Also, poorly performing engineers will sometimes be promoted into management roles to get them away from the code. Now the incompetent guy in the team is your boss.
I would also add that if companies attempt to give technology specialists higher salaries they will often run into problems with their financial auditors claiming a lack of market conformity.
That used to be the case in the US too, a perhaps still is. In the early 80s I was hired while still a student at the equivalent of today’s FAANG rate for a mid career developer.
At some point I learned that my hire had to be approved by the board of directors because they had put in place strict rules about who qualified for what kind of salary.
There weren’t a lot of AI developers back in those days (this was before the 80s AI Winter), so that’s what it cost. And I had more than a year’s salary worth of hardware anyway, another thing that’s changed dramatically since then.
I wish I could say this for every job I’ve had, but: at least in this case they did get their money’s worth.
Is there anything about your personal experience in the Netherlands as an American engineer that you could share?
I recall that being popularized as the "Dilbert Principle", a more cynical take on the "Peter Principle". (That said, the creator of Dilbert has... gone weird in the last 30 years, so I'd be careful of seeking any organizational wisdom there.)