Just on the subject of programmer salaries, I was talking with someone who had much more experience in the computing industry than myself and he pointed out something I'd never known. He said that programmer salaries from pre-bubble days was six-figures, and that we're still in that range, and not higher is proof that salaries have been kept low. Six-figures today is not what six-figures was worth in 1998. Inflation alone from $100,000 1998 to 2014 is $144,877.91 using http://www.usinflationcalculator.com
And yes, I don't trust anyone who cries foul about a shortage of workers and then offers 40% under market wages, anecdote of course.
> anyone who cries foul about a shortage of workers
Those people generally use the phrase to mean "a shortage of workers willing to accept below-market wages and invest all of their time and energy in a company while bearing the downside risk of a entrepreneur but none of the upside."
In Germany all kinds of industries have been whining about shortages for ages, but in reality they're all looking for unicorns that work for peanuts in combination with an absolute unwillingness to train anyone (let someone else or big gov foot the bill, if that doesn't work cry for immigration reforms).
In the US, it's popular for Valley companies to complain that they can't hire for what they're willing to pay, but at the same time they are totally unwilling to train—if you're a developer who wants to advance and improve your skillset, well, that is going to be up to you on your nights and weekends. Funny how that works.
> Those people generally use the phrase to mean "a shortage of workers willing to accept below-market wages and invest all of their time and energy in a company while bearing the downside risk of a entrepreneur but none of the upside."
I agree that salaries are an issue, but I can't agree with this attitude which seems so prevalent on hacker news recently.
First of all, the downside risk an entrepreneur faces is huge. We like to say we are the type of nation and culture that accepts failure and encourages risk, and compared to other places that may be true. But the reality for an entrepreneur coming out of a business is usually not super easy. Few companies are looking to hire people who ran unsuccessful businesses - the entrepreneur skillset tends to make it hard to market oneself. On the other hand, an engineer coming out of a failed startup will have the same trouble finding work they had as they went in.
In terms of upside, negotiate a position that makes sense for you. You're the only one responsible for how much of the upside you share.
> But the reality for an entrepreneur coming out of a business is usually not super easy. Few companies are looking to hire people who ran unsuccessful businesses - the entrepreneur skillset tends to make it hard to market oneself.
That's just about 100% opposite to my experience, both firsthand and by observing others.
Why do you state this with such certainty? Keep in mind that there are huge differences from country to country about how failure is perceived. In Germany what you write might by true to some extent, but in NL it wouldn't be and in the US it would be a badge of honour and people would be more than glad to have you.
True that I don't have any citation, like you only going off my own experience. My own experience in hiring has been that short of consultant positions ex-CEOs don't have specific enough skillsets to be put to work in many places in a company. When I have worked with them they have been unmitigated disasters.
I'm curious about your experiences because, correct me if I'm wrong, I think you were pretty successful early on in your career. I'm sure you've had failures, but having a win behind you tends to temper failures quite a bit.
Regardless, the entrepreneur will have to either change careers (go back to being a programmer - which is not difficult in this market), or negotiate successfully for much rarer positions than the programmer. I'm not saying it's impossible, I'm just saying the concept that there is a risk for entrepreneurs, and more so than their employees (at least the engineers).
Edit: And I'm curious what your thoughts on the comment I was replying to are as well.
Well, I've always been a programmer so I guess that's a marketable skill. The only thing that probably stops me from getting a 'day job' is that I'm too expensive and I like my freedom but it's not as if I would have trouble finding a job. Rather the opposite, offers from all over the globe with some regularity.
I specialize in work for the financial sector and do the occasional interim management / project rescue job, high pay, very intense and fun to do with both a defined beginning and end.
As for the failures, they're too numerous to recount :) Having one 'win' and a string of failures still adds up to a win (for me), but it was a pretty slow road upwards with one stroke of good luck in between somewhere. For the most part it was simply hard work.
The first contracting job I landed sustained me for quite a while, you're definitely right in that (and it became a very large success over the longer term but I did not see any revenues from that).
CEOs without specific skill-sets are usually not the best CEOs to begin with, that might be where the failure correlation comes in. I don't think I'm the best CEO either (or CTO for that matter), but I know how to spot talent and when to get the hell out the way and I think those are the major skills you should have as a manager at any level (as well as knowing how to keep people motivated).
As for the parent comment: I think it's spot on. The worst possible position to be in is early hire in a start-up. You're going to see all of the downsides but only 1% of the upside of being a founder. If you're going to be taking that much risk you might as well be a founder.
> The worst possible position to be in is early hire in a start-up. You're going to see all of the downsides but only 1% of the upside of being a founder.
Let's expand on this, because that's me and I'm quite happy (but also willing to be convinced otherwise :D).
Financially, you're balancing lower salary with a potential for a large upside later. That upside can be great if you believe in the company and/or the value of the stock options offsets the lower salary, which it probably has the last two times I've done it, and definitely didn't the first 3. That being said, the first three gave me access to the last 2, and allowed me to see why the last 2 would work in a way that the first 3 didn't. Edit: also, comparing to the risk an entrepreneur takes, the salary cut tends to be much higher for an entrepreneur than an early hire (often the entrepreneur takes little to no salary for a long time).
In some ways you miss out on working with specific talent. You work with fewer people, so by definition you have access to fewer viewpoints. That's a very real opportunity loss, for sure. On the other hand, you get to work on a wider variety of things, and working at an early company tends to give you a better work-life balance which can allow you to learn more aggressively outside of work (and allow me to be a happier person in general). You also get far more control over the company's direction, if you care about stuff like that.
In terms of "might as well be a founder" - my CEO puts in way more work, way more hours than I do, is able to attract better talent than I can, is able to attract money in a way I couldn't, is able to administer the business better than I can etc. If I didn't think that was true, I wouldn't be where I am (this is part of the skillset that I can pick up at an early stage company that I couldn't at a later stage company). If I had those skills, yes it would obviously be better for me to found, but I don't so I don't think the way you've laid out the risk is entirely fair.
There are many more trade offs, but it's difficult for me to see why being an early stage employee is worse than a late stage. In either cases a lot is left to the negotiator and in both cases you can get a great deal, depending on what you are looking for.
Again, where do you get the "same risk" from? Edit: and I know we are both comparing anecdotal experiences, not asking for a repeat of that, I'm asking specifically for yours (or an expansion on your point of view).
> It's simple math: the equity a founder gets is paid for with less cash than your salary downside as an early hire.
I'm not sure why that matters. To me the only thing that matters is my salary downside vs. interest I could be making on a larger salary else where. I might be misunderstanding what you mean though.
The risk that the company folds hits the early employees just as hard as it hits the founders.
Founders don't typically provide a whole lot of capital.
Three guys meet in a room somewhere, hash out an idea, assign themselves CEO, CFO and COO, plunk $1000 on the table each, call each other 'founder', then get some funding and then hire you to implement their vision.
Their risk is just about the same as yours, only you get to share - if you're lucky - maybe in 1% or so of the success (assuming you don't get screwed somewhere along the line) and in 100% of the failure.
And if you're in for a profit share the odds are even worse.
If you're good enough to be engineer #1 you're good enough to be a co-founder.
On the other hand, as engineer #1, I didn't personally guarantee any debits of the founder, nor was I the one the IRS was after for years for not paying payroll tax when money was tight.
That sounds like a very bad company to work for. Debts of founders are not guaranteed by the employees for a good reason (even more risk without upside), founders that go into debt in order to finance their start-up and put up personal guarantees are obviously in a different class than founders that externalize all or most of the risk. If the IRS goes after founders for not paying payroll taxes when money is tight then they more than likely have a reasonable cause to do so. I've seen one such case up close and I didn't fault the local tax arm one bit when they decided to go after the founders. After all, if you allow founders enough leeway to pass the risk of their business on to society then they will take even more risk.
Better to fold than to not pay payroll tax, or, alternatively, talk to the tax man and see if you can work out some kind of a deal. Simply not paying is illegal and will get you in seriously hot water.
As an employee you are insulated from that but that's simply bad business and bad management and nobody forces anybody to do such things.
In principle, I agree with most commentators on HN that if there were actually a shortage we'd expect to see salaries rising.
Yet, in practice, it does seem that there's simply an absolute shortage of experienced developers. I've been hiring developers at my job for most of the past year, yet we have never had an offer turned down. Rather, we see only a trickle of applicants, very few of whom are event remotely qualified. If we actually saw a great developer, I'm sure we could put together a fantastic compensation package (despite being an early-stage startup, we pay above market for NYC). Yet all we see are mediocre developers, and few of those. It's hard not to call this a labor shortage when my colleagues hiring for other positions (marketing, writing, etc.) see 100x the number of applicants with 1/10 as much outreach/advertising.
Given that it's impossible to produce more senior developers in a 1-2 year timeframe, what alternatives do people suggest to immigration?
Advertise the salary you're offering. If your positions look like 90k positions but you're offering 150k, how will an applicant know?
EDIT: I noticed that you wrote in a nested comment that publicly listing salaries is a non-starter. I'm not sure why - at the very least you could list the smallest number you'd imagine offering a qualified applicant.
Note that it's pretty strange to claim that you can't attract enough skilled engineers even at higher salaries when you're keeping the fact that you pay higher salaries a secret. How do you expect this mechanism to work?
There are two major problems with listing salaries publicly.
1. We don't really want to make the huge salary discrepancies obvious to our non-tech employees. While it's theoretically true, publicly listing the difference wouldn't be great for morale.
2. There's a huge range, and where a particularly candidate falls in that range requires qualitative judgement. We consider everyone from talented new grads to senior developers with over a decade of experience, but the expected salary range can swing by as much as $100k—publicly listing such a big range isn't helpful for anyone. (Yes, I understand that we could theoretically have different job listings but our criteria are driven more by "how much smart shit can you get done" and "how much will you learn" than by years of experience or anything quantifiable on a careers page.)
> Note that it's pretty strange to claim that you can't attract enough skilled engineers even at higher salaries when you're keeping the fact that you pay higher salaries a secret. How do you expect this mechanism to work?
It's not that I think an unadvertised salary will by itself attract skilled engineers—I'm just using our experience as a counterfactual for the claim that there are loads of senior developers but we aren't willing to pay them enough. Note that in private conversations/outreach, we do try to be upfront about salary ranges.
You don't have to just post a range. The listing just needs to communicate that you're paying well above market, which is a step beyond competitive (and I've never seen "above market" in a job listing). Of course, this is only if your company really is committed to doing so!
I don't have a clever solution for 1. This is definitely a broader cultural issue - non-lawyers at a law firm would completely expect to make less than the lawyers but programmers still don't nearly get that level of respect.
EDIT: I think we're miscommunicating a little. There absolutely are quite a lot of qualified senior developers right now. Most of them are employed. You're just not seeing a lot of qualified senior developers applying to your jobs, which is a different issue entirely. Given that nobody's turned an offer down, there's something that your job postings are missing that people are learning during the interview process. "Not paying enough", in this case, can be effectively synonymous with "not communicating that you're paying enough".
> Given that nobody's turned an offer down, there's something that your job postings are missing that people are learning during the interview process.
You are quite correct—I haven't yet figured out how to convey the interesting product/technical challenges we're working on in a mass way: especially not well enough to overcome must developers instinctual reaction to "publishing."
If you have a minute, I would love to hear your thoughts on how we could better communicate through our listings: http://www.cafe.com/careers
A cynical man would read your salary offer(for lead developer) - " As we haven't taken any outside funding, we can offer you meaningful equity with a competitive salary." as: not-so-good salary , with promises of getting rich on a startup that wasn't even able to convince investors.
Heh, interesting read. Maybe I should adjust. I meant to imply that our equity is sizable (because we're still early-stage) while our salary is still competitive with later-stage startups (our founder is self-funding off his last $545M exit).
No, I think "standard market rates" are what employers are paying their engineer who has been there for a few years (and whom they are currently paying below what he/she could get if they left for another job) or possibly what someone would pay for a "standard software engineer" who really needed a job.
If you want to attract exceptional engineers then by gosh, you might just have to pay exceptional salaries.
At the end of the day, it's a business relationship and an intelligent engineer is quite justified in capturing some of the value that he or she generates.
Yeah, those career listings are pretty bland. Not much sense of what you'd actually be doing, or even what the company is hoping to do in a bigger sense. If nothing else, more specificity in both those areas would help you stand out. Especially since, as you say, it's publishing and techies are kind of skeptical about their role in that.
And "competitive compensation" to me signals "eh compensation". It's a pretty weaselly word.
Also, I didn't see any technical people mentioned on the About page? Are they not part of the team?
Here's what I'm getting at- sell people on the vision and what their specific role in it would be. What impact are they going to have, both in the company and in the world? As a startup, you've got the vision thing, or at least you damn well better, and it's your advantage. :-)
> And "competitive compensation" to me signals "eh compensation". It's a pretty weaselly word.
What do you think would sound better? Above market compensation?
> Also, I didn't see any technical people mentioned on the About page? Are they not part of the team?
Good catch. I'm on there (Director of Product & Technology) but we haven't done a good job of keeping it up to date with new hires.
> What impact are they going to have, both in the company and in the world?
Yes, I definitely need to work on this. I've done a pretty good job of refining the technical vision and how it fits with the overall company, but haven't yet distilled it down to a good description. How's this:
Cafe is building technology for discovering, publishing, and sharing great stories. We're building: web scrapers which analyze content across the web (with NLP and Amazon Mechanical Turk) to identify promising writers, a platform which makes it easy for non-technical writers to publish interactive stories, and analytics which model how ideas and stories flow across the web in real time. As a developer at Cafe, you'll be using technology to inform and entertain millions of people while driving clickbait off the web.
I suggest looking outside of NYC for a developer that would be willing to move to NYC.
In Silicon Valley, the talent pool is very picked over. I suggest to anyone in SV to look outside the immediate area. Post ads in Kansas or Michigan. Some place where getting paid a NYC salary seems great.
You have to get creative.
Even if there was a dramatic increase in engineers - there is no guarantee that they would be interested in cafe.com.
I did look at your job postings and I do have some suggestions:
1. List your tech stack - not as a requirement but just to let applicants know what they are signing up for.
2. List your tech stack for SEO purposes- I can't think of any google search that would put the cafe.com jobs high on the list.
3. What are you doing to market the job - be aggressive with linkedin, github, stackoverflow. Every single week I get interview requests by all three channels.
If you are not aggressively recruiting people who are not actively looking then you are missing the boat.
The last time I actively looked for a job was a decade ago. Most job connections come to me via friend/network/etc.
Thanks for the feedback! We do actively recruit outside the NYC area, but could probably ramp this up somewhat (admittedly, recruiting is not my favorite part of the job).
We avoided listing our tech stack because people frequently read it as a requirement, but I think you're right. Will add it soon.
We aggressively recruit on LinkedIn, GitHub, Stack Overflow, and AngelList, but the majority of our qualified applicants have actually come through my network and Hacker News. I'm trying to expand this though, particularly because I want to avoid building a mirror image engineering team (young, white, males in their 20s).
> Given that it's impossible to produce more senior developers in a 1-2 year timeframe, what alternatives do people suggest to immigration?
Why do we operate under the assumption that these companies are entitled to as many unicorns as they want? Why shouldn't they just go out of business?
After the whole collusion ordeal when it became abundantly clear that on one side there are VCs, founders, and C-levels who work to suppress our wages -- and on the other side, us, I actually want to see them lose and get hurt after all the terrible things they did to us.
I'm not a VC or founder. I'm a developer just like you, trying to deliver cool products—but doing so requires more developers.
If my company was trying to suppress wages, or refused to pay above market, then I'd agree with you that we have no right to ask for more talent. But we're perfectly willing to pay for talent—we just can't find any.
I wouldn't be surprised if the number of senior developers on the market was less than 10% of the number of open positions.
So the thing is, I share your general opinion -- there is a legit shortage of talented developers, and it's hard to find them.
BUT: I guarantee you that there is in fact a wage and benefits package you can offer that would get you more good applicants. Maybe it's more money (sure, "above market" is nice, but I'm not going to leave a job for $5K more than my "market" rate -- but for $50K more, well, let's talk). Maybe it's perks and benefits (the Google package, for instance).
Whatever it is, there is absolutely money you can spend that would end up getting you noticeably more applicants one way or the other. That the company doesn't WANT to spend that money is exactly what bothers people.
And yes, yes, it's all well and good to say that developers are paid and treated well -- they are -- but if their talent and skill is really that rare and that in-demand, maybe they should be paid and treated even better.
Okay, let's assume we were willing to offer substantially higher salaries than the market (though the practicalities of our funding certainly limits that to some degree).
How would we communicate said information in a way that doesn't actively distort the hiring process? When was the last time you saw a job ad with salary listed?
Put it in the ad. It's not common, but it's not super-rare, either. And the main reason you don't do it is that you don't want to eliminate your chance at hiring someone at a below-market rate (or of alerting your below-market-rate current employees that they're being screwed and should be getting big raises). If you're committed to paying the rates you'd need to pay to get good talent, then put that upfront.
This is what I'm running into right now. Our CEO will not buy health insurance or computers for Dev. In a second breath, he gloats about paying people damn near nothing because they 'want to work in the industry.'
I am currently looking at jobs in NYC. With 2 years of experience I am fielding offers between 60k-80k in a cheap state to live in. Two comments above you make great points: (1) Developers should be making more than what they are and (2) Why should startups be entitled to cheap labor?
That being said my point is if I had the 5+ years of experience you probably are looking for and was moving to NYC I would expect to be making 150k+. Which if that is what you are offering, great. But if it's not then you can find the talent you are looking for, you just can't afford it.
> (1) Developers should be making more than what they are
As a developer, I'd love to agree with this. In fact, I do. But in our experience this isn't directly related to the talent shortage (again, we have never been unable to make a compelling offer to a candidate).
> (2) Why should startups be entitled to cheap labor?
I don't think they should be. All our senior devs have generous compensation which easily adds up to $150k+.
I'm not sure I agree, especially when you factor in substantial equity. We have interviewed numerous people from banks and large tech companies and our salaries certainly don't seem out of whack.
To you, that "substantial equity" might be a real cost, but to the applicant it's essentially a lottery ticket. The expected value of your equity is zero. I've worked in many silicon valley firms that offered stock options but the only time one ended up having any value to me was as a bargaining chip - I was able to tell the next firm that wanted to hire me "gee, I'd love to take your offer but if I leave now I'm giving up all these unvested options worth lots of imaginary money" which helped negotiate a signing bonus.
Most companies fail, making their stock options worthless. And even the few companies that succeed usually hit bumps in the road that dilute the stock options or put their value underwater.
So if you have a reason to think your idea of "substantial equity" is much more likely than average to ever be worth anything at all, you should make that fact a key part of your pitch. (Or if you're indifferent between equity and salary, offer more salary and less equity.)
"especially when you factor in substantial equity"
Unless your company ends up being the next Google or Facebook (which is a statistically unlikely outcome for any startup), your "substantial equity" may never be worth any significant amount of money. Living in NYC is expensive, and you can't pay your rent with stock options.
Maybe the AngelList data is why startups have trouble finding good engineers? There is no good way of finding out what a good developer should get, and that is because the companies (including yours) like it that way.
I only have anecdotal data, I don't think many people have more, but I am very sure a decent senior dev can get way more than what you are offering.
I think there is more to a job than just the salary, but at least be open about the fact that there are open positions doing similar work in the same city offering significantly more.
>I don't think they should be. All our senior devs have generous compensation which easily adds up to $150k+.
I once got messaged on LinkedIn by a Bloomberg/banking guy looking for me to contract with them in New York at a rate of $144,000/year, and I'm comparatively junior. A properly senior developer, someone with something like 7-10 years of experience in industry, should definitely be making a bunch more than some guy offers me off-the-cuff when trying to recruit on LinkedIn -- especially in an expensive area like NYC!
> I once got messaged on LinkedIn by a Bloomberg/banking guy looking for me to contract with them in New York at a rate of $144,000/year, and I'm comparatively junior.
We have successfully hired people from Bloomberg and finance (including competitive compensation).
One thing to keep in mind is that contracting is very different from full time. $150k is low for senior contractors but normal for senior developers (annualized, I expect senior developer consultants to be making more than $200k if they're based in NYC).
You're right that our biggest challenge is in getting people to apply in the first place.
What do you think is the highest value of deploying monetary and other resources to make that happen, given that publicly listing salaries is a non-starter?
If you want the benefit of offering significantly above market salaries, at some point you've got to let it be known that you're doing that. Secretly paying people a lot of money won't attract new talent.
Does your employer use the lots of startupland hiring phrases, like "we're looking for passionate rockstars who believe in our mission to change the world through payroll software"?
A lot of the phrases in vogue right now seem to indicate companies that want employees that work 80 hour weeks and pay entry level salaries. Have you tried "competitive compensation" or some other non-numerical indicator that you guys pay well or phrases that indicate you guys have a professional vs. passionate culture?
I think our job listings are quite fair and free of "startup" phrases. We emphasize the actual problems you'll be working on and try to communicate that we pay professional salaries for professionals.
"I think our job listings are quite fair and free of 'startup' phrases."
Just looked at your "Lead Engineer" listing. It says: "We offer a great startup work environment with free beer, snacks, and friendly teammates." That sounds more like a typical startup that expects people to work there for the fun experience than a workplace that wants to attract highly-paid professionals.
And the offer of free beer makes it sound like a frat party. Maybe that's a turn-off to women who don't want to work in a place full of drunken guys. Maybe it's a turn-off to guys who want to have a life outside of work. Skip the free beer and make sure your employees have enough free time after work to get a beer outside if they want to.
I'm going to concur with selmnoo, but be less rude about it: sorry, but those are the rules of the game. However hard a time you're having finding senior developers, the incentive to produce them domestically gets skewed downwards, making the problem worse in the long term, if we let you "patch" the issue temporarily with immigration rather than signaling higher demand to the market with rising salaries.
Of course, your firm can also do its own part to fix the problem directly: hire more junior candidates and train them up. Yes, I realize this is quite difficult for your situation, but consider that if few to no companies train junior developers into senior ones, that explains why there are so few senior developers on the market.
And then there's the housing shortages around NYC and SF that make land rent eat up most salary rises -- that's worth an entire post in itself.
Training is part of the solution, but I truthfully don't think that can be driven by startups. We might not even be around years from now to receive the rewards from our investment in junior developers.
More practically, I wouldn't feel right hiring junior developers when I don't think we'd be giving them the best training given our current staffing levels and product needs. Since we already have too few senior devs, I'm not sure I could justifiably ask the team to take on the additional burden of mentoring junior developers (though I do hope we can start a robust training program once the dev team is a bit larger).
We of course help each other, but bringing on a junior developer is absolutely considered an investment. There is a tangible decrease in the amount of time senior developers have available for other tasks, not to mention the cost of any off-site training we might invest in.
Using that logic, you could say immigration laws are actually what are making the problem worse in the long term - by temporarily keeping salaries higher than what they otherwise would be.
On the one hand, everything you've said is more-or-less correct. On the other hand, there's an additional problem: as long as cities suppress the construction en masse of affordable housing, every attempt to raise salaries mostly just ends up raising rents, leaving employees only a tiny bit better-off than before.
> Don't limit yourself to local candidates. Especially somewhere like NYC.
For many roles we're very open to hiring remote developers. Even that is rather challenging. (Though for lead roles, we do ask that you be based in NYC because it involves a lot of brainstorming with writers/analysts.)
What makes you think that immigration is going to result in an increase in high-quality applicants to your company? This sounds an awful lot like "If you build it, they will come."
While I don't doubt that you see a lot of candidates who aren't remotely qualified for your positions, one of the harsh realities of this market is that it's hard to attract "great" people, even if you're at or above market in terms of compensation. There just aren't enough "great" people to go around, so other factors, such as technical challenges and business viability, are often taken into consideration by quality candidates. Chances are there are other startups competing for the same talent that seem to be working on more challenging problems and have better prospects than you.
Early-stage startups like yours would be wise to consider optimizing their businesses and technology architectures around this fact. Unless you can pay stupid guap or are working on something really, really objectively interesting, one of the best and most underutilized techniques for finding great employees is to hire decent folks with potential and develop them into great employees.
A lot of companies will insist this isn't viable ("We needed 15 unicorns yesterday because we're building the world's most advanced analytics platform for selfies!") but most of them aren't being honest with themselves about their real needs. They're intent on building technology for the business they think they'll have and don't want to admit that they don't know how to develop employees.
> What makes you think that immigration is going to result in an increase in high-quality applicants to your company?
I don't think immigration is a panacea (in fact, my primary point in this thread has just been to rebuke the argument that salaries aren't rising so therefore there isn't a tech shortage). That being said, we do have some overseas contractors who I'd love to bring in-house if the immigration system didn't make doing so incredibly byzantine and challenging.
> Chances are there are other startups competing for the same talent that seem to be working on more challenging problems and have better prospects than you.
I do think this is truthfully a big part of the challenges. Despite the fact that our CEO has a great track record (two successful exits, last one for $545M+) and that we're actually building some cool technology (using data & technology to make it easy for writers to understand how their content flows across the web and to adapt their writing accordingly) many are turned off by the fact that we're working in "publishing."
Unfortunately, at this point it seems almost impossible to hire good developers unless you're Google—even if you have a viable business model and interesting/new technology (microservices, graph analytics, etc.).
> Unless you can pay stupid guap or are working on something really, really objectively interesting, one of the best and most underutilized techniques for finding great employees is to hire decent folks with potential and develop them into great employees.
We're very big on hiring based on potential, but there is a certain baseline. Particularly because our engineering team is small as it is, bringing on junior devs would be somewhat unfair to our existing developers—increasing their workload.
Absolutely; the programmer's wages even today are lower than the were in 2000. Of course 2000 was a peak.
Rather than just looking at general price inflation, you should look at cost-of-living at the tech hotspots (the big cities, silicon valley). That of course makes things even more dire.
Luckily you too can make the next big thing, sell your startup and then live happily as a venture capitalist / philanthropist.
>He said that programmer salaries from pre-bubble days was six-figures, and that we're still in that range, and not higher is proof that salaries have been kept low.
The pre bubble days had plenty of immigration, not to mention NAFTA was in full swing as well. The job and salary situation seems to be poorly correlated with salaries and job availability.
By Paul Graham's description in that "Let in the 95%" article, companies are standing around with their dicks in their hands hoping that they find "the best" engineers, but on the cheap. If a company wants to hire 30 more "great" engineers, but isn't bumping up their pay to get at least 15 at a higher rate instead... there's something really off happening.
It's standard economic theory that wages are sticky. I think for a while, at least the past three years, junior developers (especially in web dev) have been overvalued and seniors undervalued. From my recent job search, I think this is starting to change, which is why the whole "not enough engineers" is reaching a fever pitch (ie, we can't find seniors at the traditionally understood market rate, as everyone realizes seniors are a better buy right now).
As it stands, career programmers in the US who are good but not celebrities generally try to move into management/consulting/whatever because their career stalls otherwise. Solve that problem (PAY MORE) and we've got our programmers.
And, besides the dick in their hands part, what Graham didn't mention in his warm christmas tale of meritocracy, they also make deals to not competete against others on talent, to fix (i.e. ruin further) what is already an extremely dysfunctional market (when did you last ask your coworker what she made?).
What's even worse is that the whole issue of the wage suppression saga has been conveniently forgotten by the tech elites and media. The case is still ongoing after the judge threw out the settlement Google et all offered, but the last begrudging mention of this in the tech or mainstream media was in Aug.
How can Paul Graham sit there and not mention the anti-competitive and illegal collusion of the top tech employers while he tells us to vote against our own financial self-interest?
He wants us to vote even more money into his pockets, and vote to undermine our wages, and he doesn't even give the smallest mention to the fact that the most respectable and respected tech employers have been fucking us over for years!
What seems to be happening is that Silicon Valley wages are flat or down (relative to 1998) but the rest of the country is improving. There actually is good news here, though it might seem otherwise if one takes a Valley-centric approach.
In 1998, software engineers in the Midwest generally didn't make six figures. $70,000 was a strong salary for a mid-career (5-10 years) engineer. The $100-140k figures were limited to the Bay Area and New York (around Wall Street) and possibly Chicago (also finance).
In 2014, engineers in the Bay Area have lost ground relative to the housing market, and have lost social position relative to well-connected "serial founders" and investors... but on the other hand, you can now work in any of the top ~20 hubs and make 80-95% of what you'd make in the Bay Area.
That is not true - my compensation has grown by about 100% moving from DC to the Valley a half year ago, and it still isn't as high as I believe it should be. From what I understand, DC is one of the better areas in the country for tech as well.
On one of the previous threads about this topic, someone suggested that accepting H1-B applicants in order from higher to lower salaries instead of based on a lottery would clear up a lot of the lottery spots that currently go to the below-market-wage-indentured-servant type shops to be used for more deserving companies and applicants.
Seems like a solid change to me, without an obvious downside. (But I am not an expert and haven’t done any detailed analysis, so maybe this would have negative consequences I’m not anticipating.)
Another change that might be a big improvement, it seems to me, is to let H1-B visa holders more easily change jobs once they’re here, without so much risk or paperwork hoops to jump through. If it were easier for H1-B workers to switch jobs, then abusive employers would have less leverage to exploit them (forced overtime, below-market wages, etc.).
As much as it may sometimes seem like it is, the H1-B isn't a programming or IT visa. It's applicable to a wide range of specialty occupations, across the entire nation. The suggested change would block out virtually all applicants from many other professions.
Regardless of the industry, if the H-1B is designed to allow employers to hire specialists they can't find locally, then a salary-sorted approval process should still be desirable.
Machine shops fighting over top-1% welders with deep materials science knowledge should be no different to software shops fighting over top-1% developers with deep computer science knowledge.
That'd be fine if the applicant pool was first sorted by profession and geography and like compared against like. But how do you decide the distribution of visas across those sub-groups?
For that matter, who picks the number of "how many H1B visas should we have", based on what criteria? Is there research backing up this number? Statistics?
I'd be much more willing to let people decide on their own:
The current system isn't simple. The H1B is only one non-immigrant visa category. There's an entire alphabet soup of other categories, and that's not even getting into the permanent resident visas.
I certainly agree that the system could be rationalized, I've got a lot of my own ideas, but most reform in this area must pass through Congress. I've been paying attention to this issue for over a decade and half now, and one thing I've learned is that there isn't much enthusiasm on either side of the political aisle for major changes to the legal immigration system. Every once in a while a strong lobbying group will get a tweak or added numbers to a particular program, but the real political interest is the stock and flow of un- and semi- skilled workers from Mexico and Latin American.
This is a feature and not a bug. If a profession with lower wages has a real shortage then the wages should rise until demand is filled. This can either come from people domestically switching to the newly lucrative career or foreign workers coming in once the salaries are high enough.
I mean, if the Foo profession has huge salaries and crowds the Bar profession from getting any foreign workers... Did the nation really need to import those Bar workers that badly in the first place?
Carving out reservations for particular professions/industries is really just a big cake for lobbyists to fight over.
I think the far bigger issue isn't the professions, but the skewing effects of cost-of-living or non-salary compensation, or professions which our economy already doesn't value "appropriately" for some other reason.
I'd make one other big change. Move the distribution of visas to a monthly basis instead of annual. Currently the visas for the whole year go very quickly. If they were distributed monthly, and based on pay, you'd have a good idea of what you needed to pay to be competitive and bring in the workers you want and wouldn't need to wait a year if there is someone you really need now.
This whole immigration thing sounds like an excellent opportunity for someone to put together a better way to work remotely. We're all supposed to be internet savvy, why can't we come up with something better than skype and github? Is something better even required? Why the emphasis on getting people into the country? We're selling virtual presence solutions to industry and telepresence to doctors and we're trying for surgeons. IT is the easiest job to do from a remote location. I work with people every other day that I've never even met in person and I have never visited the co-location of a large chunk of the server hardware that I've worked with over the last couple of years.
And worse, management that won't acknowledge it's deficient.
Managing a remote team is a skill, or more accurately a set of skills. No, you probably can't do it well right out of the gate. Yes, you'll probably have to work harder at it than you would having a team in one open plan office. Yes, it will take you time to learn.
But if you're really being held back by a lack of engineering talent, if that's genuinely keeping you from being more successful, you'd be much better off if you put the time and effort into learning it.
Tele-presence has a long way to go, and the network infrastructure too, but it will obviously, eventually, get to the point where it's indistinguishable from being in the same room, minus the physical contact. But to your point, it's not even a given that would help much.
Even with that, you still suffer mostly from time zones. You're just not going to collaborate the same ways with someone on the other side of the planet. That just means barriers to entry and more opportunity for those brave enough to try and ultimately get a system that works for them.
I think there's a remote-work bias which isn't fully born out from the evidence. It helps if you can somehow start with perfectly trustworthy peers, because I think a large part of hiring local is keeping tabs and keeping control. If you already know people who happen to be remote, versus trying to hire someone you've never met before remotely, the former can work perfectly fine, the later is [currently] nearly impossible.
There's probably legal and tax issues to deal with too, but I'm going to hand wave assume they do not negate the potential benefits and could just as easily work out in favor of the foreign independent contractor vs. local salaried employee.
The time zone issue can be solved easily.find a south american country that is immigration friendly and open an office their ,recruiting from all over the world.
However, it's not as simple as it seems, you think "let's send everybody to Canada and then grow our offices there with all the foreigners we want" but that doesn't happen and you wonder why.
Maybe they don't want to outgrow their main offices, or maybe it's got to do with Canadian work culture
I've seen people being "parked" in Ireland before applying for their H1B
That's partly related to the non CGI parts of movies often being shot in Canada because of cost advantages. In Toronto you couldn't walk two blocks without tripping over a film crew.
I believe we have plenty of tools that do a great job of facilitating communication, project management and work activities for remote workers. What is missing is the willingness from companies to accept these workers, not the tools.
Physical presence means the host nation also collects the tax revenue. It also means that those workers consume products in that nation. An immigrant will go to movies, buy food, go shopping, and pay taxes in the nation he immigrated to instead of the one he came from.
A big part of it is timezones and language barriers. Unfortunately in tech, the big hiring pools of engineers are:
1. USA
2. Eastern Europe
3. India
4. China
5. Western Europe (Much smaller than the above)
And in this situation, usually the main office is in the USA, and sometimes the main office is in Europe. And then you have to synchronize with teams across very separate timezones. 5 minutes becomes 1 day and it become very frustrating.
Then on top of that, you have to deal with the culture and language differences that can make communications very difficult. You quickly start noticing people will organize into native-language social cliques very quickly and that can be a hard problem to manage. You can get to the point that you say you will fire them if they don't start communicating with other people in the company other than people in their native language.
Eventually with these remote workers, because of all of this separation, you'll want to eventually bring them into the main office. Then you have entire other suite of problems to deal with, since immigration authorities usually require you to go through a visa song and dance bring these guys temporarily into the main office that is pretty close to just importing them permanently into the main office anyway.
So to deal with this entire problem, they say screw it and try to import them into one time zone / black hole called the main office. Immigrating into one country starts creating a melting pot effect where their language skills improve, they integrate with the local culture and language of the main office better and you don't have timezone differences to deal with.
So you say, why not say remote workers but they have to be in the USA only? And there are many that do say that! Unfortunately, latin america just doesn't make a lot of software engineers, and you get laws like 'hire 10 mexicans for every foreign worker in your company' that prevent you from establishing an office in the same timezone at a place with freeform immigration policies, because it probably doesn't exist.
Big money over there will prevent big money in the US from hiring smart people over there because big money over there would rather sell those smart people (or their product) at a 400% markup. For example, this quote in an article about Google moving engineers out of Russia: "The changes in the political situation make it less viable, less feasible to maintain engineers here" http://www.theguardian.com/world/2014/dec/12/google-closes-e.... It's simply about money and has nothing to do about fulfilling immigrant's dreams or "being in the epicenter of tech" or any of that. Tech workers are money generators and people are simply trying to capture that money.
I think one way to fix the trust issue outlined here would be not tying the H1B visa to a specific job, but instead giving it for a defined period of time, eg 5 years, and not making it dependent on the employer.
I know at least a few people on H1B visas who celebrated getting a green card with 2 weeks notice and a nice $20k/year raise to do the exact same job at a competitor.
A fundamental question not being answered is: Who gets to come to America?
Right now, our system massively favors immediate relatives and refugees, and only lets in a trickle of everyone else. If you are a person who wishes to move to the US, don't have relatives here, and are not a refugee -- then good luck, because you'll have a really hard time getting in.
Stories of people who literally sell everything to get a chance to live here, like that of Claudia Mendoza, bring tears to ones' eyes: http://app.fwd.us/stories/429 Now her husband was probably not among the 1% in his field. But he was hard-working person, valued by his colleagues, who added and contributed to our society. He and his family were kicked out of the country, for not winning the H-1B lottery.
So to people who oppose skilled worker immigration, I have a question: Should only refugees and people with family relations be admitted? Should everyone else be completely blocked off? People who oppose skilled worker immigration are essentially advocating this.
I favor much-more-open borders for people who want to immigrate and become citizens. Any kind of guest-worker program, including the H1B system, I'm more skeptical about. It's understandable for capital to work to carve out selected holes in the fence to benefit themselves the most -- changing the laws isn't easy or cheap -- but that's not the change I'm excited to get behind. (I don't know what specific changes are being pushed right now, if any.)
This is my position, as well. Worker visas are effectively a modern indentured servitude. Foreign workers are much less likely to be a fluid commodity on the job market as US citizens can be, because they have their visa to worry about. I oppose borders, generally speaking, but I have a hard time swallowing the massive corporate empowerment represented by the worker visa process (bootstrapped startups also cannot effectively participate, either).
For someone wishing to move to the U.S. the diversity lottery is a non-option, as the odds of winning it is a tiny fraction of 1%.
Practically speaking, if you're not being persecuted, and don't have immediate relatives in the US -- you can only come as a skilled worker. It's the only route available to the vast majority of those who wish to come here.
And the US is incredibly hostile to skilled workers by allocating a tiny number of visas for skilled workers. For comparison, Australia with 1/15th the US population lets in nearly as many skilled workers as the US does in a year -- i.e. approximately 15 times as many, per capita.
The global percentage for 2014 was 1.45% to be selected, but an applicant's percentage can be higher/lower depending on the quota assigned to their country of origin and the number of applicants for that country.
I was working a minimum wage factory job in an area where it is very easy to get a job not that long ago, (it took 4 days from the phone call) and I asked my line manager if they had problems hiring. 'Yes', I was told, hiring was a major problem and keeping staff on was really difficult. I asked why they though that was. Apparently they think it is because state benefits are too high.
edit - I'm still working it, I am rubbish with cash.
They are not bad people, but they honestly cannot see that they may actually save money by paying slightly more. I am planning to point this out in the next week or two, but luckily I have nearly sorted my cash-flow issue, so I can afford the license.
I'm curious about the town you are talking about. I've seen
the finances of people who rely on state benefits, and in the Bay Area--unless you have a bunch of kids(afdc) and were lucky enough to find section 8 housing; the state benefits
are not enough to keep a room--you can eat though. I know too many homeless people who tried to get state benefits, and the help they recieved was tiny, and had a time limit. My best friend who passed away was on SSDI. He knew he was lucky he qualified for SSDI, but he was always broke. I saw his checks and it was just enough to get through the month. People used to rib him about buying a cup of coffee at Starbucks, at the expense of The Federal Government, but they had no idea just how little money he was receiving.
Am in the south west of the UK. 2 to 3 days a week of crap work covers my rent and most of my food and gives me loads of free time for pissing about on my own stuff. I avoid benefits, not through any particular ideology but more because I find them more trouble than they are worth. I sometimes earn decent money, but I find I get stressed as hell in offices and I don't get motivated enough by money to make up for it, so I am avoiding those kind of jobs for a bit.
I always have fun telling executives "how much are you spending each week?" "oh, so you aren't paying your employees even half that, and that is before taxes, rent, etc" "you have a labor shortage why, again?"
Yes, if the best engineers really have x100 or x1000 productivity, why aren't employers offering higher salaries?
There's been high-profile high-tech anti-poach collusion, and Ed Catmull (pixar) even claimed it's for the best. But without that, there would be implicit collusion anyway. It's obvious to employers that an arms-race to attract talent is not going to benefit anyone (who is an employer).
But what would happen if wages did rise to their natural level? First, it would attract people to the profession. Second, the most-profitable companies would end up with the best engineers because only they could afford to outbid everyone else (and resources end up in the hands of those most able to utilize them).
Startups, being poor, will find it difficult to attract excellent salaried, non-equity talent ("inequitable"?)
Thirdly and sadly, it would also mean less development work would occur (because it costs so much, and employers have limited money). But I have a feeling you'd end up with even more open source projects; and more people working on startups (to fill the gaps).
Training is a big problem in tech. When I graduated college two years ago I couldn't find an entry level job anywhere. Every company wanted at least 1 year of experience. I finally found a place that would give me a shot but also massively underpaid me. Two years later and I am a dev lead on a major project and they are begging me to stay (although they refuse to give me more money). I'm actually getting calls from big valley companies that turned down my new grad app like nothing.
Why don't tech companies (or any company really) invest in their workers and help them attain new skills and career advancement?
> Why don't tech companies (or any company really) invest in their workers and help them attain new skills and career advancement?
Because they don't actually want the "skill shortage" solved. There actually is no skill shortage.
Companies create the "skill shortage" by making the job requirements so impossible that no one applies:
"speaks Mandarin, programs in Java 7.1 and .Net 6.5, is able to travel 80% of the time, is a Backbone.js guru...."
Just look at the laundry list of "must-haves" in a job posting now a days to really get the true picture.
If companies really wanted to solve their "skill shortage" they would look for talent that could be trained to the exact technology rather than demanding that every possible candidate already know the tech stack.
Its pretty much the same reason why most people buy houses that are already built and renovated vs. building it themselves from a single empty plot of land.
It's far more of a sure thing that you can move into immediately vs. possibly not move into at all. You can choose an potential employee to train who may not 'just get it' for a cost far higher than hiring the experienced guy would cost. It's like building a house with cost overruns that your construction loan won't cover anymore and you cant get any more money. You end with a huge useless debt that YOU have to pay now and a useless half-finished house that most people don't want to buy.
Also when you train employees, you get these retention contracts that can create a perverse incentive for and employee to take advantage of or a deal as an employee that you wouldn't want to take, because you'd have to pay for a training cost subject to the whims of an employer firing you.
There's a huge "purple squirrel" problem. Employers expect to be able to hire someone who knows Drupal, PHP, and Ubuntu. They don't want to retrain someone who knows Methode, Java, and Red Hat, even those do the same job.
Few employers have the capability to train any more. Whenever you encounter an employer whining about this, ask them "How many people do you have in offsite training right now?" If the answer is zero, tell them you've found their problem.
we're a startup and we've sent multiple people to offsite training. in general it only costs a couple thousand bucks per class per employee including room and board.
Interesting. Were they otherwise experienced developers who you just needed to train in your particular toolchain, or have you hired inexperienced developers and trained them to be more experienced?
There's training expenses regardless of who you hire. There's training in the work flow and the software stack you use (which you haven't mentioned at all on any of the job posts you mentioned elsewhere). It's never "slot right in and be 100% productive from minute one."
both, although the second type you mention just happens on the job, there isn't really a "get better at everything" class, that's just called work experience.
training classes for specific software is either free (depending on the type of business relationship between the two companies) or $500-$5k with a big cluster around $1500. anything outside of that range is really rare. hotel/flight/car is usually about $1k+ combined in the US. classe usually last a day or two.
Instead of a 'shortage of workers', the situation should be more adeptly described as a 'shortage of skilled workers'. I do think there are tech workers floating around, but the really good ones are hard to come by. Extending immigration helps, but does not solve it, as only a bunch of the pool are actually good talent.
Maybe immigration needs to be tweaked to help filter down the pool even more, for example, raising the minimum H1B wage for its skill levels. A disparity in the minimum wage only enables companies to bring in workers that are 'meh' and only pay the minimum cause it's cheap labor, albeit not top talent.
Question for the anti-immigration folks is, if immigration was reduced or stopped entirely, would that necessarily result in higher wages for everyone else? Are talented engineers really not being able to find a job that wants to pay what they want? Are the decent, run-of-the-mill engineers not able to find a job that pays market or slightly below market? Would companies then outsource even more anyway?
>> would that necessarily result in higher wages for everyone else?
Unless companies like Google relocate ( to where? ) then yes, wages would absolutely rise, because they don't allow WFH [1], ergo the only engineers available would be those in the Bay Area, NYC, etc. No, they wouldn't outsource critical infrastructure to places like India or China, who hacked them. I also don't see them picking up and leaving and going to e.g. Vancouver.
I think the only way to address this "great engineer" thing without American engineers crying foul is to gasp introduce standardized testing that all the American tech companies -- who can't get the amazing talent -- agree upon and then select the 99th percentile of the candidates that pass it and pay them in the 99th percentile of wages for the bay area. This would be an objective measure and Americans wouldn't be suspicious of whatever criteria VCs/founders use to measure "great programming ability". Make the interviews and the criteria public, bring it to the light, then people would be more inclined to believe them. Right now I simply hear a bunch of hand-wavey math and see a bunch of rich people whining about how they don't have engineers to build their things. Yes, I know there are flaws with standardized tests, but it's the best of bad things.
[1] Most companies. Yahoo notoriously, but most companies aren't in favor of allowing WFH.
A lot of west coast companies are in Vancouver. It's not their headquarters but having a Vancouver office gives them access to large pools of foreign talent that they can't easily bring into the US. It's also conveniently located in the same time zone as California and Washington which reduces the difficulties of having remote workers.
Any standardized test will be gamed. Just look at all of the books and other resources you can find for how to solve the types of problems that get asked in coding interviews.
Perhaps "hard to accurately identify through an inefficient market"? Pretty much everybody has some horror stories about interviews and rejections unless they founded the company or got in through some side-channel relationship.
There's something interesting missing from this discussion -- do the most-skilled international developers want to move to the US? The US's reputation is at a low ebb.
I mean, I like visiting, and I would love to work on some of the projects that are only available in the US, but the idea of actually living there? That's a really tough sell.
Enough do. For example, the line for people from India with a master's degree (separate lines for bachelors or phd) to get a green card is more than 11 years long. That's the time from when they qualify to get a greencard to when they actually receive it and not counting the years it takes to qualify for a greencard. During that time they have to stay on h1b visas, which can apparently be renewed indefinitely if the holdup is the backlog in the line for greencards.
Better be a hell of a big compensation. US laws and treatment of foreigners by law enforcement is quite crazy. Spying on my email and all cloud assets, no problem since I'm not US citizen. Even Obama said we have no rights to privacy. And nobody in US bat an eyelash when they hear that kind of xenophobic explanation.
The whole premise of this "crisis" is that folks want to have their cake and eat it too.
Feels to me like this is more about convenience for financiers. It's easier to do due diligence when everything you do goes through the same funnel a few minutes away from your office. Much easier than flying to Denver, New York or Chicago.
Instead of importing more workers into the overcrowded and expensive valley, maybe export the jobs to one of the other cities in the US with skilled workers. At this point, New York City is practically a cheap market.
I don't read a lot of techcrunch to be honest, so maybe this is their standard fare and isn't worth the time I'll take to write this. On the other hand, I dislike that this man just painted my entire industry as xenophobes, without so much as a quote from the party in question. Is this acceptable now? I certainly reject the idea of a world in which psuedo-journalistic conjecture is taken at face value, without so much as an anonymous source.
"We don't have exceptional programmers and hence we may be fucked" sounds like an excuse to me. A successful manager or leader is supposed to make an average team do great things. If a manager starts moaning for lack of great talent, I would suspect he is looking for excuses. Perhaps some introspection is needed.
What the article neglects to mention is that if the US doesn't capture workers (and SF doesn't work to lower living costs) its inertia for the tech industry (which admittedly currently seems unstoppable) will wane and other countries will pick up the slack.
A call for immigration reform is almost always an attempt to reduce wages and to avoid having to train people, instead of a real shortage.
The likely result of open borders would be something like London startup salaries, which are extremely low (measured by what the amount of money buys you in London) for people that aren't on the upper end of the skill range with years of experience.
Entry level salaries will barely get you by and you'll have to live in a shared apartment for 5 years or so until you can afford to rent a place on your own (if you're smart enough to up your skill-set in that time).
This is due to a small startup ecosystem and the ability for most Europeans to access the UK's job market.
One part of the immigration problem that is keeping wages is high is the fact that spouses/dependents cannot work. Want to bring in an ace programmer? You'll have to pay double (or just "more") because her husband cannot work in the "land of the free" ... If they're from a country with free healthcare, education or any other benefit, you'll have to pay for that because it was part of their "compensation" before .
The fact is that investors want a free market for labor, but will not accept a free market for capital.
Otherwise anyone could invest in any company without silly "accredited investor" rules, which serve only to keep the cost of capital high enough to generate desired returns from the money changers.
This whole set of lies really makes me angry. Ever notice how it's only the most powerful of powerful who complain about "talent shortage"? Those who have the most to gain from reducing technology salaries? Sure, you might hear about it being a competitive market with high salaries and all, but that's what it's supposed to be! Engineering talent is in high demand and salaries are supposed to go up!
If anything, they aren't going up enough. Programer's salaries as a whole have stayed nearly even since 1992 [1]. Furthermore, profit margins in the technology sector are remarkably high with very little spent on HR compared to another highly profitable sector: banking. Highly skilled STEM graduates frequently choose to go into finance because they can make more over a longer career without a cap on their income. The ratio of revenue to HR costs at tech companies and finance companies is way out of whack.
If tech wants the best workers, there are plenty of willing and capable Americans ready to pick up the work. Just fucking pay for it. Stop lying through your teeth that this is about talent. It isn't. It's about your stockholders. That's why you only hear the most powerful bitching about it since they are the only ones who would benefit.
For a variety of economic and historical reasons, many software companies are only likely to succeed in the US.
Without an influx of new people at a faster rate than education, increased salaries from demand will just shuffle existing engineers around. Instead of working at company A, they'll work at company B, earning a few percent extra; and company A, not being able to afford engineers, will either find something else to do, or close up shop. Higher salaries aren't enough to increase the supply of labour very quickly.
Which one of company A vs company B is more likely to be a startup?
What you are actually arguing for, is for software engineers to seek rent on the creation of new companies. You want to slow down growth in the economy and decrease the rate at which software gets applied to new problems, in order to make more salary (for Americans, in particular, as opposed to people less geographically well off).
It's self-interested, and thus understandable. I don't really fault you for arguing your corner. But you should be aware that it's not necessarily in the interest of your fellow Americans, never mind VCs. Other Americans also benefit from the application of software to all sorts of problems. Increased salaries for engineers mean that software is more expensive (however it's paid for), and there's less of it.
PS: the parasites feeding on nexus of finance are a separate issue. It doesn't make your argument more convincing, because they are a special case, recently in particular. Those parasites need dealing with, but the regulatory system has largely been captured, especially in the US. My problem with working in finance is ethics, rather than salary. Much of those earnings have been against latent risks that the taxpayer is underpinning.
You have some good points, but a lot of your argument is hinged on the idea that higher salaries would not bring more talent into the field. It's a statement that isn't backed up, and one I feel very skeptically about.
I think both sides have fine points. I don't support immigration barriers, but I also don't think we should tear the wall down in one fell swoop. If we significantly lower the boundary to immigration all at once, it will probably create a painful cycle in which all workers are significantly under paid until the businesses find the right balance in salary in order to get enough quality.
Ultimately lowering the immigration barriers will probably be good for everyone, tech workers included as the talent market globalizes and opens up more opportunities all around the world. Right now the need for good software globally seems to far outweigh the supply.
I've heard a lot of companies reason for locating in the Bay Area is for access to high quality engineers, way more than it is for financing. It's way easier to take money outside the Bay Area than it is to convince good engineers to move to X.
Would be nice if someone extrapolated how the wages would look like today if the H1-B program wasn't put into place. Would programmers be making WallStreet salaries? How would that have impacted the start-up ecosystem? Also, numerous H1-Bs are the core of companies like Google, Microsoft, Facebook etc. How would things have looked without any of them?
And where would wages be if the biggest tech employers had not been blatantly colluding to depress wages, using illegal anti-competitive tactics?
Paul Graham advocates for free trade when it will increase the value of his portfolio and the wealth of his friends. He doesn't say a word about how free trade has been undermined by the illegal collusion of Facebook, Google, and Apple.
Agreed, there does seem to be a pretty asymmetric view of the effects of free trade by the VC crowd and the media.
Case in point, there has been an almost complete radio silence in the tech and mainstream media about the wage suppression related class action lawsuit that is ongoing. There was a brief flurry of reports at the beginning, but ever since Aug, when the judge rejected the proposed settlement, there has been no mention of the lawsuit at all.
The only people who keep the issue alive are the rank and file tech folks as witnessed by the comments section of any article related to tech wages and immigration.
Sergey Brin came to the U.S. with his family at the age of six from the USSR.[1] His family was probably admitted to the U.S. due to the religious persecution they faced: "Michael Brin [his father] claims Communist Party heads barred Jews from upper professional ranks by denying them entry to universities, and that Jews were excluded from the physics departments in particular."[2]
So his story is not very relevant to the discussion of H1-B visas and tech worker shortages.
No there isn't. H1-B workers can't leave their current employer easily. (green card applications go to back of the line, must get a new job fast if they are laid-off, etc.)
H1-B employees are not mobile thus their salaries lack other workers.
> No there isn't. H1-B workers can't leave their current employer easily. (green card applications go to back of the line, must get a new job fast if they are laid-off, etc.)
Actually, that glitch has been fixed. I was witness to a counter example.
> H1-B employees are not mobile thus their salaries lack other workers.
Yes, but having H1-B employees may nonetheless open up opportunity for higher paying wages for domestic workers. There isn't strictly a zero sum game here, as cheaper skilled labour and more importantly a greater skilled labour supply can make business models viable that otherwise aren't.
What is certain though is that every H1-B programmer is a programmer that otherwise would have otherwise been working in another country, and almost certainly at much lower wages. Odds favour that they'll get a job as a programmer.
> Yes, but having H1-B employees may nonetheless open up opportunity for higher paying wages for domestic workers. There isn't strictly a zero sum game here, as cheaper skilled labour and more importantly a greater skilled labour supply can make business models viable that otherwise aren't.
Sure there are benefits for EMPLOYERS. However, you aren't making a very good case for EMPLOYEES.
NAFTA and all the other "free" trade agreements since NAFTA always promised these wonderful benefits to Americans.
And those benefits were delivered... provide the American in question was worth $10+ million. But there are entire cities in the Midwest that saw major, devastating declines over the last 20 years as a result.
Everything sold to the American public about immigration and the benefits of opening up borders has talked about how wonderful the next new agreement will be for American businesses. Well it turns out the only "American" businesses that benefited are those listed on the NYSE/NASDAQ. Mom/pop businesses have been driven out of business as more and more of their customers have sunk from middle class to lower class.
> What is certain though is that every H1-B programmer is a programmer that otherwise would have otherwise been working in another country, and almost certainly at much lower wages. Odds favour that they'll get a job as a programmer.
Great. That's fine.
Now mind you, I do know the history of immigration in the U.S. And it used to be in general a benefit to more than just the business owner. But the last 25 years have been characterized as a coordinated effort by the 1% to drive everyone else into poverty by making Americans fearful of their jobs being sent overseas, union busting, tax giveaways, and Wall Street financial shenanigans.
"Immigration reform" as proposed by Paul Graham is just more of the same. It is clearly just to benefit him and people like him - there is no benefit to anyone else.
> Now mind you, I do know the history of immigration in the U.S. And it used to be in general a benefit to more than just the business owner. But the last 25 years have been characterized as a coordinated effort by the 1% to drive everyone else into poverty by making Americans fearful of their jobs being sent overseas, union busting, tax giveaways, and Wall Street financial shenanigans.
Perhaps a reflection of something other than evil businesses behind this. Might be a reflection of absurd global wealth inequality that is slowly getting chipped away.
> Sure there are benefits for EMPLOYERS. However, you aren't making a very good case for EMPLOYEES.
Yeah, you're looking at this too narrowly. A new opportunity that otherwise didn't exist, that just might have a few high wage jobs in it. Even if the average salary goes down, the total number of opportunities goes up.
> H1-B workers can't leave their current employer easily.
Agreed.
> green card applications go to back of the line
If you have an approved I-140 you can use the priority date of the original application. So no, it does not go to back of the line. Also, under the new executive action on immigration reform one of the proposals suggested is to issue EADs to folks with approved I-140s.
Agreed, it is brutal how awful the zucks and pgs of the world argue about this. What I find bizarre is aren't they aware of how dishonest / douchey they come off when they fail to mention the impact on wages?
There is a way to solve the immigration problem. Create a system where the companies can hire people if they poney up 50k. That way there will be minimal impact on salaries and companies can get all the super stars they can afford.
" but that's what it's supposed to be! Engineering talent is in high demand and salaries are supposed to go up!"
And this is the other half of the labor/capital equation, doing its damnedest to keep expenses low and profits high. It's supposed to work like this. :/
I can't get behind this because it's not workers versus management, or at least not only that. It's also workers versus other workers. Don't you have any friends who have had immigration issues? Screwing with them (or rather, supporting the politicians who do it) to get an even higher salary when we're already paid very well is pretty callous.
The reputation of tech employees is bad enough without this infighting over getting an even better seat at the table.
This is my perspective as a much-maligned foreign worker. I lost the lottery of birth, and was born to lower middle class parents in a third world country. But I worked hard in school, and got a scholarship at a respected private university in the US. I worked hard in college, and got a decent offer from a big tech company. When I start next year right after graduating, I will earn more in one year than my father earns in five. Even with cost of living differences, I calculated that I will have a far better standard of living than I was used to.
Perhaps my university gave me the scholarship to boost its diversity figures. Perhaps my company is paying less than it would have to in some imaginary world in which foreign workers with H1Bs were not allowed -- then again, if that were the case, I would never get that job (I'm smart, but not "extraordinary" enough to get an O-1 visa). But it doesn't matter. Whatever the reasons, I stand to win, living a much better life than back home. So for those of you with inflated senses of self-worth complaining about people like me, why don't you go cry to your mommy about how you should have taken a Wall Street job instead, so that you could have earned a lot more money while fucking over the world economy. Because fuck the rest of the world, right?
>"So for those of you with inflated senses of self-worth complaining about people like me, why don't you go cry to your mommy about how you should have taken a Wall Street job instead, so that you could have earned a lot more money while fucking over the world economy. Because fuck the rest of the world, right?"
You're more than welcome to cut your upcoming now-1st-world salary that you boast about and give most of it to a third-world charity or something. Because otherwise, you're also saying "fuck the rest of the world". When you understand why you won't do that, then you'll understand why others won't as well. No, seriously, you can't just ask others to do good, you have to do good yourself as well. Until then, all you're saying is that you expect others to take a hit in their advantage so that your opinions on what matters are satisfied. Without even considering that maybe they're doing what they think matters already, and all you're really complaining about is that it's not the same as yours.
Edit. I'd like to add something about your "birth-lottery" comment.
>"I lost the lottery of birth, and was born to lower middle class parents in a third world country."
I don't agree at all. If anything, you WON the "lottery" over probably billions of other people, ones that are born into families that do not support their offspring as much as it sounds like yours did to you. You may not be lucky enough to be born in a fancy 1st world country, but that's just entirely besides the point because you're succeeding, despite your claim that you lost some imaginary lottery.
You're right, I'm luckier than several billions of people in the world. But my point is simply this: the fact that I wasn't born in the US was not in my control. If I want to move here, some people want me here, and it is in my control to do so, I just feel that I have the right to do so.
As far as the last few lines in my comment go: I was expressing bitterness at the fact that we foreign workers are being dismissed as worthless talent-less job-stealers. In my comment I wanted to be dismissive of those who are dismissive of me. I am not really so in real life, as I know that the ones being so vile here are not like that in person, because everyone is more complicated than that.
We are not expressing bitterness at foreign workers - we are expressing the reality of 30+ years of US jobs being exported. Good paying manufacturing jobs in the Midwest. Many, many towns are now empty poor shells inhabited by once middle class families who are now poor because their jobs were exported to foreign countries.
And now Americans are supposed to be willing to give up their jobs even within the U.S.?
Maybe if the 1%ers hadn't been so busy destroying the American middle class, you would be welcomed more generously.
You won the birth lottery by having the IQ to do this kind of work.
Software professionals would not be against immigration if VCs and their portfolio companies were not illegally suppressing wages using anti-competitive tactics.
Employers are suppressing wages using both hard and soft collusion. If they stopped doing that no one would have an issue with letting more workers in.
Still--the argument applies--why not just create software companies in your place of origin?
How are you giving back to your country of origin by participating in a brain drain, where all the talents of your high IQ are awarded to the imperialists that keep your home country in a state of economic subordination in the first place?
There is a very strong argument to be made that the best way to help "3rd world countries" is to refrain from draining their best and brightest brains. Paul Graham is arguing that America should fuck the rest of the world by stealing their best people, leaving the dregs to wallow in a ghetto of human misery.
Yes, I agree with you about the brain drain. But it's complicated, isn't it? At the moment, there isn't the right sort of environment to build a successful software company in my country of origin. The usual suspects are there: corruption, lack of infrastructure. and so on. Things are improving, but there's a long way to go.
But I wasn't quite arguing that I would be giving back to my country of origin. That is not to say that I don't want to. I was just arguing for myself, and people like me: foreigners in search of a better life, regardless of the geographical location.
Although I am the son of an immigrant, am married to an immigrant and am a hiring manager who regularly hires migrant workers, I have no problem understanding anti-immigration sentiments when it comes to people with your attitude.
I don't understand. Am I supposed to accept the arguments I keep hearing for why I shouldn't be here? I'm just defending my right to be here, using the same self-serving attitude espoused in the rest of the comments I found here. What should I say: I am going to contribute to the American economy by paying taxes and being a good citizen, I am going to create value for my company, etc.? Well yes, I do think these things, but all the commenters here do not care, they just think I'm stealing their jobs.
I wonder how long time this will live on the frontpage of HN before it gets "censored" to back as the discussion of PG's piece did?
With the all internet's "direct communication" and "netizens democracy" it is funny how we cannot have a non-bullshit discussion about a subject like this.
"VCs" aren't responsible at all, as far as I can tell, for the Google/Apple/et-al wage-fixing that cost the trust of engineers. That shouldn't be pinned on them, and it certainly shouldn't be pinned on Paul Graham.
What VCs do that is wrong is that they've created a culture of co-funding and collusion-- a feudal reputation economy-- which thwarts independence in decision making and generates a small set of big winners before startups can start hiring and get to the market. Comparing notes on who they like and who they don't is sleazy and creates an in-crowd that is mostly incompetent, but it's not illegal, and it's a subtle-enough offense that average engineers (who probably have little interest in being founders, anyway) dislike them.
As for why they do this, it comes from the fact that building a good portfolio, though technically their job, is a game at which feedback cycles are slow. You might have a strategy that is going to make 40% annual returns (on average) each year, but if macroeconomic events take you down over 3 years, you don't get to prove yourself. So, the VCs have (justifiably) learned that their career benefit is maximized not by building the best portfolio, but by having association (even if the percentage they end up with is tiny) with the very-rare "home runs" that happen every 5 years or so. That requires them to spread information around and create the culture of co-funding, much like an academic department where 20 names get on a paper when 2 researchers did most of the work.
It's not that we "don't trust" the technology elite. We know what their economic interests are and we trust them to pursue them. And that's fine, if this pursuit involves openly advocating what is best for them and what they believe is best for us and for the country. What's not morally OK is lying to the government about a "talent shortage". If they want to come out and say, "our economic interests favor <X>, and here's why we think our interests are aligned with yours", I'd be fine with that. Just don't fucking lie. Immigration is a complex topic and there's no simple answer. "Talent shortage" is a lie, and the ethical status of claiming one exists actually is black-and-white: it's fucking wrong. There's no talent shortage when it's this hard for women, or minorities, or people over 40, or people who spent their careers outside of California, to get themselves taken seriously in tech.
The problem with FWD.us is that they're using their wealth to get access to government officials, and then lying to them, with the intention of bringing economic changes that may or may not harm us, but we've been left out of the discussion.
You really shouldn't use any opportunity to bring on your usual thesis - VCs collude to fund only startups created by "connected" founders - when it is so out of topic.
It would be helpful to have some concrete examples of companies who are hurting from this shortage.
What projects, specifically, are they not getting done?
What specific requirements are they not able to find in potential employees?
Why, specifically, is training not an option?
How, specifically, is inability to get this project going hurting them?
What specific compensation are they offering?
If you want some trust, you're going to need to be forthcoming with specifics, not vague talk about top 5% coders and "We need 30 more great programmers".
That would take too much time! Better to spend years lobbying to expand incoming worker numbers vs spending less time training people in the skills you need (short term). Longer term look to invest in education programs here too, but hey, that costs money. Better to keep billions overseas, then complain about the state of the country's education system, than pay taxes on the money and have those taxes help better the very country you're complaining about.
Here's ways to demonstrate there really is a talent shortage.
- wages rising, in real terms, faster than inflation. And not some bullshit fed measure of price inflation (ex the things that inflated), but bay-area inflation that counts the 10% annual increases in rent / home prices.
- getting serious about remote employees
- if location is really so critical, paying enough that talent from the midwest / west moves to the bay / nyc. And not fresh grads, but engineers 10 years into their careers. I currently see experienced engineers leaving sfbay.
- companies, particularly big ones like oracle, google, linkedin, yahoo, fb, salesforce, and even vc coalitions getting serious about addressing local cost drivers, ie housing and transport.
Training is seen as competitive suicide, because while you bear the costs of training, your competitors can then poach your trained employees by offering a salary that is less than your total cost for that employee but more than the salary you pay that employee.
X = cost to train employee
Y = salary of employee
Competitor pays Z such that Y < Z < Y+X and puts you out of business.
The second factor is that if you raise wages for one person, then the rest of your workforce expects those wages. So a 10% salary increase for one person quickly becomes an across the board 10% bump on your personnel costs.
Bribing, lobbying, paying PR firms, pulling the wool over people's eyes is all judged to be a smaller expense and a worthwhile cost-saving measure.
The economically viable solution is to have schools do the training, but universities are likely not the best model for getting good tech workers.
> because while you bear the costs of training, your competitors can then poach your trained employees by offering a salary that is less than your total cost for that employee but more than the salary you pay that employee
I tell everyone that in this day and age, the company is not loyal to you -- they will get rid of you very easily if they need to, and so you should not be loyal to them. However, if the company starts investing in you, training you, then you should be loyal to that company. I would't go to a competitor that pays higher in this case (if they pay higher than 2(X + Y), consider it :)).
> Training is seen as competitive suicide, because while you bear the costs of training, your competitors can then poach your trained employees by offering a salary that is less than your total cost for that employee but more than the salary you pay that employee.
Then I guess the company will just have to do without.
Seriously, if the need is so great then maybe, just maybe the company should do the training and should reward employees for staying.
And surely, if your pay sucks so much your employee jumps ship the minute he/she finishes training maybe your company sucks.
The airline industry has one of the highest training costs of any industry and they still pay for training. Some manage to contract the employee into staying a couple of years (but this is not allowed in all countries)
And yes, I don't trust anyone who cries foul about a shortage of workers and then offers 40% under market wages, anecdote of course.