it a bubble is that the supply is artificially constrained by local zoning laws. Eventually people will be fed up with the situation and they'll vote for a government that'll allow more development, at which point housing prices will plummet.

> Eventually people will be fed up with the situation and they'll vote for a government that'll allow more development, at which point housing prices will plummet.

Clearly you don't live in CA. Homeowners vote more than renters, and they will never intentionally vote for policies that will put them underwater on their own mortgages.

This is one of those bits of common wisdom that falls into the "it's more complicated than that" territory. Zoning laws are a contributing factor, but they are far from the only factor -- and it's a stretch to say that they're the deciding factor. Zoning is an issue. Rent control is an issue. Basic supply and demand is a huge issue that arguably outstrips regulatory roadblocks. Regional geography is also much more of an issue than people sometimes think.

Housing prices here are likely to stabilize, but they're not going to start seriously declining unless the job market starts declining, too.

All those other reasons you mentioned are contingent on zoning. Allow highrise apartments anywhere in the Bay area and just watch how fast the buildings go up and the rent goes down.

It is artificial in the sense that there really isn't a good reason why the supply shouldn't be going up.

Top companies pay similar salaries in Seattle and New York. New York real estate isn't as bubble-like as SV, and Seattle's is possibly bubble-like but still about half the price as SV.

> Let's be generous and say there's about a dozen or so companies that routinely pay engineers that well

You aren't being generous. The amount of companies paying people that well is on the order of dozens, maybe even 100.

Every single FAANG company, every single unicorn, all hedge funds, and a few successful non-unicorn company based out of SF and the Bay Area.

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