[salgernon]

While I frankly believe that libertarians are idiots and will drag society and social progress into the victorian age (hey, opinion, ok?), I think its important to point out that Steve Jobs @ Apple was not in any way one.

I don't believe for a minute that he cared about how much people made and was far more concerned with either employees leaving with secrets, or more likely annoyed that a revolving door of employees between his company and others took time away from getting his projects completed.

Apple has no problem paying people, but if they're trying to complete something for particular market opportunity, they probably don't want to waste time bringing new hires up to speed.

[coolsunglasses]

Yet, when I look at the data, Apple engineers get paid below the market average and they work at one of the most profitable companies of all time.

[cbsmith]

Considering how many engineers would gladly take a below market wage for an opportunity to work at Apple, I don't think that is necessarily out of line with market forces doing their usual "magic". Even economists would admit that wages are not the sole determinant of where people choose to work.

[discardorama]

> Considering how many engineers would gladly take a below market wage for an opportunity to work at Apple

Well, then Steve had nothing to worry about, did he? Then why the secret agreement??

[cbsmith]

> Well, then Steve had nothing to worry about, did he? Then why the secret agreement??

Exactly. The motivations behind this practice, the nature of the practice, and the individuals impacted by it are just horribly misunderstood and distorted because the story that big Silicon Valley success stories are making their fortunes by screwing over the "little guy" (whose base salary is at or above the 98th percentile nationally and well above the 99th percentile globally... and that's ignoring bonuses & equity) is just so easy to sell.

[girvo]

I was thinking about this the other day coincidentally. The only big tech company I would want to work for is Apple, and I'd gladly take a few tens of thousands less than my already far larger than my living expenses wage to have the opportunity to. I wonder what that says about me?

[dhimes]

I wonder what that says about me

For one thing, it says that you are likely young. And I don't intend that as an insult.

[girvo]

Fair! I'm 23, no children, no wife, no particular responsibilities. I suppose that means I can "afford" to take that pay cut and throw myself into something like Apple. The only thing that gives me pause is the reports from those that I know who have worked there is that it's very very demanding, but also very very fulfilling.

[dhimes]

Well, if you're going to do it now's the time. I'll have two kids in college next year, and a third in a few more years. That'll probably run about $300K when all is said in done.

So taking a few tens of thousands of dollars cut for ten years is that.

[cbsmith]

I think it says that the career ahead of you of greater concern than the paycheck ahead of you (or as another poster put it: you are likely young ;-).

[kenster07]

Why are people defending artificially depressed wages? What planet are you from?

[cbsmith]

I'm not defending artificially depressed wages. I'm not even defending what these companies purportedly did. I'm just pointing out that the motivation for and consequences of their actions are being horribly misrepresented and/or misunderstood.

As for what planet I'm from... it's the one where the world isn't black and white and employers aren't automatically the guilty of any and all claims they ripped someone off.

[eli_gottlieb]

>Considering how many engineers would gladly take a below market wage for an opportunity to work at Apple, I don't think that is necessarily out of line with market forces doing their usual "magic".

There's no such thing as magic. This is just as true in economics as in anything else. If wages are down, then either labor supply is up, or someone is cheating.

[dkural]

It might be a way to keep out those who care and optimize for that last $5K / $10K and pick a workplace based on that, as opposed to which project they'll be working on for the next five years. If I were Steve Jobs I'd prefer the naive ascetic hacker type who loves the work, and just to make sure I don't get the other type by accident, I'd keep salaries below market.

[raverbashing]

Pretty much that

It can't be too low as too "worry" the employee or to make him/her uncomfortable living in Silicon Valley

For the "paying less" I see it as backwards. Between working at Apple at X and SomeOtherPlace at X+Y the Y may not be worth it. And based on some places I worked, Y may be totally not worth it.

[soup10]

I seriously doubt it. Trying to figure out what a person values may be important in an interview. But I think it's more likely apple has just decided that optimizing the last 5/10k doesn't matter because people will still want to work for them.

[majani]

Apple engineers get paid below the market average HENCE they work at one of the most profitable companies of all time

[smtddr]

That's because having Apple on your resume is worth your weight in diamonds. Same thing with Pixar & Lucas Arts(Industrial Light & Magic) if your career is in the digital-entertainment production world. These are especially true as you grow closer to the age of 40. Google is some kind of anamoly where they pay high _and_ are a gold-star on your resume; don't know how that works.

[gaius]

At some point, you have to cash in the prestige or it is worthless. So companies that do this are encouraging turnover.

[shock]

Considering that diamonds are basically worthless[1], I don't think that's helping the point you're trying to make.

[1] http://www.theatlantic.com/magazine/archive/1982/02/have-you...

[yen223]

I think this Wikipedia article should be pinned somewhere: http://en.wikipedia.org/wiki/Metaphor

[nickik]

Checkout this article "Diamonds, Advertising, DeBeers and Sex" for a alternative on some parts of the story.

http://daviddfriedman.blogspot.ch/2013/08/diamonds-advertisi...

[TeMPOraL]

Value is not an intrinsic property of a thing, but is determined solely by what someone is willing to pay you for it. I agree that the value of diamonds is an engineered one, but it still doesn't change the fact that people will pay truckloads of money for them.

[shock]

> Value is not an intrinsic property of a thing, but is determined solely by what someone is willing to pay you for it.

Well, that's the thesis of the article I linked: out there, in the free market, you wouldn't get much if you'd try to sell a diamond and weren't part of the supply chain.

[smtddr]

Cool, so if you ever get a 100lbs+ bag of diamonds you'll be sure to give it to me.

[shock]

I'm ok with that, but I'm not sure I'd be doing you a favor. I might keep a few rocks for myself to test the theory, though.

[jmeister]

There's a similar situation in finance - Goldman is known to pay slightly below market to entry-level/junior employees, and the gaps swings the other way with senior employees who make above market on average.

[eli_gottlieb]

>Google is some kind of anamoly where they pay high _and_ are a gold-star on your resume; don't know how that works.

I think Google has an extraordinarily high need for engineers due to their blatant attempt to take over the world by moving out ahead of everyone else in every industry they can reach.

When you're trying to corner markets that don't exist yet while also competing to keep other firms taking a slice out of your cash cow core business, you need a lot of R&D.

[steven2012]

A couple of months ago, my friend was offered a job at Apple for 170k + 250k in RSUs over 4 years. I don't think they are getting paid below average.

[coolsunglasses]

Exceptions proving the rule and all that. I'm working with a larger N (glassdoor) for now.

What does your friend do?

[mironathetin]

Had that story already last week: https://news.ycombinator.com/item?id=7111531

According to this version, Jobs was a leading figure in those payment-limitation-talks. Indeed, free markets exist in our minds only - until someone uncovers talks and transactions... Shouldn't accept that and a lawsuit is the right move. THIS is also a tool of the free market.

[adventured]

The only thing I'm familiar with about Jobs that relates to free market ideology, might be Ayn Rand, whose books he supposedly enjoyed.

I have seen many people take her books from the point of view of the creator or individualist struggling against the collective. Some take inspiration from that, while disgorging the rest of her ideas. I know many people that blend up a sort of free market economics + social libertarian + limited socialism (eg healthcare) world view.

[lgieron]

If it's only about employee retency and not about money, the solution is simple - just pay the employee enough for him to stay (counter the offer competition gave him). No need for illegal conspiracy.

[mindcrime]

and will drag society and social progress ...

If your "social progress" is accomplished at the end of a gun barrel, it should be rolled back to the Victorian age, or even the Stone age. What good is social progress without freedom? If we institutionalize the use of coercive force to accomplish social ends, then we're a fucked society anyway.