
Are STEM Workers Overpaid? - 31reasons
http://spectrum.ieee.org/riskfactor/computing/it/are-stem-workers-overpaid
======
freyr
>> _Greenspan is not alone in his thinking that STEM worker salaries should
look a lot more like non-STEM worker salaries. In March, over “100 executives
" [wrote an open letter begging Obama to increase the number of H1-B visas]_

Perhaps, as STEM workers, we should suggest that executive salaries should
look a lot more like non-executive salaries?

>> _And those [immigrant] workers would compete with high-income people,
driving more income equality._

Really, Greenspan? You're going to paint _STEM workers_ the posterboys for
income inequality? Not your banking brethren making 5X, 10X, 50X the average
STEM salary? It's a cheap, transparent ploy by those at the top to increase
corporate profits at the expense of the workers and the middle class.

~~~
Mikeb85
From an economist's perspective, STEM workers are still just labour. 'Bankers'
represent investment, and their compensation is based mainly on the fact that
they take on risk by allocating money...

Compensation is based on supply (which itself is based on many factors,
including education and demographics), demand (number of businesses in a
market, demand for the products created by those businesses), and risk.
Assuming no government meddling, an efficient market will properly price
workers wages.

What Greenspan is suggesting makes sense from a macro perspective, but of
course on a personal, human level, isn't ideal for many people.

~~~
dvanduzer
I don't understand why you put 'bankers' in 'quotes' like that.

Saying bankers represent investment isn't exactly non-controversial.[0]
Perhaps that's exactly what you're saying?

[0]
[https://en.wikipedia.org/wiki/The_aftermath_of_the_repeal_of...](https://en.wikipedia.org/wiki/The_aftermath_of_the_repeal_of_the_Glass–Steagall_Act)

~~~
gaius
A normal banker doesn't take _any_ risk himself, he risks money belonging to
others. Back in the old days, Goldman Sachs (for example) was owned by the
partners, who were risking their own capital in every transaction. That setup
is very rare these days. An investment banker should be paid like an
accountant or a lawyer, well enough by most anyone's standards, but in line
with what the work actually is.

~~~
waps
Why not tell the rest of the story ?

Then a crisis happened, where a lot of banker's decisions turned out wrong due
to factors that cannot reasonably be said to be the fault of those bankers. A
lot of people, who were told beforehand that their money was indeed at risk in
trade for that "interest" demanded the government step in and guarantee the
deposits (which the government didn't do for them, but implemented for all
savings from then on).

This meant that anytime a sizable bank would topple, it would cost the
government massive amounts of money, which meant the government became
complicit, by necessity more than by bribes, in making banks grow and bailing
them out if "risk" strikes.

Which is what you're complaining about.

BTW: the "risking your own capital" demand also meant that only the wealthiest
of people and their immediate families could reasonably get jobs at banks, for
obvious reasons. And I'm certainly not unhappy that particular tidbit ended.

~~~
briancaw2
Just because the government insures deposits to keep public trust in banks
does not mean that it justifies banker's high wages. It's actually the
opposite - the fact that bankers require government insurance 1) takes risk
away from them (meaning the risk that "earns" them money according to
economists isn't as high) and 2) they should be paying more money for
insurance or using profits to mitigate risk instead of paying themselves.
Insuring deposits has resulted in the opposite - it encourages risk and
overpayment.

~~~
waps
My point is that you're wrong. It's not (or at least it was not) the banks
that demand the government take the risk away from banks, it was voters, you
and me.

And I'm positive that today, a vote would turn out the same.

So this whole too much risk followed by bailouts process is exactly what the
average voter wants (in the sense that it's what he'll vote for). Sure they'll
complain about the bailouts but faced with the prospect of losing their
savings (as they will naturally be when a bailout is proposed) ...

~~~
briancaw2
"Banks require government insurance" doesn't mean they demand it, it means
they need it or people won't trust them. Both banks and people demand the
insurance, because without it everyone fails.

------
kbenson
> Significantly opening up immigration to skilled workers solves two problems.
> The companies could hire the educated workers they need. And those workers
> would compete with high-income people, driving more income equality.

TL;DR Income equality is being redefined as cost cutting through wage
suppression. W. T. F.

If you want to define income inequality as the "problem" of different skills
demanding different wage premiums based on demand, then sure... If you want to
define it, as it has been in almost every report I've seen on the matter, as
the widening gap between the _rich_ and _everyone else_ , then that doesn't
help at all, it just exacerbates the problem.

STEM work is still a quick, mostly egalitarian way to allow movement from the
lower to _middle_ classes. Defining middle to upper-middle class as high-
income earners might technically be accurate, especially with a shrinking
middle class, but then making decisions based on them being "high-income" when
it's so relatively different than it was in the past seems the exact _wrong_
way to go about things.

~~~
jmspring
We need downward pressure on wages so that the executives can make more money
and the corporations can profit. Clearly borders should be open to throw away
any avenues to prosperity that still exist in this country still. A mix of
corporate and union greed f'd up previous iterations of the middle class,
clearly we should follow the same path in all cases to the benefit of the 1%.
Yeah, that works.

I believe in the global economy, but I also believe that local markets have
their demands and wages should be commensurate. If I were to live in San
Francisco working as a full stack developer, I should expect one wage. If I
was in Berlin, Stockholm, Singapore, etc. I would expect something
commensurate that maintained the similar lifestyle in the community I work.

There are cultural/societal tradeoffs, but personally, I am pretty tired of
the "US IT wages are too high, let's open the borders" argument. The opposite
side of that argument -- corporate america promised X, but failed to deliver
for aged populations, oh well...just moves along doing it's thing.

Between my age and that of my parents, there was a shift of "spend your life
working for a company, you would get training to your potential, and your
efforts would be reciprocated"; to today it is "fend for yourself, the
contract you enter in is at will on both sides with no guarantees" with the
caveat of "hopefully we are both striving for the same thing for an acceptable
duration".

~~~
wildgift
How can you compare corporate greed to union greed? The best paid union
workers were autoworkers and longshore workers, and the companies they worked
for were still huge and profitable. So as "greedy" as these well paid workers
were (and I mean "were," because autoworkers make a lot less today) they
weren't greedy enough to destroy the company.

If it weren't for this so-called "greed" there wouldn't have been a middle
class at all. And now that unions are shrinking to almost irrelevance, the
middle class is vanishing.

The old attitude of companies holding onto workers was created by unions
making demands. Now that unions are few, and in many sectors, were never
present, the "fend for yourself" at-will contract is the standard.

The unions made those "good old days". The labor strife of the 20s and 30s set
the conditions for the middle class of the 50s and 60s.

~~~
jmspring
By greed, I mean the failure of unions to adapt. They relied wholly on
seniority even when senior members became settled and were no longer
contributing as they should. Seniority as the sole measure of contribution was
a huge hit to how unions were perceived -- be it autoworkers, teachers, etc.
This is where I mean greed comes in. A refusal to self evaluate what was
working and what wasn't.

~~~
te_chris
Your use of seniority seems like a straw man to distract from the fact that
unions have faced an unprecedented corporate and political offensive in the
last 40 years that has no desire to compromise and is only intent on
destroying any fragment of organised labour. To blame senior union officials
for the decline of the unions is to miss the point entirely. Yes they were a
contributing factor, but certainly not the main cause.

~~~
jmspring
Not a strawman at all...teachers unions are all about seniority over
effectiveness and will fight tooth and nail accordingly. Many other unions are
similar. I agree to the policy of public bargaining, but individual members
should be subjected to measurements of their effectiveness. Tenure based on
the sake of time (only) should not have equal weight to merit within the union
structure. I say this as a product of public education and having many
wonderful teachers, but saw younger ones forced out where older were tenured
in and safe but not effective. I can't speak to other unions which I did not
experience.

The unions helped build the middle class in this country. The
apprentice/journeyman/master levels within the trades is a great measure of
skill and advancement, but regardless of trade (metal working, teaching,
programming, etc) your tenure should be one component of your measure, but not
the sole measure. Do you continue to learn? Do you teach? Are you advancing
the best interests of the group? There is more than "oh, I've been here longer
than you".

This is what I mean when I talk greed and seniority.

Yes, unions have faced an offensive, but their insular nature has also harmed
them just as much as the outside offensives.

------
freyr
It entirely depends on perspective. When I moved from the west coast to the
east coast after completing a STEM PhD, my perspective changed completely.

My girlfriend worked for a hedge fund, where her co-workers and bosses
received bonuses that were multiples of my annual salary. I had a few friends
who landed law jobs with lockstep compensation, where, within just a few
years, they'd be make more than I could ever hope to make at my research lab.
Another friend, an english major from a second-rate college, was hired to
manage a team of programmers. She had no STEM skills but great people skills,
and was eventually chosen to head up a new west coast division. She's
compensated extremely, extremely well. We'd occasionally travel down to DC,
where there are many, many people feeding off of government excess who make
far more than STEM careers pay.

That's what they don't tell you when picking a college career. You'll get paid
relatively nicely out of college, sure, but you'd better not expect to make
much more than that if you want to be a "STEM worker" __no matter how hard you
work or how good you are. The glass ceiling is very low compared to many other
careers.

Not only that, a $100,000 salary was, not very long ago, the key to a
comfortable upper middle class life. The cost of living, housing, everything
has gone up so fast in proportion to income that it just doesn't feel that way
anymore. I cannot provide my family with the material comforts my parents
enjoyed and provided me (and neither worked in STEM... or had college
degrees!).

 __Yes, there are exceptions _at the moment_ if you're considered a "rockstar
programmer". Still, that (and programming in general) represents a tiny slice
of the overall STEM pie.

~~~
georgemcbay
I totally agree and have made similar points here on HN in past threads.

It is nice that you can fairly easily make $85k or higher in some regions as
an entry level developer, but it sucks that outside of a few exceptions that
prove the rule you're unlikely to ever make more than about $150,000 (and I'm
talking Bay Area, CA dollars here) without moving into a pure manager role or
playing the lottery ticket of starting your own company.

Granted, $150,000 is a _lot_ of money relative to the average income globally,
even when you factor in cost of living adjustments, but to have bankers(!) and
politicians(!) saying it is too much is a fucking slap in the face.

~~~
deadc0de
Except 150k in Bay Area is nothing and you won't even make it into the middle
class (i.e. buy a house).

~~~
eli_gottlieb
Then maybe the Bay Area, the tech industry, and the economy broadly shouldn't
be run so "efficiently" that salaries and real-estate prices become locked to
each-other.

------
nohuck13
Quick refresher on what the word "shortage" actually means.

SHORTAGE: Below market rent-controls. If more people want housing than there
are apartments, and the price can't adjust, that's a shortage.

SHORTAGE: An oil supply shock as in the 1970s, and gas stations choose to
ration fuel rather than profiteering by jacking up prices. More people want
gas at that price point than there is gas. That's a shortage.

NOT A SHORTAGE: The lack of first-class flights from London to Chicago for
$1,000. That ain't a shortage, it's a market-clearing price I don't want to
pay.

I like the BCG quote: "Trying to hire high-skilled workers at rock-bottom
rates is not a skills gap."

~~~
k__
You're so right.

In Germany this is called "Fachkräftemangel", which translates to "Shortage of
Specialists". But it can also translate to "Mangle for Specialists".

------
spamizbad
If there's downward pressure on salaries in Software development, you're going
to see two things that will counter-act this long-term:

1) An exodus of developers. Devs will be likely be leaving either as the
result of fat getting trimmed or by transitioning into management and analysis
roles that offer better career prospects.

2) Less "young blood". A big reason why everyone is pumped these days to learn
to code is due to the career opportunities it provides: the great salary, the
job perks, and working for companies that are perceived cool. Most aren't
looking to become entrepreneurs. If software shops lose their charm and gains
a reputation for long hours with mediocre pay, people will seek opportunity
elsewhere.

I saw the same thing happen in the early '00s after the dotcom crash and the
outsourcing craze. Startups became a punchline instead of an aspiration and
everyone thought most of the world's code would be written in Bangalore. CS
enrollment tanked. People lost their appetite for learning programming. But by
'05 we were back into a "shortage" again after believing the first-world
programmer had gone extinct.

But I'm not surprised business and political leaders think STEM workers are
overpaid. The general attitude is that exceptional salaries should only be
doled out to exceptional individuals - if you're just a mere mortal that's in
demand, well, that's clearly just an inefficiency in the market.

------
briancaw2
It's cute that the income inequality Alan Greenspan is worried about
threatening capitalism is between regular engineers and everyone else, instead
of between executives\owners and everyone else. Explains why I see so many
documentaries about STEM workers and their lavish 2 bedroom homes they own
after 20 years.

------
tankerdude
So basically, Greenspan and other companies think that us STEM folks are
beneath lawyers, doctors, and most people in the financial industry? That we
should be "put in our place"?

Anyone who knows anything about the H1B rules knows it's all a bunch of
hogwash that there is a "skills gap". The corporations simply want higher
profits. It's just simply a known fact. Better profits for the promise of a
green card.

Let's see the companies prove that there truly is a skills gap. Instead of
paying the 'prevailing wage', H1B workers should get the _top_ pay for non H1B
engineers in the company + 20% or at that the 90% mark of engineers + 20%,
which ever one is greater. Then I say, please open up as many H1Bs as
possible. I'll tell you one thing, H1Bs applied for will go towards near
zero...

------
prostoalex
One thing that gets overlooked in this debate is the survivor bias. STEM
people have a pretty good way to drive down incomes in certain STEM
occupations by automating them out of existence.

WordPress alone probably killed a good portion of formerly gigantic market of
HTML programmer, CMS companies and consulting companies installing and
configuring the CMSes. Potential income from building simple HTML Web sites
nowadays is roughly zero, so people with those skills don't stay in the
industry (and get counted in surveys) - they either upgrade their skills or
move into other careers.

------
bdcravens
Alan Greenspan made approximately $180,000/year as Chairman of the Fed.
Perhaps Presidential-appointee salaries could be made equal to non-
Presidential-appointees by opening up those positions to foreigners.

------
droopyEyelids
A withering brilliance shows through this casually abusive headline.

I feel like this is a few steps away from some sort of revolutionary political
speech. Did Greenspan really say that shit while representing the country I'm
supposed to love?

------
short_circut
Given the skill level and investment required to get a competitive STEM degree
and the amount of profits a STEM person can produce for a company's long term
profits I think that they are actually potentially underpaid.

~~~
darcrossito
They should've written an article titled "Are Financial Analysts Overpaid?"

------
kenster07
I can play this game too:

Are bankers, lawyers, and doctors overpaid?

Well, it depends on what you want to pay people for -- what if we argued for
the value they added to society on average? What about the banking industry
during the financial crisis? What about the price of lawyers in California
staying stable even though the supply has increased multi-fold in the past few
decades? What about the people who design, validate, and erect the buildings
in which these guys work? The people who created the private jets in which the
questionably wealthy have always flown? The internet through which information
became significantly more accessible (aka affordable)?

The people who truly enable the good parts of modern life? I know where my
vote is going.

------
opendais
They really should have picked a different title and hinted at the conclusion
which was STEM workers are suffering the same wage stagnation as everyone else
and the only companies with hiring problems want STEM workers on the cheap. :/

------
dvanduzer
I would gladly take a pay cut if we also raised the minimum wage to $30 an
hour, got rid of most welfare programs and replaced them with a $10k/year
minimum income, and simplified to a flat tax rate (I think Dick Armey liked
17%).

~~~
jcnnghm
Given that the mean wage was only $43,460 in 2009, in order to raise minimum
wage to $60,000 per year, your pay cut would be to minimum wage. The
government would have to confiscate all income, supplement it with printed
money, then redistribute it evenly across the population. In that kind of
scenario, why would anybody do anything but the absolute minimum? Isn't that
largely why the Soviet Union wasn't competitive? If there was no economic
incentive for hard work, I'd wager many of the presently most productive
people would optimize for work minimization.

~~~
e12e
> Isn't that largely why the Soviet Union wasn't competitive?

The backwater pre-industrial, post-war torn nation that beat the US to space?
No, I don't think that was why they couldn't compete.

As far as I recall, pay is a pretty poor motivator -- while low pay is a
pretty strong _" de-motivator"_. So if you give people interesting challenges
and make sure they can meet their basic needs, people are likely to preform.

But, even if competing for exceptional wages was a great motivator, no-one is
saying that you couldn't do that in such a system -- you might have to limit
it to fewer "exceptional" people, and there might be a higher risk of being
demoted -- but I can't see why it wouldn't be possible. I don't think it would
be a good idea, however.

All that aside, a household income of 80.000 USD sounds pretty good for most
of the US (never mind 120.000) ?

~~~
jcnnghm
_The backwater pre-industrial, post-war torn nation that beat the US to space?
No, I don 't think that was why they couldn't compete_

Pretty amazing what you can do when you're willing to spend your country into
insolvency and collapse.

 _So if you give people interesting challenges and make sure they can meet
their basic needs, people are likely to preform._

It's not like 50% of workers in the USSR admitted to drinking on the job, or
40% held second jobs to make more money, right? I guess if you're not
motivated by a strong aense of community and bullshit pay, the gulags and
purges might help.

------
mzahir
Wages are so skewed towards the top earners - A typical corporate CEO gets
paid $7000/hour. Suppressing tech wages isn't going to make a dent in income
equality. Tech is already more egalitarian with the offering of shares to
employees at most (if not all) levels.

[http://moneymorning.com/2013/04/19/ceo-pay-now-7000-an-
hour-...](http://moneymorning.com/2013/04/19/ceo-pay-now-7000-an-
hour-350-times-the-average-workers/)

------
nnq
_Of course governments and current social elites from all parts of the world
want us overworked and underpaid!_

"STEM workers" can be the base of the new "over-middle" class - educated,
well-off and with good social mobility plus political mobility and
geographical mobility (this is fucking dangerous for governments and elites!).

You wouldn't want the class underneath you to have "well rested minds" and
time to think about the world and their proper place in it (at the very top
that is, because same as in old military societies warriors were the "natural
rulers", in the new info-tech society techies will be the new "natural
rulers"). Let's overwork them and stress them with unemployment so they don't
get any funny ideas in their heads...

Though to be honest, all this sounds good for us STEM workers outside US in
lots of indirect ways... I'll bet US will have a nice civil war / revolution
soon, and more immigrants moving in any directions will only mean that the
enlightening ideas from such a conflict will be easily exported worldwide.

------
alexgolive
Over the past few years I have seen starting salaries at top tech companies
(Google, Dropbox, Twitter) increase by huge amounts. This may not be true at
all companies, but it is definitely true at top companies. I also know that
these companies will hire anyone who can pass their interviews.

I feel like many times the argument is that preventing high-skilled workers
from staying in the US will help US citizens. This assumes that there's a
fixed pie of jobs and that basically bringing talent from outside will burden
the US economy. I definitely don't think that's true.

It also assumes that top tech companies have no option but to hire people in
the US. I have many friends who had trouble with getting a visa and instead
went to work in Canada for Google. This basically means the US lost one job,
plus the taxes and economic stimulus that a high paid worker would bring in.

------
rybosome
I am incapable of discussing this rationally, obviously, but this feels silly.

Why do these 100 executives who wrote an open letter to Obama care so much?
Obviously they don't want to pay the prices they're paying, but would they be
campaigning so hard if the work wasn't important? Ok, so the work is
important; they also can't just hire someone off the street, because the skill
requirement is high. Sounds like a normal market to me - your demand is high
relative to the supply, so the cost rises.

Again, being in this field, I'm wildly partial...but I have very little
sympathy for an executive who wants to pay below-market rate for business-
critical work. Why not cut your own salary if you are so concerned with
profitability? OH, that's different; you _deserve_ it.

------
frozenport
Gut Reaction: Do non-STEM workers do anything useful?

~~~
WesternStar
A better question might be.Can we automate away the jobs of sales people,
middle management and strategic directors? Yes, I believe we can.

~~~
kbenson
The real question; Can we automate the job of corporate officer? The cost
savings would be enormous...

~~~
WesternStar
Thats is a really hard problem. How do we define priorities and goals? There
is certainly an argument for a company where the only goal is to make money
and there is no overriding authority between divisions but there is so much
sociopathic behavior in companies already.

------
rusabd
I cannot believe you guys even discuss this. We are grossly underpaid. Mainly
because we are (en masse) not able to negotiate the compensation. That would
be a problem if we were able to organise, so someone else would do that for
us.

Look around, everything is driven by computers now. EVERTHING. Even bloody
banks. And we are still not sure are we underpaid or not. En masse IT person
is shy, ready to accept lower pay, and easy to accept more hours.

------
sremani
That is how your bosses look at you, IT workers are a cost center - whether
you are a programmer or sys-admin or db.

The simple fact is the MBA dude hates you.

------
dsugarman
> Likewise, tech companies are definitely not interested in paying higher
> wages

Most tech companies understand that the best engineers are 10x better than the
average, but you rarely have to pay them 10x the salary. Most are happy to pay
the higher wages if it means they are winning the 10x guys.

If the argument is all about the average -> poor engineer, I don't know that I
entirely disagree

------
carsongross
Comrades:

Either get lean, or seize the means of production.

Which, mirabile dictu, is yourself.

------
EricDeb
I'm not sure I agree that STEM workers are overpaid. I mean, I make a bit more
than the customer support, PMs, and sales people in our company, but I'd
rather do their jobs if the pay was equal.

------
eli_gottlieb
Oy gevalt.

 _Either_ there is a shortage, in which case STEM workers' salaries need to go
_up_ to attract more people into the field, _or_ STEM workers are overpaid,
which can happen if and only if there is an _oversupply._

It can't work both ways. You can't have a shortage of overpaid, useless
employees.

Unless, of course, you're a capitalist begging the government to let you
manipulate the labor market to deliberately suppress wages below the natural
market-clearing level set by supply and demand.

Capital, capital uber alles! Fuck the markets and fuck the workers! /s

------
bayesianhorse
No.

------
Daniel_Newby
These STEM salary stories seem empty. They are all price and no value. What is
the price elasticity curve for engineers? How much of the salary loss would be
offset by increased prosperity from more workers?

