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Comment by malfist | Hacker News Reader

I'm one of those "discriminated" against here. I live in kentucky, work for a FAANG company.

My employer pays me less because of that, and you know what? I'm okay with that. My discretionary income after housing and basic living expenses are removed is way higher than that of someone in a HCOL area.

I have a 3300 sqft house that was built in the last 10 years and a quarter acre of land. That costs me $1400/month. If I wanted a comparable standard of living in SF, the wage gap between here and there would need to be many thousands more that it really is.

So pay me 20-25% less, it makes me more employable and I have a better standard of living than you do.

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I am the original poster from the post linked in this article.

I know these as a fact that a comparable property in my city would cost me much more than what you're paying. All the while I'm getting payed less than half of my colleagues living in your area.

And there are many other costs that are comparable eg. electronics, vehicles and education.

All this is to say that location based pay is not about cost of living, its about getting away with paying as little as possible.

Can we see some sources for those "facts" please?

A comparable sized property listing https://www.nobroker.in/property/buy/4-bhk-apartment-for-sal...

For electronics and vehicles you are free to google iphone and mercedes prices in India vs Us. Its especially higher if I want specific items to import like framework laptop, fairphone, tesla car

Private education can get very expensive very quickly too. Public schools are not even an option as they don't even have furniture sometimes.

You might say remaining costs are low, but they are low only if we use uncertified, unskilled, low quality services/labor. For even decent quality of work the prices will be in multiples.

About my comment about being payed half, the pay scales are visible to everyone in the company so I know that the least in the US also gets payed 2x of my location

If you're paid 50% of what your HCOL breathern are being paid, and living in a higher cost of living than myself, then perhaps it's not location that's the culprit here.

I don't know any company that has a location based pay differential that ranges into 50%.

I get exactly 45% percent of SF rates. Just to be clear, this is an international company

People very much miss why they are getting paid so much. It is because they are in HCOL area with lot of competition. Thus employers are forced to pay a lot to get warm bodies there. For some reason they have wanted them there...

Now, if work can be done else where, magically the supply increases, go figure. So they don't need to pay so much. Instead they can pick someone else for less.

For me, I consider the high pay a payment for living somewhere I don't want to or cost lot to live. If I don't live there I get less.

Hey I’m in KY at a FAANG too! Happy to take the pay cut, I don't see how I could have the life I want in the Bay even at 100% pay.

I’m buying later this year, really thankful I grew up in a place where I can easily settle down, and I’m looking forward to passing that on someday.

There's dozens of us!

I would bet 100+ people at a FAANG work remotely in Kentucky (excluding Amazon fulfillment center work). Based off of one that has ~40 remote Kentuckians.

When’s the meetup? :P

Arguments against location-based pay generally assume that all employees would be given raises to match the company's most expensive market.

Realistically, most companies aren't interested in paying everyone more just because some of their employees are in an expensive location. I would expect any location-independent compensation programs to move toward median compensation across locations, not upward toward maximum compensation in the most expensive location.

Existing companies like the FAANGs don't have a choice because they have a lot of customers in those locations, but younger companies adopting location-independent pay would absolutely be targeting median compensation rather than paying everyone top of market in Silicon Valley just because that's the maximum possible compensation they might need to pay someone.

That's exactly what companies like Reddit do that don't have location based pay. They pay middle of the band nation wide and the excludes people from HCOL from working for them.

Might be true in some zero-sum sense if the highest salaries are already subsidized by the lowest ones, but let's say some company is already turning a profit on their highest paid employees, it should be theoretically possible to match those wages. Assuming the value of a unit of work is the same no matter where it is produced.

I think this is part of the dilemma(and I am not arguing right or wrong here), but there will be a subset of employees who are okay with giving ground to the employer on this issue, in exchange for job security and some financial security. And this ultimately takes away some of the ground from the people trying to fight the inequality. I believe economics will have the last say in the long run.

Is it an inequality though? Everyone's seen the baseball game equality comic with the different high people. Equality is when everyone can see the ballgame, not that everyone gets the same height boxes to stand on. I'd argue that this is the same here. I'm the "taller" person because my cost of living is lower, if you give me the same size box (income) as the person in the HCOL area, they might not be equal to me, because I start with an advantage.

In the literal term, I think it is inequality if one is just comparing the salary numbers. BUT, once variables start to get added(location, personal preferences, the availability of replacements) then you start getting into murkier territory. There are also significant impacts of standardizing pay across regions. There will obviously be a flow of people from HCOL > LCOL/MCOL areas, consumption will increase, local inflation will happen...these things benefit some groups and hurt others. No idea how it would all shake out in the end though.

Ultimately, I'd be far, far more concerned about a race to the bottom. That race to the bottom is possible regardless of location-based pay or not. Once people discover how to navigate remote work across big timezone differences en masse and mentality shifts, things will truly get interesting.

Is this from a consumer or producer standpoint(or both)? A race to the bottom ultimately hurts everyone. In a simplistic world, if wages go down, people will consume less, causing decreased revenue. Its in the best interest for companies to have a competitive wage floor that still allows for quality goods and services to be created.

Remote work will certainly shift dynamics, I am quite interested in if the concept of 'hybrid' work will take off, and how that would shape cities/communities.

A race to the bottom ultimately hurts everyone.

It's already a race to the bottom. It's just the fact that "doing the job well" hasn't been the only factor in the race. Strip off "being able to move to and tolerate living in the right place" and the race gets a lot more fair in my opinion.

Consumer. And frankly, I believe most producers do not realize it will hurt everyone, or are hoping some form of automation/AI will take off so they can massively minimize the downsides.

Thanks, you're one of the good ones I guess. You must be a mindreader, my (slightly negative) comment was NOT inspired by you :)

I talked about all the entitled rich boys that bought $50k shacks in Kentucky (for $300k), and are now whining that their pay is being clawed back.

Anyway, I got a bit of a kick out of that; what a coincidence.

Fair enough, although being content and discriminated is not mutually exclusive. In fact, even if you are satisfied with your numbers you can sympathize with those who are not.

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