Hacker News Reader

Comment by lkbm | Hacker News Reader

If your employer spends $20k a month on you (salary + everything else), $200 a month breaks even at around a 1% boost in productivity.

View on HN

You have to set of your cost delta against your margin, not agaist your cost. Why do devs keep repeating this faulty reasoning? Where did this emerge?

If you cost 20K a month at a 5% average margin, the required ' break even' for a $200 cost increase is 20% not 1% increased productivity.

And it gets worse as you just assumed that increased 'productivity' 100% was converted back into extra margin, which is not obvious at all.

Maybe if you're working in FAANG...

Lots of jobs where employers pay that much per head, not just FAANG. Honestly FAANG is probably spending double that for senior+ level engineers.

Average US salary for SWE is 10-12k/month. Fully-loaded cost (what they spend) is 1.5-2x salary so that's not an unrealistic number

So you're arguing about the top 10-20% earners in the US?

Also the world is much bigger than the US.

The point is you don't have to have FAANG salaries to hit $20k/mo in cost to your employer.

Tons of software developer jobs in the US for non-FAANG tier or unicorn startup companies are >$100k and easily hit $120-150k.

Also the fourth quintile mean was like $120k in the US in 2022. So you'd be in the top 30% of earners making that kind of money, not the top 10%.

https://taxpolicycenter.org/statistics/household-income-quin...

> unicorn startup companies are >$100k and easily hit $120-150k.

So still way below than $240k, no?

> So you'd be in the top 30% of earners making that kind of money, not the top 10%.

Maybe you missed it but I actually wrote "10-20%".

Also in 2024 earning $100k puts you in the top 20% of the US population.

https://dqydj.com/salary-percentile-calculator/

(which is already way above even the EU for dev salaries)

You dropped off the "non" part of that. It's the non-Unicorn software companies easily paying $120k for a seasoned software developer in the US.

Also, I noticed where our sources diverged. I was looking at household income. My bad.

> which is already way above even the EU for dev salaries

Maybe they're underpaid.

Either way, I was responding to the idea that only a FAANG salary would cost an employer $20k/mo. For US software developer jobs, it can easily hit that without being in FAANG-tier or unicorn startup level companies. Tons of mid-sized low-key software companies you've never heard of pay $120k+ for software devs in the US.

The median software developer in Texas makes >$130k/yr. Think that's all just Facebook and Apple and silicon valley VC funded startup software devs? Similar story in Ohio, is that a place loaded with unicorn software startups? Those median salaries in those markets probably cost their employer around $20k/mo.

https://www.ziprecruiter.com/Salaries/Senior-Software-Engine...

>So still way below than $240k, no?

No, fully loaded cost of an employee is 1.5-2x salary

Yes, this product mostly only targets the top 20% of US earners. That's a lot of people, and a lot of HN readers especially.

If you get an employer match on 401k/HSA, the employer pays full healthcare premium, employer sponsored life insurance benefits, unemployment insurance, employer covered disability, payroll taxes, and all the other software costs, it wouldn't even take $200k in salary to cost $20k/mo. Someone could be making like $150k and still cost the company that much.

gentle reminder that the majority of developers do not live in the united states.

median salary for a japanese dev is ~$60k. same range for europe (swiss at ~100k, italy at ~30k for the extremes). then you go down.

Russia ~$37,000 Brazil ~$31,500 Nigeria ~$6,000 Morocco ~$11,800 Indonesia ~$13,500 and india ~$30k usd

(asked chatgpt for these numbers down there, JP and EU numbers are mostly correct though as I have first hand experience).

Sure, but ~$150k isn't exactly FAANG US salaries for an experienced software dev. That's my point. Lots of people forget how much extra many employers pay for a salaried employee on top of just the take home salary. Labor is expensive in the US.

I imagine a lot of people saw $20k/mo and thought the salary clearly had to be $200k+.

According to Wilkipedia, general average wages in Italy in 2023 were 48K, and SWE jobs are usually above average.

It would be interesting to know from where Chatgpt sourced those figures as some of them look very sketchy.

this website put the number at 40k (and 30k entry level 50k senior)

https://www.levels.fyi/t/software-engineer/locations/italy

so there s a change it took entry level numbers. another possibility is that it took numbers from a specific region in italy (big north/south gap).

Reply on news.ycombinator.com