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Comment by Vinnl | Hacker News Reader

What I don't get is: why would they pay more for someone from San Francisco? I'd expect the incentive to be to indeed pay the same for the same work, but that pay would be the lowest they can get away with. (i.e. I wouldn't expect that to lead to Silicon Valley salaries all over the world.)

Unless it's not actually the same work, and location affects work. It does at least affect gross pay in any case, I suppose.

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> why would they pay more for someone from San Francisco?

Because they probably want someone from the area working in the company. If they pay a flat rate globally, they only have to pay average or lower and get great people in LCOL areas. But then you have a company with no people in CA or NY, which means you dont have contact with local trends or contacts in the big tech companies.

Right, so then location does affect the quality of the work provided. Although it then still is weird to base differentiated pay on cost of living / local market rates; surely those don't all correlate with the quality of the work delivered? If you can get an engineer with the same skills from Spain for less money than you'd pay for the equivalent in Germany, why would you hire the latter?

The Bay Area usually commands a premium because a) quality of talent b) the ability to scale out a team.

Quality of talent means not only intelligence and skill but also people who have spent years working on the specific thing you are building (hardware/firmware, AI, at scale codebases or services).

If you assume that timezone matter and relevant experience working in large orgs is important, the Bay Area premium will continue for the foreseeable future.

Scale means you can hire 100-200 talented IC's within a year that meet the quality of talent criteria and have experience working and getting things done in larger orgs, the ability to do so also commands a premium.

Only a few other places in the USA have this scale, i.e New York and Seattle.

Coinbase the company I work for is fully remote and does salary bands by location. Within the USA, Seattle/New York and the Bay Area all are in the same top tier band. Also, the majority of our USA engineering workforce is still based in these hubs despite being fully remote for nearly 2 years. I don't expect this trend to change any time soon.

More like a) well-funded || revenue-generating firms competing in a limited pool of local talent and b) high salaries have yielded high costs of living, so to hire local, we must pay said premium

Coinbase is fully remote, i.e no local talent pool dependency, with no expectation of coming into the office, can hire from anywhere in the USA and still it mainly hires people in those locations.

It's not the only remote company where I've noticed this happening.

> why would they pay more for someone from San Francisco?

I can't answer for GitLab, but widely, people often believe that San Francisco has an "exceptional" talent pool and that companies pay a premium for that because of competition.

But in that case, it's not the same work, no? You can simply pay more for exceptional talent regardless of location, just as how org (theoretically, at least) already differentiate pay based on skill level within the same location.

I agree, I was just putting in plaintext what I've heard others say over the years when I complained about living in a state where I was paid nearly a third of what people doing my same job in SF made. I think those kinds of comments and attitudes that got us here need to be preserved, especially for how combative some of those folk were.

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