
Companies worry more about access to software developers than capital - ScottWRobinson
https://www.cnbc.com/2018/09/06/companies-worry-more-about-access-to-software-developers-than-capital.html
======
_m96l
Curious how articles like these almost never give the most obvious advice to
businesses, which is: pay developers more.

Instead, this article for instance advises employers to "increase developer
productivity" and "outsource":

> If developers are your company's most constraining resource, the key
> question is how to increase their productivity.

"Increasing productivity" typically puts pressure on developers. This is quite
surprising: developers are seen as a scarce valuable resource, and in a free
market that means they should be rewarded for their rare and hard-won
skillset. Instead, the universal advice is to pressure them to be more
productive, outsource them, etc.

~~~
cortesoft
That would work for a single company, but not necessarily the market as a
whole... paying developers more wont suddenly add a bunch of skilled
developers into the market.

~~~
dunpeal
Won't it?

There's a whole bunch of smart people right now who won't go into tech because
they can make more elsewhere.

Another example is senior engineers who retire because their investment
portfolio is large enough, and they don't feel like working hard for another
year just to make another $150k. If it was $400k, they might stay. These are
the engineers who are the most scarce and at the greatest demand right now.

Another example is turnover. Engineers currently have to job hop every couple
of years to get a decent raise. That leads to more waste of engineer time and
effort than any single management improvement that can possibly be
implemented.

These are just 3 examples off the top of my head.

In every other field, it is obvious that more pay == more and better
candidates. Yet somehow engineers are the single exception?

Against any sensible market theory?

~~~
geebee
Other fields also pay well and can draw top talent away from software
engineering. Take a look at "US News Best Jobs" and drill down by salary in
top paying regions for each job. The information is a roundup of BLS data.

[https://money.usnews.com/careers/best-
jobs/rankings/the-100-...](https://money.usnews.com/careers/best-
jobs/rankings/the-100-best-jobs)

Some examples:

The top paying market for software developers (the #1 job, apparently) is San
Jose, at $133k a year median pay.

Here's the top pay/region for the next few jobs:

#2 Dentist, Peabody MA, $285k/year #3 Physician Asst, Yuba City, $149k/yr (and
$138k a year in Santa Rosa CA) #4 Nurse Practitioner, $180k/Yr in Altoona PA
($158k/yr in San Francisco, CA).

A bit further down the list, a registered nurse (#18) earns a median of
$138k/yr in San Francisco, CA. Lawyers (#33) make a median of $193k/yr in San
Jose (top market)

I think national pay for software developers may be skewed by how many of them
work in the valley. When you compare them to what other well educated and
skilled professionals earn in those markets, you'll see that their
compensation is ok, but nothing notable. There are lots and lots and lots of
jobs that pay better, and may offer more fulfilling work.

My point isn't that software developers deserve to make more money. Maybe the
deserve to be paid less because their work matters less, but that's hardly a
selling point. It's never an apples-to-apples comparison.

But overall, I'd say the market is working just fine. There's no "shortage" of
software developers, any more than there's a shortage of any other skilled
professional in a high cost area. IN fact, there are probably considerably
more software developers at the current price point, because of 1) government
and industry PR programs designed to convince young people that they are
desperately needed in software, and 2) work visa programs that put Silicon
Valley companies in control of who is allowed to work in the US and the
conditions under which they are allowed to remain.

In fact, I'd say as long as non-market mechanisms (such as visa programs that
allow Facebook to decide that immigrants should be engineers but not florists)
are used to suppress wages, we should expect an almost permanent "shortage",
as people who have the freedom to be florists (or anything else they might
wish to pursue as free people) go into fields where wages and working
conditions don't reflect the negotiation power of people who can be deported
if they lose their jobs.

~~~
sanderjd
So where does the idea that developers are highly paid come from? I think it's
because very young people can get a six figure job right out of school, or
even without a degree. That's pretty rare.

But then it turns out that compensation doesn't scale with experience as
quickly as in other fields, and that a lot of people have to switch to
management to progress in their careers, so the overall median across all
experience levels ends up seeming low.

In general, software development seems like a really good field to get into,
but a mediocre one to be in for the long haul.

This same phenomenon underlies our perennial debate about interviewing: it's
actually great that you can get an amazing job just by doing some artificial
programming puzzles on a whiteboard, but it sucks that after ten years
building expertise, with a long string of successful projects under your belt,
you have to do artificial programming puzzles on a whiteboard to get a job.

The other fields you mention have the opposite setup. It's quite hard to
become a nurse practitioner, but once you're certified, employers pay well and
don't constantly question your basic level of competence.

~~~
dunpeal
> I think it's because very young people can get a six figure job right out of
> school, or even without a degree.

DING DING DING!

It was a clever scheme, and it even worked for a while.

"We need a lot of people to study CS, but we don't really want to pay them so
much and cut into our fat bonuses. Whatever shall we do?! Oh, let's offer eye-
popping entry-level salaries, that will get them to choose the CS major and
learn to program. Once they do, they're committed, so we can just freeze their
wages indefinitely. What are they going to do, go to medical school at 35?!"

> it sucks that after ten years building expertise, with a long string of
> successful projects under your belt, you have to do artificial programming
> puzzles on a whiteboard to get a job.

That's an artifact of the unfortunate fact that references are worse than
useless in the US.

There's no real way for a new employer to objectively tell how well you
performed on a particular project in the past.

Casual references don't work and are typically misleading.

I'll give you an example.

One startup I worked with had two very different developers.

One guy was totally incompetent. Multiple years of "senior" experience on his
resume, but couldn't complete a single feature.

However, he was great at socializing, so when he got kicked out, several
developers were happy to get on the phone and tell prospective employers how
great he was.

Another guy was quiet, socially awkward, and introverted. However, he was
among the top 2-3 programmers on the team. Completed some of the most critical
parts of the project.

I guarantee that he had a lot more difficulty getting any references. In fact,
I guarantee the first guy had a much easier time getting his next job.

Most employers who just speak to both and check references would get the
highly inaccurate picture that the first guy was far more crucial and
competent than the 2nd.

~~~
geebee
That's true. Is the cost of firing really that high, though? And how good are
the tech tests at determining that a software developer will be good at
working on a product? It seems to me that you could be great at printing all
paths in a linked list of numbers that sum to to sum of a different path in a
binary tree, but really not all that good at working on a product.

I know that many companies are so concerned about false positives (hire a bad
developer) that they are willing to tolerate a high incidence of false
negatives (fail to hire a good developer). That's an odd position for an
industry claiming a severe shortage of talent, but there's also a strong case
that if you allow too high a rate of false negatives, you can make it so hard
to hire a good developer that you end up hiring a bad one. In short, it's more
likely that one bad developer will slip through the cracks than a good
developer will make it through, if the good developers are a small percentage
of the hiring pool and the false negative rate is very high.

------
mlinksva
Story is a writeup of [https://stripe.com/reports/developer-
coefficient-2018](https://stripe.com/reports/developer-coefficient-2018)
discussed at
[https://news.ycombinator.com/item?id=17928067](https://news.ycombinator.com/item?id=17928067)

There's actually very little difference in the surveyed % saying
[https://stripe.com/files/reports/the-developer-
coefficient.p...](https://stripe.com/files/reports/the-developer-
coefficient.pdf#page=3) access to talent (55%), software engineers (53%), and
capital (52%). Note immigration requirements (47%) is lowest of the
constraints on company growth asked about. I'd say the headline is
questionable at best.

------
closeparen
Developers as a community are currently screaming about a number of things
companies can do to steal us away, even for less money:

\- Go full remote

\- Locate offices in reasonable COL US markets (my company has overwhelmingly
rejected this one and skipped from NY/SF/Seattle to the developing world).

\- Provide private offices, cubes, team rooms... any kind of workspace other
than the in-vogue open floorplan barn.

Companies are _not in their wildest dreams_ going to touch any of those things
with a 10-foot pole at scale. Do they not know? Do they think we're lying? Or
would they just rather complain than actually solve the problem?

~~~
Swizec
In the words of one manager: "I don't believe people are working if I can't
see them working"

In the words of another: "Remote means you aren't interested in advancing
inside the organization"

~~~
mgkimsal
> Remote means you aren't interested in advancing inside the organization

Do they really want the work done, or do they want to actively encourage
inter-office politicking? Not everyone wants to advance, and even in places
I've worked where I've _wanted_ to advance, it was made pretty clear that
nothing was going to be happening on my time schedule (too many other people
who'd "paid their dues" ahead of me already). So... wow - I _was_ interested
in 'advancing' but they weren't interested in me advancing. Would have been
easier if we'd just... focused on the work, no?

~~~
castlecrasher2
One of the biggest lies we tell ourselves is our code will speak for itself.
Whether you like it or not, politics is part of work. It's absolutely required
for intra-department projects and sometimes even single-department projects,
especially in big companies.

~~~
mgkimsal
there's the politics of 'getting ahead' and work for the promotion that
"everyone" is after. then there's the politics of ... getting along with
coworkers and getting projects done (time mgt, priorities, etc). To me,
they're different, and I was speaking mostly of the former.

------
kaycebasques
I saw this headline earlier. My immediate thought was that this doesn’t
necessarily mean that companies understand the importance of developers. It’s
just that developers are currently more scarce than capital. Which isn’t
saying much, because companies have been able to get loans with low interest
for many years now, thanks to our central banks.

------
jihoon796
If what the article says is true, it's great that executives are starting to
understand the opportunity cost of technical debt.

Too many companies see software development as a menial "cost center" while
hypocritically relying on it on a fundamental level for operations.

While I see where they're coming from - the ROI from software developers can
be rather opaque for many industries - these companies are often hellbent on
hiring as cheaply as possible (in-house junior developers with no experience)
and cutting as many corners as they can get away with, all the while accruing
massive amounts of technical debt.

~~~
dunpeal
> If what the article says is true, it's great that executives are starting to
> understand the opportunity cost of technical debt.

Nothing in the article implies tat "executives" (or anyone) has gained a
better understanding of the cost of technical debt.

This is the main paragraph talking about technical debt:

> And yet, despite being many corporations' most precious resource, developer
> talents are all too often squandered. Collectively, companies today lose
> upward of $300 billion a year paying down "technical debt," as developers
> pour time into maintaining legacy systems or dealing with the ramifications
> of bad software.

So the article author says that despite the skyrocketing value of developers,
companies generally waste this scarce resource on technical debt and related
mismanagement inefficiencies.

------
sokoloff
The world is awash in usable money.

The world is not awash in usable software engineers.

------
teddyh
As is common, Joel said it all back in 2000:

Whaddaya Mean, You Can't Find Programmers?
[https://www.joelonsoftware.com/2000/06/15/whaddaya-mean-
you-...](https://www.joelonsoftware.com/2000/06/15/whaddaya-mean-you-cant-
find-programmers/)

(Repost from five years ago:
[https://news.ycombinator.com/item?id=6454140#6455545](https://news.ycombinator.com/item?id=6454140#6455545))

~~~
stevenwoo
I went through a few interviews earlier this year and no one met the standards
for environment Joel listed almost 20 years ago. Unless one works from home,
that requirement listed is pretty much a lost cause AFAIK.

------
pleasecalllater
I'm afraid I don't agree. I'm more worrying about my job than the companies
about anything.

If lose it, I will spend months for finding a new one.

I will send emails with no response.

I will be offered to spend enormous time for multilevel recruitment process,
just to be rejected at the end.

I will spend hours making shitty take-home tasks, just to be rejected. Some
companies even don't check them when I upload it on a server.

I will be asked terribly complicated white-board questions about forgotten
algorithms used in no place. All that just to be offered a job about coding
ETLs or adding some Javascript to a website.

All just to get a simple job. It doesn't look like companies are afraid. It
rather looks like companies have endless stream of candidates and want to
crawl them first, so they could not hire them later.

My last job hunt: 55 resumes sent (I was a perfect fit for 15 positions, not
100% for the rest). 10 companies responded. 5 were interested only about the
salary, 4 of them didn't respond, 1 responded with "you wanted too much, we
are not negotiating salaries". 2 terribly complicated take-home things (one
company didn't event check it before rejecting me). Just 1 job offer, I took
it, as I didn't get any other option after 3 months of searching.

It was 2 years ago. I'm looking for a job again... I've sent 20 resumes. Got
no answer.

All 55 companies were posting the same job ads for the next months. About 5 of
them are doing all the time, and the web is full of opinions how great the
companies are.

So generally I feel like I'm rather useless than needed for the companies.

Writing anonymously here is cool :)

~~~
commandlinefan
Yeah, I keep reading about the software developer shortage “crisis”, but
nothing about the real world seems to reflect it. There’s a shortage of the
top 1% of software developers (“top” being defined by where you went to
college and where else you’ve worked, not actual programming ability) - but
that’s it.

~~~
homonculus1
I think I might just try to get into a different field. I'm a "recent" grad
yet to get my foot in the door, and I'm pretty sure I'm capable of
programming... just not of navigating the absurd requirements at every corner
and apparent dearth of entry-level openings.

Maybe I'm just underqualified and not that good at all, maybe I'm doing
something wrong in my search or I need to move to the valley or something. But
thus far all my applications have been a complete waste of time and it seems
foolish to continue down this path.

~~~
ummonk
There are ways around this. Triplebyte and codefights are good options and
finding a recruiter to refer you tends to improve the success rate (you can
email me if you need help with any of this).

~~~
vailprogrammer
Where can I email you? If you're open to helping others, that is. No email
listed in your profile

~~~
ummonk
Ah, forgot that it doesn’t list the email on the profile. I updated my about
page and it should have it now.

Yeah, I’m happy to help everyone!

------
hn_throwaway_99
If this is _actually_ true, it is easily provable: if companies have more
access to capital than developers, then they should pay more to hire better
developers, and you should see developer salaries rise. If this does _not_
happen, it just means they are bullshitting: they can't get developers at the
current price they are willing to pay.

~~~
austenallred
I know engineers at Facebook and Netflix making $500-750k/yr. Does that count?

~~~
anothergoogler
No, because the article is about a survey of executives.

~~~
austenallred
The parent comment said, “If it’s true that programmers are an undervalued
resource then some will be highly paid.”

There are many that are highly paid.

------
panic
If the premise of this article is true, we're doing a terrible job organizing
ourselves. Individual offices, remote work, ownership of things we make in our
free time -- we could have all of this if we used our power effectively.

~~~
cheez
Yes, software engineers are terrible negotiators.

~~~
dwd
Software engineers allowed themselves to be categorised as a cost centre
rather than a revenue generating asset.

Costs are to be minimised while those preceived as adding value like sales,
marketing, c-level execs get paid accordingly.

In industries that are unionised, collective action gives you the leverage and
backup to say enough - but we don't even have an industry body that requires
membership like the IEEE or AMA.

------
jorblumesea
Companies that complain about lack of talent are generally the ones that
refuse to pay competitive salaries. These are also the same ones that want the
government to increase visa limitations and import cheaper engineers from
overseas.

If there was a true talent shortage you'd see increases in salaries and other
methods of compensation.

~~~
friedman23
To be fair, competitive salaries are almost absurdly high nowadays.

~~~
jorblumesea
Competitive salaries are just that, competitive. There's no concept of "too
high" or "too low", just what the market accepts and will pay for.

Companies love the free market when it benefits them and hate it when it
benefits skilled workers.

~~~
friedman23
>There's no concept of "too high" or "too low"

Did I say so? I'm not saying it's _too_ high. I'm saying it's absurdly high.
If I was saying it was too high I would be arguing that it should be lowered
which I obviously would not want.

~~~
ncallaway
I think most people would interpret "too high" and "absurdly high" to mean
reasonably close to the same thing.

That's probably why you're getting downvotes.

~~~
friedman23
I mean, I don't think my statement is in any way inaccurate. It's kind of
absurd that you can get a job that pays $200k+ total compensation your first
year out of college with only a bachelors degree. Some people within the field
don't even believe it's possible.

------
salawat
Not surprising.

Software developers are one of the ultimate forms of throughput multipliers.
Get the pixies in the box dancing right, and BOOM! Personnel load decreased!

In a world being driven toward hyperoptimization as fast as she'll go, your
developer is your growth source.

If only you could get them to do what you want...

Which is why they like pulling developers from countries where the cultural
norm is to shut up and do what you're told as I understand it.

It's also part of the bias towards preferring younger devs. Younger devs tend
to be more pliable and "flexible" and don't ask inconvenient questions in
emails that can be subpoena'd later.

Always ask questions. YOU have to be the conscience of the industry, if you
don"t, no one else will. And even if they do have "another guy" lined up. Be
vocal. Make sure your view can't be buried. If it smells, ASK and DIG. Someone
very well may not be telling you something.

------
village-idiot
I mean, all those companies buying back stock could just re-issue it if they
need more capital. Creating developers is a significantly slower process.

------
expertentipp
> Collectively, companies today lose upward of $300 billion a year paying down
> "technical debt," as developers pour time into maintaining legacy systems or
> dealing with the ramifications of bad software.

As a person who had looked intensively for a job in Central Europe in the
recent months I can confirm this. Plenty of awful software and stacks. Decade
old monoliths in ASP .NET, Visual Basic, pyramidal monstrosities in JAVA,
fucking COBOL transactional and registering systems. The only reason they
„maintain” these projects is some legal obligation, once the obligation
expires the project will be shut down and people will have to look for a job
in the year 2020 having experience with Visual Basic. You will have „standups”
with „American colleagues” at 7pm your time. It’s literally working on
carcasses. Good portion of German and Swiss businesses pushing out their
rotten carasses over here as well.

------
jt2190
There was a discussion about the Stripe report itself a few days ago:
[https://stripe.com/reports/developer-
coefficient-2018](https://stripe.com/reports/developer-coefficient-2018)

~~~
AdamM12
OP's post and this seem to be telling executives to avoid fixing technical
debt. Am I the only one who's reading it that way? Having worked at a company
that completely eschewed even fixing basic formatting of legacy code for ten+
years I've seen how this mindset can completely hinder the development
process.

------
fogetti
As a software engineer with more than a decade of experience I have seen all
kind of appalling "management" strategies in a variety of industries. And not
so surprisingly the common denominator was that managers in every industry
simply cultivate "speed over everything else" culture. Which directly
translates into technical debt.

I stopped counting how many "rockstar developers" I have seen rising in their
shiny armors, outputting some crap extremely quickly just to see them sailing
away with a friendly manager pat on their back, so that half year later a
whole team would clean up the mess after them.

------
jondubois
What usually happens though is that the wrong kind of developers get promoted.
They get promoted based on their social skills and ability to sound smart
instead of actual technical ability and actual intelligence.

------
torgian
I currently make about 24k a year as a part time engineer (which should go up
to around 40k if I go full time for this company).

I stay because of other benefits (good health care in Japan, remote work with
bimonthly meetings, and most importantly I am doing good work with data that
helps people in some way).

I honestly don’t think high pay is out there for what I want from a company.
This one I work in checks all the boxes, for me. But if I pursue more money,
I’d probably be stuck working in some crappy conpany where I’m a number.

~~~
artsyxxx
You said it torgian; I'm looking for a company with Emotional Agility
operating according to The Startup Way where people treat each other humanely
and perks don't masquerade as strategy. I'd care to know more about your job
in Japan if you would be willing to share

~~~
mooreds
We should chat. Or you should check out weworkremotely.com.

These companies do exist.

------
spenrose
Developers and capital are partial substitutes for each other:
[https://twitter.com/indy_johar/status/662678550911303680](https://twitter.com/indy_johar/status/662678550911303680)

------
exabrial
One could establish development offices in places with low taxes compared to
California, Seattle, or NYC, saving them significant amounts of $ to avoid
salary bloat. Why no one is negotiating on the sorts of deals with city
planners surprises me.

------
Oras
As some stated in comments, it depends on many factors but mainly some
companies mainly startups with good funding starting offering higher than
market rate salaries which attract talent not just for money but also for the
opportunity to make an impact and definitely fewer legacy systems comparing to
well-established companies.

~~~
rco8786
That was an incredible run on sentence.

------
rightbyte
Strange.

"A majority of companies say lack of access to software developers is a bigger
threat to success than lack of access to capital."

Capital gives access to software developers but software developers don't
necessarily give access to capital.

Mr. Will Gaybrick doesn't seem to get his causality right.

"Tech's ultimate success: Software developers are now more valuable to
companies than money"

That's just stupid.

"2\. Outsource. Fully embrace the cloud. Not just for storage and compute but
for every business function that's not unique to your business"

Custom tooling is one of the most valuable part of having in-house
programmers.

It's interesting to read the thoughts of these suits. It explains so much of
my everyday troubles at work.

~~~
aerotwelve
I agree, I thought the piece was very odd.

 _" If you're considering buy vs. build, the answer is simple: buy."_

If you're not going to write or implement anything more advanced than "glue
these two off-the-shelf systems we bought a year ago together", why are you so
concerned about access to software developers?

~~~
jihoon796
There's a few reasons why: many businesses are in geographic locations where
there's not as much software presence, they don't know how to hire correctly,
and they don't want to swallow the bitter pill of "software developers cost
significantly more than minimum-wage employees".

I've worked with a company where developers were hired to "glue these two off-
the-shelf systems we bought a year ago together", but the implementation was
laughably poor. From talking to this specific company's executives, I found
that they were confused as to why things were always behind or why they were
running into so many bugs. They told me that they were having difficulty
accessing software engineers and that there was a market shortage.

What they didn't tell me was that their current "software developers" were ex-
military operations folks with no actual dev experience, and that they posted
on Indeed/LinkedIn but wanted local talent (in NC, not the Bay Area) and only
offered $50k/yr salary with no real benefits.

Wanting only local talent (instead of remote) already reduced their available
developer pool by 99%, and the terrible salary put the nail in the coffin. But
to company executives, all of this only proved that they lacked access to
software developers.

~~~
village-idiot
Most of the time when business executives talk about “lack of available
talent”, they usually mean “lack of talent at the price I’m willing to pay”.

Everyone’s a free market enthusiast until the market says they have to pay
more, it turns out.

~~~
kasey_junk
At current prices it’s entirely possible that some software businesses are not
viable. Saying that out loud (or even admitting it to yourself) is not a great
look.

Further, the software industry is such that failures are more common to
successes when it comes to software projects. I suspect if that ratio got
better or predictability did, we’d see wages rise even more (at least for
those predictably successful devs). As it stands you can throw all of the
money at the software hiring problem and still be making a terrible gamble on
whether you’ll get software out of it.

~~~
village-idiot
The first point is possible, but given an era of super low taxes and massive
stock buybacks, I doubt that many of these places can't afford developers, I
bet they just would prefer to use that money elsewhere.

I think your latter point is much closer to the mark.

------
HillaryBriss
> _Unless you 're Amazon or Microsoft, you shouldn't be deploying engineers to
> build data centers._

i wonder if the author has heard of Google

> _Including software developers directly in strategic business decisions will
> ensure you have the right product road map, the right team and ultimately
> the right technology strategy for long-term success_

I would agree that including software developers is necessary -- but is it
sufficient? The business and technology landscape are always changing in
unpredictable ways. I question whether this can _ensure_ "long-term success"

