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Comment by arcticbull | Hacker News Reader

I take it that's 60K USD per year, but not adjusted for PPP? Adjusting for PPP that's $140,000 per year.

> Of course, the few real know how holders are kept loyal at just any cost, and I heard rumours of 7 digit incomes for those few.

That's pretty true across any industry. These nominal-to-PPP adjusted salaries are roughly in line re: base compensation for what I would expect a good tech job outside the bay area to pay. If you got a job at the upcoming TSMC fab in the US, $140K would be about right.

Converting using exchange rate isn't the right way of comparing compensation as you're not trying to buy something in the US with your Taiwanese compensation. You're trying to determine a compensation figure in the US that gets you as much in the US as the Taiwanese salary gets you in Taiwan. This is when you use PPP.

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Based on anecdotal evidence (interactions with people at MOSIS, Qualcomm engineers, etc.), $140k is quite a bit more than you'd get for 5 years experience, even for a high COL area like Southern California. It's an industry that's got the emotional appeal of gaming due to its cutting edge and impactful nature but the monopolistic economics of telecom due to the investments required, so you either work for the salaries they dictate or you go find another career. The same is largely true for electrical engineers and firmware developers in general.

On the other hand, anyone with enough experience in any of those fields can go off as a consultant and make absolute bank - mid to upper six figures relatively easily. The utility of experience grows superlinearly because the risks and capital involved in each project are so large. Someone with 20 years experience who has seen 5+ successful projects is easily worth 5 to 10x someone with only a few years.

Wow - yours and baybal’s comment above explained this quite well to me. I’ve always wondered about this salary dynamic! Thank you.

PPP becomes meaningless when you try to buy international standard products or services which are almost always priced in USD, irrespective of purchasing parity.

This also holds true for products and services which are needed for professional skill development and their upkeep. The massive disparity between some countries’ PPP and nominal revenue/income is foolishly portrayed by some economists as a good thing, but at an individual level it’s a huge disadvantage.

Where it is relevant is groceries, fully local services and products.

> PPP becomes meaningless when you try to buy international standard products or services which are almost always priced in USD, irrespective of purchasing parity.

And it becomes meaningless too in light of TSMC being industry's biggest employer. And Taiwan pulling more than a half of semi engineers globally.

Intel is or course bigger in total number as a company, but their actual microelectronics side is still quite much smaller than TSMC.

I seriously dislike PPP calculations for salary numbers. I feel like it disingenuously masks the real event that’s happening - employers arbitraging history and geopolitics to get labour at a suppressed cost.

In a way, I guess that's true, in a more practical way, how do you account for the fact that $10000USD in one country buys you a car, and in another it buys you a house -- without using PPP?

PPP is one thing. You also don't have to worry about healthcare or tuition costs for your kids or (depending on country) pension. 60K is absolutely plenty of money if you don't have to worry about all of this.

What is PPP?

I think purchase power parity.

Exactly. "Purchasing power parity (PPP) is a measurement of prices in different countries that uses the prices of specific goods to compare the absolute purchasing power of the countries' currencies." [0]

The Big Mac Index is a more approachable way of looking at it (and also shockingly accurate). For instance, in this case a Big Mac is $5.71USD in America. However, a Big Mac in Taiwan costs 71NTD ($2.44USD). This means that your $60,000USD salary in Taiwan will go ~2.34X further in Taiwan than a $60,000USD salary in America. So a 60K USD salary in Taiwan is roughly equivalent to a 140K salary in the US. [1]

Using market exchange rates only makes sense when you earn in one country and you're planning on buying something from a different country. If you earn and spend in the same country (for instance, looking at moving from Taiwan to the US), you want absolute purchasing power, not relative, so PPP compensates for that.

[0] https://en.wikipedia.org/wiki/Purchasing_power_parity

[1] https://www.statista.com/statistics/274326/big-mac-index-glo...

I think the Big Mac index has a major flaw that no one discusses.. A big mac is considered a "luxury good" in India and an "inferior good" in the US.

I guess the question is does McDonalds price it as a luxury good in India?

Yes, although if you're saving up to send your kid to study in the US and you hope to follow them there, favourable PPP won't help you much.

If you have an opportunity to move to the US and earn money, you can return to Taiwan and buy a house more quickly than if you stayed there to earn.

So you do still have to compete globally, in some cases.

I'd imagine that this is because the Big Mac is priced corrected with PPP, more or less.

It’s also representative of a basket of commodities, between the wheat, lettuce, beef, sesame, salt, pepper, tomato, cucumber. These are basic commodities and a decent proxy all things considered.

TLDR: divide money salary by local price of big mac, and compare big-mac denominated salaries.

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