[CodeSheikh]

What's the guarantee that say your San Francisco/NYC employer will keep paying you city rates when you are living in a small town in mid-west. At some point they will catch up and start saving money this way. Everyone at a tech company is not a crucial employee. Don't get me wrong, I am all in for getting paid SF rates while living in a cheap Texas suburb.

[kbos87]

Bingo. As a director of a team at a mid-sized tech company who had conversations with employees making decisions like this, I can tell you that it is standard practice to adjust salary for the cost of living and the availability of talent in a particular market.

I work for a very pro remote work company, but that’s still how we did things. You want to move to the Midwest and work remotely, or apply for a transfer to a different regional office? Happy to let you do it, but know that the market rate for your skills there is X, which means an adjustment in salary for a voluntary move. People usually weren’t jazzed about it but understood.

[SauciestGNU]

Just because it's standard practice doesn't make it right. Is the employee contributing less to the company based on their location in a cheaper market? I think not. So why should we as workers allow a company to extract more profit from our labor based solely on our physical location?

[nostrademons]

Markets never pay you what you contribute, they pay you some number between "what you contribute" and "what you can earn working elsewhere". Your contribution sets a ceiling on your compensation; your opportunity cost sets a floor. What you actually make is whatever you can negotiate in between.

When you work in an area with fewer jobs in your field, it's far less likely that you'll have a competing offer that'll jeopardize the company's ability to keep you. That means your opportunity cost is much less, which means that the floor on what they can pay you is less.

(A similar dynamic on the investor side is why startups end up starting in the Bay Area to begin with. In most other regions of the company, there are very few investors willing to invest in high-risk tech startups. That means that a prospective startup needs to take the only financing option they can get, which means that the investor ends up owning the majority of the company. The Bay Area has a liquid and competitive market for funding, which means that there's a real chance of a VC firm losing the deal, which is what allows startups to raise capital on fair terms.)

[dvtrn]

It does feel quite bizzaro doesn’t it? The manager here says

Happy to let you do it, but know that the market rate for your skills there is X, which means an adjustment in salary for a voluntary move.

my question is: in this hypothetical, did my skills somehow lose monetary value to the company because I left the west coast and bought a house in Indiana? What’s the calculation on that one? Let’s talk numbers.

I’d love to sit down to coffee with a hiring budget manager one day and get into the weeds on CoL against present value and just do all of the math until the cafe closes or one of us has to take the first coffee induced “bio break”.

Or at least, this is how it would go if my company tried to sell me on this. Hell, I might even be amenable to the pay cut if the company was otherwise doing right by our relationship as employer and employee and I felt sufficiently invested in continuing that relationship, but we’re going to get real mechanical and be VERY thorough about it.

[dogman144]

I mean CoL is a thing. There are some talent asymmetries in DevOps and InfoSec, that could command high salaries/remote work. Remote work in security vs. salaries support this.

But for your run of the mil developer -> senior developer, a large chunk of that $150k Bay Area pay for non-FAANG is COLA, no way around it.

[wtetzner]

> my question is: in this hypothetical, did my skills somehow lose monetary value to the company because I left the west coast and bought a house in Indiana? What’s the calculation on that one? Let’s talk numbers.

It doesn't have anything to do with your skills. It's just that they believe they can replace you in Indiana with a lower salary.

I'm not saying it makes a lot of sense, just that they're probably thinking about it in that way.

[aaronblohowiak]

Or that there is less demand for those skills in Indiana so the market for those skills in Indiana pays less than the market for those skills in a separate location. This raises the question of if "remote" is its own "virtual location" in terms of market. Unfortunately, there is not yet enough remote work for there to be an established "remote" market distinction.

For people where there is only a handful of people with those skills in the world, they command ny/sf pay wherever they live.

[dvtrn]

This is an interesting take. I am a remote worker (technically in Chicago), but my employer is headquartered elsewhere. We have offices in Chicago. But I live in Indiana.

What's my 'demand market', as it were? Is it Cali where my parent company lives? Is it Chicago where the subsidiary division I support operates? Or is it Indy?

How does one negotiate salary taking in all that when negotiating a permanent full remote transition?

(This is just for the sake of the hypothetical, I’m very satisfied with my current actual arrangement, but we’ve crossed into a new working world and consider me a career “prepper” or something)

[lotsofpulp]

> I'm not saying it makes a lot of sense,

It makes all the sense. If you can get an apple for $1 from seller A and the same quality apple for $5 from seller B, why would you buy from seller B?

[geodel]

Since we are here, people not only will buy for $1 from seller A they will also show a faux outrage about bad treatment of workers at Seller A.

[TigeriusKirk]

They can now, because top tier companies aren't competing for employees in small town Indiana.

But if this becomes widespread, they will be.

[dvtrn]

Question, to build on your second line there. Does tech hiring becomes more or less competitive if this becomes widespread, in your opinion?

[thorwasdfasdf]

yes, your skills did loose monetary value. That's because it costs X less to hire in that location. The reason people are will to accept X less is because there's a lower COL.

But, the crucial thing to remember is that people's calculation of ROI of compensation to COL is way off. And so they're being under compensated in places like the bay area relative to other areas. Bay area is 50% more than the rest of the country but the COL is x4 to x8 (heck even day care is x4 more in SF than houston).

i've posted this before: https://skilldime.com/blog/see-which-cities-pay-the-highest-...

As you can see, you're way better off anywhere outside the bay area even if the salaries are less.

[itsspring]

> yes, your skills did loose monetary value. That's because it costs X less to hire in that location.

I disagree. Your skills didn’t drop. Your value didn’t drop. They weren’t going to hire anyone in <location> anyways, they’ll hire <local> if you quit. So you’re negotiating between them wasting time & money hiring for someone of equal value locally

[beefalo]

That chart is completely ridiculous. I moved from one of the cities at the top of that list to SF. My pay went up by 3x, my living expenses went up by 4x and my overall savings increased by 3x.

[thorwasdfasdf]

the compensation numbers I put up are averages based on Stackoverflow salary postings.

You're pay going up by x3 could have many reasons. If you're in the early part of your career, that's very much possible but it's not typical of an average SE in SF vs an average SE in the rest of the nation.

[bradleyjg]

> my question is: in this hypothetical, did my skills somehow lose monetary value to the company because I left the west coast and bought a house in Indiana? What’s the calculation on that one? Let’s talk numbers.

It’s a bad idea for a company to pay you significantly more than you could earn at a different job. Because then you’ll never quit even if you’re miserable. You’ll stick around and be a toxic presence.

[BeetleB]

This framing is merely convenient. I work in a company that has workers in several countries, and an equally valid framing is "Those in poorer countries are as productive as the Bay Area folks, it is unfair they get paid less. Therefore we will pay everyone equally".

The outcome is that Bay Area folks will get paid less than their current pay, and those in India get paid more than their current pay. Because there's no way my company can afford to pay all their developers Bay Area rates.

That would be using exactly the same rationale as your comment: Equal pay for equal productivity.

[SauciestGNU]

I agree that workers in other countries deserve to get paid the same high wages I get paid for doing the same labor I do. If a company can afford to pay me those wages just because of the passport I carry then they can afford to pay, for instance, my Indian colleagues the same fair wage.

Let's not pretend that all companies are cash-strapped startups. The FAANGs of the world and the Fortune $x companies and the multinationals can absolutely afford to pay their global workforce uniform wages, but they choose not to because it's not maximally profitable to do so.

[BeetleB]

> Let's not pretend that all companies are cash-strapped startups. The FAANGs of the world and the Fortune $x companies and the multinationals can absolutely afford to pay their global workforce uniform wages,

I'll contest that. FAANGs are extreme outliers. I can assure you my company, while it certainly can pay everyone an extra, say, 10%, definitely cannot pay all its SW engineers Bay Area salaries. And then Non-SW engineering companies - even the top ones - rarely have that much money. Their operating expenses and capital costs are a lot more than a SW company's is.

[zajio1am]

> Those in poorer countries are as productive as the Bay Area folks, it is unfair they get paid less.

That does not really make sense. Work does not have some inherent value, its value is based on market situation, and different markets have different price equilibriums.

[rootusrootus]

Tell that to the developers in India.

Honestly, if you go 100% remote, you are now competing with a much, much larger pool of developers. You are not going to command Silicon Valley prices.

[maximente]

i don't think morality is really useful here: right or wrong, it doesn't matter. labor is labor; that software engineers are a talented, "woke" (or at least perceived as such) group of labor doesn't change anything. you trade your time for money, which you use to buy stuff and then continue to trade your time for money. that's the game.

software engineers have it pretty good, anyway. this manager's example is perfect: sure, people grumble, but they typically eventually accept a reduced salary. why is that? even at a reduced salary, most laborers will be OK with a non-physically-straining, intellectually decent job that lets them live where they want to live and largely earn enough to not worry too much.

[whack]

Prices aren't set (solely) by value provided. If that were the case, toilet paper and other essentials would cost 10-100x more than it does today.

Prices are set by supply-and-demand. More to the point, companies will pay you the least amount of money they can, while still retaining you. Just like you pay the toilet paper company the least amount of money you can get away with, even if you get vastly more value out of it.

You're welcome to reject the above on principle. But then you'll have to settle for the next best alternative. And if the company's done its homework right, your next best alternative wouldn't be any better.

[HighPlainsDrftr]

This is something I've debated for quite sometime prior to the pandemic.

Why do janitors, and wait staff get paid so little? Two of the most important jobs in the world are to clean things and feed people.

I guess anyone can clean a toilet or cook a burger, but to what level?

What about teaching?

Our world is definitely out of balance. I don't know to what degree, or as to why.

[hessproject]

I mean really you already nailed it on the "anyone can clean a toilet or cook a burger". This is only from my own experience working in a chain restaurant kitchen, but to a pretty high level. You don't need to be a great chef or anything to be a standard line cook, even if you don't know how to cook they can teach you in one or two training days, everything is timed to the second and all the equipment beeps to let you know when it's done. I was 18 at the time with no experience, my interview was "what days can you work, and are you comfortable staying until the bar closes" and for every one of me there were 30 people ready to take over when someone quit, including high school kids and people fresh out of jail without many other options.

[lotsofpulp]

What is there to debate? As the person you responded to explained, people don't want to pay $10 for a roll of toilet paper because people can buy one for $0.50. People don't pay a janitor or cook $200 per hour because people can buy one at $15 per hour.

If UBI existed and no one "had" to work, then people would probably have to pay a janitor or a cook $200 per hour.

[s1artibartfast]

Employee compensation has very little to do with contribution. It has to do with labor competition. The only way to capture more compensation is shut out workers willing to work for less.

[adrianN]

Because software developers are reluctant to form unions and show solidarity with their coworkers.

[eitally]

People need to understand that salaries are set based on cost of labor, not cost of living. Companies will pay what it takes, but that value is preset by what employees are willing to accept in any given market.

[lukevdp]

Because the value you provide is more fungible than you think, and it becomes an equation of supply and demand.

[badfrog]

> You want to move to the Midwest and work remotely, or apply for a transfer to a different regional office? Happy to let you do it, but know that the market rate for your skills there is X, which means an adjustment in salary for a voluntary move.

It seems like nobody wins in this situation. If my goal is to maximize savings, I'd move to the Bay Area to get the maximum salary from you and find the cheapest housing in the area. I'd be miserable because I'm living in a place I don't like in a shitty apartment. On the other hand, if you offered to pay the same amount while I live in the midwest, I'd be happier with my living situation and be pocketing more cash. This would make me more productive and make me stay at the company longer, with no additional cost to you.

[bogomipz]

>"As a director of a team at a mid-sized tech company who had conversations with employees making decisions like this, I can tell you that it is standard practice to adjust salary for the cost of living and the availability of talent in a particular market."

It's standard practice for your company maybe. This hasn't been my experience at all. I have had three jobs where this was not the case. I've had colleagues who have experienced similar as well. People should be paid for their time. I can't even believe a company would want to engage in salary reduction negotiations with employees they value.

[OJFord]

That doesn't make sense though, 'the market' isn't wherever they decide to move to, it's 'remote'. And yes, that will be less than SF rates, but it may well be more than non-remote rates wherever the employee happens to live.

It's not paying less that's silly, it's paying an artificial amount less. The only way in which location should come into it is restricting candidates to those located in (or willing to work to) a particular time zone(s).

[vkou]

Doesn't this just create an incentive for people to work remotely from high-COL areas, while living frugally?

Does relocating from San Francisco to San Jose also come with a pay cut? What about to Stockton? Modesto? Further out?

[ghaff]

Generally speaking, CoL adjustments don't really make you whole. You may make more if you're in SF but housing is still going to take a significantly bigger chunk of your paycheck and you may or may not come out ahead at the end of the day.

Being on the periphery of a high cost area is probably the best deal. For most companies, for example, I imagine that Boston/Cambridge will be considered the same as Boston suburbs--even though within an hour drive you can get to vastly cheaper housing than in the city proper.

[godelski]

I wanted to add: If you live in SF and make $150k/yr and are able to put away 10% on investments that's $15k/yr. If you work somewhere else and take a move and make $75k/yr and are able to invest 20%, you haven't made a financial change. But a pay cut that big likely means you're somewhere that has less going on, less access to food, less for different types of activities, lower quality schools (that are funded less because property tax is lower), lower quality hospitals (big cities can afford all the fancy equipment and big time doctors), etc.

So to be honest, moving to a cheaper area with the exact same COL might not be better because of other factors involved.

[shuckles]

Price, as it turns out, is a signal of value. Some of the value might be access to jobs which you may now be able to access from elsewhere, but certainly not all of it.

How many places in the United States have the immigrant communities of the Bay Area, for example? And how do you recreate such communities in cheap places without making them expensive?

[vkou]

> Generally speaking, CoL adjustments don't really make you whole.

Only if you don't live frugally, or if you aren't a senior engineer.

If you do, a lot of the high costs of a high-CoL area can be avoided.

If you are a senior engineer, that XY% raise over a junior is free money... Applied to a larger starting salary.

Oddly enough, high-CoL areas have the same, or higher % raises, when you are promoted, than low-CoL areas. In the mid-west, the wage difference between a senior and a junior may be $30,000. In the bay area, it can be $150,000. Your CoL doesn't go up just because you have a better job title.

[logfromblammo]

It creates an incentive to establish legal domicile in a high-rent neighborhood and then always be somewhere else, "traveling", and taking care of all your business over the network.

So you can own/lease a broom closet or pied-a-terre in Expensiveton, maybe rent it out intermittently or to a "roommate", and actually work and sleep in Cheapsville.

If home address has an impact on take-home pay, it will be gamed just as hard as all the other metrics.

[fredophile]

Do you pay them more if they want to work remotely and move to an expensive market like New York or London?

[kbos87]

Yes, on the flipside, it works exactly the same way in reverse if someone is moving to a higher cost market. We benchmark against data from Radford & Comtrix (salary/pricing data providers) and adjust upwards on a regular basis too.

[supergarfield]

I'm a little confused by this.

To simplify, it seems like either you want developers that are physically present in London, in which case you have to find some and pay them London rates, or you don't particularly care if they are physically present, in which case I don't understand why you would pay someone working remotely from London differently from someone working remotely from Llanfairpwllgwyngyllgogerychwyrndrobwllllantysiliogogogoch.

Presumably in both cases your company is getting the same value out of the employee. So why not hire only people working out of the Welsh countryside and refuse raises to anyone who wants to move to a higher COL area?

In other words, it seems like if I decide to work remote and lie about where I physically spend most of my time, it would make no difference to the company but might make one to my compensation, which, ignoring any moral judgement, just seems strange for the company.

[ghaff]

>So why not hire only people working out of the Welsh countryside and refuse raises to anyone who wants to move to a higher COL area?

Companies do this to a certain degree. My anecdotal observation is that a lot of tech companies that aren't in the Bay Area or only have a small presence there don't in fact try particularly hard to be competitive with the big Bay Area employers--unless there's someone they really really want. People may still join for various reasons.

[bcrosby95]

Because not everyone wants to work out of the Welsh countryside and the number of developers available there is limited. Which is a factor because developers still have some power. Because the market isn't completely flooded with developers.

[eecc]

Exploitative crap you can only pull because of lack of unions and power asymmetry. Bleh

[refurb]

If you're in a union, you're usually stuck in pay bands based on seniority.

[ulfw]

Market rates are such a weird idea. The whole concept is.

You should pay for how GOOD an engineer is. Not for where (s)he lives.

[stuxnet79]

This is a simplistic view of the situation.

Define "GOOD".

For a business a "GOOD" engineer is one who is able to deliver business value at minimal cost. If by "GOOD" you mean talented then you have to realize that the US doesn't have a monopoly on talented coders.

The greenback goes far in many places within your timezone. If borders are opened up via remote work companies will be forced to re-evalute the axes by which they quantify "GOOD" (talent, cost).

[rubidium]

As an employee it is. As an employer it’s not.

[vsareto]

>Happy to let you do it, but know that the market rate for your skills there is X

This seems logical, but determining X is still in your authority, so let's not pretend this is fair. It's usually not a granular break down of skills either, or worse, it's calculated by job title plus a single primary skill, e.g. "Senior C#/.NET Developer".

[jjeaff]

Doesn't seem logical to me. Unless they are also offering to increase salaries if you decide to move to a higher col area.

[a_imho]

Make remote protected. Substitute your argument for any protected class and see how silly it becomes[1]. Just because the market (actually people) [2] can discriminate against group X it does not make it right.

[1] https://en.wikipedia.org/wiki/Equal_employment_opportunity

[2] https://elsajohansson.wordpress.com/2017/09/13/what-does-a-w...

[ketamine__]

Do these transitions actually work? I can't imagine taking a massive pay cut because I need to be closer to ailing parents. That is going to generate a lot of bitterness. What is the turnover like at your company?

[deegles]

If I deliver enough value to receive salary X, I don't see how my personal living arrangements factor in. There are stories of Google engineers vandwelling in company parking, by that standard they should have their salaries reduced.

I'm sure that if one of your directs asked for a raise because they moved in to a more expensive apartment you would politely refuse.

[0](https://www.businessinsider.com/google-employee-lives-in-tru...)

[simmons]

CoL adjustments have always seemed like a bit of a foreign idea to me, as someone who has been a freelancer for 20 years (WfH for 15). I'm not sure I would be able to sell my customers on the idea that I should get paid more because I live in X county. (Since my value proposition would be the same, assuming the customer wasn't in/near X.) On the other hand, if I lived in an area with a weaker tech scene, maybe my ability to negotiate would be weakened if they knew I didn't have a wealth of local options to fall back on?

[jjeaff]

So, as a director of a big team, you also offer to increase the salary of employees who want to move to higher col areas like, say London or Tokyo right? I mean, it's only fair. You pay what the market rate for the talent in that area is.

[ryandrake]

All places I've worked that have multiple locations adjust salary both up and down when employees move to different markets. It's all about the prevailing rate for labor where you are located, and not some measurement of the "value you provide".

[jjeaff]

Yes, but I assume these are all markets where these companies have physical presence. I doubt many are adjusting up because you want to move to London because you like the fog.

[OJFord]

Sure, but 'remote' is the 'location', not home town.

You don't pay a non-London salary because the employee lives outside, or a Euro-denominated one because they commute from Paris.

[city41]

If Twitter’s move is a sign of things to come, the “potential market” you’re talking about can become quite large.

[soulnothing]

I'm mixed on the cost of living to salary argument. If I provide X value to a company. Say I complete a project that generates Y revenue. Why am I now docked on pay, because I'm choosing to live in a lower cost of area. Have I contributed less to compete this business item that now generates revenue. I find I'm more productive working remotely. So I'm doing more to drive that revenue line for the company.

I think this comes down, we're not paid based on revenue we generate. But to keep us out of the talent pool. Or how much an adjacent firm may be willing to pay us. I don't believe it's based on what I can offer.

The next argument is on market salary demand. I live locally in a market that makes no use of my technical skill set. If I need to keep cash flowing I find any three month contract to keep the lights on. But then I go back to being remote, and compete on a remote pool.

Now we're on a remote pool set. America, or another cheaper to live country. If it's an external firm, do we have a middle company that can handle that tax implications. So we can hire a developer in Southern Asia or Europe. That role can now be filled for a drastic monetary reduction. But at the cost of management over head. Time zone difference, communication lag, better remote processes / documentation, etc. I've helped a few teams acclimate to these off shore changes.

As an aside I always found it odd companies that outsource a majority of their development to an off shore firm. That will never be on site. But if a full time, on site, employee asked for a wfh to watch a sick kid, they had to burn a PTO day.

Compared to an off shore developer there is one thing a country local developer may offer. Better communication with stake holders. Working in the same time zone. Communication especially remote is a big deal. I've seen a number of teams not be able to adapt to the time zone difference or communication differences.

I went to work for a FAANG company several years ago. I took a 35% pay cut off my last local job, while my rent increased by about 60%. I did it for the experience. I've never seen the high FAANG salaries people talk about, but that's just me. I'm also horrible at leet code / hacker rank so there's that, and I studied for over a year on hacker rank to get that job.

As to my experience with cost of living adjustment frankly they've been border line insulting. Locally, on site, if I find a role that uses most of my skills I'm looking 150/180(full time / w2 contract). I had a fully remote contract role, that used all my skills and challenged me. That paid me 245. I always look at my rate as what is the given task and job duties, because I generally work medium to long term contracts. Senior Software, vs Dev Ops, vs SRE, vs Product manager all have different salary bands. I don't have a blanket salary, it's always what's the role you're asking me to do.

When I first got a COL adjustment rate, I laughed. Then I became frustrated, and then I ignored COL adjusted salaries. Coming off a local contract role at 165, I was in talks for a more senior position, full time remote. A company out of a high cost of living area no less, started at 95. I'm not against being paid a bit less, but that drastic of a pay cut is insulting to senior staff. If you're going to pay me less, I want to know why.

Regardless of locale, I'm incurring more costs. I pay for better internet, stocking of coffee/pantry, electricity, and the big expense space. I still live in a city. Getting a second bed room can help a lot ensure a better work from home environment.

Globalization is going to become very interesting. I moved from New York for about a 10% salary reduction, while halving my rent. The determining factor is politics, and how people can adapt to working remotely.

[nathan_long]

It cuts both ways, right?

Companies: "I don't have to pay you $big_city rates because you live in $small_town and nobody there will offer you $big_city rates."

Candidates: "I don't have to accept $small_town rates because I work remotely and can work for a company in $big_city."

[klodolph]

> But if a company is fully remote, why should it adjust for costs of living at all? Candidate A lives in an expensive place and Candidate B has an expensive hobby. Neither is the company's concern, is it? The bottom line is that each is worth $X to the company and wants $Y in compensation.

Because if it wants to hire workers that live in SF, it has to pay SF wages. It doesn't have to pay SF wages to workers living in Tulsa.

Think about it flipped around a bit. Let's say that instead of hiring employees, you're buying candy bars. Someone running a bodega in NYC isn't gonna give you a discount just because you're going to have the candy bar mailed to Oklahoma.

The bottom line is not the $X value and the $Y compensation. It's a lot more complicated than that. Just like the company's bargaining position is a complex mixture of the value that different employees provide and the opportunity cost of leaving a position unfilled, the employee's bargaining position is affected by the salary the company is willing to provide and the opportunity cost of accepting this job offer instead of another.

[aantix]

> It doesn't have to pay SF wages to workers living in Tulsa.

Not yet. When Tulsa engineers wake up to their value, they hold the cards.

I’ve been on the hiring side for good senior engineers. They’re hard to hire, period.

They take a ton of time to properly screen and by the end of the interview process, the company has wasted so many resources that could have been used for development if they don’t land that person.

[nolaspring]

I work for a company based in a major west coast city from a non-major city in the southeast. My employer has different buckets it puts cities in and then limits your base pay based on those buckets. Even with that limitation, my compensation is much higher than what I would make at a local company but not the rate I would get in a 'premium' market.

The most impactful benefit for me is I get to work on $big_city problems with $big_city talent. $Small_town problems and the $small_town talent are mind-numbing and deeply frustrating to work with

[aantix]

Strangely, you could be getting paid from the premium bucket. They have that budget. It’s there. You provide the same value as Adam from SF.

Why not you?

[klodolph]

Short reason is because the market is driven not only by what value you provide, but how strong your negotiating position is.

As an analogy, imagine someone from NYC traveling to Mexico City to get tacos from a cart on the street at 9 pesos a pop (about 50¢ US). Those tacos are better than the tacos in New York, so why aren’t they paying $4 each?

[TallGuyShort]

The market is / will be self-balancing in this case. If companies can't hire people they'll have to come up with more than you're offering. If you're unemployed, you'll have to accept less than you're asking.

[rconti]

Yeah, it won't last forever. If remote work becomes more popular, salaries will become more harmonized, as well costs of living.

[rootusrootus]

Unfortunately a lot of folks are going to find out that 'harmonized' means lower, and maybe a lot lower. Cost of living may not adjust fast enough.

[HighPlainsDrftr]

It depends. Many engineers will run elsewhere once they start getting paid less than they deserve, and the company is cutting paychecks for profits. The more extreme the difference, the crazier it will get.

[chaostheory]

Not forever, but it'll be longer than most people think.

We've tried to make a vaccine for the original SARS. It's been 12 years now and there's still no successful, safe vaccine for it. For COVID-19, if a vaccine is released within the optimistic 18 months, how safe will it be compared to vaccines that went through all the trials normally?

[jshevek]

I believe rconti was not talking about the duration of COVID19 issues, nor the duration of WFH. Rather, the evolution of economic norms given the assumption of sustained normalization of remote work.

[chaostheory]

I think you're mistaken, since WFH gained massive adoption due to the COVID-19 outbreak. It's also what I believe he's referring to by, "Yeah, it won't last forever." I don't appreciate the downvote either for a reasonable comment.

[chrischen]

The same reason they didn’t hire someone from the Texas suburbs rate in the first place.

An employee’s rate depends on how much they would be going for in the market, and living costs are part of the employee’s expenses—not that of the company’s.

[notyourday]

Suddenly the market becomes really large, including India, China and Eastern Europe in addition to the mid-west.

[TallGuyShort]

There's a bit of a spectrum. Companies have learned to have employees working from home, but they're all in the timezone they were in before, they already got to work together in-person before being in this situation, and entire teams were put into the same situation at once. That's a step toward full support of remote people all over the globe, but the further you get the more you have to factor in legal overhead, cultural and situational differences, time zone difference, etc.

To be clear - I'm a big fan of remote work, I'm just saying that companies have been forced to solve only a subset of the problem they face before the market really can scale to be that large for everyone.

[notyourday]

"Remote work" is globalization of white collar jobs. It is baffling to me highly paid tech workers do not see it.

"Work from home" is the first step. If a company embraces work from home, it embraces completely asynchronous communication. As soon as that becomes an acceptable way of solving problems, Vlad making $50k/year in Ukraine who will do 65 hours a week will become a contender to replace Jackson in SF, who is making $250k/year and refuses to work more than 40 hours a week because of work/life balance.

[dpoochieni]

I do not know if its my non traditional background (no degree in computer science, big emphasis in history and philosophy since middle school) but I'm baffled by how politically naive many people in software can be. I understand why you might not like it but in pretending politics do not matter or won't affect you, you are letting other people decide and most importantly, think for you.

How many people think tech companies are just completely well-intentioned in everything they do? Curb your enthusiasm, a healthy chug of skepticism is needed.

[bcrosby95]

I chose CS as my major in 2001. Yeah, during the dotcom crash and the outsourcing frenzy. I was told I would never have a job.

I'm not saying it will never pass. But history has shown it's much harder than you're making it out to be. We already had a great outsourcing attempt 20 years ago which had questionable results. And now pay is higher than ever.

Maybe they will be successful this time. But I'm not going to lose sleep over it. I haven't based my life around earning an SF bay area salary. My retirement is already paid for. My house is 80% paid for. College funds for children are mostly paid for.

[1MoreThing]

Markets are still going to be separated by time zones.

[notyourday]

There are US traders that trade in HK. They maintain HK hours. Money apparently is good.

[RHSeeger]

And an employee in the Texas suburbs will generally be "going for" less, given it's a different market. Sure, as more people are working remotely, the gaps will close more, but someone living in a cheaper area is generally going to be willing to accept less pay. As such, the going rate in the cheaper area will generally be lower.

[chrischen]

That is a conflation of cause and effect. Employees in general may be paid less in Texas, but that doesn’t mean the location is the cause.

As companies go remote, they will depress salaries as a side effect of no longer having a locality-sensitive hiring constraint. But again the cause is the hiring constraint—not the location the employee is in.

[mLuby]

A straightforward legal fix is to make location one of the things you can't ask about during hiring, like age, marital status, or disability.

All they should be able to ask is what fraction of their work hours you're available for. It could be that everyone must be online 9-5 PST, or there're a few hours of overlap, or there's no expectation of common work hours as long as you "get your work done."

[dheera]

If that really happens, the next order effect will be cheaper rents in the bay area.

Even now, there are some good rent deals. I moved to a new apartment a couple weeks ago (mainly because I needed a better WFH space to work effectively) and got 6 weeks free on my lease, which isn't normally seen in the bay area.

When the pandemic passes though I do hope to be able to return to working from an office, if just because it's less lonely and there is usually better sunlight in business spaces than what I get at home. Maybe 2-3 days a week in the office and 2-3 days from home would be a nice balance, when it is safe to do so. Employers may also see the value in at least providing some additional financial incentive for living closer to the office and being willing to come to the office (if safe), although enabling full remote work for those who choose it is something I also fully agree with.

[metajack]

At a certain point people will move to the bay area for the higher paycheck, so that keeps it adjusted pretty high. Companies are not competing against local-to-the-employee employers, they are competing with all employers globally.

Even with regional adjustments, the math usually works out in your favor to not be in the bay area.

[Vysero]

"What's the guarantee" - There is no guarantee. Then again, there is no guarantee that the person who bought my drink didn't spike it with molly either...

[thorwasdfasdf]

I'd be fine with that. Even 30% reduction in pay would still be much better in an affordable city like Chicago or Houston.

[lukevp]

Hey, as someone from a cheap Texas suburb... why did we get singled out for this example specifically?

[freepor]

They don’t need to pay SF rates. 100K in Indianapolis buys you a way better standard of living than 200K in SF.

[beefalo]

The problem is that I've seen the pay difference be far larger than that. I worked in the midwest and people getting paid $100k moved to the bay area for $300k+

[sidlls]

No, it doesn't. Or, rather, it doesn't while also leaving the same amount of money for savings and discretionary spending: which is the same thing. It may get you a bigger house, but you pay for that in terms of opportunity (not just jobs, but savings, culture and recreation).

[pb7]

Only if you disregard things like weather, things to do, proximity to great nature, and maybe not even then.

[rootusrootus]

Maybe Indianopolis isn't the perfect example for everyone. Portland, perhaps. Better proximity to great nature, still a lot of things to do, great weather (and getting better every year thanks to climate change, while California gets drier and drier), somewhat lower cost of living, etc.

[shuckles]

Portland sees the same cost of living trends as the Bay Area, so enjoy the arbitrage while it lasts I suppose. (For what it’s worth, so does every similarly desirable metro area in the USA outside of Houston.)

[rootusrootus]

Agreed. We jokingly (and sometimes not jokingly) talk smack to Californians moving north to Portland in hopes they won't come, because along with the steady influx of people comes steadily increasing housing prices. As much as I have said for years I never want to live some place like Seattle, I have to admit that Portland isn't really that far behind.

[freepor]

If you do that you also have to disregard the other myriad ways in which Indianapolis is a better place to live than SF.

[logfromblammo]

The weather in Indianapolis is tolerable most of the year.

Their biggest problem is that they are on Eastern time, despite being way too far west for it, observe DST, and start public schools way too early.

Also, they have developed traffic circle cancer all over their north side.