>OK, I’ll tell our recruiters they are free to approach any Adobe employee who is not a Sr. Director or VP. Am I understanding your position correctly?
>if you [Brin] hire a single one of these people that means war.
Chizen's comment:
>if I tell Steve [Jobs] it’s open season (other than senior managers), he will deliberately poach Adobe just to prove a point. Knowing Steve, he will go after some of our top Mac talent…
Jobs sounds like a Grade-A Asshole, along with every other player involved in this mess. Makes me even less likely to relocate to SV than I already was. Though now I'm curious to know whether these wage-theft pacts extend beyond SV, perhaps to Austin... Many of the same players have a significant presence here. Seriously. If you've got info, hit me up.
"Jobs told him that Atari gave them only $700 (instead of the offered $5,000), and that Wozniak's share was thus $350. Wozniak did not learn about the actual bonus until ten years later, but said that if Jobs had told him about it and had said he needed the money, Wozniak would have given it to him."
*...told Jobs the good things these machines could
do for humanity, not the reverse. I begged Steve
that we donate the first Apple I to a woman who
took computers into elementary schools but he made
my buy it and donate it myself.*
I really respect Steve Wozniak. But why does he not rebel and leave him. Why does any body surrender when they have a choice unlike most others. And this is the reason i wish there are more people like RMS who are both talented and have deep philosophy.
This whole episode is pretty depressing. But, it's far better for people to live without illusions about the nature of their bosses, etc.
At the risk of a hundred downvotes, I wonder how many people can see the parallels in the current silicon valley push for "immigration reform."
Having watched H1B farms style companies up close and personal, I can say there is very little to recommend about this model of employment, other than the CEOs like having a lower employee expense base. It might sound more exciting to hear the pitch from a wunderkind like Mark Z, but it's still the same story.
The H1B issue is absolutely about providing cheap, endentured labour: visa holders are tied to their sponsoring employer and must appeal to be allowed to seek other employment.
Norm Matloff of UC Davis has literally been trying to expose this for decades, with little luck:
Moreover: this is entirely consistent with behavior of employer first observed in the 18th century:
[I]n every part of Europe twenty workmen serve under a master for one that is independent, and the wages of labour are everywhere understood to be, what they usually are, when the labourer is one person, and the owner of the stock which employs him another.
What are the common wages of labour, depends everywhere upon the contract usually made between those two parties, whose interests are by no means the same. The workmen desire to get as much, the masters to give as little, as possible. The former are disposed to combine in order to raise, the latter in order to lower, the wages of labour.
It is not, however, difficult to foresee which of the two parties must, upon all ordinary occasions, have the advantage in the dispute, and force the other into a compliance with their terms. The masters, being fewer in number, can combine much more easily: and the law, besides, authorises, or at least does not prohibit, their combinations, while it prohibits those of the workmen. We have no acts of parliament against combining to lower the price of work, but many against combining to raise it. In all such disputes, the masters can hold out much longer. A landlord, a farmer, a master manufacturer, or merchant, though they did not employ a single workman, could generally live a year or two upon the stocks, which they have already acquired. Many workmen could not subsist a week, few could subsist a month, and scarce any a year, without employment. In the long run, the workman may be as necessary to his master as his master is to him; but the necessity is not so immediate.
This is the dirtly little secret. Even if you hire at "market wages" there are all sorts of ways to exploit the relationship going forward. The power-assymetry this puts the H1B holder in is the opposite of 'negotiating leverage', and one can rest assure that this will not go un-noticed.
>The H1B issue is absolutely about providing cheap, endentured labour: visa holders are tied to their sponsoring employer and must appeal to be allowed to seek other employment
This is plain wrong. You can very easily shift and people do shift. You just interview with a different company, just like a citizen would.
Sure, but you can only renew the H1-B once (although you can get extensions). Also, most companies make it a policy to not sponsor you for a green card unless you've put in a year or two, and then once you apply for it they've got you by the balls. So every time you switch companies, you're starting the clock over again.
This is even worse if a company brings you in through some other visa like a TN-1 or L1 (NAFTA and Intracompany transfer visa respectively), and then make you convert to an H1-B before they will sponsor you.
A word of advice: Always use your own immigration attourney and not the one being paid for by your company. If the company is paying for it, the attourney represents the company, and not you.
Your statement " So every time you switch companies, you're starting the clock over again." is incorrect. After your i-140 is cleared and you have received your priority date you can port your i-140 and retain your priority date. Your clock doesn't reset per se.
Oops, good question. You port your priority date not your i-140. The new employer still needs to apply for a new i-140 with your previous PD. This way you don't lose your place in the queue.
Your comment about TN makes no sense to me. TN is not an immigration-intent visa - if you apply for a green card while on a TN, you have to maintain an address in Canada and prove that you plan to return there. This is very difficult to do, and your green card will almost certainly be rejected and you might be allowed back into the US on the TN. So of course they make you switch to H1B before they'll sponsor your green card.
Not quite. It's certainly possible to enter the US on a TN visa to work with the intention of returning to Canada but also intending on becoming an immigrant at some point in the future. Yes, you do need to maintain ties to Canada when you enter under the TN visa, but there is no requirement that you need to be on an H1 when filing for Adjustment of Status.
I've seen a couple of people do this, and it allowed them to skip the H1-B hassle. You just have to be honest and show that your intention initially is just to work and return to Canada, but your future intention is to become a permanent resident.
H1B throws all that much more friction into an already unequal relationship, tossing power further to employers.
My preferred reform would be for H1B to be fully unrestricted. If you're going to allow labor into the country, let it compete on fully equal footing with domestic labor. For the reasons Smith articulates and you've either failed to read or are intentionally choosing to ignore, employers already have the upper hand.
A better balance of power would be to repeal anti-unionization laws such as the Orwellian (100th anniversary of his death by the way) doublespeak "right to work" (really: "right to fire, and disrupt organization attempts") and ensure that labor has the same access to collusive collective action and mobility as capital and finance.
real changes that need to be made to h1b are the fact that they need to prioritize the h1bs to foreigners who graduate from US universities. Every year thousands of foreign PhD students graduate and go back to their home country not because they want to but because they could not get an H1B visa mostly because they wont work at the cut rate a person fresh from their home country would work for. These PhDs are trained with public funds because no PhD student pays their own way through school they receive public grants from the schools or other public entities that fund their research and their study. Americans just dont want to enter graduate school in the same numbers that chinese and indians want to and there is no problem with that as long as these people are not being trained just to go back to their country. They use US public funds to be trained so it is beneficial for them to stay in the US and boost the US work force
They do pay for their own education. They pay for it through substandard wages for the work they perform. If their department didn't pay for their tuition then there is no way those students would work for the peanuts they currently do. The net cost/income to the school would be the same but the current arrangement has less transactional friction and makes it very hard for the student to leave once they've started.
That is another element of possible reform, yes. I've watched the changes of the past 14 years with increasing gloom.
I also saw the effects of the liberalization of immigration regulations in the 1960s which saw floods of foreign students, many Indian, Chinese, African, and others, which had profound influences on US academic institutions, the communities around them, and, to be honest, on their home countries, one of which was a brain drain.
On that last point: one of the arguments for increased global wealth and/or population is that it would increase the number of geniuses and intellectuals (along with the rest of the population, one might suppose). That's possibly true, but I strongly suspect that the existing mechanisms for recognizing and promoting talent have already encroached on much of those possible gains. Not all, but a considerable fraction. Which means that the additional benefit would be smaller than a naive estimate would suggest.
It is very variable depending on your subject and research focus.
Teaching opportunities are not good; there are far too many PhDs awarded compared to job openings for university positions.
It may be a benefit for private industry work, but remember that a PhD is primarily about showing you can perform rigorous scientific research, and compared to a Masters, matters less (or not at all) in jobs where research is not the focus.
Read about "post doctoral treadmill" and adjunct gigs, which are like second tier faculty. If you get a phd in some programming related field, like compilers, programming languages, networking, yes, you can work for some valley firms. Yes, you can get green card easy, too. But there is no 'secure' employment like the phd grads of 1970s
I think you're being a bit unrealistic about how people behave. The H1B does give a lot of extra market power to employers because it means the employee has a lot to lose if things go wrong. The threat of being fired carries with it a much greater weight than for regular citizens.
Sure, the employee can interview for another job and applying for a transfer is not a difficult process. But, even with another job, the threat of being fired is still a huge pressure.
Plus, there's still a risk that the employer will find out they are looking for another job before they find one. Also, employees are unlikely to complain or make requests, since rocking the boat could get them fired and sent home. Most people are not risk takers and are not confident at being able to hide things.
On the E3 visa - and AFAIK the H1B - you can't be out of work for more than 10 days. If you're not confident you can find a similar salary (and have an approved LCA) within that time then that makes the idea of rocking the boat a little more scary.
Well it isn't that easy too if you bring in ethics to the table. This happened with my friend and it was done by a well known "online retail" company. So this guy got an offer from another "search engine" company. He went to his manager in the best interests of his present employer to tell them that he might be leaving in a few weeks and to hire a probable replacement for him. The next thing what this * company does is pass on a request for his H1B to be cancelled immediately. Thankfully , it all worked out for him in the end since his LCA luckily had already been filed by then. But this does bring into the question of how H1B is readily exploited by most employers.
I'm not keen to defend the ridiculous immigration system, but it's possible to avoid this risk in the following way:
You can interview at, accept an offer from, apply for and receive a new LCA for another company all while continuing to work at your existing job. This means you have a new job and (preparatory documents for a new) visa set up before even giving notice and triggering the 10 day period. I know this from personal experience (on the E3).
That remains a constraint a permanent resident wouldn't have to face.
More specifically: in a case where an H1B holder had concern for employer retaliation (say: working for a sketchy, illegal, or otherwise undesirable firm), and was looking for an option to leave (or possibly whistle blow), the fact that not having employment would be grounds for deportation within short order would be a constant threat.
I've known many people over the years who've had varying levels of frustrations with emigration issues. Many spent at least some of that time as undocumented, what some like to call "illegal", including working without authorization. For others it was merely the frustration of waiting while an impenetrable and slow process worked its way, with several having to make unavoidable trips out of country to be able to retain eligibility, often leaving work, friends, family, and homes for extended periods (sometimes with greater levels of support and assistance). And this isn't just a DESI situation: Europeans, Canadians, east Asians, doctors, programmers, healthcare professionals, researchers, nurses.
Oh, of course. I completely agree that the system is horrific. I only wanted to point out how one can minimize their risk if one is forced to interact with it.
He isn't wrong. I've had friends that had their processing take much longer and go into a more detailed review which delayed them taking a job. You can also get your "H1B transfer" denied for the new job even if you're doing a similar job to your old gig
+1. H-1B transfer process is much easier than an initial H-1B application process, so moving to a new employer is almost just as easy as if you were a citizen.
Immigration reform is fine but it needs to be balanced by restraints on corporate power to do things like wage theft.
What I'd like to see is things like a complete national abolishment of non-compete agreements as a rider on Immigration Reform.
Conspiring to keep out immigrants is interesting (who doesn't want to pull the ladder up after we're safe), but it if we're honest with ourselves it's not appealing to our better nature.
I don’t want to sound like I am excusing this behavior but this type of thing happens all the time in various other industries all over the country. This is not an isolated sv disease. And as much as it is about money in regards to salaries it’s also about employee retention which is also about money haha.
What vision? The idea to make technology easy to use? What a mind blowing idea. I'm sure nobody thought of that before, in 10,000 years of human history. But you know, Jobs actually DID IT, he had the balls to hire a bunch of engineers to make his personal phone easier to use, and stiff them over and over systematically, like any business would.. Wait, what exactly did Jobs do? He had a lot of money.
If you are a student, I would still recommend moving to SV. It's probably the best place in the world right now to be a software developer. This wage-theft stuff is for very experienced echelons of engineers.
The article does not support this claim. My reading is that GOOG's HR department kept/keeps the salary curve artificially flat (over-rewarding low performers) to manage pay within a narrow band and thereby prevent having to negotiate with top performers.
> Google, like the others, used a “salary algorithm” to ensure salaries remained within a tight band across like jobs. Although tech companies like to claim that talent and hard work are rewarded, in private, Google’s “People Ops” department kept overall compensation essentially equitable by making sure that lower-paid employees who performed well got higher salary increases than higher-paid employees who also performed well.
Are you from SV? There are plenty of affordable places to live in SV. Just because everyone is talking about how SF is sooo expensive, does not mean you can't live in Berkeley/Oakland/East Palo Alto/other areas.
I'm from Santa Clara, and "affordable" is an extremely relative notion. Silicon Valley itself isn't much cheaper than San Francisco. Berkeley, Oakland and East Palo Alto are not in Silicon Valley. And frankly, they're not as cheap now as they were even 18 months ago. It's still possible to get a one-bedroom apartment for $1000 a month if you look around hard enough, but it's almost certainly going to be small and old.
The big issue is that right now, $1200, even $1300 a month for a one-bedroom apartment in this area would seem quite reasonable, even a bargain. That's banana crazypants. In Sacramento you could get a two-bedroom, one-bath place with all the amenities for under $900 a month without looking too hard. That means that if you were able to telecommute three days a week -- maybe even just two -- it would cost you less to live in Sacramento and take the Capitol Corridor train in to San Francisco on your office days than it would to live pretty much anywhere in the Bay Area.
I'm not advocating that (the thought has clearly occurred to me, but I have too many friends here in SV to want to make getting to them that difficult), but I think it points to a genuine problem with the local economy. The median housing costs across the Bay Area show an implicit assumption that everybody is making Big Tech Money, but they're not -- and some areas are starting to get too expensive even for the people who are making top dollar. This just isn't a sustainable mix.
Hmm. I think I'd have to agree with you, actually, not just for the bike proximity. :) I've thought of Silicon Valley as running from Mountain View down toward Los Gatos -- the actual geographic Santa Clara Valley, essentially the South Bay region -- but it would certainly make sense to consider Palo Alto the northern end of it, given the importance of the city and Stanford University to all things silicon (literally and figuratively).
I'm a student in the Deep South, and getting out to the Bay Area is a dream of mine. Here's to hoping the price comes down in the next couple of years.
Don't listen all the whining. When I moved to San Francisco in 2008 to work on a startup, I rented a small bedroom in a house with an immigrant couple for $450 per month. If you want to make it work, you'll make it work.
There are plenty of places with decent rooms you can rent for $800-1000. I paid $825 for my old place in South San Francisco (20 min commute to SF). It was a 2300sqft house shared by 3 others.
Renting just a room isn't always feasible, depending on how much baggage you have in both the literal and figurative sense. When I moved out here 11 years ago from a one-bedroom apartment in Tampa Bay, I did indeed rent just a room from a friend -- and I had to sell a lot of furniture. I've since bought new furniture, and I would not be particularly inclined to give it up. I realize this is my choice, but it's one that you're more likely to face once you get into your 30s (or at any point if you get a family, of course).
And, I think my larger concern about prices still stands. That $825 a month could get you a 1BR place with W/D included in many other cities. Actually, it could get you at least a 1BR/1BA place with W/D in many other cities, and we're not talking "middle of nowhere" type places, either. There are still certainly reasons to live in the Bay Area rather than those other places, but we're paying an awful lot for the privilege.
Well, going by Craigslist you can find 2BR places for less than that -- but it doesn't look it's easy to get much under $3000, and the median seems closer to $4000. I suppose Silicon Valley is still a relative bargain, in the sense that the third or fourth most expensive place to live in the country is cheaper than the first most expensive. :)
I would be troubled by the thought of spending 80 minutes each day trapped in a steel cage. That's 400 minutes per week, or about 300 hours per year just sitting in traffic.
Even if SV were the best place to be an engineer, it's hard to imagine it being worth sacrificing 300 hours per year.
A 10 minute commute is 25% of that, which is 75 hours per year, which is still a lot. But for me, there is a huge psychological difference between a 10 minute commute vs 40.
Cutting commutes up into hours per year doesn't seem all that useful. Lots of stuff takes up what sounds like ridiculous amounts of time if you look at it like that. I'd rather look at it in terms of your day.
If you plan to spend 8-9ish hours actually working, and another 10 per day on sleeping, eating, shower, and other such necessities, that leaves about 5 hours of real free time. A hour and a half a day of commute time is a pretty solid cut into that. 20 minutes of commute time is hardly noticable. Personally, I'd sooner take the 10 minute commute and have that mental seperation between work time and off time than have an extra 20 minutes a day and work at home.
I've done a not-quite-so-bad commute, Seattle to Redmond, only 20-40 minutes on the way to work, 50-70 minutes on the way home. I found it soul-crushing. Most of the wait on the way home was in the line to get on the freeway. I became a worse person, unwilling to let other cars merge in, always assuming the worst of other drivers.
Currently I have a 20 minute pleasant bus commute to work, and I wouldn't go back to that commute. For me, it wasn't worth it.
For about six months I commuted from south San Jose to Mountain View. It was a fucking nightmare. I will never in my life live in a situation that requires such a commute.
Of course, now I live in the midwest and am hating the weather. My commute? Not so bad. But I miss the weather.
I came to the conclusion last time I was visiting SV that Northern California actually has terrible weather, everyone there just calls it 'traffic.' ;)
If you write code or do something meaningful in tech, the money and housing will come in SV. If you are reading hacker news, you probably are planning on doing something of the sort.
Agreed, there many good positions for new college grads. I don't think there is any better location than SV when starting a software engineering career.
While housing prices are quite high, working in technology you are certainly able to afford the higher rents. The problem is when you don't work in tech and live here.
I'd have to respectfully disagree. While I've never worked in the valley I have researched and interviewed with 10+ companies there.
My findings were that startups there are extremely busy. They are slow to respond to emails, meetings and interviews are often missed/rescheduled, and salaries are relatively low (<100k). When talking to execs it became clear that they demand 45+ hours a week.
Compare that to Austin, Seattle, DC, Chicago, and Portland, who all have thriving startup communities that often match SV wages, and SV starts to look less appealing.
SV working conditions are not something a college grad should strive for. They should focus on locking down a nice salary with relatively cheap living costs, clearing themselves of debt, and growing their personal worth with side projects.
I want to agree, but the scene here is really incomparable to anywhere else. There's simply too much damn VC money floating around which attracts top business people. Chicago does not have billions of dollars of VC floating around. Austin might. DC does not.
Also, the wages here in SV can not be matched anywhere else. It's economically impossible to pay someone a SV wage anywhere else. Economically impossible because if you're a business that has intentionally based your company in say DC then why would you continue to pay your engineers SV-sized wages. You'd be amongst the wealthiest people in DC if you were paid what a typical engineer is offered here.
I'm not sure how reliable indeed is but doing a quick search shows that the average salary for a Web Developer in DC is $105,000. It says the average for a Web Developer in San Francisco (the most expensive city in SV) is $114,000. Now that roughly $10k difference could seem like a lot to some but they'd be mislead to think that money wont get eaten up by SFs extreme cost of living.
>...your company in say DC then why would you continue to pay your engineers SV-sized wages.
Because you value great employees? I mean think of it this way. A lot of people can't just pack up ship and move to SF. But a lot people can! Companies keep their salaries on par with the valley to keep up. Granted the numbers aren't a science. It is hard to compare salaries in different areas but It has been my experience that SV wages are not that much more than any other city in the US.
> You'd be amongst the wealthiest people in DC if you were paid what a typical engineer is offered here
This is just blatantly false. Do you know how much government workers and politician minions make? It makes engineering salaries look laughable.
I suspect that those numbers don't tell enough of the story. The range of salaries in SV is huge. Netflix routinely pays more than 200k. Tiny startups pay < 100k. I don't imagine you see such a variance in DC. 50th percentile might only be 10k apart but I suspect the gap widens as you get deeper into the "above average space".
I do think that a developer getting paid 300k (not unheard of for top talent at top companies) in a place like Austin would be ridiculous.
Well if you care for privacy and data protection I'd recommend not moving to SV. Most places are not a lot better but many places at least try harder/care at all.
It's hard to say, from just this snippet. You forgot to mention that Chizen tried to slime his way out of the problem by claiming he was only hiring junior-level staff. So Steve responded, rather sarcastically, "Okay, so everyone is open game then?", and then Chizen goes "No I was just kidding! Let's just be friends! Tee hee!".
I mean, Steve was a douche for a lot of other reasons. But this is savvy business right here. He had Chizen by the balls. Considering there's no mention of Apple intentionally trying to recruit from other companies in this article, I have to assume (until other evidence is provided, of course) that Apple was not doing such things.
To me it sounds like Steve knew he had the advantage, and he exploited that to keep his top talent where they were.
The typical response I hear to the idea of more widespread labor unions or AMA-like professional associations for programmers and network/systems/storage/database administrators is that if someone is really talented, they can negotiate a good salary, and that labor organizing together would just protect the lazy and the slackers.
You hear this same thing when someone is lowballed a salary number, or has to put up with some other annoying workplace condition, it's said the person should negotiate this all up front with the employer, and that the person's lawyer should get involved in the negotiation.
As if one person has any chance negotiating against a Fortune 500 company's HR department, legal department etc. (or the equivalent forms coming from some venture backed firm whose VC's lawyer's help with the HR legal forms). Especially when the heads of tech companies are united ( http://www.fwd.us ) to trying to flood the Valley with low-paid workers chained to the H1-B visa, driving down wages and shortening the careers of programmers ( http://heather.cs.ucdavis.edu/h1b.html ).
Now on top of that, we see that the companies are united in trying to drive down wages. It's not just one Fortune 500 company doing this, it's the management of all of them doing it together. Yet the idea of programmers and admins organizing to defend their interests? Well only complainers do that. Steve Jobs and Eric Schmidt organize for their collective interests, but any tech who did that must have something wrong with him - he's a complainer, lazy, whatever. We shouldn't be organized to have our interests defended.
It's a zero-sum issue with two potential beneficiary sides. There are those of us who work, and create wealth being screwed by this. There are those on this board who benefit from this exploitation and thus will pick at points in this article, in this post and so on. Why wouldn't they, they're the ones who parasitically benefit from this expropriation and exploitation.
As a H1-B myself, I think I'm pretty much a modern-day slave without the physical shackles. I hate going back to my home country and I love the intellectual, rational environment here. But I'm stuck with my current company until I get a green card which isn't bound to happen in the foreseeable future. I read his book on this and I agree with one of Matloff's points that H1-B should be solely for talent and I also agree with the reforms he suggests that there should be laws against exploiting them (ex: don't imprison them with the whole green card ruse which could take 6-8 yrs for some countries).
However, I disagree with his generalization that H1-Bs are talentless compared to Americans (Just look at Goog). And that somehow they're paid lower wages. All big companies (MSFT, FB, GOOG) pay H1-B candidates the same salaries as their American counterparts. And they all go through the same interview process. Personally, I went to a top 20 uni here and paid $100k in tuition alone. It is true that bringing more talented H1-Bs will drive down wages, but isn't that a competitive advantage ?(None of the European companies have this advantage really and I think it's one of the main reasons for the valley's growth.)
What we need to rectify is fraud of H1-Bs. Come up with a white list of companies that can use H1-Bs and make sure there's no cheap, talent less labor. Don't let body-shopping, consulting and outsourcing companies like Infosys, Wipro be issued H1-Bs. Most people in the operations group running our service for instance are on H1-B and frankly, the work they do can be done by any average American working at a BK/McDonalds. The pie that outsourcing companies are eating into is really a gold mine that should be used to expand the American middle class. But the outsourcing companies themselves seem to have powerful lobbying in place (NASSCOM). So it is a hard problem.
It's not that H1-B's get paid less than other workers, it is that by having more people available to do the same job it decreases the pay for all people doing said job. That's how the logic would appear to work, supply and demand, etc.
The thing with and H1-B is if they lose their job they have to leave the country the same day. That is a big incentive to work very hard and accept low compensation.
> Most people in the operations group running our service for instance are on H1-B and frankly, the work they do can be done by any average American working at a BK/McDonalds.
That doesn't make sense. If they can be easily replaced, then why aren't they? Wouldn't it directly benefit the company hiring them to not hire them?
Also, I don't like your characterization of people based on where they work. A person may choose to work in BK/McDonalds but that doesn't imply anything (positive or negative) about their capability.
> That doesn't make sense. If they can be easily replaced, then why aren't they? Wouldn't it directly benefit the company hiring them to not hire them?
In our cloud service, these guys are the first-line of defense in troubleshooting customer issues. They're the guys customers talk to and they follow a standard troubleshooting guide before pinging one of the on-call engineers. So it can't exactly be automated. And trust me, if that were possible, it would've been done. In a way, that's also one of the reasons this stuff is outsourced, companies don't want to go through the trouble of doing the hiring themselves for these roles.
> Also, I don't like your characterization of people based on where they work. A person may choose to work in BK/McDonalds but that doesn't imply anything (positive or negative) about their capability.
Sorry, I probably wasn't clear. That absolutely wasn't the message I was trying to get across. I understand working there doesn't mean anything about their capability and often it is a stepping stone to something greater (ex: college/high-school students). What I meant to say was the skill level here is the same. In effect, they just need to know their way around a machine and speak good English. Heck, they'd do a better job at it considering how poor the outsourced folks are at it. They'd even have more fun because there's still room for the occasional intellectual stimulation and creativity within these roles. And they'd be better pay too. Overall, it will be a better use of their time and they'd have more job satisfaction.
Hmm, why don't manager replace H1-B's with skill-less people at fast food wages? Managers do not necessarily do things that benefit the company. Managers need to maintain the appearance that their project is important and relevant. Their goal is having as many people as possible to manage. Actually accomplishing important work is not important. Yes, other people should notice that nothing is getting done and all these people are sitting around doing work that could be done by a fast food worker. What are you going to do, go tell the guy that approved the project that his project sucks and he and the entire management chain are failures?
1. This is not a zero-sum game. The incremental value gained by a large company defrauding their employees may be the same dollar amount, but to the employees it makes a much larger subjective difference. Also the company that gets caught colluding once will have a much harder time regaining its good name.
A tech employee gets offered $300k/year + options? He jumps.
Google's "double irish" has $3 billion more in revenue? Ho hum, just another day.
2. Since it is not a zero-sum game, it makes sense to avoid the corrupt, lazy actions that Jobs, Schmidt, et al. have embraced. Hackers don't need to "band together" – all that means is appointing some PHB and blindly following him. Society's behavior just serves to convince us that the hacker ethos was right after all.
Each of us will make our own decisions.
Each of us will weigh the costs, benefits, and ethics.
Feel free to start a union or just go straight to a political party.
We are decentralized. No thank you to all forms of government.
> Society's behavior just serves to convince us that the hacker ethos was right after all. … We are decentralized. No thank you to all forms of government.
Well, I'm certainly convinced that pure optimism will trump powerful interests with huge financial reserves and far more influence with lawmakers and the media. How could this not succeed?
What exactly are you proposing? An alternative credo for hackers to ascribe to? Please specifically mention whether you are pro- or anti-union and whether you live and work in the US or not.
Edit: I see you're using Windows, so would you mind also listing your tech experience?
Fair enough, I have strong feelings against Windows and a personal bias against it too, and I use it every day!
I think what triggered my hot button there was the feeling that other tech people have looked down on me because I use Windows. I don't like Windows either, I just dislike it a bit less than the other operating systems. :-)
Sincere apologies if I overreacted, and if you're in the Bay Area feel free to take me up on that beer!
> What exactly are you proposing? An alternative credo for hackers to ascribe to?
I'm proposing a basic understanding of how markets work, specifically in this case how they can be distorted by a power disparity. Huge companies like Apple, Google, Facebook, etc. have an incentive and the means to do so, which means there needs to be some form of collective pressure to prevent that. This could be government regulation (i.e. what happened here), unions or something else but no ideological cult is going to make the problem magically disappear.
> Edit: I see you're using Windows, so would you mind also listing your tech experience?
I wasn't aware that pointing out the logical flaws in someone's argument required passing a shibboleth. I would also note that your observation could both be trivially answered if you put any effort into it so perhaps you should not be in the business of challenging the expertise of others.
The point that I think your comment is missing is that if the vast majority of employers are colluding to drive down prices your feet will invariably lead you to a less profitable place overall.
Also this response seems to indicate that an individual's actions will hold any meaning against the concerted and united effort of employers. Unless a multitude of others act in concert we, the developers, will be at a disadvantage.
Exactly. I can't think of a more inane comment to an article on how companies are colluding together to prevent their workers from getting better opportunities than "vote with your feet". How exactly do you "vote with your feet" when company management's are colluding together to prevent just that?
Management and ownership has not only been organizing to protect their interests, they've even crossed the line into breaking the law, as they did here. They seem to have done well for themselves by organizing together for their collective interests, I think it would be a good idea for tech workers to take a page from their play book and do the same.
There's just no way that every (or even most) companies in, say, the US, are all collectively colluding to do much of anything, much less fix wages. There's a reason that cartels don't really work, and that's because somebody always has an incentive to cheat. Same deal here... even IF you got every single company to agree to fix programmer salaries, it would never hold up, because some member of the group would either find a way to pay more and disguise it somehow, or they'd flat out openly rebel and take their chances.
Does this happen on a small scale among handfuls of companies? Almost certainly, as we've seen. But how much impact it has at a more macro level is certainly questionable.
It doesn't take every company, it realistically takes less then 30%.
I have never seen companies trying to pay more then the bare minimum to get someone to fill the role. Being generous, sadly, isn't in the DNA of the majority of organizations. They always attempt to pay as little as needed.
The thing that turns me off to unions are the work rules. Could you imagine if you couldn't use git because that work was reserved for source-code engineers? Work rules are the reason that you've never heard of an intellectually stimulating union job.
Tech engineers get pushed around by upper management and have failed to professionalize like doctors because too many of them lack social and political savvy. It's a clear personality trait in the profession. Look at the way so many programmers choose to dress and groom. Can you imagine a top lawyer looking like that? The importance of projecting a serious professional image to the broader society doesn't seem to even occur to most software people.
There are programmers who love calling themselves "geeks", "nerds", "code monkeys" and promote boot camp style schools as well as myths such as "anybody can code" such that people think any homeless person off the street is a coder.
You don't get doctors and lawyers talking down their own skills or saying it's easy.
I think there are two different "programmer archetypes" that help prevent unions from forming. The first you identified: programmers who have conflated, mistakenly, "doing what you love is more important than compensation" with "compensation is unimportant if the work you're doing is something you're passionate about."
The second is the cadre of elitist programmers who think they are more intelligent than anybody else, and that therefore if a programmer isn't swimming in money shoved at him by an employer it's because he's not good enough. The egos in the software world dwarf those in the academic world I come from (and that is, believe me, an impressive achievement). Hilariously, it seems to me at least that far more programmers fancy themselves a sort of Programming John Galt (or, perhaps, being a citizen of some Programmer's Lake Woebegon, where all the programmers are above average). They relish competition because they believe, erroneously, that they're working in a meritocracy and that their own skills are so exceptional they will definitely rise to the top anyway.
So much for being smart and logical, most will never apply this to anything outside of a computer.
And most will turn their noses up at the ethics which would have them converting their technical ability and wealth into long-term power. (To see how this could be done, look at the relationships and rent-seeking behaviour around startup incubators. Others are deftly stealing your lunch.)
The affordance which a software engineer now has will not last forever; power left on the table is power lost. As engineering becomes more commoditised (through education and simpler tools) the pay check will drastically decrease but the less-than positive terms will remain.
It's a personal choice that anybody can make to raise their opinion of themselves, to learn how an executive (and other professions) behave and to not accept less than they are worth. There's so much opportunity to be had. Nobody should be acting like a cog! You should all be playing greater games and constantly redefining what you believe you can do.
A hustler is just a social hacker; a hacker is just a technical hustler. But a human being, they are neither: they are whatever they wish to be.
Nailed it right there "A hustler is just a social hacker; a hacker is just a technical hustler. But a human being, they are neither: they are whatever they wish to be."
The problem is the opposite is just as bad, if not worse: programmers can't go around saying "I make tons of money because I have a rare skill/high IQ", because that sounds elitist (which is a very bad word these days). If programmers advertise themselves as a caste that you can only get into by luck/genetics, that only makes things worse.
> Look at the way so many programmers choose to dress and groom.
Doctors/lawyers interact with clients/patients a lot, so they dress to impress; whereas programmers only interact with other programmers or managers, who don't really care. If you're a programmer, the code you write matters much more than the human interaction around it (arguably the same can be said about doctors and lawyers, but a lot of people wouldn't hire a lawyer dressed in jeans and a t-shirt).
Also, there are external dress requirements. For example, a lawyer might get thrown out of court if he/she shows up in casual clothes.
> programmers only interact with other programmers or managers
This is the problem half the time. Nerds in childish t-shirts want to sit around pecking out code in isolation instead of taking full responsibility for their work by putting on a jacket and working the organization. This is why IT projects are consistently such disasters and why executives have the idea to get cheap grunts to do this stuff under a layer of middle managers.
I think you have a certain narrative about how the world works that you'd like the facts to fit into, but the facts - at least in Silicon Valley - don't actually fit into them. I doubt I'll be able to change your mind, but for bystanders' benefit:
The reason that programmers don't dress to impress is that their work product - the value that they add to other people - has nothing to do with their appearance. A programmer is paid for the software she creates; the user of that software has no idea what the programmer who wrote it looks like, and they judge the quality of it by what it does. So programmers have developed other metrics that they use to form a status hierarchy, notably the quality and difficulty of programs that you've written, but also things that are somewhat fuzzier like the technologies and tools you use.
Contrast this with a lawyer or salesman, where your buying decisions are directly influenced by how they present themselves and you often cannot directly determine the quality of their product. People in these professions have a strong incentive to present themselves well because customers have no other information to base their purchasing decisions on.
Certainly in the one metric shared across all professions - money - engineers at top tech companies are not being taken advantage of by management, nor are they "cheap grunts". A senior Google engineer makes more than all than about 2 of the salaries listed on the first page of a GlassDoor CEO search [1].
> Certainly in the one metric shared across all professions - money - engineers at top tech companies are not being taken advantage of by management, nor are they "cheap grunts". A senior Google engineer makes more than all than about 2 of the salaries listed on the first page of a GlassDoor CEO search
That's completely irrelevant. The point is not whether Google engineers make enough money to be comfortable, or an amount that other people would consider "a lot", or anything like that. The point is that "all" the relevant big tech companies in SV colluded, prisoner's dilemma style, to pay them less than they would have if there were no collusion.
I'm responding only to the parent poster, not to original article. The view put forth in this particular comment thread is that programmers are underpaid because they don't dress well, which I find ridiculous. The article has a more reasonable explanation that programmers are underpaid because their employers collude, but plenty of others have already responded to that.
Amen. It is the Jobs-Wozniak syndrome re-played again and again. We focus on technical issues and (mostly) ignore the business value we produce (aesthetics included). Guess what, the money is being made not because of code quality only, but from the business value it produces. So whoever presents him/herself neatly and can accentuate the awesomeness of the product (taking credit for your work), becomes the rainmaker and assumes power.
I have no doubt that professionalization is highly related to social and political savvy. The ability to form an "in-group" and commit to doing what is in the interests of this group (thus solving the free-rider problem) is an essential social skill.
However, when groups professionalize in the sense of restricting the supply of people to that job, they are benefiting their own in-group at the expense of society as a whole (customers, employees and shareholders, people excluded from the profession, and indirectly, everyone else). Tech workers intuitively recognize this, and professionalization is the antithesis of hacker culture. In fact, I would say that professionalization wouldn't actually help the nerdy people you are referring to. It would just bring in different people (of course the social justice movement is already working hard to eliminate hacker/nerd culture from the tech industry).
As this article shows, tech workers are fighting this issue through the legal system. Maybe a union will be needed just to deal with this issue. I suspect that the rivalry between Google and Facebook, and the fear of further lawsuits, will keep competition rigorous in the short term.
True, techs are often nerds, but not always. Look at someone like Larry Ellison, or a lot of startup founders, etc. Also, look at how FOSS was created - by nerds. So, nerds can organize socially.
There are unions for cinematographers and editors in the media. Those are two terribly "nerdy" jobs, and the people who do them are, honestly, huge nerds.
Musicians have a union, and a pension system, and generally do pickup work rather than working for companies. And the musicians in that union are quite a mix of people ranging from "alternative" people (aka, cool nerds) and classical musicians.
Dressing is not important. Business casual is good enough unless you're working in an orchestra. You can be professional in jeans and short sleeved shirts. Most physicians in the ER dress casual.
Maybe if there were a tech workers union, we could finally organize politically for some pro-tech policy. Is there a better paid group of people who can't get anything done politically?
Engineers should make more money than what they are making now. The largest number I heard lately is $240k for a data scientist from Apple. That's too low! That person can make Siri better and make millions for Apple.
Why aren't we getting paid like lawyers? If they win $20M they will get paid at least $2M. But if we make a product that generates $20M profit, at best we get $20K bonus. This has to change!
There are several reasons why software engineers are underpaid compared to their performance. Keep in mind these are generalizations and therefore you will find exceptions to what I outline below.
-Software developers typically aren't comfortable negotiating, nor are we well versed at it. Therefore, we accept job offers for less than we know we are worth and accept raises offered rather than negotiate raises based on our actual performance.
-We have no collective bargaining capability, and anyone can enter the field. In Canada engineers have a professional designation, the software industry is typically not a part of that collective. Lawyers have the bar exam to pass before they can practice. These restrictions restrict the labor supply in those industries to ensure higher wages. In our industry anyone can join, even foreigners, or employers can even outsource the labor to another cheaper country. This has the combined effective of raising the labor supply, and reducing our ability to negotiate as a group.
-It is difficult to measure the performance from one developer to another. Look at sales as an industry, it is very easy to measure a top performer. If we were better able to demonstrate performance it would be easier for a developer to earn 50% more than his/her peers. Where I live some shops that hire refuse to pay even 10% more for a developer because they are filling head count and treat developers somewhat like a commodity.
The above realization has left me a little jaded. I love this field, but realize that I can earn more selling software than building software.
Or given the startup context of this site, I'd phrase it as software development has no Barriers to Entry, which as startups (and yourself) have learned is great for getting into the market, but can be really bad once you establish a foothold and gain experience and realize that competition from new entries into the market severely undercut you on price.
So, for those in the industry we need to find ways to add barriers to entry so that our salaries are protected.
> So, for those in the industry we need to find ways to add barriers to entry so that our salaries are protected.
This argument for professionalization is fundamentally flawed because salaries are not suppressed by an excess of supply. Just look at all the companies who constantly have open headcount. If wage suppression in our industry were caused by an excess of supply, you'd expect there to be lots of unemployed software engineers—but there are barely any. You'd never see firms trying so hard to poach from competitors and agreements like this would be totally unnecessary (nobody bothers to recruit passive candidates if people are queueing up to get hired).
So, this argument for professionalization is completely flawed. Professionalization imposes a price floor but we're dealing with a price ceiling (firms unwilling to pay the higher market rate). In such a scenario, a price floor is completely useless.
Personally, the day somebody demands that I get a certification to be a software developer is the day I quit developing and go put my econ education to use on Wall St. At least in finance there's a pot of gold waiting after all the hoops.
However, there is value in operating more as a collective. Employees are uniquely disadvantaged when negotiating for salary. Employers have experienced negotiators, they know their salary ranges as well as the industry. While the employee has only the knowledge of perhaps a few of his peers, if that.
A professional organization could aid employees in their negotiations. That would be a nice way to start. I'm not entirely convinced that a 'bar exam' for developers is the right path. But, clearly as this article states we are being taken advantage of. In my experience the problem is larger than SV.
This is why, as bad as this scandal is, I'm thoroughly opposed to 'professionalization,' and unions in software. Keeping the barriers to entry low is our best bet across the industry. As someone mentioned, a few major SV companies is not the whole tech industry. There are software engineers in every sector of the economy, and if it's payscales we are talking about, the Big Banks can match it.
If you are really good with programming, I guess the only reasonable thing to do is start a Software firm as a solo practitioner or as a partner with other Software developers.
The reason is "free market" is only for the big people -- not for the "human capital". Free market is just an illusion that is fixed that people believe in. It was never meant to be free and much more it was never be meant to be just.
Remember the case, an engineer got lower wages just because he was from India? Also his boss was not allowed to offer him higher wages from the upper management.
The existing free market system is only free, if you understand it as "law of the jungle".
Why aren't you getting paid like lawyers? Because tech companies don't operate like legal partnerships. As a techie, you are an employee, not a partner.
Don't forget either that lawyers don't just 'make money', they 'prevent loss'. That $20M suit that ends in your favour also comes with a nice injunction preventing your opponent from doing -foo- again. Techies can't do that.
Interestingly enough if you work for a financial firm (doing their software) you'll likely get paid significantly better than many tech jobs. Largely due to bonuses based off how much money you bring to the company.
Further, 240k for a data scientist isn't necessarily low, they are one of a team and the person who "made" Siri likely is paid much better (I could be wrong, as I do not know for certain).
Siri was an acquisition of a spin-off from SRI International. It is unreported how much Apple paid for it though it is suspected to be in the $200 million range.
$240k is not the upper bound though. Granted, it's a good salary for an employee, but that's really just an indicator that maybe you don't want to be an employee.
In reality, your salary as a developer is unbounded. There are plenty of examples here of engineers who have built their own software product businesses that bring in orders of magnitude more than the number you quote.
If you're good at what you do, there's really nothing stopping you from going out and getting that lawyer money. You just have to step outside the conventional path a little bit.
Employer's have salary ranges they will pay. If you want above that range you need to be incredibly special for an employer to consider, ie. a public figure in the industry.
If you are willing to take considerably more risk than an employee and are the 20% or so of entrepreneur's that succeed then your income can be unbounded as you say. But, that's substantially different than salary, and not what the article and this thread is about.
This is because a programmer's contribution to the "20M profit" is not easily quantifiable and measurable being that he is mostly likely part of a team working on a feature that is a part of a whole.
However a lawyer who wins a case or a sale person who sells a big deal can easily point to the quantifiable win to a specific dollar amount.
Except for the fact that startup founders by in large perpetuate the owner-employee inequity that they themselves were a victim of. Really, it reminds me of fraternities/athletics and hazing.
So choose to work for a startup that doesn't do that. There are plenty of profit sharing companies out there. Or become a quant where you can eat what you kill.
Inequity, really has nothing to do with fairness. If the startup can't hire, they will offer more until they do hire (or go out of business or worse never achieve). What you can negotiate is based on your position. If you are ex-Google or Facebook you can make bank at a more established tech company looking to turnaround (cough.. cough.. Yahoo) or at a startup looking for "top talent" or get access to VC funding. It is the same dynamics you see in professional sports.
Unfortunately, starting your own company is a high-risk path to change it & no guarantee that you will make more money. A lawyer, doctor, trader, or investment banker does not have to take the risk of starting his own firm in order to make significantly more than the highest level engineers.
and yet the practice of acqui-hiring can actually get you a 7 figure return on failing. Instead of unions, we have that, strange as it is. though mostly disproportionately good for the acqui-hired managers and not so much normal employees.
> Why aren't we getting paid like lawyers? If they win $20M they will get paid at least $2M. But if we make a product that generates $20M profit, at best we get $20K bonus. This has to change!
Is that really true? Their firm might get 2M. But in a big case, I imagine there are many lawyers and assistants involved. Sure the partners are going to do quite well. But, the founders of a tech firm also do quite well when their company receives a windfall of cash.
So what? Most people in the world would kill to make $30k a year.
The issue isn't the absolute level of compensation, but the relative split between labor and management/capital. Exploitation is exploitation: a Roman house slave, though better than the majority of slaves, is still exploited and still a slave.
And why are you complaining about engineers wanting to get paid closer to the value they provide the company? It's no skin off your back: sure, it might eat into shareholder and upper management salaries, but they get paid in the millions, which even more people would kill for.
Adages only go so far. "A day's work for a day's pay." "To each what he deserves."
Every economic function involves risk, to both labor and to capital. There's no reason, however, that the majority of the value should go to capital. The economics of relative scarcity, possibly. But that's not the situation here: market forces didn't decide compensation packages and the return to capital, here. Collusion did, which is a distortion of the market from a situation of perfect competition.
That's the rub though, 240k may be a lot to you, but what if that data scientist is delivering 100 times that value to the company? Who's to say that person shouldn't be paid $500k or $1 million a year.
The Yahoo COO who just got let go was paid $109 million in two years. He got a $29 million severance package. Would it be too crazy to suggest that maybe a brilliant engineer who was a major contributor to the success of a problem is worth more than $100-250k a year?
It can be tricky and getting murkier quick: what if Google comes back with an argument that that data scientist would not have been able to produce those $2-3 mil without the resources and the infrastructure made available by Google?
Would that employee be as productive anywhere else?
If the answer is yes, then that employee deserves a larger share of the pie. If the answer is unclear or no, then the employee will receive whatever the market will bear.
This is why traders and IT devs on Wall Street get better compensated: it is way easier to see the exact impact and it is very likely that those guys would be able to easily replicate it in any other firm.
You compare Apple to Orange. First you ask if the employee could generate this revenue on her own, and then you compare that to a trader that could generate the same revenue at another firm. Are you comparing employee productivity with and without company resources, or employee productivity between companies A and B?
I know you have been downvoted to hell, but I completely agree with the point you are making. We engineers might think that traders are not adding any value at all, and it true to a certain level. But they make money where they can, show what they made and demand a reasonable compensation.
If all software developers had the social skills of traders, we would indeed be paid much more than what we are now.
Compared to what other members of the professions make, yes, it is reasonable to complain.
How come when a lawyer charges $400/hr or a surgeon makes $800K/year nobody bats an eyelid, but when an engineer gets $240K he should be deliriously happy, because it is more than the median salary in the USA. Most of us are very smart men/women, who typically have college degrees in hard sciences - why do we compare our salaries to median wages?
BTW, in the Boston area, senior people make $160-$170K, not even close to $240K.
Expected value of additional devs in the world if he goes to Wall St. is far below 1. There's a shortage of devs, and it's not really due to a lack of compensation.
I first read your comment as being sarcastic, but then realized you're being serious. It's ridiculous how vastly different software engineer salary expectations are in Valey vs countries like Russia.
It's also different in that there is a very well-defined path to becoming one of these partners from the associate level. All the people above you are also lawyers. There are usually 8 clear levels of associate and then you become partner if you are competent and make 7 figures.
As an engineer, there is no such clear path. Most engineers end up working for 8 years and at the end are only making 150-250k if they are competent. Even if you make it to the management/architect level, you are looking at 250-400k.
Software Engineers are sadly not compensated fairly for the massive value they add to the economy. That's the bottom line. We need to work together to change it.
I don't see a big difference really. Just as some engineers found their own companies and some are employees of other people's companies, there are thousands of lawyers employed in corporate legal departments who are simply employees, because they don't want the stress or responsibility of running their own firms.
I'm not sure if it's the same for lawyers, but with a lot of doctors, they have to buy out the guy that's retiring/buy in to become a partner at a practice.
Problem is, boutique implies specialty. In tech, specialties involve short term expertise. Experience works against specialists in our field, whereas in fields like law and medicine, specialization is likely to increase value over a career lifetime. We are up against a far more sinister s-curve in the experience/perceived utility equation.
I would argue that specialization in software is more about delivering solutions and value. I agree that in general technology evolves, but there is clearly a 20+ year lifespan for some technologies. Cobol is still in demand. As a botique software shop you offer a company critical business infrastructure that gives them an edge. 90% of the software in business is developed or customized for the client. As developers we don't necessarily like it because it is not always elegant or optimal but it exists.
And how many Cobol jobs do you see advertised? Close to zero.
I am an independent consultant, with 20+ years of experience. Let me tell you, noone who is looking to hire me gives a damn what I did 5 or 10 years ago. The technical problems (and tools used to solve them) 10 years ago were very different than today (even though you and I know that certain principles remain the same). I work pretty hard to remain current/relevant.
I often joke that software engineers should be paid like star athletes or actors - their shelf time is limited.
What happened to the news in the past year or so about the large glut of lawyers in America, having to work for relative peanuts because of supply outpacing demand? Has the valley somehow managed to keep them out?
Or is it that specialized lawyers can make $350+/hr? In which case developers with certain specialities can make that much as well.
You can hire a bar-admitted lawyer for $20/hour, yet some firms bill first year associates at almost $400/hour. The corporate service professions (law, finance, accounting, and consulting) have a self-regulating labor supply. A professional without hands on experience is not valuable to corporate clients, and hands on experience can only be acquired in the context of real litigation/deals/audits/etc. If demand grows, firms need to train and hire more people, and supply grows. I demand stops growing, as happened after the 2008 recession, firms cut back training and hiring to replacement levels, and supply stabilizes. That circumstance is unfortunate for the people who want jobs in corporate law/finance/accounting/consulting that can't get them, but limits the degree to which changes in demand affect the price of services.
I know lawyers who charge $1000+/hour. Name me one programmer who can do the same. Outsourcing has killed our industry in terms of monetary compensation
I would suggest to you to think your premises carefully before coming to such conclusions. When in an unfair situation, it is easy to be angry at a group that you consider as 'outsiders'. However, even with outsourcing, there are thousands of open positions for software developers/architects that are just not getting filled.
The only real solution to this problem that I can see is for each of us to be so super smart and accomplished that we have the capacity to make a significant contribution that not many others can. And then develop the social skills to demand the kind of money that we (fairly) think we deserve.
Outsourcing has ensured a downward pressure on salaries. Can an employee that is not allowed to leave his employer really ever going to be earning true market rate on salary? That's the case for HS1B in the US. There is plenty of evidence that salaries are manipulated down.
Now, regarding your proposed solution of becoming a master of rare and difficult skills. That's what I strive for, but that can be a challenge in an industry where technologies are replaced every 5 years or so. In reality it becomes that much harder because unlike other professions the mindset of employers does not respect the concept of 'superstars'. Ie. I can't really name a developer that has the ability to command a 50% premium over his peers. However, I can name several companies that can demand a price premium for their consulting services. So, how do we as a field make the shift from companies achieving a price premium to individuals achieving a salary premium?
An individual freelancer might make that. A consultant with an established firm will be billed at close to lawyer rates, if not more. The consultant isn't being paid that however, as the firm will keep a fair cut for overhead.
Interesting. Is that entirely comparable? The lawyer is equivalently a lone freelancer, not part of a specialized organization? The comparable developer would be part of a boutique consultancy.
It seems like we should be able to measure whatever effect there was. There must be sources of data about salaries in the Bay Area. Has anyone tried looking to see if there is a depression in tech workers' salaries, relative to people in other fields, during the time this agreement was in force?
Remember when Facebook started aggressively poaching Google employees and Google responded publicly by giving every engineer a substantial raise and privately in ways substantially more expensive than that? And Facebook pretty much just laughed and matched offers? And every engineer in the Valley figured out simultaneously that $100k was a floor not a ceiling?
That strikes me as persuasive anecdotal evidence of what happens when a tech titan feels threatened by poaching that they cannot resolve by a gentlemen's agreement.
My recollection for the timing of those opening salvoes in the talent war was mid-2010. This would have been right after the DoJ told the cartel to knock it off.
I'll acknowledge off the top that that may be purely a coincidence.
They didn't give substantial raises, they moved comp from variable bonus to base salary (instead $X being the minimum bonus, $Y < $X was the minimum bonus and base was raised.
I remembered having commented on this about half a year ago on a post which at the time didn't get a lot of up-votes. I just dredged it up:
"Clearly the tech talent shortage can't be that bad, otherwise salaries would be going through the roof. I realize they may seem high relative to many other professions, however if we really are in dire straights, one would expect them to have spiked dramatically. That just hasn't happened. Either collectively the valley is colluding to not inflate wages, or, more likely, the problem isn't as big as many companies are making it out to be and those companies want to bring in foreign workers to help put deflationary pressure on wages."
I guess it turns out that was a false dichotomy and both things were happening. It looks like there was a conspiracy, and the tech companies still complained about not being able to find workers while pressuring congress for more H1-B visas.
My point is I don't think you'll be able to really get an accurate picture of how much wages were depressed because many companies are trying their hardest to decrease workforce mobility any way possible (legal or otherwise). I've personally seen some pretty crazy shenanigans at a very large tech company with workers being steered through insane hurdles to get a green card.
And I guess why not? If you can get someone to stick around for 5 or 6 years at a reduced wage, why wouldn't you do that?
I doubt we will ever be able to "measure" the effect. We can only guess and debate it with hypothetical scenarios -- "what if all these CEOs had had to compete for talented employees, instead of fixing the market for them?"
Regardless of the effect, it is a shame to see that these leading CEOs, who for years have vociferously complained about media & telecom oligopolies for preventing competition, were for years simultaneously using their oligopoly to prevent competition for employees.
Apparently, they're all for free markets, except when it affects their bottom line!
I think the parent meant that this collusion artificially denied what would otherwise be a fair market for the employees. Of course, you are entirely correct that this sort of thing is allowed if no regulation is placed on the corporations.
A free market neither encourages nor discourages this type of behavior. What it does, is not regulate whether a company can poach other talent by paying higher wages, or whether a company can collude with other companies to pay the same wages and stagnate. If a company believes it has the upper hand against a competitor - and some company always acquires the upper hand sooner than later - then it would be in its best interests to poach, pay higher wages for superior talent, and bleed the competition to death.
I think what the parent means is that these companies are all for free markets only to turn to informal regulation amongst themselves, making them de facto hypocrites.
Err, I think it is more a human trend, than a "big" trend. Most everyone I know loves the benefits of competition, except when they are competing, then they aren't as big a fan.
(Yes, yes, there are the people who love competition even when they are competing, but I find that they are fairly uncommon.)
Experian? Supposedly salary information is now being shared with the big credit bureaus, or so I've been informed by HR folks who can apparently know now what you made at your previous jobs.
What I meant to convey with that first sentence is that any effort at measuring the effect is bound to be highly politicized and subjected to endless debate, so it's best to focus first on the documented actions of these CEOs, which are objective facts.
The most relevant questions right now, I think, are not about the magnitude of the effect, but about the actions themselves: who, what, when, why, and to whom?
Maybe I'm misunderstanding you, but empirical data on human behavior is notoriously more difficult to both collect and control for than data on more basic processes. I think it's glib to suggest that the effect here should be easily measurable. I also don't think the actual effect is relevant in the first case: no reasonable ethical accounting would gauge the immorality of the act in proportion to its final impact on wages.
It is funny that there would be reason to complain, given that this statistic would probably show that tech is a profitable place to work relative to other industries.
But we're talking about the tech employee's relative share of the company's own profits, right? which means cross-industry comparisons aren't relevant.
i'm sure this is the line the defense would take. I guess - we would be asked to believe that even though you have the collusion stated as plain as day, "it was not successful" - just talk. And that might actually fly.
but it's crazy to see the greedy underbelly of SV out in the open like this, although it fits with the aggressive ("legal!") tax avoidance strategies. (EDIT: IMHO both behaviors are forms of community theft, even if you don't consider your taxes to be a charitable contribution.)
I suppose it only feels like hypocrisy because of the lionization of our heroes. We expect more, particularly considering how they position themselves relative to their values - "think different" - "don't be evil" - more than just businesses.
50 years from now, once the tech equivalent of the iphone is in every object on earth, I suspect Jobs will be looked at as another Rockefeller - awesome, epic, business man, just not necessarily the guy you aspire to become when you grow up.
If you somehow got complete data, you would be certain to find that Google employees received a large raise after these agreements were terminated (as others pointed out in this thread):
That was something like 20,000-30,000 people, so if you consider it among the population of the 5 companies involved, it's extremely significant.
That was the largest raise I've received in a 13 year career in Silicon Valley, so I consider it anomalous.
But then you're back to the problem whether correlation is causation. You could conceivably argue that it was due to competition from Facebook, which was not part of those agreements.
In my opinion, salaries were depressed -- although how much and for how long is very hard to determine.
Other industries are deeply unlike tech, so comparing salary trends would be meaningless.
A sibling comment suggests that we look at salaries in tech companies that didn't collude. But that doesn't work either, because (1) those salaries could have been indirectly affected by the collusion, and (2) other tech companies are different than Apple, Google, et al -- most importantly, they have less money!
I don't think that comparison would be illustrative. I suspect that trends in tech wages in the Bay Area are divorced from those in other fields in the same way that finance wages in New York are.
The productivity of a single programmer has famously increased as the rise of multimillion-dollar companies with less than ten employees shows. You still need the same number of nurses and teachers, though.
In cases of conspiracy, I believe the illegal act is the very act of meeting to plan criminal activity.
The effectiveness of such planning is not the deciding factor as to whether or not the people involved have behaved criminally.
As a parallel, planning to distribute illegal drugs is illegal (conspiracy to distribute). While actually distributing is an additional charge. Something similar is going to happen here, where the executives in question may have broken several laws only one of which is conspiracy.
I'm not a lawyer, so I could be wrong. But this is what I remember from Business Law during my MBA.
No he wasn't; comparing tech salary growth to other salary growth in the presence of a tech boom was completely disingenuous. Wages can increase relative to other industries, and still be being slowed by collusion.
It would be just as disingenuous if someone said we should measure it by whether tech companies' profit per-employee increased during the time relative to other fields, which would give the exact opposite conclusion.
Probably wouldn't provide reliable data. One of the major factors that would have driven up tech salaries was if some of the biggest and most profitable tech companies (indeed, some of the most profitable companies in history) such as Apple, Google, etc. were openly competing to try to lure talent to their companies through financial incentives.
Likely, compared to other industries tech workers were nevertheless handsomely paid, but I think this is still an example of abuse of power.
It's all the more worrisome because the changes in the nature of the stock market and so forth have made it that much more difficult for top tier tech workers to become rich. That used to be the pattern in the '80s and '90s, there are thousands of millionaires who worked at apple, microsoft, etc. for only a decade but were around during those companies' crucial early growth phases. Today I think that phenomenon is much less common except with extremely early stage employees. A lot of startups are the brain children of the sort of top tier techies who made it rich working at various vast growing companies. That variety of wealth is, I believe, very important to the vitality of the industry. But for various reasons it seems to have been significantly curtailed in the last decade or so, but if there is a more competitive marketplace for salaries in the tech field then that would go a long way toward bringing it back.
Look at a typical software developer salary in SF vs a typical software developer salary in Chicago, adjust for cost of living, the difference between SF salary and adjusted Chicago salary is the depression
For example, demand in SF is much higher than Chicago
so SF salary should be >> Chicago * cost of living adjustment. My guess is it's lower
I've done this same calculation and I found the opposite. And after I moved I realized that you have to also factor in how much more awesome the Bay Area is. I've been able to be outside most days this winter hiking and doing other outdoor activities. I can't imagine going back to winters where I'm trapped indoors.
That's not entirely valid, that's a subjective judgement. I live in Chicago and I hate the outdoors. Just a simple back of the envelope calculation tells you Chicago software developers make about the same or more ( because trading companies pay more ) as SF developers yet cost of living is 2.5-3 times higher in SF. It's hard to explain this as a mere correlation with the known fact of illegal collusion.
Cost of living or the cost of housing? Because they aren't the same. Sure, rent/mortgage payments take a huge toll, but it isn't like that Ramen costs 3x as much or that you pay 3x as much for gas or a new car. I'd wager the costs of goods are not even close to 1.5x.
I broke down some numbers awhile back comparing Seattle to SF, because a guy claimed that 80k in Seattle is the same as 200k in SF. Clearly not. Even after paying 4x my current mortgage I had thousands of extra dollars a MONTH of free spending money. Hardly the pity party I see from all the comments.
My guess is everything is SF is more expensive than in Chicago. Housing is 4X more expensive and other things as a result, are somewhat more expensive. Of course, you can still spend the same amount on housing in SF by living in a much smaller place, but that's besides the point. per square foot it is still more.
Trading companies do pay well, but that's a pretty boring and not value-adding industry to pigeonhole oneself into, and the corporate culture is beyond terrible. There aren't a plethora of interesting jobs sw devs can jump from and to in Chicago. Trust me, I wouldn't have moved if this wasn't the case.
I am not entirely sure that 'relative to other fields' is a useful metric in this case.
Maybe if we could restrict those fields to others in the middle of a boom or otherwise in a fierce competition for talent...petroleum and other engineers in the oil industry in the past few years, for example. (though I'd wonder if the big players in that industry have similar pacts in place).
I don't know. It would be difficult to hold enough variables constant to make any useful comparisons but there might be something in the broad strokes.
> Has anyone tried looking to see if there is a depression in tech workers' salaries, relative to people in other fields...
You want to use other fields as a control? That makes little sense. From 2005-2009 the tech industry grew at a vastly greater rate than most other fields.
>> It seems like we should be able to measure whatever effect there was.
Against what litmus test?
All the players (Apple, Google, Intuit, etc) were blazing new trails in a whole new economic model - and localized to an economy in the SV. That is why the whole scheme wasn't apparent at the time.
It's not a new economic model, it's ephemeralization, advertising, Veblen goods, and especially disaggregation of previously existing models largely involving breaking down existing toll-collection interfaces in transactions of physical goods.
And the scheme was apparent, to those who were paying attention. It simply wasn't being discussed in polite society.
The statistics are there for the time period[1], but I am a little uncertain what would be a valid comparison career. I would bet the wages grew above the local aggregate. Perhaps looks at the line on the last boom?
Specifically you'd want to find other SV companies who weren't party to these negotiations (Netflix? Twitter? I didn't see a comprehensive list), since they'd be a pretty close to exact benchmark...
Yeah hate to spoil the party, but this is not 'wage theft'. Wage theft is very specifically the act of withholding wages that an employee is entitled to according to the terms of his or her employment agreement.
What happened here is not even 'price-fixing', it's a fairly weak attempt at 'collusion'. Yes, it seems improper at first blush and the email exchanges are almost comically incriminating, but my guess is that it didn't really have a substantial effect on the engineer salaries write large (or even executive salaries). Agreeing not to cold-call employees is not the same thing as refusing to hire them; that latter would have had a major depressing effect on wages (kind of like if all MLB teams had a handshake agreement to never sign another team's free agent) but that clearly isn't what happened here.
It seems to me like the proof is in the pudding. If big tech companies are colluding to depress engineer wages, they're pretty obviously failing.
Anyway, I have no idea how this lawsuit will shake out, but I know that Pando Daily is doing a shit-ass job of reporting, and I regret clicking on the link and giving them the additional pageview.
"Wage-fixing" is probably more accurate than "wage theft", but it is most certainly illegal under antitrust law.
The key issues I see in the case:
1) they agreed not to do counteroffers
2) some of them shared salary data
3) they agreed to disallow active recruiting (cold-calling)
4) they agreed notify each other when hiring from each other
The third seems a little weak, but it definitely crosses the line when you combine it with the fourth (and emails between CEOs to stop hires that were already in the works).
It is absolutely clear that the market price for engineers in a free market would be much higher if there wasn't collusion.
And their efforts are evidently working, because otherwise Jobs wouldn't be threatening other CEOs with "going to war" over this. It's so important to them that they're willing to cut significant cooperative deals with each other.
This is the exact proof that software needs unionization and is not in any exempt from the worldly issues of labor anywhere else.
If big tech companies are colluding to depress engineer wages, they're pretty obviously failing.
If crooks are trying to rob retailers, I don't see empty shelves at walmart so the crooks are obviously failing.
(I don't think it matters if Jobs failed or succeeded. The appalling thing here is that Steve Jobs attempted an extremely scummy and potentially illegal move.)
The fact that I'm a 21 year old drop out making nearly 100k because I sat in my mom's basement for a few years and studied software that interested me is pretty crazy.
Market price is market price. These companies are generating massive income. They are paying high wages (and colluding to avoid paying higher ones) because engineers are necessary to that.
The question you should ask during salary negotiations isn't, "Do I, based on my own value judgments and moral code, deserve this much money?" It's: "Are they paying me market price for my skills?"
If market price for your work is more money than you need or you believe you deserve, then take it and give it to somebody you think does deserve it. I promise you that if you let your employer keep the extra, they will not do anything better than you will with it.
Remember this is net rev, what they take in after paying everyone. Assuming the average employee makes $120K, and given that they can't exist long enough to make $1 without the engineers showing up, these companies should be willing to pay everyone up to 2-3x that
What's even crazier: owners of firms get paid millions or billions of dollars for doing much less than you do--literally nothing besides initially deciding to purchase shares, in large companies--merely because they acquired, one way or another, a big bundle of cash earlier in their history.
How do I properly quantify exactly how much value I'm adding to the company I work for and the world to possibly determine how much I'm precisely worth?
You should. I write code in another industry (HFT) and most people coming out of college are getting 400-500k bonuses or more after a year. We joke about how raw of a deal the average developer in SV is getting -- Google has roughly the same net profit/employee that we do (maybe even more), and all they're getting is chump change.
I both hate and admire you for that. One bonus like that is all I need to finish plans for good. I know talented programmers getting the equiv of $50k and I wish I could do something for them.
you aren't paid in proportion to your worth; you are only paid in proportion to your negotiating power. if 50 other people can produce the same worth for your employer, you're going to be paid a lot less than if you are the only one who can produce the same amount of worth.
don't take this as an argument that you are being paid "unfairly" - you're not. just see it this way - you are worth much more than that. set your career sights a lot higher because you deserve it.
"a) never cold call each other’s employees; b) notify each other if making an offer to an employee of the other company, even if that employee applied for the job on his or her own without being recruited; c) any offer made would be “final” so as to avoid a costly bidding war that would drive up not just the employee’s salary, but also drive up the pay scale of every other employee in the firm."
I assume that the poster was being genuine, but is also suffering wage-shock - the wages that tech workers get are so much higher than what he/she was used to getting, and for far less (apparent) effort than people who make peanuts. It seems unfair, until you realize how much money the company is getting for these services.
I'd agree that using the term 'wage theft' roughly 500 times in the article seems way over the top, and makes the whole article sound like left-wing propaganda.
Yeah, it's illegal, and I don't have much sympathy for them getting whatever happens as a result of the collusion investigation, but it does seem pretty weak. The best proof I can think of that they were or were not effective is to look at engineer wages at companies that were not subject to these agreements, like startups. Most of them are probably too small to benefit from tech giants agreeing not to try to recruit their people, or at least stand to gain much more from paying excessively high salaries to recruit from those tech giants. So are there a bunch of startups routinely paying much more than normal salaries to hire top talent quickly?
And therein lies the problem. Although these companies are being prosecuted, nobody wants to run afoul of them or anybody else. I'm not saying that any one individual or company is presently a bullying wrongdoer, but what I am saying is that there is an culture of fear around speaking out or rubbing people the wrong way.
This atmosphere--along with the kind of proprietary shenanigans that make it difficult or impossible to truly own your own hardware and software stack--is the very opposite of the hacker ethos that created much of the value these barons robbed from the economy.
Old Money's corruption of SV saddens me greatly because it pollutes the culture that helped many things grow. For example, instead of open data, we seek to lock up the most inane and useless data out of fear it might be used in a way we never approved of.
Basically, the existential question of Old Money is one of taking as much as possible, whereas the hacker ethos operated on more of a giving spirit.
Note that of the fairly sizable group of high-profile, well-informed SV people who frequent this site, you never see one of them comment on a post related to this scandal.
Yes, I know a fair bit about who raganwald is; I was thinking of the guys who are even more prominent and more SV-centred than him. All due respect to raganwald's willingness to stick his head above the parapet on sensitive topics like this, though.
> But it's so much easier to play hardball with a new hire who doesn't know anything; thus this kind of thing is "ignored."
I don't know about that though: if I was, say for instance, in a line of business which benefited from skilled developers going into startups rather than established tech companies this kind of news would look like the perfect advertising to me—but I'd still want to keep my head down while it was being discussed.
90k USD ist just shy of 66k Euro, which is by no means unheard of for an experienced developer.
I know personal anecdotes doesn't count for much, but I turned down several 80k offers in Berlin. I would expect salaries in Munich to be 10-15% higher due to cost of living.
From what I've heard from colleagues, and seen while working on projects there, Munich sucks precisely because it's so expensive and the pay does not track the cost of living. Working in Frankfurt pays better, and living there is just slightly cheaper. Berlin's cost of living is catching up fast.
You're right that 90k USD (~65-70k EUR) for a dev is not unheard of, but it appears to be the final stop on the salary train for that profession, unfortunately.
And in Germany I'd be hard-pressed to find you a non-management tech job that makes north of 90k USD/year.
How is that relevant? (And) Once you factor in healthcare, education (for kids) and housing, I suspect that 90K USD in Berlin goes just as far as 200K USD in Silicon Valley, probably a lot further.
It doesn't. Germany is having its own little housing price explosion in every major city where there is employment. Prices are being driven up by wealthy non-tech investors throughout the EU thinking German (and London) real estate is the only safe place to hold onto their fortunes. Consumer goods prices are also significantly higher than in the US.
Healthcare is approximately the same cost now from what I've seen with ACA prices in the US. Education is still cheaper, but only if you assume an American student will have zero financial aid. I also doubt this lower price tag offsets the prices and regressive taxation elsewhere throughout the economy.
> Healthcare is approximately the same cost now from what I've seen with ACA prices in the US.
Germany has $6,000+ deductibles? Thin provider networks that leave out the good doctors and hospitals, and large or even unlimited out-of-pocket limits for out-of-network care?
Monthly premiums are just the beginning of the story.
Not to go too deep into the weeds, but there are comparable trade-offs, such as premiums being a percentage of pay instead of a flat fee. The German system is without a doubt better, but I think (and hope) that the US is closing this gap with the ACA and a general awareness of the problem.
But we don't need to compare ledgers to show that 80k USD in Berlin, Munich or Frankfurt won't go nearly as far as 200k in SV or SF. That's what exchange rates and the big mac index are for, and that's why I converted the currency to USD in my original comment. You can argue the rate is maybe 10 or 15% off, and I can argue for 10-15% the other way, but no way is a dollar (0.82 EUR) 2-3 times as powerful in Germany.
Healthcare is approximately the same cost now from what I've seen with ACA prices in the US.
Are you using ACA? (I am.) Do Germans have to pay $500-$1000/month, maybe more if you're older, for a plan that pays almost 80% of their in-network costs? And speaking of those costs, how much is an endoscopy in Germany? Here I was just quoted $8000.
German healthcare is clearly superior by any measure not thought up by a Koch-Brothers think-tank. It covers 100% of treatment, and even if it didn't, list prices for treatment are not off-the-wall absurd. I'm not arguing that the ACA fixed US health care, nor would I.
My point was that the cost of living here is also very high. Sure, there are EU/US trade-offs all over the place, but they are not anywhere near big enough for you (or the GP, or anyone) to just wave away a factor-of-three pay difference.
Btw, yes, last I checked my monthly premium is over 400€, so it cleanly weighs in within the range you name. I switched to private insurance because public 'Krankenkasse' charges a percentage of gross income, which would turn out to be even more. Not complaining, just answering your question in case you really wanted to know.
It's genuinely impressive how you contort people willingly giving their money to Apple, Google, Pixar and Lucasfilm for goods and services into them robbing money from the economy.
As a programmer sure this annoys me, but I find it a bit disingenuous to tie it to growing societal inequality. Tech workers are definitely on the beneficiary side of the inequality gap, so I don't see how these conspiracies to indirectly keep tech workers salaries down to 2x to 5x of median American household income is really germane.
So the money that would have gone to the programmers goes to the upper executive layers instead. This merely moves things around slightly, and if anything further squeezes wealth into the top 1% as opposed to top 10%.
This whole story looks fairly damning, especially to Jobs and Schmidt, though that is probably the intent. Faced with a hiring war with 2005 era Jobs you'd have to have serious guts to refuse - like apparently the Palm CEO did.
>So the money that would have gone to the programmers goes to the upper executive layers instead. This merely moves things around slightly, and if anything further squeezes wealth into the top 1% as opposed to top 10%.
Citation needed. Where do you see that it went to the people at the top and wasn't invested back into the company?
Even re-investment back into the company could lead to increased revenues for the people at the top.
Regardless, I find it doubtful you could possibly prove such a thing, even if it were true. One just has to assume that such things helps the company, which in turn helps the people who profit from the company doing well.
>Even re-investment back into the company could lead to increased revenues for the people at the top.
I think the best comparison is Wall Street firms, where a disprportionate chunk of revenues are paid out as compensation to employees. There's longstanding criticism by shareholders that this outsized compensation should be reduced in favor of giving back that value to shareholders.
"re-investment" back into Google likely benefits such shareholders (the majority of whom are not employees of the company) than employees.
True, but as the article seems to point out, the people at the top tend to be major shareholders of the company they work for, as well for the other companies in the group that they were board members.
So, in that train of thinking, they double-dipped by helping the bottom line of multiple companies of which they profit from with their illegal agreements.
Remember how Jobs was considered such a good person for taking a $1 (or something low like that) salary at Apple? How much stake in the Apple stock did he have? He wasn't benefiting from a salary from Apple, but probably was from Apple's profit margins. Profit margins that likely benefited from such agreements.
I strongly disagree that the average tech worker is on the "beneficiary side" of the inequality gap. This is a case of people looking around themselves and seeing they seem to be above average, and concluding that they are on the rich side. Reminds me of a ten-year-old article [1] that presented the remarkable finding that 39% of Americans believe they are or will one day be among the top 1%.
It's certainly in the interests of those REALLY on the right side of the gap to have tech workers believe they are on their side.
The median income for Americans over 18 is $24,062[1].
You're correct that tech workers are still workers--they're not part of the ownership class--but they're the lucky workers who are benefiting from the shifts in the economy toward automation/software/knowledge work.
There's that possibly-apocryphal quote about socialism in the US never having taken hold because Americans all believe themselves to be temporarily embarrassed millionaires.
I definitely buy that software developers have a huge veil of ignorance[1].
We accept lower salaries today because we assume that one day we might be in the ownership class. But this is somewhat reasonable, at least vs other forms of labor. (A line cook will never end up as a millionaire, but a developer might by either founding a startup or getting options on the right one.)
Of course income distribution is technically a smooth curve with no gap, so you can draw that line anywhere you want. Hell, Gates can look over at Slim and shake his head, "God damn 0.0000000001%!"
Every tech job creates 4.3 other jobs[1] Maybe that would be 5 or 6 or 7 other jobs if the market was allowed to function without manipulation. So yes it does directly effect social inequality in general.
So, anyone who has any sort of income at all should be humble and content, because while someone may be artificially hindering their income and networth, at least they aren't a homeless person on the street with no income. I guess . . .?
Now that this is exposed and (presumably) not as present, has anyone done any work to see if salaries at Apple, Google, etc have since risen higher than salaries at companies who weren't involved with such activity?
This sort of shenanigans went on 100 years ago, but we couldn't study the consequences so tightly back then...it seems that Glassdoor's data, H1B data, etc provides a unique opportunity to study the effectiveness (or lack thereof) of such federal intervention.
Anecdotally salaries at the major tech companies just shot up in early 2011, which was soon after the DOJ started its investigation. It's hard to infer causation though, as this could have been because of rising competition from Facebook for employees, or it could have been because of the large amount of seed capital sloshing around in the startup world then, or it could have been because of the Fed's easy-money policies.
Connecting this to current events, this was also the start of SF's rent-and-eviction crisis. 2011 was when new grads started getting 6-figure salaries to work in tech, and experienced senior engineers started getting up to $250K/year in total comp. Turns out that when a large number of workers start getting big salaries in a region where the housing supply is basically fixed, much of that money goes into rent.
Facebook was the company that broke the cabal based on everything I've heard from friends at these companies. I think it actually started a little before 2011, more like the end of 2009, early 2010. Facebook was (obviously) not averse to poaching employees of other companies, and was particularly good at hiring ex-Googlers by offering large stock grants and relatively high salaries (~150k + 100k+ in options) for someone with 2-3 years of experience out of school. Google made some jaw dropping counteroffers to those who left and gave everyone a large raise and bonus at the end of 2010 as a result of the increased competition.
I agree it would be a mistake for the layperson to infer strong causation, especially in the middle of the issue - I was more musing that this is the sort of opportunity where a student in law or economics could someday get a Ph.D attempting to answer it properly with data. (It doesn't seem impossible to normalize for the impact of fed policies across industries, for instance.)
I hope someone does it and shares the paper with me. :)
Hard to say since the hiring boom has mostly passed. There's still demand for tech talent but you don't have multiple companies trying to hire thousands of engineers at once anymore.
One thing that strikes me as curious is why none of the companies involved broke the story at the time or reported the situation to the Feds. I can think of numerous reasons why, none of them particularly reassuring:
⚫ They all thought they could get away with it. The idea that there were no defectors on this basis makes me question the integrity of the entire tech industry leadership.
⚫ Nobody had faith in the DoJ's ability to to investigate, or a court's ability to place injuctions, on this behavior and/or retaliatory actions.
⚫ The threat of encroaching action was too great. Any defector would be destroyed before the practice could be halted. There's one slim glimmer of hope here: It suggests that the threat of union action would be similarly disruptive and that a concerted action on the part of employees would in fact tend to succeed. The Achilles heel of the tech industry is that its capital walks out the door every night. If it realizes it can not come back, or merely threaten to not come back, it will have gained a great deal of leverage.
⚫ They simply didn't care. Arrogance, psychopathy, delusion. It doesn't particularly matter. Again, trust and reassurance are not promoted.
It may be that the consequences of the 'conspiracy' was to depress wages, and it should clearly be prosecuted if the legal case can be made.
However does anyone think that this was the intention behind these agreements? Isn't it more likely that they wanted to stop an insane war on one another's businesses by buying off key employees to disrupt one another's operations? It would seem as though companies with a giant stockpile of cash - I.e. MS, Google, and Apple, could stifle competitors by just taking out key employees of their opponents with large signing bonuses, regardless of whether they intend to put them to work or not. The result would be a destruction of value.
The solution here is the same as the solution when Zuckerberg complained about employees leaving their jobs too quickly[1]: Pay your employees more. Figure out what kind of value they bring, and the amount of cost if they were to leave, and adjust their wages accordingly. Make no mistake about it, the ultimate goal of stifling competition is to depress wages. While maybe described as "disrupting operation", it is really just allowing a company to not pay an employee what they are worth.
Analogously, if 2 companies sold widgets, one in state A and one in state B, and they each had a near monopoly in each state, if they each made a closed door agreement not to enter into each others' states so they could each maintain their near monopoly, I think people, and courts, would certainly cry foul. Certainly competing would disrupt each others' operations, but the competition would bring better products and better prices to both states, and that's the point.
You missed my point. The cost of losing a particular employee at a particular point in time can be far greater than the individual contribution they will ever make. That cost is transient because it depends on the state of a particular project. The value of the employee becomes the value of disrupting the project to the competitor. Matching the offer would be an option, but it would cause massive distortion within the company since the retained employee wouldn't be contributing that much more than their colleagues.
I don't see any justification for your statement that better products would result from this.
"The cost of losing a particular employee at a particular point in time can be far greater than the individual contribution they will ever make. That cost is transient because it depends on the state of a particular project." I think what you're trying to say here is that if a competitive company can time it right they can derail a project by scooping away talent at the right time (say, right before a product launch) which will cause greater harm at the moment than what the employee is "normally" worth (by "normal" I mean an average of their normal value output). I agree with this, but it is a failure of the company's compensation structure if this is the case. For instance, project base bonuses (upon completion of the project) should relieve some of this pressure because they would only get paid out upon completion of the project.
Regarding "better products" do you mean in my analogy, or our real world case of companies competing for talent? In the analogy, the competition causes both company A and B to beat each others' products in order dominate the market (either by lowering price and improving the product). In the case of companies competing for talent, the "product" is really the overall compensation package. Some combination of salary, options, benefits, etc will attempt to be found that will keep the employee where they are.
Thanks for clarifying - I would like to believe that you are right - but I still have concerns about things like project base bonuses, because there is still a giant distortion around employees who happen to end up on key projects being overvalued compared to other employees without whose contributions the key projects couldn't exist, arguably mirroring the inequalities we see in the larger society and leading to disintegration rather than increased cooperation.
With regard to better products, I hadn't understood that you were referring to the compensation package as the product. That makes sense as an analogy.
Your position makes sense, but I'm not at all sure that the market mechanism really optimizes in the way you hope.
Even in countries with out "at will employment" (y'know the EU), can still be distrupted by an employee leaving. You usually only have to give 1 months notice for when you leave a job.
My point is that if the employee has no guarantee of continued employment over the period where the company still benefits from the IP that employee created, why should the company have any right/expectation to the employee's continued employment during a period that is critical for the company? Employees can and should be expected to leave at any time in the absence of a contract to the contrary.
I would say that since the idea apparently started with Lucas and he specifically stated it was done to prevent bidding wars because they simply couldn't afford it at the time supports the thought.
I don't think it was the sole intention. But two things stand out to me that was part of the deal. The fact that the HR departments would inform each other if their employees were applying for a job at a company within the group; which by the way should be considered a huge privacy issue. Also that when an employee was made an offer, they only received a "final offer" to specifically avoid a bidding war. Those two things directly relate to wage suppression to me.
As for your example, that's quite true. But in the end it still stifles those employees' ability to increase their income because these companies directly conspired to not recruit from each other. It is not in the employee's interest to worry over if Company A wants to give them a pile of money to simply leave Company B but not work. Two companies coming to such an agreement for their benefit is a detriment to the employee, which is what the lawsuit is about.
Never mind the fact that the whole thing is clearly illegal under multiple federal and state laws. Therefore, their intentions are irrelevant.
> However does anyone think that this was the intention behind these agreements?
From the article:
> George Lucas believed that companies should not compete against each other for employees, because ‘[i]t’s not normal industrial competitive situation.’ As George Lucas explained, ‘I always — the rule we had, or the rule that I put down for everybody,’ was that ‘we cannot get into a bidding war with other companies because we don’t have the margins for that sort of thing.’
I'm not sure that is enough to make the case. For one, it's Lucas alone. But secondly - the bidding I think they would be concerned about would be more like the 'ransom value' of an employee who happened to be on a critical path and who could not be replaced quickly enough to avoid a significant setback.
The problem is not the market value for an employees skills and experience that will enable them to contribute to whoever they are employed by, it is that there is also a value to simply disrupting the opponent's team.
I think the intention behind these agreements was to stop Steve Jobs throwing a pile of burning crap at your house. It's like sweet valley Fortune 500.
Steve Jobs said it well, "this means war." The engineering profession as a whole needs to play "war" like adults. This is going to cost money like anything. A permanent PR company that at least gets the engineering profession a louder voice than Marissa Mayer would be a start. A permanent lobbying budget to slowly but continually chip away at domestic and international threats to the buying power of your talent with changes in law is the other half of how grown ups play "war." No need to act like laborers and form a union or have strikes. Real change today happens via PR and lobbying. A well-funded and run professional organization formed with this as its sole agenda would do wonders for all of us.
Somebody already complained, that the wage possibilities of software engineers are limited.
I would take it further: In all industry, the trend goes one way: The wages of working people (including white-collar, I hope, that is the right word) have to go down, and the earnings from investments (pure money makes money business) have to climb.
There are only very few exceptions: One are lawyers, as mentioned in an other thread, and the other are people that work in the investment business (investment bankers, traders, ...). The reason for the second exception is obvious: their work is needed to make even more money from the money and every trick is played, to have the smartest, best guys getting the job done ... and get it done better and better.
Problem is: The whole thing breaks our society. Middle classes are already melting massively in many countries. The possessions of the worlds are concentrating in the hands of very few people more and more. Those people make our laws! The other people become poorer, even in the situation that the overall worlds possessions expand massively. The countries are already so much in dept, that many of them can not pay even the interest. Even the US is so much in dept, that there seems to be no possibility to get ever rid of it.
Nobody seems to realize, that while we are talking, investment companies are roaming the world for land, for houses, for companies to buy them, exploit them and throw it away when not needed (and not useful) any more. The wealth of the world gets accumulated in the hand of investment companies and the super-rich.
By rising the value of pure money investments, the value of human labor (to a more and more extend even high-paid and high-value labor) is degrading.
Something that I think gets forgotten in tech salary discussions is inflation. Consider that a $122k salary in 2001 would be $160k/yr in 2013, adjusted for inflation.
I was at Yahoo during the years in question and must have been approached 50+ times by Google recruiters. I wonder if Yahoo refused to play along or perhaps they were never invited.
Google’s “People Ops” department kept overall compensation essentially equitable by making sure that lower-paid employees who performed well got higher salary increases than higher-paid employees who also performed well.
Serious question, is this generally considered a bad thing? Every company I've worked for has had salary bands that work like this. They don't make it a secret. Generally you know which band you're in and the range of that band. I've recently been told in a company meeting at my current workplace that they are mainly working to bring people to the middle of their bands. So if you're above the middle, expect a low raise.
On the other side, I can't help but feel underpaid since I've been told by people who know that the work I've done personally has allowed us to bring in more than 100 times my salary in recurring revenue.
Salary is unimportant. Its like allowance from your parents. "Here's a little cash so you don't starve or freeze during wage slavery" It does not matter if its $50k or $102.5k, the goal is going to be the same for me.
> These secret conversations and agreements between some of the biggest names in Silicon Valley were first exposed in a Department of Justice antitrust investigation launched by the Obama Administration in 2010.
Why is it that lines like this never quite make it into the comments section here?
Ah yes, "Don't be evil": illegally colluding to line your own pockets at the expense of your employees is clearly perfectly acceptable behaviour as far as Google execs are concerned however.
Makes you wonder in what other ways Google has "not been evil" doesn't it.
Maybe it goes back further than that - maybe in the late '80s lobby Congress to get the "Immigration Reform and Control Act of 1990" - a.k.a. the H-1B - to get some cheap immigrant headcount up, then maybe come up with the Java programming language to get a simplified base point where they would be at equal state, or something like that, maybe ship some of them back home to train more, and then recurse. Maybe. Maybe people other than engineers do engineering.
As a new grad about to enter the workforce, I find this more than a little disconcerting. Do any experienced engineers have any advice on how to avoid this kind of mistreatment?
Know your market value. You can find this out by doing occasional job interviews and receiving offers. Don't view this as wasting your time or theirs, if a truly exceptional offer is made you would take it, and you often don't know if they are exceptional until late in the process. (e.g. my second job out of school nearly didn't happen because after the second interview I thought the role wasn't interesting, fortunately the hiring manager persisted and found a role in the company that I enjoyed, I stayed at that company for 5 successful years)
Learn how to negotiate, use those job offers from above to practice countering on an offer. Realize that raises are negotiations too, and in negotiations before the raise comes you need to prepare your boss properly. E.g. Weeks/months before raise season remind your boss about your accomplishments. Remind your boss about your accomplishments, it's not bragging if you do it right.
Finally, just as you manage your career by learning technical skills you need to manage your career by learning soft skills, and other career advancing techniques. I wish I had books to recommend, but my lessons were all learned through mistakes.
⚫ Be ownership. Start your own company. You'll rapidly find that the same numerical collusion advantages which apply to large employers are even more applicable to VC and funders, and that the game they play is for control. Even Jobs got screwed out of his own company.
⚫ Opt out of the game. Welcome to the world of post-growth economics and the impact that has for wages everywhere.
⚫ Move to where hiring is growing. I've quoted Smith above on collusion. He also has advice for where to find rising wages: "It is not the actual greatness of national wealth, but its continual increase, which occasions a rise in the wages of labour. It is not, accordingly, in the richest countries, but in the most thriving, or in those which are growing rich the fastest, that the wages of labour are highest." (Wealth of Nations, Book I, Chapter VII, http://www.gutenberg.org/files/3300/3300-h/3300-h.htm#link2H...) So, if you can emigrate somewhere with rising employment, you'll do better. The problem of course is the same as for the 3rd option: growth is flattening everywhere.
⚫ Unionize. Good luck with that, as Silicon Valley has been hugely resistant to union organization, in no small part due to the contrary-to-their-own interests brainwashing of Libertarian indoctrination. Even if you don't believe it, I can all but guarantee that the suggestion of forming a union will bring the denouncers out of the woodwork. If you do want to proceed, find ways of removing them from the conversation. There are publications from civil rights, unionization, and nonviolent revolutionary movements detailing derailing tactics and how to respond to them. The Albert Einstein Institution's book list is a good start: http://www.aeinstein.org/english/ . In particular, From Dictatorship to Democracy. Studying how opposition movements are disrupted is also helpful. For these, go to the source. FBI's COINTELPRO and HOODWINK documents (the YELLCASING is their thing), the Lewis Powell memo: http://reclaimdemocracy.org/powell_memo_lewis/http://billmoyers.com/content/the-powell-memo-a-call-to-arms...
⚫ Suck it up and accept it. You'll be making better bank than most salaried workers, at least while you're working. The rare superstar may do significantly better. Odds are good you'll work in startup serfdom for 10-20 years, then find yourself on the aged side of hip, or whatever the cool kids are calling it then. Assuming there is a Silicon Valley in another 10-20 years. There are a few bigger epochal changes on the horizon. At least having read this you'll begin to understand where you stand and how the game works.
I don't really feel sorry for the employees. There's this fascination between geeks to work at one of these "prestigious" companies, Google, Microsoft, Apple, etc. yet at the end of they day you are burning all your time, effort, essentially your life, to make a few guys rich.
They pay you enough to keep you happy, give you a few "interesting" problems to work on if you're lucky, maybe a couple of perks at the office. Why are you selling your soul to these guys in the first place? I just don't get why you'd be interested in making someone else rich for some geek-cred.
That's pretty pessimistic. Sometimes there actually are interesting problems at those companies. Larger companies can also offer benefits that aren't available at some other companies-- sometimes security, sometimes work-life balance, greater access to resources or talented people. Not everyone's tradeoffs will be the same when evaluating where to work or what to do.
And in the end, pretty much everyone is working for someone to "make a few guys rich". Unless you're a completely self-funded founder or investor.
The article claims that a "no-poach" agreement constitutes "wage theft". I lost count at how many times that phrase was used in the article, but it was probably fifteen times. It's completely incorrect, dishonest, and overdramatic to the point of being insulting.
I accuse pandodaily of brain theft.
HN needs a kill file, I have truly never read an intelligent article from them.
I get why you are upset about that, in that it's a term of art that is being misused. But given that the goal was to keep wages lower so that companies could pocket the money, it's not an unreasonable way to describe it casually.
What astounds me by all this is the idea that the HR people in all these companies seemed to have no issues with going along with these highly illegal schemes. Must make for an interesting work environment to know that your HR people were willing to screw you over for little or no personal gain.
There's a couple of examples of them getting fired for not going along with it. I don't think "following instructions so as to keep your job" is as bad as "willing to screw you over".
If you are threatened with firing or fired for not going along with an illegal activity I would think the proper thing to do would be to report the illegal activity. If the law was structured in a slightly different way they could have been dragged into the court case for going along with the scheme.
This conduct is obviously despicable, though certainly not out-of-character for Steve Jobs (all due respect for his talents). However, I generally believe this will resolve (and has been resolving) itself via market mechanisms. The mistaken assumption is that the only competition here is between Apple, Google etc and that it is focused primarily on income.
The market is a lot more subtle than that:
1. Hackers are not simply mercenaries, esp. the best.
2. A decent % of the best are involved in startups, either as founders or early hires.
3. "Acquihires" are a mechanism for the best engineers to get paid more "outside" the system.
4. Aside from industry, there is competition from academia etc.
Your points are well thought out, but I'd like to play devil's advocate to get you to expand on them, if I may...
1. Isn't this why large companies target the inexperienced, the recent college grad who is scrambling to make rent, or exploit people who can only live and work in the US if they get that job?
2. Some would say once you're a successful startup founder, you're "one of them" and the incentives become reversed. Do you think hackers who become founders still retain the hacker ethos? Why?
3. Because acquihires aren't fully disclosed, wouldn't the market function more efficiently if the compensation came through more normal means (salary and stock grants)?
4. Do you really feel like an academic path has competitive compensation to industry?
1. Absolutely, they do target these people, particularly through internships which are essentially recruiting tools. The BigCo advantage is that any decent salary will seem like a lot to people who've never had one before.
However, they are not the only players in the game, particularly recently. Y-Combinator itself started as a recognition of this paradox: while recent grads may be "struggling" to make rent (and in need of income), they are good at struggling (scrappy, risk-tolerant etc) and therefore ideally suited to starting a startup.
That said, I believe this particular lawsuit is more relevant to "proven" talent than students.
2. I think "hackers" will generally retain the "hacker" ethos, which I don't think is particularly tied to how they behave as founders or executives. I don't see "hackers" as any more or less benevolent or idealistic than the general population in the long run. In the short run, however, they are more likely to feel empathy since they were in the same shoes as their early employees more recently. From a more pragmatic standpoint, they realize more acutely that it will take a lot to get the best people to stay and contribute to someone else's dream.
Finally until they are formidable enough to engage in strategic discourse with the likes of Google and Apple, they don't have the ability to attempt such collusion.
3. Perhaps, but not necessarily. Acquihires might be a particularly good tool for talent discovery. There's also the potential threat that acquihires represent (if you treat us (engineers) too badly we'll just leave and you will have to buy us back 10x).
Your argument here is a good one, acquihires may reduce information available to all parties. However, this information asymmetry may work against the acquirer more than the acquired (or vice versa). I don't think there is enough data to confirm either possibility.
4. It depends on what you mean by compensation. In many cases (not all), the work may be more interesting and more importantly you (may) have more freedom in choosing what to work on. I qualify these statements because to get all the way to this utopia you need to get tenure, which is hard.
Regardless, you get to work with the best and most interesting people, which is a form of compensation. Also, plenty of startups come out of academia simply because it's like an extension of student life* (particularly grad students, post-docs and other non-tenured people).
This seems like it takes some basic facts and then jumps to a lot of conclusions without any data (like sbisker mentions) - I'm not suggesting it's BS, but it's not clear their obvious conclusions are so obvious. I'd love to see actual wage data.
What could the wage data show you? That everyone in all these companies were being paid much the same for similar positions? Doesn't seem like that would prove much of anything.
You would have to somehow compare data from these companies with companies outside the group. But even then, I'm willing to bet it would show little because these companies were the big guns in the area. Very few companies would be able to outbid them in wages in the first place.
Wage data is probably not really needed here. From what I understand of the law, the mere fact that they had the agreement was illegal. Meaning they didn't even have to implement the agreement, just that they made it. That they seemed to have implemented it and attempted to hide it only adds to their problems.
The price of anything is a function of its supply versus its demand.
A non open (or not truly open in this case) kills demand. Without demand for a finite supply (high quality engineers) the supply's worth can never fully be realized.
So what if Google/Apple/Intel and everyone under the sun poached each other's talent. How high can the salaries go and how high can the money drain affect. After a certain number of years, things are bound to normalise isn't it ? Why fret over 5 - 10 billion when all of these companies put together have something like $500 billion collectively in cash. I seriously do not get this.
I think I've read anecdotal stories about companies like google paying huge sums to hold onto engineers, like 6 and 7 figures. Does anyone know what I'm talking about and is this a result of recruitment pressure by startups.. Who obviously don't have the same agreements in place?
If so that would seem to support what the plaintiffs are saying.
I don't agree that these agreements are ethical, but can someone explain how they're different from the way a professional sports team manages the rules for players transitioning from team to team? Perhaps the leagues should have more oversight too?
Note that this completely ignores the NFL's non-profit status ... why was that ever granted?
NFL players are all members of a union and collectively negotiate those rules.
(I doubt the league especially factors into the terms of the contracts between teams and players, but the non-profit status is probably granted because the team owners extract profits and the league just keeps the wheels turning, there isn't an owner that makes money on the league itself)
All of the excuses and rationalizations I see posted here make me ill. It's like very few "peons" understand the mentality of those who are "in charge" - e.g. the Clueless, Loser, Sociopath hierarchy of how businesses are structured. There has been a recent spate of stories across the web about how wealth affects people's mentality and behavior - I am reminded now of a story about India and how the stark class differences there motivate those at the upper end to treat those not in their own class as even human.... it is more subtle, but just as bad here in the UK. Why would it be any different in the West? How in the world is Silicon Valley, or IT in general, any much different than any other business sector? It is a fundamental characteristic of capitalism that capital will try to exploit labor as much as possible and by any means available. Engineers getting $250K a year is irrelevant - those people are still just "house niggers"...
As a middle class American, admittedly clueless, the education I've gotten over the past decade has been eye opening. And a bit late; I wish I'd learned this stuff years ago. But that is the dark side of being an engineer - the work and the creative aspects can swamp everything else. Other creative professions have this same basic problem, with the business major types exploiting them as much as possible. And basic Marxist theory is even more forbidden than rational thought about drugs in America...
i am not a raving Marxist, but after the last 4 years of my life getting shafted by one of the new crop of robber barons (an out and out sociopath) (yes, I have finally graduated from the Loser class (or been expelled)) it's... christ. Humanity is so tiresome. I've had some great bosses, mind you, and worked for some good companies. But the capital-labor relationship is fundamentally deteriorating and with the coming rise of automation and increased population and refusal to raise taxes and all these other social forces I see, the future looks very dystopian over the next 20 years. Things are getting such that the only logical position to take is that you incorporate yourself and thus you can act as sociopathic as you need to, given everyone else is acting the same. Does anyone with any sense want to live in such a world? I'd like to just do a good day's work, get paid fairly for it and not have to spend more time figuring out how to protect myself from getting screwed over - or figuring out how to screw over the next guy. I can't do my best possible work otherwise. I've got better things to do than play social games. This is something Ayn Rand touched upon in Altas Shrugged, as reviled as that book might be. Lots of capitalists these days are nothing but the social leeches that she railed against, despite their hypocritical protests to the contrary.
I guess I am a Marxist, or at least see the slice of truth about life and society that it reveals. There is a value in honest work, in creating something useful for society - that is something fundamental to being a real engineer. IT likes to claim that is a fundamental value of the profession, but I don't see that anymore (in general). There is too much money sloshing around. Things are getting out of balance. I can only hope the social strife prevalent in the 30s (go read some American history) comes about again - OWS and the protests in the Bay Area now are only the beginning. Then again, the resurgence of the fundamental social forces motivating the 60s that happened in the very early days of the rave scene got explicitly squashed by the authoritarian parts of the power structures in society.... Yes, I do have some stories.
Fortunately, climate change will smack humanity upside the head and force us to start thinking differently.
Do you want to know what marxism is like in america? Try academic research science. Pay lines for postdocs are effectively set by a centalized agency - NIH guidelines. There's limited market and a captive, oversupplied labor pool, zero ownership of the means of production ("it all goes for the collective effort"). Advancement is not meritocratic, but rather a combination of being in the right place when a position opens up, and who you know ("political connections"). As a result you have absurdities like me: a PhD four years out of grad school (10 years off my bachelor's) that can run circles around bosses both intellectually and technically, experience in multidisciplinary research up the wazoo - making $40k/year. Meanwhile, the head of the institute built a $37 million vanity building, excuse me, lab facility, and does media gigs showing off his tesla roadster to David Frost - largely extracted off of state funds by skimming off of grants ("overhead") and also state-provided "R&D and investment vehicles" - SBIRs, etc.
Well, at least I'm not an H-1B. I remember a postdoc on an H-1B who lived in a one bedroom underneath me and my roommate's from grad school, who was paying twice I was in rent and also trying to support a wife and two kids on an equivalent salary in this relatively expensive city (San Diego).
Enjoy your marxism.
I have left the system - I'm starting up my own biomedical/science research institute run off of actually humane principles - and so I'm, in the interim, unemployed. Luckily, I seem have some skill in the "free market" and so I'm financing this short break in employment off of investments I made (bitcoin, a handful of stocks) and am entering in 'hustle' mode - picking up whatever jobs I can to tide me over (you don't get unemployment benefits if you quit, even though you've paid into it). I'm much happier. When I do work, I know that what I'm doing is making a difference -if minor- in people's lives, not working to advance the agenda of a faceless bureaucracy doling out grants mostly administered by scientists who couldn't hack it in research and so went to work for the bureaucracy (dunning-kruger effect).
Presumptively the 'most important' things that Marx believed is the idea that the workers should "control the means of production"[1] via a centrally organized apparatus, preferably the state, plus theoretically orthogonal (except to the keepers of the faith) stuff like labor theory of value, distinction between productive and unproductive labor, and dialectic model for social progression, plus a little bit of pining for the simplicity of the feudalistic era.
But, you're right, I don't know what "Marxism" is. But, I suspect many self-proclaimed marxists haven't even read Das Kapital or the Manifesto, so at least I'm a little bit ahead.
[1] I will cop to not fully understanding what it generally means to 'control the means of production' but I blame Marx. It's kind of not a really well-defined idea, and he had a penchant for florid language, in places where he was compensating for not being precise.
My post was a bit of a rant, admittedly. I am reading Das Kapital now and have found it useful - I am an engineer, so yes, "central planning" is a unrealistic ideal (how does the behavior or organization of the Federal Reserve not fall under "central planning"?) But as a work of philosophy, the ideas in Das Kapital are useful - labor theory of value, productive / unproductive labor, etc. My first draft got long, so I'll try to keep this short.
As for your situation, it to me seems more like the corrupt quasi-totalitarian system involving oligarchs and Ayn Rand's "moochers" and etc - crony capitalism? It doesn't sound anything marxist to me - the Soviet Union was not communism, despite whatever they claimed. And America is hardly a democracy... People are fundamentally corrupt, especially when there is money and power involved.
Re: "control of the means of production" - let me explain it this way. In London, I got hired to build a website and somehow it turned into me being employee-ish #1 (and the only one) for a B2B startup. In my contract (one for contractors) was a clause about my ability to stop work and demand payment for late invoices at any time. But IT startup culture is not really like that - you get the job done, right? It is hard, and professionalism counts for everything. So in my mind, it was the nuclear option - I need to use that, then the relationship with my client has irrevocably broken down because step 2 is calling in the lawyers. But the CEO of this startup, who is a lazy, shiftless, and sociopathic bastard, leveraged that work ethic to the point where he was refusing to pay everyone's invoices (me and the salesguys) - "cash flow problems". But we still kept working, to keep the company running. While this bastard took skiing vacations - he and the other founder did very little work, really. All they did was put up a bunch of cash and had an idea and no skill what so ever relevant for the task, except how to exploit the workers and scam the customers with badly written contracts.
It all came to a head when one customer threatened to sue - he'd been flat out lied to about the nature of the data he was being sold. I fixed the situation - I was the engineer - and then demanded payment. They point blank told me to go fuck myself, deliberately breaching the contract.
This is when I realized I 'control the means of production' - I was the -only- person in this 5person company who could do anything useful of value. I was the one generating all the value (the code, the systems). I was labor and had been fucked over by capital, who brought nothing to the table except money. They didn't even bring a work ethic. Well, the salesguys, but their function was to take my output and get customers interested in it. All capital did was think up ways to exploit both customers and workers. So I controlled the means (because everything I did was the foundation of the company) and I did not use that power to my benefit to counteract the predations of the evil capitalist pig I was dealing with. I should have gone on strike; that's what that clause in the contract was for. But middle class white collar Americans don't have that mentality, and especially IT people. My introduction to the real world utility of Marxist philosophy was a harsh one...
Fundamentally, my mistake was not realizing I was my own corporation, and not an employee, and so had the responsibility of acting as sociopathic as need be in order to deal with 'corporations' or people who are doing the same. I hate doing that - it is not in my nature or mentality. I guess mentally, I am more working class. I prefer to cooperate with people than exploit them and I would guess this goes for most people in IT.
So what are you producing that other people higher up in the hierarchy are appropriating for their own and exclusive benefit? It sounds like you have decided to become capital yourself, which I encourage - today's ethos of engineers starting their own companies is a good thing, one that really wasn't happening when I started in IT. So hopefully the lazy capitalist pigs who do nothing but exploit labor can be cut out of the equation eventually... But don't exploit the people who work for you!
Bravo. The absurdity of some of the highest paid people in the world calling for a revolution is really comical to an immigrant like me. Not to say that the collusion was not despicable.
I was hardly very well paid - I was constantly paid late and should have been charging the assholes I was working for double my rate. Perhaps a good way to explain the problem is a) let's say I got paid $50/hr. Task A takes me 1 hour and I go and generate some work product that fulfills a customer's request. B) this customer is paying $2000 a month for their problem to be solved. You have to take into account as well the cost of the system that I built that task A is built upon, so let's say that cost $5000.
So in 3 months, the cost as paid by the capitalist pig has been fully paid for, and from then on, in perpetuity, there is nothing but $2000/month in profit that goes strictly into the piggy bank of the greedy capitalist pig. Meanwhile, I don't even get paid the $50 he owes me on time.
As a white collar professional who is doing _all_ the work, while capitalist pig goes on skiing vacations, this is really galling. Ok, I can quit or go work for someone else, or build my competing system (then get sued by the sociopath)... I think this shows how the pay of CEOs etc over the past 20 years has risen to astronomically insulting levels while everyone else who literally enables that is getting shafted. If the CEO does a whole lot of work, then I won't begrudge them some difference in pay. But such a difference compared to what they actually do in terms of effort? No, not when CEOs etc in general seem to be able to avoid responsibility for their screwups so easily.
The system is out of balance. It really has nothing to do with the amount of money involved.
I remember reading that these pacts don't apply if an employee initiates contact with another company.
Seems like that would be the best way to get salaries closer to market rates - simply be proactive and always talk to other companies and get your company to increase your salary to stay.
You missed the part where salary ranges are shared, that before an offer is made the current employer is made aware of what is about to happen, and more... I suggest you read the article it is quite comprehensive the measures taken to decrease pressure on rising wages.
Amazing how just a day ago, the media is carrying stories about wealthy techies hurting poor people, driving up prices, living in lavish palaces, and enjoying huge unfair perks like free shuttles to the office. Now the story is, they should have had even more money.
Does anyone know more about how the institutions which these men and women are perched at the top of, affect there attitudes about workers and their labor?
I just can't understand what their motivations are, is it really just about maximizing the bottom line? Do they look at workers as just machines, which are fungible; instead of as human beings that are indispensable from their individuality? Is the institution the sole cause of this, or are these powerful positions in a electric field, only attracting particular forms of matter (and repelling others), or a combination thereof?
Mark Ames loves overusing the word "dreary" and its variants: three consecutive times in as many short paragraphs. PandoDaily needs a copy editor rather badly.
My personal experience is that the pay structure at Google has not depressed wages at all. It's not unusual to encounter a mid-tier engineering lead pulling down $650k+/yr (with stock), working 40 hours a week. Try hiring that person away from Google. It's nearly impossible to match that kind of take-home without turning your business completely upside down.
I blame the spineless executives, who peed themselves and folded at the words "this means war". WTF did that hippy salesman Jobs know about war? Oh, you'll go and hurt someone's feelings at a meeting? Give me a F-ing break. That shitbag Jobs wasn't fit to scrape the muck off a real veteran's boot.
Since CA is one of the few states that bars non-competes, I doubt this lawsuit could have been brought forth in any other state. Lawyers out there, am I right? In NYC for example, the non-competes are draconian, and there is far less movement between companies. In SiV, fortunately, movement is the norm.
Does anyone else find it amusing that the author is trying to put an "income inequality" spin on an article about tech employees being forced to take low to mid six figure salaries?
No, I don't find it amusing. I think you missed the point. What is being discussed is _relative_compensation. Relative to additional revenue generated, or relative to what other professionals (doctors/lawyers) make. Keep thinking like a slave, you will be one for life.
I'm not sure why no one is talking about Schmidt in regards to this article? He is also a famous dick and even a sex creep. Neither of those two were known as being a nice guy.
Power-mad, short-sighted CEOs are par for the course. What is really sad is to see are references to the extent that Board members not only were aware but actually facilitated.
To anyone just starting their tech career in the US, pay attention to the parent comment.
Edit: parent deleted the comment, so here it is: (I sincerely hope the parent is not getting hauled off in handcuffs as we speak.)
As a former Intel engineer the only thing that surprised me
is how high up these abuses went. These companies and their
leaders are scum to the highest degree. Between refusing to
consider american candidates, mandatority never ending
"crunch" time and suppressed wages I can only warn others
to stay as far away from the companies listed in this
article as possible, especially if you have an engineering
degree.
If you don't actually do anything its can be a pretty
rewarding career assuming you have a knack for abusing
others... such actions are highly rewarded at these
companies. The number of H1-B visas I saw pleading for
relief would astound even the Foxconn taskmasters.
H1-B visas are one of the major motivations behind the "immigration reform" being talked about in Washington DC. The purpose is to drive down tech salaries.
Don't believe them when they claim they are trying to improve labor conditions for minorities or something. To truly help non-US-citizens they would be requesting more green cards and US citizenship. H1-B leaves a person in a limbo world where they are essentially an indentured servant of the company. And the result is lower wages for everyone.
Intel's hiring and HR fiasco has been a running joke in the industry for decades now.
Read iWoz (by Steve Wozniak) to find out about Jobs' behavior at Apple.
Intuit appears to be at the center of this class action suit.
The real surprise is that Google joined them. Good thing Facebook didn't!
They've acquired a company that builds military robots [1]. I think it's safe to say their sense of ethics is all but gone. The only question here is when exactly they became "evil" (in their own terms).
I am working in the US under a temporary work visa, and by no means Im enslaved or abused. I have a market competitive wage for my skills, and have the most engaging and rewarding job i ever found as a software engineer other than personal projects.
In fact, It's a huge effort and sacrifice to move to the US for work, leaving friends and family behind. US is not qatar, i can always leave whenever I want and work in argentina.
Increasing the number of workers would , by supply and demand, lower wages. And that of itself its a very reasonable goal for any big company. Thats why companies back "teach to code" programs, "teach science in school" and many other education related endeavors, simply to increase the worker base.
Also visas provide a very strong incentive for the US government to sponsor: tech is one of the most outsource-able jobs out there, and that means lots of money and taxes go to other countries. Moving the talent prevents that.
Just so you know, the problem of people going to the US for tech jobs is a huge concern in other countries, that cant provide competitive wages as the US.
I agree that calling an H1B an "indentured servant" is a bit of an hyperbole.
But you certainly have a lot lower leverage than an US citizen.
As you say, you can leave whenever you want, but you went through hardships to go to the US, and back in Argentina you're going to find awful working conditions - a 25.000 pesos salary is about 1500 dollars right now, good luck with that, and that's the salary I was offered not very long ago.
So, you're lucky you're not treated differently at your company, and most H1Bs I know aren't either, but some do have abusive bosses or situations they have to tolerate or get deported.
Of course there is definitely a leverage difference, but its impossible to completely eliminate that in a migratory concern. Argentina has very low requirments for immigration, so if an american went looking for work there, he wouldnt have nearly as much hassle from the government to do it. And even then, he would be less leveraged than locals: "you dont know the language as fluently" , or the market, or whatever.
About the argentinian wages: you can work from argentina to an outside company as well, which is what i used to do. Wages are less, but so are taxes and cost of living. If you want to get a US wage and live the Argentinian life, you are taking the best from one and the best from the other, its not a sensible comparison.
At least with what I see on the visa, companies have a lot to lose by "abusing" the power: a formal complaint could put the organization under review and that is probably not a walk in the park.
Overall, from the US market perspective, getting "slightly cheaper labor" is still much better than straight down outsourcing.
I am so glad this is being revealed now. It's not exactly new, but this is the perfect time.
Why? Because Google Bus Protests, that's why. This is a chance for the people and the engineers to line up, shoulder to shoulder, on the same side and take down the fuckers who've become the elite of this system.
Please. I know activists like the Google bus protesters. I'd call them protest enthusiasts, and usually less than half work for professional activist outfits. Most have regular jobs and just love to protest.
The "astroturf" is fwd.us and peers.org are pure astroturf. You can't even get a political position out of them until their lobbyists have written the legislation and tried to insert it into some bill.
Every time I read an article about this I fell like I'm at The Onion. Drive ++down++ engineer wages? Really? Does anyone on planet earth feel like engineer wages are/were artificially low?
> Does anyone on planet earth feel like engineer wages are/were artificially low?
Yes. Just because wages are high does not at all prevent them from being suppressed.
There's actually pretty strong evidence that wages are suppressed across the board in tech. In near-perfect labor market equilibrium, you'd expect employers to not have open headcount for extended periods because if they're unable to hire for a position they rationally increase its salary. Yet in tech you see many/most companies with near-permanent open headcount who still steadfastly refuse to increase salaries outside certain predefined bands.
Whether such behavior is consciously profit-driven or unconsciously motivated ("non-managers should never make more than $200k") I don't know but it's largely the reason for the longterm hiring crunch.
Every time I read a comment like this I know I'm at Hacker News. Did you read the article? These companies all held illegal discrimination pacts designed specifically to prevent them from needing to shell out a little bit more cash to keep their best employees from leaving for other employers that offered a better deal. The wages were, by definition, held artificially low.
based on anecdotal evidence, top engineer salaries start capping out at 150k, when in reality this should go into the 300, 400, 500k range like lawyers and finance people make.
At many companies, both startups and established, if you're a top performer and/or joined early enough, stock grants can easily propel you into this range (and beyond).
the figures he referenced are straight salary. A typical 30 year old investment banker at top firms will make 400k salary, but could easily be over 7 figures with bonus. Startup equity is rarely, if ever, worth that much on a risk-adjusted basis.
Not just startups, but even big companies like Google and Facebook have seen significant stock growth that have resulted in 2-3x compensation increases -- even if you joined post-IPO.
Ah, yes the "get rich through stock options" myth again. It is funny how everyone uses Facebook and Google as examples not realizing that they are pretty much unicorns. The truth is that 7 out 10 start-ups fail, and your options will be close to (or completely) worthless. Even if your start-up does well, are you really going to get rich with your 0.05% share of the company? Except for VP Eng or CTO positions, it is rare that anyone in development gets more than 0.5% of shares. Which are diluted at every round of subsequent VC round.
They could be, it's all relative of course. The most affected engineers in this case were likely the cream of the crop. It's in a way analogous to professional sports, where (if salaries were truly unrestricted) the very top players could easily demand a multiple of their already astronomical salaries. To combat this, some leagues like the NBA have 'salary caps' and 'maximum contracts'. You won't see the government going after this extremely obvious anti-worker collusion because there isn't much sympathy for multi-millionaire athletes. However, salaries for the best are almost certainly artificially low.
In a larger sense, argument isn't about what the affected workers "should" be paid, it's about who gets to decide: the potential recruits or their prospective employers.
As someone who believes that free markets generally "find a way" (in spite of information asymmetry), I'm hesitant to endorse the government's view point. One good thing that can come of this is more of these top-notch engineers get fed up with this sort of behaviour and start more startups. At the same time, I'm not going to shed any tears for Apple or Google if they lose in the courts.
these teams also have minimums they must spend on players and minimum salaries per player. in the MLB and NBA the player's unions are very powerful and salaries would likely fall without them (NFL is a different story)
The median salary would likely fall, the mean would likely rise (or stay around the same) but the very top salaries would rise dramatically, in line with what these same players make on the free market as brand ambassadors.
This brings to light an uncomfortable truth: incentives are not really aligned for the very top talent and the majority of workers. To extend the sports analogy, Roger Federer recently opposed spreading prize money more equally in the grand slams, saying essentially that players should win more to get more money. (right now tennis prize money is essentially a power law distribution).
Both have more education than the typical programmer, the majority of lawyers actually barely make over $100k, and doctors are not only significantly more trained than programmers but also generally work more and literally save lives.
>OK, I’ll tell our recruiters they are free to approach any Adobe employee who is not a Sr. Director or VP. Am I understanding your position correctly?
>if you [Brin] hire a single one of these people that means war.
Chizen's comment:
>if I tell Steve [Jobs] it’s open season (other than senior managers), he will deliberately poach Adobe just to prove a point. Knowing Steve, he will go after some of our top Mac talent…
Jobs sounds like a Grade-A Asshole, along with every other player involved in this mess. Makes me even less likely to relocate to SV than I already was. Though now I'm curious to know whether these wage-theft pacts extend beyond SV, perhaps to Austin... Many of the same players have a significant presence here. Seriously. If you've got info, hit me up.