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by epicureanideal 4795 days ago
What does living cost have to do with the value a developer produces? It doesn't make much sense to me why a developer in a low cost of living area is worth less in terms of what features they develop for the company. I say this as someone who lives in a high cost of living area, so I'd be at the higher end of your scale and this is not a self serving comment.
2 comments
icodestuff 4795 days ago
If the best developer for the job happens to be in Manhattan or SF, s/he won't take a job paying Detroit or Wichita salaries.
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epicureanideal 4795 days ago
Right, but if they don't produce more than the "normal Wichita salary" then you probably shouldn't hire them. If they produce enough value to be worth $150,000 per year let's say, then you pay them that. If they don't, you shouldn't pay them that much whether they live in SF or Detroit.

If they do produce enough to be worth $150,000, why pay them less just because they live in Wichita? Supply and demand, sure, but it just seems odd to me to explicitly say that you're paying less if someone lives outside of a major metropolitan area. I prefer to be (or think that I am) paid based on the value I produce (value pricing) rather than what it costs to keep a roof over my head (cost pricing). Whether or not this is the case also influences my understanding of how a company thinks about me.

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kroy 4795 days ago
A lower salary for a developer in low CoL area doesn't indicate that a company values that resource less than another dev in a higher CoL area. It just means that the company has to pay less in order to reward the developer in the low CoL as much as the employer rewards the high CoL dev. The equation looks like this:

salary - CoL/year = reward_dev

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epicureanideal 4795 days ago
Sure, but I still find it interesting to make the following observation:

The CoL modification to the developer's salary has nothing to do with whether the company makes more or less revenue as a result of their work.

My guess is that as companies find good talent increasingly hard to find this problem will resolve itself as the remote workers outside major metropolitan areas get bidded to higher and higher salaries.

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