[dx034]

Because that was exactly the argument banks used before 2008. Not that salaries in Finance are low now but a lot of the excesses have been cut back following the crisis. Banks also made a ton of money pre-2008 but that didn't come out of nowhere.

So far, there has been no industry that just continued making high margins over decades without any cut backs. I doubt tech will be the first one.

[icebraining]

But the industry as a whole doesn't have these margins or salaries; only the top dogs do.

[fergie]

If you live in a first world country, try to find out what your mid-tier technology consultancies (Accenture, Deloitte, CGI, etc) are charging customers. It is almost certainly around 250-350k per year, even if they are working for an unglamorous, boring, traditional customer. The real issue is that outside of leading tech environments, too much rent is being extracted from the wages of software engineers.

[f00biebletch]

Great point, although said rent is being driven largely by FB and GOOG. I remember the first time I was outbid for a flat in 2016 when a small group of googlers paid cash for the entire first year of rent. I should have moved to Seattle that afternoon :)

[fergie]

Ok, but I meant rent extraction in the economic sense https://en.m.wikipedia.org/wiki/Rent-seeking

[dx034]

Pre-2008 not all banks were hugely profitable. Some investment banks were and some smaller companies. The tech sector isn't that dissimilar. Salaries in SV show that not only Google and Facebook are willing to pay $200k+ for engineers, most of the industry will (and usually can).

As tech can't print money, these salaries must come from somewhere. And at some point those sources won't be able or willing to provide it. Maybe that's a soft landing, maybe harder. I don't know but as I said previously, I'd be surprised if tech's the first industry in centuries that channels wealth into the hands of few (including SV landlords) without any consequences.

[icebraining]

Salaries in SV show that (...) most of the industry will (and usually can).

Yeah, that's what I doubt. SV is not the tech industry as a whole. The average salary for a software developer in the US is less than half than that, and if we removed those top outliers, it'll be even less. So I'm skeptical that this is out of the ordinary; doesn't seem that different from other well-paid white-collar professions like lawyers.

[f00biebletch]

And, even in SV, most of the industry cannot; certainly the AirBnB/uber/lyft's of the world can, but the smaller companies seem to be falling behind (based on anecdotal conversations at least).