I feel I must ask where you live / what competitive salaries look like to you, because as far as I know, a software developer salary of $190,000 USD+ in Barcelona, Spain is eye-poppingly high
I think he's talking about runn where the compensation honestly looks terrible: $43k as a junior and under $80k as a senior. I wonder if the goal of transparency there isn't to avoid wasting time with the majority of people who won't put up with a salary that low.
I am sure it’s low in the Silicon Valley. Here in NZ - we are the highest paid tech juniors I know off. Most offer around 60k NZD.
Need to remove your US bias. However - the whole point of transparent is that everyone knows.
If the salary is low for you, you will never apply. But you know exactly what you’ll be paid, and know it’s the same as everyone else doing the same role/level.
That is the benefit to being transparent - it doesn’t have to be the highest paid, it’s simply fair. equal and transparent.
What are you even talking about? The median yearly take home pay (sorry, don't know the right word for it) in my middle-of-the-pack EU country is around $16k.
Let me say that again, this country is in 35th place out of 193 by GDP per capita and this is how much people make here.
Yeah, my bad. My comment is very US-centric. At the same time, cost of living is likely much higher in the US, so that also makes a difference in the comparison.
Is that double the median income of juniors in similar tech positions or the general median that contains part-time workers and jobs that require no education at all?
In the US at Big tech cos(FANG style), that would be the base salary for someone with 7-10 years experience. And then you add on generous compensation packages(stock grants, 20ish% bonus target, signing bonus).
I would say it is eyepopping for US techies who haven't made it into the "big leagues", but there are probably a million software devs in the US making that.
in norcal or new york, $190k is pretty standard for a senior role, with equity compensation on top. I get $185k with 7 years of professional engineering experience + rsus worth about $150k over 4 years, and really I could get more if I left for a bigger company, which I don't want to work at. Europe has lower salaries in general, but also a lower total cost of living and better gov't services.
6 figure salary for an executive assistant in Tennesse is quite nice. A lot of engineers I know dont make that much and the skillset gap required between both professions is quite large IMO.
Skillset gap is not what determines price. Supply and demand ratios do, which does not necessarily correlate with skillset gap.
For example, I might be able to be an executive assistant, but I imagine the quality of life of an executive assistant is worse than what I do now, so I would want even more money to be an executive assistant.
Salary transparency, like all levelling mechanisms, pushes salaries down. Your highest salaried team members are simply replaced by contractors as they realise that their remuneration is now tied to the impression it gives to their colleagues rather than the value of their own labor.
It seems to me, in my uninformed layman opinion, that it would do the opposite. Maybe it would force the outliers down but perhaps bring the average up.
These are two common scenarios I see:
- Two employees at the same level on the same team. One is paid $X higher than the other. Employee one asks for raise based on the fact they do the same job as employee two
- New hire is paid $X more than member of team who has been there receiving meager raises yearly. They can point to the new hire and request $Y more due to their experience
That said, this is conjecture and not backed by anything. Are there published works on salary transparency = lower pay for employees?
There is a 3rd scenario that I've occasionally seen: Two employees with the same title on the same team. Employee One is unhappy because they are paid 10% less than Employee Two, despite same experience and title. Employee Two ALSO unhappy because in practice they do 50% more work than Employee One for 10% more pay.
I still don't see the parent's connection of transparency to lower pay, but there is a rich scientific literature on the concept of "Comparison is the thief of joy" -- I hypothesize that turnover rates might positively correlate with transparency because they could promote intra-team competitive feelings.
The exception would be if there were a rigid structure that you know going in, similar to how e.g. government pay scales work. Since you know going in that the only input is seniority, you won't care that exceptional work is not rewarded because that was made clear from the get-go, and if that would have bothered you you wouldn't have accepted the offer in the first place.
The natural counterargument to that is that if the only input to compensation is seniority, then there is reduced incentivization for performing "above and beyond", possibly cultivating a culture of mediocrity.
It also would promote pay equity, however, since e.g. employees' implicit biases and social conditioning would not come into play under subjective evaluations.
While I support pay transparency on principle, I have never seen it work. In practise, no two employees are ever equal. Even those with the same years of experience, the same qualifications, and the same roles. One might be happy to work late. The other might be happy to pick up the phone on weekends. One might prefer working alone. The other might play better with colleagues. One might offer to take on more projects. The other might not, but they have better attention to detail. The differences go on ad infinitum. There is no "objective" way to determine the market value of each of these two employees. The best we can do is let each business make subjective judgments of each employee. We know this is far from perfect, but it could be more fair than paying two very different people the same wages just because they studied the same thing at university and worked in the industry for the same length of time. One of them will be contributing more to the business bottom line - sometimes significantly so - and they probably know it. They'll leave if they're paid the same as their lesser-performing colleague.
You can observe it by counting the contractors in any company that has salary bands, or transparency, or any other similar system. Very few high performing employees are prepared to accept that their remuneration is being constrained to prevent the lower performing employees from getting jealous. They are strongly incentivised to either leave or become contractors, increasing their remuneration even more. Only the average performing and under performing employees readily accept such an arrangement, because they are either unaffected by it, or benefit from it. You don’t need to do a study to figure out that people avoid things that are detrimental to their own interests.
This is only true if people are underpaid in their salary bands -- which certainly can happen.
However, it doesn't have to. We are still small with our experiment, but we pay 95% percentile in our market, plus provide additional benefits well above the norm.
We have no issues hiring and retaining high performing staff because we pay as much or more than they would get elsewhere in the local market.
We don't even need to speculate about it. In for example Sweden, everyone's tax return is public information. You just call the tax office and ask how much income someone declared last available year.
Do you have empirical evidence of this? I struggle to understand how salaries being in a black box helps your chances getting paid more as an employee.