Why do people feel this way about their salaries. Always seemed to me that in the grand tottal we will be better off if we did discuss our salaries publicly. I make around 60k usd in a Scandinavian startup as a programmer with experience. What is so big deal about it
> I make around 60k usd in a Scandinavian startup as a programmer with experience
I'm still trying to wrap my head around why European developers earn significantly less than virtually all their American counterparts, even in high cost of living areas (like Scandinavia)
I do understand you specified you work for a startup, but even at one of the many established regional consultancies dev salaries tend to cap out at around $90K IME.
Is it the lack of lucrative VC funding, the prevailing sense of egalitarianism at all costs, the abundance of (comparatively) well paid middle managers, all of the above or something else entirely?
US tech companies can scale into a ~$21 trillion economy between the US + Canada, with barely any adjustments for culture & language. From there they can then use their considerable footing to push into any number of other foreign markets and press the scale further.
Most software businesses benefit immensely from such scaling.
If you're a Scandinavian tech company, doing something like that is far, far more difficult. It caps the upside for most companies. That's not unique to Scandinavia of course, it's true about almost all other countries / areas, other than China. US & British cousin cultures have a slightly easier time as well in general, as they can often immediately tap right into the US as an early market. That's why eg Shopify was able to so quickly scale itself, despite the smaller size of Canada's economy, they're doing a monster business in the US. Tech companies that have pulled that off coming out of Scandinavia are still semi-rare, such as Mojang or Spotify (Mojang famously was able to use the global scaling to immensely reward its employees).
- $60k/year is a lot of money for most people. Median household income is £24k - and people are generally more worried about whether they're better or worse off than the people they know than in absolute terms. In the UK most good careers cap out at £50-60k - maybe £10k more in London. Growing up, I always considered 6 figure salaries to be out of reach.
- It's not necessarily about being _content_ with earning that much. Unless you're willing to move to the US (most people aren't), you have to find someone who'll pay you more than that, whether for programming or for something else. If you're unable to get more money then it's better to be content with what you're getting!
- A lot of people I know put a lot of value in work life balance. I have a friend who's under 25 but has already cut their hours to about 75% because they would prefer free time to extra salary. From limited experience this seems a bit at odds with US work culture.
- Yes, I think in large part it's down to less VC funding pushing ludicrous amounts of money into the ecosystem.
- The recent performance of the £ vs the $ has made a significant difference when comparing to the US.
> It's not necessarily about being _content_ with earning that much.
I think this was poor wording on my part, as it implicitly assigns blame on the employee. I've edited my comment to reflect that I'm more curious as to why the market as a whole compensates devs less.
* Basic supply and demand. As long as you manage to hire developers, why pay more?
* The job market is a lot more scattered than in the US, there are fewer hubs concentrating software jobs. This dilutes competition.
* The job market is typically less fluid. This translates into more job security, but also a certain complacency.
* Europe hasn't seen the birth of many very-high margins software companies, generating millions per developer (off the top of my head I can think of SAP maybe, but that's B2B).
* Consequently, there's also less recognition for software developers, and their perceived value is lower than that of mechanical engineers for instance.
* Also, outdated management style is still fairly prevalent as you noted.
* VCs have no reason to push for salaries higher than necessary. European startups pitch cheap engineering as an advantage compared to being based in the Bay area.
I don't think egalitarianism has anything to do with our salaries. We might see the value in higher taxes, stronger labor rights, and a narrower income inequality. But I've never met a software developer who thinks they should inherently be less paid than say, a lawyer.
I agree with all of your points, but want to add an observation :
> Basic supply and demand. As long as you manage to hire developers, why pay more?
I know of several companies (Norway) that are almost desperate for more talent - to the extent that they are turning down lucrative projects. Nonetheless, I am also not aware of any of them making significant changes to their compensation. I can only theorize as to why this is, but my sense is that it has to do both with a fairly static billing structure that doesn't scale with experience, and concern for parity within the organization.
That sounds a bit silly. If you're doing so well you need to turn down contracts, why not look further out for new talent, attract people with generous relocation/signing bonus, and then give everyone a raise once your marginal revenue is increasing?
I agree, but here's a counterpoint / devil's advocate argument -
It's broadly true that wages tend to be "sticky downwards", and that it's much easier to not give something than to give it and then take it away.
As you correctly noted, there's much higher job security in European markets relative to the US. This also means that companies might be reluctant to over-extend themselves in good times, for fear of having no effective way of regulating salaries downwards in a prolonged slump.
I do actually know devs who make this much with ~5 years of experience, but they made the conscious decision to forego the large consultancies for smaller shops with less overhead.
One observation I made in Scandinavia is that the billable rate for tech professionals (including designers) appears to be more or less static. Customers pay roughly the same hourly rate regardless of whether a dev / designer has 2 or 20 years experience, so the most consistent path to higher compensation is to drop layers of support / management (with freelance being the highest).
> It's not universal. My friend started off his career in Denmark making pretty standard US tech salaries.
That's fair, and I'm aware there are always outliers. For added reference, starting tech salaries in Oslo, Norway are around $50k (cost of living comparable to Seattle or DC). Perhaps more importantly, there's much less upward potential - senior devs rarely earn 6 figures USD unless they're freelancing.
The people making a lot above average (because they negotiated well) generally don't want to share this publicly, because others will realise they are then being underpaid.
As an example: would you tell a colleague "on the same level" as you that you're making $300k, when he is making $50 or $100k? That's either 1) an excellent way to get fired, because now everyone wants $300k, or 2) an excellent way to piss off your colleagues. They will start looking for a new gig immediately.
It is technically illegal to fire you for discussing this, at least in the US.
I know at Google there's supposedly a big internal salary sharing doc started by Erica Baker, and she wasn't fired for it (although her manager was supposedly quite unhappy).
> It is technically illegal to fire you for discussing this, at least in the US.
Funny, I know of American corporation which operates low cost center over here while paying 30-40% of American salaries and forbidding the employee from sharing its salary for 10 years (sic!) in the employment contract.
If in the US, it is illegal for them to have that in the employment contract and they could be sued for that. I'm not sure how it works if it's not operating in the US, but if it's a US company, might still apply. My company abides by all US laws because they're headquartered in US, but have offices worldwide.
According to this law: https://www.nlrb.gov/resources/national-labor-relations-act employees can talk about things that matter to them, salary being one of them. And the National Labor Relations Board (NLRB) includes pay secrecy language in contracts as illegal, and even if you sign an NDA, it is still your right to talk about your salary.
The consequences for violation aren't usually very serious, so companies aren't too worried about violating the law, unfortunately. They usually have to provide back pay to the employee and/or offer the employee their job back (if they were fired). Obama signed an executive order that increased penalties for companies contracting with the government: they can lose their contract.
This law doesn't include contractors, ag workers, employees of federal, state, or local gvmt, or those employed by interstate rail and airline companies.
It does cover you if you aren't in a union.
Violations should be reported to the NLRB and they'll investigate it.
So the American company operates over here low cost center and exploits all legal means for this location to remain low cost... but hey! enjoy your "salary disclosure freedom".
At-will states still have to abide by wrongful termination laws. They can't just do whatever they would like, even though that is the case some of the time.
> They will start looking for a new gig immediately
The response to this should be: "Good for them! They should look for somewhere that will pay them what they think they are worth."
I believe that is the whole point behind sharing salaries, to help level the playing field and help people who got low-balled on their offer to realize this.
As an (hypothetical) employer I now know that, ceteris paribus, I only need to offer you around 65k USD to come and work for me, even if I was prepared to offer you 90k USD.
I agree though that we would, on average, be better off if all of us agreed to share salaries publicly.
If other employees of yours also publicly share what they earn, you won't be able to do that, as you noted. Besides, other employers will see that you under pay and offer him more and you'll need to compete on price or you will use talented employees and left with lemons.
It's not quite that easy though. Let's assume sharing salaries is common. I see that you make 60k USD and your colleagues are on 70k USD each. As another potential employer, do I assume you are undervalued or just perform worse than your colleagues making 10k USD more?
We seem to be caught up in an uncomfortable hybrid world where salaries are sort of related to performance, but not really. If we just chose one way or another, that would sort out a lot of problems immediately.
In the US culture, talking about one's salary is taboo. It is rather as if someone were to post naked pictures. Sure, you are an enlightened person and you probably wouldn't hold it against them. Much. But you'd find it a bit weird. Americans try hard to hold to the illusion of a classless society and treating everyone equally, and hiding salary is an important way to do this. It also allows people to not feel cheated, if they don't realize that others are making more than they are.
Secondly: because my company might not like it.
US labor law actually REQUIRES that employees be permitted to discuss their salary with each other, which is why companies do not forbid discussing it, and to be clear: my company does NOT have any policy against discussing salary. But it is to the company's advantage to be a bit vague about salaries. Cynically one could say that this permits them to pay each individual the minimum they can get away with without having to deal with a sense that this is unfair. As a representative of my company, they would probably prefer that I talk about work conditions and company culture rather than specific numbers about the salary we pay.
It’s a very common concern here in the US and I find it very strange. Lots and lots of people work in jobs where salary is either public or easily determined. Further discussing pay is one of the few bedrock employee protections we have here. Yet it’s a taboo subject.
If I were a more suspicious person I’d chalk it up to a cabal of employers trying to suppress wages...
Well, for one, my contract explicitly prohibits me from disclosing my salary publicly - I am protected by law to discuss it with my colleagues, but (technically) I cannot post it online. I know in some countries(Sweden) salaries are literally a matter of public record, but that's not the case everywhere.
It does, for a suitable basic definition of “basic” (it supports italics and preformatted monospace code blocks).
I think it's largely an aesthetic preference to focus on text content rather than distracting formatting that results in not supporting more. Aside from a decent formatting option for distinguishing block quotes, I don't really see any more formatting as being desirable, and even that is more to avoid people being tempted into using code blocks for blockquotes than because there aren't tolerable ways to present them without special formatting.
I have. Like I said in the other comment, glassdoor (and similar sites) lump together salaries that were collected for as long as the site exists, while in reality the salaries have changed a lot over last 10 years.
I respect your decision not wanting to discuss your salary publicly. May I suggest a throwaway? :)