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Unfortunately the Principal title has been abused and cheapened by some orgs. In some ways necessarily, as comps in tech have grown it’s become necessary to hire people at a Principal level in order to get the necessary comp. In other orgs it’s been a way to lure people who are attracted to the title. Ideally Senior positions would be more respected and have a greater comp range. But now it feels like Senior is almost entry level for some companies.

In my experience developers are going straight from junior to senior and "lead" is the new senior.

As an example, I recently got offered a Senior Software Engineer position with 6 months experience @ Zendesk.

my whole dept seems to be filled with seniors younger then me, except my manager thinks the title still means something at this point so i'm not being considered for senior for years. im asking to be senior because i just want the money fuck the titles...

It's about what you can do, not about how long you've been around.

Time to leave I guess?

Title inflation. When someone takes a job with you they want the higher title so that they can get the next title at the next job, because in most orgs title and pay are tied together.

This is an unfortunate consequence of the stair step approach to salaries most big and medium sized companies use. A L4 person makes this much (or within that narrow band) and if you want more, you need to get promoted to L5, at which point you make a lot more rather than just a little more.

If we didn’t tie comp to a small number of discrete “levels” an instead made it a smoother slope, then people wouldn’t be so focused on levels and titles.

Additionally, it doesn't help that some customers of consultancies ask for senior consultants. Surely the consultancy firm wouldn't label some semi-juniors as senior just to be able to put them on more projects and/or sell them for more money?

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