How much equity would you need to hold to compensate for a 30-40% decrease in wages?
Not to mention, the top companies would still hire top talent in a competitive market.
The truth is, no matter where you are, talent knows what talent is worth. We price accordingly and in the end the market is stable at a certain price level.
We’ve been seeing this over the last decade in major US cities competing for SF-level talent. Tech is one of the highest paid professions. Remote or otherwise. To say companies will just go hire someone cheaper assumes they can find someone cheaper.
In the end I think the real winners are rural America (or Europe or where ever you live). Having a lifeblood of capital come back to small towns and the like will decentralize our cities, improve our quality of life, reinforce the need for infrastructure, and allow innovation to solve those problems.
Exciting times.
And I don't think it's SV -> Rural America exclusively. Many of these jobs will filter back into medium to large sized metros across the country. Places like Columbus, Indianapolis, St Louis, Atlanta, Nashville, etc. . There are scores of talented developers in these areas that would be open to remote work, but not relocation to the major metro areas.
From what I can tell, people are actually mostly moving to other tech hubs (but lower priced) and to high end vacation areas. Think Austin, Denver, Park City Utah, Lake Tahoe, etc... The underlying dynamics are still at play (even tech but to a lesser extent).
It makes me uncomfortable to think tech population from Ca descending onto unsuspecting laid back mid western towns. Integration should be gentle and respectful and with consent.
This is a pipe dream and quite conceited. Talent is worth what the market will pay for it. No escaping supply and demand. If you no longer need to be in the office, the labor pool is immensely expanded. Unless you think that all the smart people in the world were already working for SF employers.
>https://www.youtube.com/watch?v=eoUtoqeEw8U
you can excuse the resentment
I don’t have a comment or solution to this problem (is it even a problem?) otherwise I’d suggest something. I’m just observing like others, but I will admit to browsing Zillow for a farm if remote work has staying power. I think being able to provide some stimulus economically from this will help those smaller rural businesses. I don’t know. I’m not qualified in economics to predict the outcome, only some hope and some fear of possibilities.
So it would follow that overpriced talent in high-demand markets would see a decrease, where underpriced talent in low-demand markets would see an increase.
This would be the same concerns with offshoring as well, but that hasn't led to massive salary drops. Because there's still a big cost to switching people. If you could fire all your SF SWEs today and replace them with identical, knowledgable, fully-ramped, culture-carried SWEs in $secondary_market for half price, you would. You can't, so you threaten and you try to convince your SF SWE that you could just enough to keep their expectations low, but not so much that they actually quit.
I see a lot of companies still trying the "CoLA trick" on employees moving to secondary markets. "We can hire your position in $market for cheaper," so the argument goes. The best move there is to call their bluff: "go do it then". Most people won't do it because a) conflict is hard and b) finding a new job on top of moving is annoying. So they'll take it on the chin and just resign 6-12 months later after they're settled.
[1] In the old world, there's still a premium to convince talent to relocate. So companies in high-demand markets (e.g., SF) either have to pay +x% to tap non-local talent and get them to move to the high-demand market (where they become local talent).
Even in the new world, non-local talent isn't going to sit by and let themselves be underpaid. "I'm doing the exact same thing, delivering the exact same value, but someone is getting paid 30% more to sit in the office? Oh, and you don't even pay for my home office?"
You can hire competent Thai or Vietnamese programmers for $20K/year on Upwork, which is a princely sum in their countries. If all you want is someone to implement a spec, they'll do the job just as good or better than any American. Why would you pay $100K/year?
Most markets bifurcate into a commoditized low-end that makes all the volume and a differentiated high-end that makes all the profits. Think Android/iPhone, Windows/Mac, TSMC/Intel, Volkswagon/Porsche, etc. The commodity low-end programmer isn't the guy in Missouri, it's the guy in Minsk or Bangkok. You're either the one making up the specs (which will probably still be in Silicon Valley, because that requires communication and trust more than coding ability), or the one implementing the specs (which can be anywhere, with commensurate wages).