Are Silicon Valley’s Engineers Underpaid?

Being born in a foreign country, I have to smile when I see a blog entry like this one. I agree that the salary is relative to where people are living and I get the point of the writer. To specify an example, let's say that some Silicon Valley engineer wants to buy a $1M house. With $100K salary, it will make 10 years of salary.<p>Now, let's move to another country: Spain in this case. A normal salary for a junior engineer is around 15K/year (euro) up to 30K for a senior developer. A big house (for europeans, 950sq ft) in a normal neighbor in Barcelona costs around 400K (euro), which would be like... 26 years of salary?<p>And I have compared different houses, for what I have seen, in general the price $/sq.ft. is pretty similar between both cities.<p>As I said, I understand that the engineers might not get back what they produce (and I agree) but I just wanted to give another point of view.

I'm not sure that I agree with the tenets of this article. Silicon Valley Engineers don't seem underpaid to me. Sure we could potentially make more in finance, but that doesn't mean we are underpaid. I feel like there are a number of things that I value (in the following order):<p>1) Exciting work<p>2) Large potential impact<p>3) Financial compensation<p>Notice that money is third, and that isn't an accident. I probably make less than many of my classmates who went into finance (although the difference is likely smaller that one might assume based on comparing "averages"). However, most of them don't really seem to like their jobs all that much. I get to work on interesting things that will hopefully have a large impact, and get paid pretty well for it (I've usually made significantly above the Silicon Valley "average").<p>In addition, I think that many people in finance are likely overpaid relative to the value they generate, and that there will be a correction at some point in the future.

Well, let's see:<p>1). Does the market clear? Can every company wanting to hire someone for $100k find someone?<p>2). Do different firms routinely value the sane person consistently, such that switching jobs results in no significant salary increase?<p>3). Do developers routinely capture gains made as a result of productivity increases? For example, has the adoption of frameworks which make web sites about 10x faster to build in ten years resulted in 10x increases in salary?<p>...<p>Well, look on the bright side: you're not Japanese engineers.

If so, then more of us should go work for ourselves. Put our money where our mouth is.<p>If we're truly creating so much more wealth for these companies than we take in salary, it should be easy (ish) to turn that into more money for ourselves, even if large companies don't want to do that.<p>And if working for ourselves doesn't instantly turn into way more cash, perhaps we're not creating as many billions in actual value as we think we are?

Anyone who believes 100k is underpaid has serious entitlement issues they need to examine. You need to look around and see how the rest of the country/world lives. Sure google, apple, and others may generate enough revenue to pay people more than that but they would also do it without you because 100k will buy them good developers.<p>American programmer salaries are so far above the country average that complaining is just ridiculous.

Employers are constantly complaining about a shortage of good developers, so the only possible answer is "yes".

One big issue is that engineers haven't seen cost of living increases in the last 10 years nearly on par with lawyer/finance/professional jobs. This was justified by the "tech crash" for many years, but it went on too long (only in the last few years are salaries going up again).<p>The only way to afford to live well in a California tech center as an engineer has been to have a big startup exit or a very senior job.<p>I managed a team at Google, and had 4 direct reports ask to work from home 50% of the time, or even to work 100% remotely, mostly so they could live somewhere cheaper.<p>This comes out in "work/life balance" - when your commute gets too long so you can afford a big enough house in your 30s, spouse gets mad, you get overtaxed, and it's not a good scene.

I'd say the overwhelming majority of programmers everywhere are underpaid. I'm basing this on the fact that I could roughly double my current salary if I quit tomorrow and spent a year working my way up as a welder and my salary is pretty much in the median range for the area I live in.

Here's a tip: move to Austin.<p>1) No state income tax. Read that again. 2) Cost of living is at least HALF of SF/SV/NYC 3) Real estate is actually affordable, even close in.<p>Now, I know there is the argument for needing to be in SF/SV for startups and tech, but Austin is a hotbed of tech activity and with more and more companies allowing remote work, it's worth a shot.

Almost everyone ITC is focusing on the developers' attitudes and whether they are "entitled" etc., but it seems to me the article was just as much (more?) about the impact that such salaries have <i>on the companies.</i> The author isn't so much arguing that it's "not fair" so much as "it's short-sighted on behalf of the employers," at least how I read it.<p>The developers' attitudes are relevant only insofar as they influence their actions in this case. If it's making it difficult for companies to hold on to talent, that's a big deal. If it's causing developers to grumble on IRC, not so much.

Silicon Valley engineers probably feel underpaid because of the high standard of living of that area. If they made $125k in Atlanta, for instance, they would be living very comfortably.<p>I'm still surprised at the number of Tech startups still locating themselves in Silicon Valley. I would figure if they started up in a cheaper city like Atlanta it would be more economical for them. But I guess they want to be near the talented people.<p>Although I would think if you build it, the talent will follow.

I think the thing people aren't taking into account is risk. Sure, you don't get to capture all the value you create, but you also aren't (usually) liable for any value you might accidentally destroy, and you still get paid even if your project generates $0.

I don't see any reason for the market not to sort it out in this case. Thresholds for starting an IT business are low nowadays and access to the information about the market is pretty easy.

<i>"... But these tales of high-rolling nerds mask a greater truth, one that actually threatens to hurt the tech industry over the long term: Software engineers in the Bay Area are underpaid when you consider the billions in wealth their work creates. ..."</i><p>This observation isn't new, cf: <i>"Career Guide for Engineers and Computer Scientists"</i> ~ <a href="http://philip.greenspun.com/careers/" rel="nofollow">http://philip.greenspun.com/careers/</a>