If the US Market for SWEs is on fire why isn’t Europe’s, or India’s?

I don’t believe it either. I mean I know it’s a thing but it seems so isolated to a few engineers at very few companies in a very small area. I’m in Europe, have 15 years experience and an “architect” type role since 10. I make around $80k/yr (Europe caveats apply - I’d want at least 50% more in the US) I still think these FAANG salaries are just people from certain universities having bidding wars for alumni from the same schools while measuring quality with whiteboard coding.

I’d be very happy to work remotely as a $150k emgineer, but I doubt that’s possible. I can see around zero job ads e.g on StackOverflow careers that approach FAANG figures.

Be careful how much of the compensation is Stocks/Shares as that is likely to collapse. For anybody based in Europe most tax laws are right down hostile to any granted stock options.

In the US in 2020: "Software Developers made a median salary of $110,140 in 2020. The best-paid 25 percent made $140,470 that year, while the lowest-paid 25 percent made $84,020."

https://money.usnews.com/careers/best-jobs/software-develope....

Keep in mind the completely different situation of medical insurance in the US. Remote is an option but then companies claim to pay according to where you are based.

Bay Area/San Francisco based 250k compensation does not impress, after you apply taxes, and you realize you will have to share a flat with four other colleagues...

> SWE is an occupation that ought to be paid more (for scalability reasons)

Scalability isn't a reason for salaries to be higher.

It doesn't matter if an employee generates $1M/year or $100M/year for the company; if somebody else would accept to do it for $100k/year that's what he's getting.

Funny that you say that Europe hires based on quantity and then you put an example (Lionel Messi) of a European football player*.

I don't believe that's true. We also have our "rockstars" in Europe that we know are nigh unreplaceable, from Santiago Calatrava (architect), soccer players as you said, etc. in modern times to all of the classic artists and architects which are known by name.

I think one big difference is that technology came a decade or more later to e.g. Spain, so there's still a strong generational difference where older hiring people do not see a big difference from a "kid" fixing their computer/phone or making a website, and don't see the value so much. Add all of the other related things, like even if they saw it valuable there's little related infra, specific knowledge, etc.

*weeell technically Argentinian but the high of his career was in Spain

I would say the factory worker mentality is actually an "everywhere but west coast US tech firms". I worked for a while for a few New Yorkers and they had exactly the same mentality, but they came from finance.

"Ambitious companies will pay almost anything to have elite engineers in every position of their team ... Being cheap doesn't matter if you never win"

This mentality and most of the wage inflation is down to extremely loose VC markets that are almost entirely focused on software, not something actually inherent to the USA or the job market. There are huge numbers of firms and industries which are not winner takes all, and in which price does matter. Being cheap can in fact matter if the market you're in simply doesn't have a single winner and lots of losers.

VCs generally aren't interested in such businesses however, because they only care about businesses that could potentially have absurd levels of return, which in practice means they select firms that make promises of entirely dominating their chosen area. But that's really hard to do through skill alone, hence the proliferation of companies that simply attempt to buy the entire market using nothing but VC money (see: Uber).

We view staggered time zones and schedules as beneficial. The team is conveniently available more hours of the day.

Can you give some ballpark absolute salary numbers here? It's a different story if we're talking about doubling from US$10k/year to US$20k/year or if we're talking about doubling from US$250k/year to US$500k/year.

The Twitter thread https://birdsite.xanny.family/Tennistetris/status/1473033790... suggests that maybe we're talking about US$80k-US$130k per year for senior developers in India. Presumably that's post-doubling.

O-ring theory

I wonder if that's true. Most FAANG companies didn't even humor to interview me as a graduate, while I have a bachelor in information science and master in CS. My average grade as an A during my master (8 out 10 in The Netherlands [1]). 3 years later, Facebook humored me. I didn't pass it (poor sleep), but I did pass one coding interview.

So in this case, Facebook would've picked me up while other companies wouldn't even think I'd be worthwhile to even give an interview to. I have a hunch this happens quite often.

If anyone would have a chat with me (email in profile) and see if I'm referral worthy, I'd be grateful :) I'm happy where I am now, but I think I'd like to switch in a year or two. And unfortunately, I don't think I'll get there without referrals.

[1] Conversion guide: https://students.uu.nl/sites/default/files/geo-grading-syste...

I'm curious what a food delivery company plans to do with 100 engineers.

Do you mean US$6000 per year, US$6000 per month, or US$6000 per two-week paycheck? (Presumably not per hour.)

Even US$6000 per two-week paycheck is only US$150k/year, which sounds like it's about 20% of what the same people will get if they can immigrate to the US.

the title is related to one of the responses in the thread if you keep scrolling down: https://twitter.com/Tennistetris/status/1473033790545006596

Silicon Valley primarily (not exclusively) derived from East Coast industrial money in terms of backing it initially and building it up. Over time it spawned its own large scale capital structure as the successes rolled in, and that snowball has been rolling down the hill ever since. The California gold rush and supposed related capital appreciation had very little to do with the Silicon Valley outcome.

Not quite the context. If you take the US market as a new tech company, particularly if you do so expeditiously, you can use that huge market as a springboard to take the world market in many cases (that giant lucrative foundational market subsidizes any losses you need to absorb to go after the hyper fractured world market). Capturing the US market turns it into a resource pool to feed your global growth and makes it very hard to compete with you (you need a comparable resource base to stay in the fight if you're outside the US, which is very hard to put together).

US tech companies tend to have nice profit margins by their very nature, with or without a monopoly (Oracle and AMD have no monopoly and have really good margins). The ones with a monopoly of course tend to have even better margins. Software and ad serving (Google, Facebook, Microsoft, Amazon AWS & ads) are hyper margin businesses generally though.

The companies that built monopolies didn't throw a switch that suddenly made them far more profitable by abusing the market. Microsoft, Google, Facebook, Cisco, Intel, AWS, Nvidia all had good margins before they were giants. Fat margins go hand in hand with the software business, if you're operating your business correctly. It's more hit or miss in hardware, but the leading companies there also tend to have good margins.

US tech companies being able to take their product and extend globally, is the cherry on top, it makes their business that much better, that much richer. You can do the exact same thing from other countries, Shopify and Spotify are both examples of being outside of the US and using the homogenous US market as a key springboard to build a large global business.

well, it is fair when 15/hr gets what 200k/y does in the USA. But I wonder if a 15/h job and a 200k job have the same responsibilities regardless.

But this is one reason so many come to where wages are high: to send money home where is goes a lot further.

What do Indian devs typically make at a decent offshore outfit?

I know many startups who are now paying _interns_ more than other companies are paying senior devs. It is conceivable to get paid $70+/h at Series A startups as an intern and $140-150k + 20-40k in options as a new grad.

Speaking frankly as someone who has worked at bog standard F500 companies that pay "not so much" to HFT, experience is not nearly as important as raw skill. A 20+ year experience engineer who has mediocre skills will never be able to write a compiler, work on complex distributed systems, or bring new verticals to market (think AR, VR, ML applications) very quickly. A skilled new grad might be able to contribute meaningfully if their hand is held on architecture and design.

For example, it's a reasonable expectation for those skilled new grads to be able to grok and start doing easy tasks in a complex codebase (e.g. on PyTorch or Spark itself or business logic in a distributed system) within a week or less, and for them to require at most 1-2 hours of help from an existing engineer to get started. I posit that a 20+ year mediocre engineer is never going to get the skills to contribute to something like PyTorch if they haven't developed those skills in the 20 years they've worked.

Why is your company encouraging people to quit? Is constant hiring of new grads part of their business model, like Epic?

Can you give some ballpark absolute numbers here? It's a very different story if we're talking about a 2% raise at US$40k/year or a 2% raise at US$400k/year.

It’s not about the raises. It’s the stock and sometimes bonuses.

The world is moving to an even more digitised economy, with robots, ML/AI in many fields, highly evolved digital markets etc ..

While I see the concept you're getting at, it may be that the tech investment is worth it. May we live long enough to see!

I think their reasoning is that if they have the 750k salary engineer, their competitor doesn't. But I'm just speculating.

If they have more of a constrained supply, they win. Right. There aren't enough SWEs, so if you have them, your competition can't. Get enough SWEs together and you get some cool shit like K8s. That and probably keeping the good ones who are 2x in some areas, but make fewer mistakes than two 1x would.

I would maybe consider it the other way; these companies are wildly profitable with huge margins, why don't the employees capture _more_ of the value they create?

I think you would be surprised how many 100k engineers at Fortune 500 companies can't do things FAANG engineers would consider very basic. It's not that there's a 7x and a 1x engineer but that there's a 0.1x and a 1x engineer.

For example I did a stint at a F500 company where 1) a data engineer did not know how to use multiprocessing to parallelize a multi-terabyte S3 upload 2) an internal tool that fired off hundreds of network requests did not use concurrency and hence had 30+ second latency 3) a certain other team was dumping hundreds of terabytes of logs that nobody even knew the schema of into S3 automatically, and none of it was ever touched. Also seen: "data scientists" who did not know Python and executives that spent more time talking about Scrum than any concrete execution.

Way more. Most of these <$300k engineers I’d pay to fire. They can’t identify the problem and fix it. I’ve got to hand hold them and then treat them like a robotic arm (I do all the hard work and then just use them as a glorified autocomplete).

The only engineers who produce value are a small set. Everyone else you try not to have because they’ll slow everyone down.

I was of similar mindset until I worked with some. Not to say a 200k dev couldn’t do it, but especially at big tech or rapidly growing large scale startups, the price difference is worth it from experience alone.

Not only are the technical challenges different at large scale, the product and human challenges are different. The 750 principle is basically leading a 500+ engineer org’s technical vision and steering the ship. Not only is it crazy difficult to get 500 people align on a vision, but the mechanics of organizing and leading that large number of people are unique too.

Plus product wise a 750k engineer can save the company multiples of that just by advocating on what not to do, and avoid expensive mistakes.

I’ve learned more in 2 years at big tech than I have in 7 in local companies or smaller startups.

This comment if I understood it correctly is basically saying that Google is probably over-paying Senior Engineers; Based on the OP's observation that "seems like very little of actual value is actually happening".

A Googler is likely best to answer here but my thesis is that since Google is just founded on the PageRank ideas of Larry Page and Sergey Brin, doesn't that already prove the value of highly skilled and highly intelligent people?

One highly intelligent person that can create a breakthrough like PageRank already creates immense value in the world so likely that is the reason that Google are willing to pay such high salaries for the best of the best.

I’m not sure if you’ve worked with a 100k engineer in the US but I’d almost always rather have one really good 300k engineer than 3 100k engineers. I mean 100k is pretty much entry level and not the cream of the crop for entry level either (which is closer to $150-250k).

When you get to 500+k you’re either talking about stock appreciation, or people in more of a leadership position/having specific technical expertise.

I’ll add that software is not necessarily a quantity thing. If you want things to have tons of features and have highly parallelizable tasks, it is. But if you want localized technical choices to be high quality you’d rather have one good person than three people who don’t know what they’re doing.

One our our engineers in a few of his sprints rewrote major pieces of Apache Tomcat, which is used in our very high TPS APIs. He fixed a bunch of the way the memory loading works, and drastically improved latency and stability of over 100 teams APIs. This guy had deep understanding of dependency injection, how java works under the hood, etc. This kind of thing might not be a huge win for a startup, but at a large corporation, you need people that can push the bounds on already well tested and well known open source software

There have been a lot of companies that tried the strategy you're suggesting; Friendster and Yahoo, for example. It turns out that "letting ... labor take such a big piece of the pie" is a much more profitable strategy.

This results from the underlying factor structure of the industry over the past quarter century. Classically, the factors of production are land, labor, and capital. Capital provides the means of production such as factories, bribed politicians, and lathes; land provides natural resources such as rainfall, sunlight, coal, and zinc ore; and labor applies one to the other to produce something which can be sold for revenue. This revenue is then divided up among the owners of land, labor, and capital.

The division doesn't reflect any kind of moral or objective valuation of the importance of the three factors; rather, it results from market processes in which the owners negotiate with one another.

Power in these negotiations results from owning a scarce resource. We're having this conversation with 100,000 other people on a web site hosted on a single server running on probably 200 watts. So the server costs maybe US$1000, the "land" costs probably US$1000/year, and it required labor that would have cost maybe US$100,000 to get it running in the first place, plus on the order of another US$100,000 a year to pay dang for moderation. The land and capital in this case are pretty fungible, and very little of them is needed. The labor is not.

A rank-and-file steelworker negotiating with the owner of a blast furnace is in a poor negotiating position because there aren't many blast furnaces around, he doesn't have one in his backyard, and there are lots of potential steelworkers with enough impulse control to avoid tripping and falling into the melt. The foreman who knows how to prevent breakouts from damaging the blast furnace and killing his coworkers is scarcer, but he's still probably limited to quitting to work for the other steel mill across town; he can't set up his own steel mill either.

By contrast, all the capital I need for my work is a US$300 laptop and a US$10/month VPS.

So the bizarre algorithm tests are not the cause of these salaries. The underlying factor structure is.

This also explains why hardware engineers are paid so much less than software engineers: an Intel chip designer can't quit and go into competition with Intel, the way the Intel founders and Chuck Peddle did, because even though you can buy foundry services on the open market, Intel's designs are festooned with patent barbed wire, and it commonly takes a million dollars and a year to get an ASIC fabbed, so you need significant startup capital. Modern patents are correctly analyzed as a way to improve the bargaining position of the owners of capital with respect to labor so that the revenues flow to investors instead of employees.

So why is it different in Europe and India? My guess is that you can't run a profitable business there without the right connections (not necessarily outright bribery), so people with the pull have the negotiating power, so they can take home the profits. And Europeans and Indians can't work in the US without visas, which are controlled by (capital-intensive) immigration lawyers and, of course, pull.

> Maybe a bigger question is: why are these big companies letting fungible labor take such a big piece of the pie?

there's a lot to dig into in this comment, but I think this is the biggest thing you are missing. the leadership of big tech companies generally does not look at revenue as a fixed-size pie to be divvied up between themselves and their subordinates. instead, they try to grow the pie as fast as possible so they can justify their own salaries and bonuses to the board. if this means paying way over market for labor, so be it. they'll keep doing it as long as they grow revenue by more than they spend on SDE salaries (modulo some organization dysfunction, of course).

the point of the $300k salaries is not to hire engineers that are 3x better; it's to hire armies of engineers very quickly. this is where the absurd algo interviews come in. a large company hiring at this pace does not have the time or the manager incentive alignment to make holistic hiring decisions. some terrible engineers that test well do slip through the cracks, but they can be PIPed out before they cost too much money.

> How many 750k engineers are actually producing 7x a 100k engineer?

A huge part of the market is hilarious bad. It's insane. People graduate from school and can barely program, and even after years they don't get a whole lot better.

So yeah, absolutely there are people 7x better.

Typically, a $750k engineer designs and builds the software that makes the $100k engineers productive, or can solve Hard Problems that a $100k engineer is unlikely to solve and may not even recognize. They are paid as much as they are not just because of the impact on productivity, but also because the $100k engineers do not have the skills to produce what the $750k engineer produces. One cannot be replaced with the other. Even if you do not have an immediate use for these very expensive engineers, it can be extraordinarily valuable to have them around for when you do need them.

Having engineers that are very good at solving Hard Problems is a major asset. They have the potential to save you countless millions of dollars when Hard Problems occur. They may be doing low-value things part of the time, but if they can deliver on the Hard Problems when they occur then they are worth it.

Generally speaking, $750k class engineers, and I know many, are extremely capable and have skills far beyond the average engineer. That's why they are paid what they are paid. They have achieved a degree of mastery that few engineers achieve.

It is not only a function of value being produced, but of supply and demand. If Google wants to hire a certain level of engineer in a certain location, they have to pay $750K, just because those engineers have other options that pay as much. Yes, at some point Google may think it’s not economically feasible to hire SWEs at that cost anymore, but given the huge profits of the tech industry it doesn’t seem like we are close to it yet.

Facebook definitely needs the "fanciest" engineers. Simple problems become much more complex at scale and Facebook also solves plenty of really hard problems. Also when your whole business relies on tech the costs of bad engineering and the benefits of great engineering are both enormous. I think I'd always have an incredible engineer for 700k or however many k rather than a 5 mediocre engineers. More people rarely solve problems, better people do

I'm not sure about other companies, but in Amazon a $1M engineer tells you how to build a VM called firecracker, another $1M engineer single-handedly implemented a distributed log service and made it the backbone of multiple AWS services. Another $1M engineer convinced the company to build EC2 and SQS. In Snowflake, a $1M engineer spearheaded the Apache BEAM initiative and wrote the best book on stream processing when he was in Google. In FB, a $1M engineer lead the RxJava and Hystrix projects for years until functional reactive programing turned from a niche into something mainstream. The list can go on.

You are absolutely correct about engineers being looked down upon.

I know the UK still refers to digital- this and digital- that, like we’re still in some magical Tomorrow’s World where computers go beep beep boop and watches and calculators have glowing red numbers on them but only when you hold down a button.

It’s getting better, but the tech scene also used to be hobbled by the usual class antics of Annabels-membership-esque popularity contests. You made it on the London tech scene not when you hit $100M ARR or a $1bn exit, but when your holiday party got featured in Tatler.

There is thankfully lots of serious tech outside of London’s second-fiddle-to finance bubble. You can make Google SWE salaries in Europe if you work at Goldman Sachs in London, but you can also command a decent salary if you work for many of the series Bs anywhere but London.

Layoffs might indeed happen , but a lot of those salaries are based on stock value. So the more likely scenario is that those salaries just become lower with stock prices.

That was coming, but geopolitical situation is shaking things up again. Possibly inflation and rates going up but the share values with them.

In my experience, healthcare is poor at most tech companies in the US. Every now and then you get a "we cover 100%" claim - which again is usually 100% of the premium for their selected plans for you...the same as any other company. It's tailored for the typical college grad and not much more. I've declined company insurance 100% of the time over the last 25 years, since I prefer Kaiser. Ofc it's not unusual for companies to only pay into the cheapest providers, when providing employees benefits.

If you have any serious medical issues, you carry your own insurance. Luckily, the salary generally makes this feasible.

Healthcare is only the thing that people most quip about.

Don't get me wrong, there are many good things about the US (e.g. networking opportunities, better availability of new tech, VC for startups, freedom to do things that just aren't possible in Europe), but OTOH, it's much harder to find safe walkable neighborhoods, excellent public transport, solidly built houses, and in San Francisco apparently human feces are a problem because of a homelessness crisis.

The US healthcare system has very poor outcome measures across the board; even rich areas in the US have poorer health outcomes than many other parts of the world. If you're young this probably doesn't matter unless you have a chronic disease. Old people might prefer to be middle-class in a country with reasonable healthcare than superrich in a country where decent healthcare is unavailable at any price.