And if you think it's bad, it's even worse in Europe.
Taking the French example: I'm an freelancer, but I used to have a contract with an American company.
They gave me 3x the salary most of my French colleagues would get, while keeping the exact same social advantages (they paid me through a French branch).
However, to them, the salary was twice lower than what they would have paid for the same guy in the Valley.
Now as a freelancer, I move a lot from companies to companies, and I hear the same complaint over and over: we can't find good devs.
But when I look at the job offers they publish, it's full of buzzwords and cool attitude, yet the pay is not remotely matching the skills they are hiring for.
You want somebody speaking 2 tongues, coding expertly in 3 languages (e.g: server lang + js + css), knowing a bit of sysadmin, ergonomics, architectural design, data base, and capable of understanding your undocumented stack du jour + infra.
My example comes from Greece where I reside for the past 9 months.
People owning touristic buisnesses on the islands are moaning about how much they need more staff and can't find any, and they are arguing why younger people tend to not work and just receive benefits instead of going to work.
The argument here that they won't understand though is that, 1st they are paying very low. They are all willing to pay the minimum salary available... which is somewhat 500 euros. It varies from 500 to 900 euros and 1200 in best cases.
The unemployment benefit is 400+ euros per month. So tell me who in their right minds would go to work for 500 euros or even 800 euros, whilst they have to spend petrol to get from and to work, work prolly 10+ hours a day, in the sun most likely cause thats what means tourism industry, get told by 'BOSSES' on what to do, and get treated awfully. There is just no point. And then all I hear from those guys owning massive hotels making 1m+ revenue in their pockets per year saying : 'Cant find anyone good to work for you nowadays, its all youngsters fault'. Well ok I'll admit that prolly youngsters dont have the nerves that older people had in their age, but at the same time you are not helping the situation at all when you are offering money that someone will just pass by and you are making 1m+ euros in your pocket a year, and then the only way to keep profiting is to steal a bit on tax and of course not fully insure your employees. AWFUL system!
I wonder if it's quite as simple as being reducible to salary as a single (or majority) variable. I tend to think people are willing to work a poorly paid job if there was some kind of light at the end of the tunnel (career advancement, primarily). (As a casual outside observer, and with all due respect) My bet would be that a pervasive sense of pointlessness or helplessness in society is an equal partner along with low entry level salaries in the case of Greece and many countries that face similar struggles.
There are only so many dollars you can shave off of your employment budget before people decide they do not have to bother.
It's an escalating problem in Eastern Europe in general. Our politicians are way too greedy. They lost all perspective. They try being a bit more insolent since the last year, they sit and wait -- no revolts, no fires, no pitchforks. So hey, these people don't mind! Let's get EVEN MORE money from them! Sadly it's how it has been going ever since the fall of the Soviet Union. Many elderly people say: "It was not all sunshine and rainbows back then either but at least the people had everything necessary to live respectful lives". They do have a point.
Thank the gods for internet and for me being a programmer ever since teenager. Otherwise I would probably live off social benefits as well.
It's very easy to demean people for being lazy or unmotivated or non-ambitious. But the reality is, the best career advancement ~85% of the people around here can hope for is an awful job with 2-3 hours of commuting in total for the day, for an income that exceeds the bare minimum needs with 5-10%. So it's pretty normal many decide not to bother, or to turn to petty crime.
The version of that currently operating in Hungary is that even though living on benefits is impossible, you can just go to Austria/Germany/UK and make way more money. Interestingly this is less true of programmers than it is of waiters and cooks, but then it's extremely true of doctors and plumbers.
Nobody in Budapest expects to make even a Berlin salary, but the difference is big enough now that lots of people say screw it, better to live abroad at least long enough to buy an apartment and so on at home. But I doubt many of those people will be coming back.
Ironically enough you could make a killing as a plumber anywhere in Germany right now, or in Vienna, or in Budapest, as per your choice. But a ton of Hungarian plumbers left when it wasn't like that, and now they have lives in Dinkelacker or wherever.
And it doesn’t help that large companies use to hire jobs that are low skilled directly and at least there was an opportunity for advancement. But now with most of those jobs being contracted out, there is no chance for advancement.
I’m even seeing that in IT. Back in the day you could start out as tech support, or an operator (as I did - long story) and be given a chance to program and move up. Now even those jobs are outsourced. It’s just as easy to hire someone from a foreign country to admin your AWS hosted instances as it is to hire someone locally.
If people are willing to drive a truck carrying garbage and feces all day, it is about money. Maybe also about shorter work days, but that is also related to money.
It really is reducible to the differential between salary and unemployment benefit, which is the opportunity cost of not taking a job. This is a well-known phenomenon in economics since the stagflation of the 70's, called the "poverty trap".
Just a few notes:
After a few years of full time employment I received a bit over 300 euro a month I believe, for a full year, when I was fired myself.
And I believe the maximum amount of time where you can be eligible for unemployment benefits over here in Greece is a year or so.
I believe a large cause for the apathy in people who you'd expect to work these jobs is the fact that working a job like that doesn't move you forward in any way.
Back in the day, you could work for a few years and survive on your salary and hope to open your own business.
Now what's the dream for these workers? They can never afford to save up on their 500 euro a month. They can never get a loan to open their own business.
The best they can hope is that they won't be discarded and their job given to a more young-looking person down the line.
> Now what's the dream for these workers? They can never afford to save up on their 500 euro a month. They can never get a loan to open their own business.
Work harder. Make more money if you want to do your own thing. Surely there are professionals in Greece making good money working as employees for others. What are they doing that the lazy uneducated worker is not?
Do more of that and less complaining that you're making 500 euro a month.
Let's ignore the fact that there simply aren't enough high paying positions for everyone that "tries hard enough".
Let's simply discuss why people might not always go for the highest paying job they could get.
What most people that aren't doing everything optimally to improve their situation is that they're succumbing to common human logical fallacies.
People don't see that there are jobs that can potentially lead them out of that class of salaries, not because they're lazy but because they're uninformed about these possibilities.
Or they might gauge that the small chance they have to get such a job isn't worth doing something they don't enjoy at all, and would rather survive doing something they find bearable.
For a lot of younger people however, things are even more depressing. A lot of the "lazy uneducated" workers you mentioned spent years getting a university education, up to the PhD level frequently, and they feel they're invested in a thing they might be good at or they might enjoy practicing.
Objectively, they should give it up. Subjectively, I can understand wanting to hold on to a small hope that you might eventually get to do the thing you enjoy doing for a living.
If I'm allowed to be frank I find the characterization "lazy" very offensive, despite not having been in their shoes, because I have countless peers that are in this exact situation.
> A lot of the "lazy uneducated" workers you mentioned spent years getting a university education, up to the PhD level frequently, and they feel they're invested in a thing they might be good at or they might enjoy practicing.
Objectively, they should give it up. Subjectively, I can understand wanting to hold on to a small hope that you might eventually get to do the thing you enjoy doing for a living.
And all it takes is one(!) bad/uninformed decision in your past: skip STEM.
One of most cirurgic comments I read in HN. It's a pity that is buried in the thread.
At least over here, studying STEM isn't a guarantee that you'll be able to make a career out of your degree, much less a lucrative one. Tech gets you a job, but medical or physical sciences, and math, from the stories I hear involve fighting over scraps. I could elaborate and repeat the horror stories related to me by people around me but I won't for now.
You're suggesting they pull themselves up by their bootstraps. Put on some boots and try to pull yourself up by your bootstraps. Let me know your vertical.
I suggesting that maybe, just maybe hard work might play a role in things. If someone doesn't want to work hard for 800 euro because they can get 400 euro for nothing, do they have the mindset and drive necessary to become wealthy in today's economy?
So you're saying that the labour force of entire countries in the Mediterranean region (Portugal, Spain, Greece) suffers from lack of mindset and drive, and that explains the low salaries they suffer from right across the board. Interesting. Perhaps you might want to come over and straighten them out. White man's burden and all that.
> Please don't insinuate that someone hasn't read an article. "Did you even read the article? It mentions that" can be shortened to "The article mentions that." [0]
"The unemployment benefit is 400+ euros per month. So tell me who in their right minds would go to work for 500 euros or even 800 euros, whilst they have to spend petrol to get from and to work, work prolly 10+ hours a day, in the sun most likely cause thats what means tourism industry, get told by 'BOSSES' on what to do, and get treated awfully."
This is the argument for Universal Basic Income.
Give everyone something less that 400s euro, whether they work or not.
Let's say its 300 euros. Then the decision is don't work and take home 300 euros, or work and take home 800 or 1100 euros. There is a much greater incentive to work.
> The unemployment benefit is 400+ euros per month. So tell me who in their right minds would go to work for 500 euros or even 800 euros, whilst they have to spend petrol to get from and to work, work prolly 10+ hours a day, in the sun most likely cause thats what means tourism industry,
There are always people who don't just want to live off the dole.
Also a lot of the people who complain about crappy entry level wages (that they're unwilling to accept) also complain that they are rejected from higher jobs because they don't have any work experience.
> ... get told by 'BOSSES' on what to do,
That's kind of the norm at any job. I'm curious what alternative you propose, a commune where workers decide on their own what they'll be working on?
> ... and get treated awfully.
That's not acceptable period though specifics matter.
>That's kind of the norm at any job. I'm curious what alternative you propose, a commune where workers decide on their own what they'll be working on?
Pretty much all the software engineering jobs have worked at have given me quite a bit of autonomy. At least within software engineering organizations the purpose of a manager should be to make sure workers have the necessary resources and coordination, but they shouldn't be telling workers what to do.
I know someone that got hired at a company to answer the phone for technical questions from users. When she started they didn't have a phone hooked up yet so she asked for github access and started writing software. They never bothered hooking up a phone at her desk and she just wrote software for the next 2 years. The software she wrote was valuable to the company and was mostly self-directed. I don't think stories like this are that uncommon in the software engineering world.
I think you mean "autonomy", and at larger firms, you're going to have to work with others. The ideal is collaboration, but you don't normally get to choose what you work on, your management does.
"I'm curious what alternative you propose, a commune where workers decide on their own what they'll be working on?"
Ever read about Sun Hydraulics?
"At Sun, we have no job titles, no hierarchy, no formal job descriptions, no departments, no budgets, no direct sales channel, no close supervision, and only some work instructions."
As I read it, the whole point was that those normal hassles of a job aren't worth the (small) differential between the salary and the dole, and the suggested alternative was go on the dole.
And don't forget you usually don't work from home: so you pay for gas or public transportation. As you're at some shit job you lose opportunities to network or get new skills. You're not there for your children.
The OP has a very strong point when it comes to money.
If they offer you a $800 wage, when your unemployment is $400, your effective earning rate for the work you are doing is just $400/mo. Cost-benefit analysis isn't in favor of working. The employers either have to offer something on top of the starting wage (like clear path to advancement), or raise the wage. Otherwise it's a fairly logical choice for people to stay home and draw unemployment.
> That's kind of the norm at any job. I'm curious what alternative you propose, a commune where workers decide on their own what they'll be working on?
Did you ever work in the hotel industry as a low-level worker ?
>The unemployment benefit is 400+ euros per month. So tell me who in their right minds would go to work for 500 euros
Is there a limit to how long you can collect unemployment? In Finland if you still haven't found a job in about a year, you stop getting payments altogether. And while getting payments, you still have to prove that you're actually searching for a job and not just trying to scam taxpayers.
Not at all. It is a signal that with the instinct for survival removed, people will push back on hard work for low pay, as they should.
I think society would be a better place if people were paid based on the value they delivered, and not coerced into work based on the need to subsist. When employers/owners have to absorb long-term costs, they make changes.
People who work on pipes or other buried things used to often get killed or injured by collapses of mud or stone. Worker's compensation costs forced employers to put reinforced steel safety devices in the holes to mitigate.
It's not the same model. Presumably the €400 are forfeited when earing €500 as a salary. One of the premises of basic income is that working more doesn't cancel out any benefits.
That sounds like a stretch, and you probably need to define what you mean by "basic income not working". For who? Society? Employers? The worker?
Parts of these "youngsters" are probably off doing something related to self-development and fulfilling which might provide benefits for society later on.
In this case they (seemingly) aren't getting any more money from working extra, compared to not working either, since their social benefits are stripped away if they start working. If this was basic income, they would be left with something extra at the end.
Really frustrating to hear that argument. It's the same the right is making across Europe: "Just remove the social security net, then people will be forced to accept any wage.".
Do you think that the owner(s) of the hotels shouldn't be compensated for the risk that they're taking by building and operating the property? There's a ton of risk associated with investing like that.
You mean the properties they now own for a decade? Those that are fully developed and barely require maintenance? The same properties that are fully insured even against natural disasters that obliterate them to their foundations?
Yeah, let's compensate them for being insured and at the worst case scenario lose 500 euros a month every now and then when a shadier employee comes around and leaves quickly. Poor them. Whatever will they do, 1 million euros a year can barely get your ends meet!
Many risks. A disaster (war, bad weather) could keep customers away. A competitor could build next door, and resulting in your hotel being half full instead of full. A competitor could start a price war. Tastes in vacations could change resulting in less customers than expected coming. The laws could change in many different ways, each of which can change either your income or expenses.
That is just off the top of my head.
Of course as has been pointed out, your suppliers could demand more money than you have left in your budget (employees are a form of suppler - the human aspect has been intentionally ignored)
I think the GP's comment was unhelpful, but there is always risk in starting a business, particularly in hospitality, and especially as an independent operator.
There's risk in the construction (that budgets/timelines will blow out, contractors will be unable to complete the work to specifications), in whether the hotel will be appealing to customers, in the possibility of a recession or natural disaster or civic crisis that will keep tourists away.
The thing you describe is the narrative of the evil capitalist owner exploiting poor workers.
Here's a thought experiment - those (tourism businesses) owners are making lots of money, so why not create such a business yourself (maybe with help of some external capital) and pay better wages and treat your staff better and pay taxes? Your clients will be much happier with you while having to pay the same. Other capitalists are probably happy to get a piece of the cake.
Of course, you cannot blame workers to not work in this industry right now, but obviously there are still enough people accepting that type of employment, otherwise salaries would have improved already.
So what you're suggesting is that this person should not complain. Instead he should set up his own business, offer better salaries than everyone else, and single-handedly change the labour market of an entire country. Great suggestion. Why didn't I think of that?
> So what you're suggesting is that this person should not complain. Instead he should set up his own business, offer better salaries
Yes. Either yourself or maybe find someone else who does.
But if you find no one who solves it for you, the question stands whether the employer is indeed an evil guy or just doesn't have a lot of margin to hand out higher salaries. It's easy and lazy to assume evilness without ever having been there.
> and single-handedly change the labour market of an entire country. Great suggestion. Why didn't I think of that?
Not many people have €5M to build their own hotel, particularly those who are unemployed. Furthermore, not everyone can overcome all the barriers to entry, or have the know-how to keep a hotel operating.
> Not many people have €5M to build their own hotel
There are evil rich guys waiting to invest into a promising venture. Interest rates are at a record low. VCs are everywhere.
> particularly those who are unemployed
You just added that element to the discussion.
> Furthermore, not everyone can overcome all the barriers to entry, or have the know-how to keep a hotel operating.
That's an interesting point, maybe it's not so easy after all and maybe the risks and costs of operating the business is higher than the employee thinks.
Do it yourself and the you can complain and prove you have cash left over and hand it out. Then you can complain the guy is evil, the rest is mere speculation.
Note I am not saying it's easy (I know for a fact that it's hard). I'm just saying it's lazy and non-constructive to just assume the other guy being evil without knowing even 10% of what's going on and where the problems of the business lie.
Small business guy here. When abusive employment practices give you a competitive advantage and nothing stops you from doing them, you can indeed go and be virtuous and make less money for yourself and your business and lose all day long.
At the scale of publically held companies, your bossy evilness is virtue signalling that tells the market that you are viable in the era of Uber and Amazon. Right now, as things stand, wrecking things and your own employees is expected and you will get no support and no investment from breaking ranks. That's just how it is.
In my field, I ended up just flipping the table and switching to Patreon so I could dump free competitive product and better serve my own userbase. My income got literally decimated by this decision but has rebounded to about a third or half of what it would have been, but I'm totally exempt from having to behave like a vulture: it suits my market positioning quite well, though if I was a really serious threat to the market leaders in my sector, I'm pretty sure they would come up with a way to sabotage me. That's also why I MIT license: I can funnel good stuff to poor musicians if I also let already-rich people steal it in exchange for only publicity. The alternate is they steal it anyway but with no publicity, or simply try to wreck my operation so there's less competition.
The narrative of the evil capitalist overlord persists for good reason: in the absence of a working society it's down to power and power alone, and only winning and getting the most capital allows you to continue to win and get more capital. It's a feedback loop and there's no reason 'salaries would improve' barring outside interference, which is less likely by the year.
Go ahead and do your thought experiment, but it doesn't map to the real world of 2018. To survive you've got to think more disruptively: your axioms here are pretty naive. For instance, what is actually important: your clients being happy, or your clients paying more money?
All is not lost, the story of Gravity Payments is an unfolding example and experiment of a company owner, Dan Price, taking positive actions for employees including large wage increases. https://gravitypayments.com/thegravityof70k/
Dan took a thought and turned it into a real experiment. I believe the results are very positive in terms of profits, much higher wages for workers, higher customer retention, and deservedly good PR. https://www.forbes.com/sites/petergeorgescu/2018/01/24/what-...
I think you're reading a little too much into my above comment.
Just to reduce my point to the basics:
Either the evil guy makes lots of money (in the sense of profit) -> You start your own business in the same sector -> get some of that market share and profit -> pay your workers better -> everyone is happy except evil guy
Or the evil guy doesn't make a lot of money -> He cannot pay his workers more -> He's not the evil guy.
Sure, this isn't black and white but as long as there isn't a monopoly on anything involved, the above holds.
Let's just stop complaining and force evil guys to press the pause button by competing with them.
As a side note, it is an open question whether truly evil guys have a pause button (I assume Sauron and Darth Vader don't have one) or whether there are other things at work.
Maybe those guys just spent years living close to poverty to make their start-up a huge success. Maybe not. Just saying there are somewhat understandable reasons that don't necessarily mean the guy is evil.
That's so true. Employers in general complain that they can't buy filet mignon for the price of hot dogs, and that's suppose to be the employee's problem.
To make matters far worse, the industry in general pays lip service to on-the-job training and some employers also avoid junior/inexperienced developers, because they don't want to train anyone.
And don't get me started on the absolute cancer that are HR/outsourcing/body farm companies, the type that hires 3 HR technicians to dedicate themselves to bullshit naive techies to work for 50% of their actual market value and fire them as soon as they aren't indispensable.
>> Employers in general complain that they can't buy filet mignon for the price of hot dogs, and that's suppose to be the employee's problem.
The real underlying problem is that most employers I've encountered think that they're doing their employees a favor by "giving" them a job. They don't truly perceive it as a value-for-value economic transaction.
This becomes quite evident when they give you a pile of legal papers to sign where the balance of the benefits slant heavily to the employer.
I've seen this a lot, a lot of employers seem to think they're doing their employee a favor and are insulted when they demand higher salary/better hours, but they are quick to mourn their loss and to say they can't find anyone when the employee decides to leave.
I've worked around in a couple of european countries and I can confirm that the freelance rates for software development today are the same or typically less than in 2001.
The software developer golden age was in the mid-nineties here in Europe, and then the rates and salaries have stagnated (but not the inflation).
Also, the contractual conditions are getting worse. We are now many times offered contracts with a termination clause of one week on the employer's side, and without a termination option the the freelance side.
This means that if you sign a contract of one year, and then on the first week you realize that the job is not what it looked like in the interview, you are stuck for one full year.
This is especially important as employers are not really transparent in the interview process, they will often not tell you what the job is really about, and the job description you have is either out of date or it was embellished to look much cooler than the day to day job actually is.
I can confirm that rates are a lot lower than what they used to be. Comparing what I earned in 1996 with 2018, the actual income at the end of the month is about 20% of what was there in 1996 for about twice as much work, and 20 years experience more.
For the contractual side, if you are in Europe, one-sided rules in such contracts are easily removed, since they are void by European laws.
It's the same with US companies insisting that you do not work for a competitor after contracts end but European laws actually then require the company to pay you for monetary loss or such clauses are void. Also has been confirmed in court cases.
Regarding lack of information or even invalid information before signing contracts: this is also grounds for annulling the contract.
Do you mean that in 2018 the income is 5 times less than in 1996, taking into account both lower rates and inflation?
Or 20% less today than in 1996, in gross terms? The problem is, now most freelancers are forced to create their own service companies (of one person), so the contract is between two companies and not between a company and an employee.
And in those cases, the rules are not the same, AFIK. I did ask a lawyer to get the contract reviewed in 2013 for a mission that I was baited into taking and then there is literally almost no programming involved and I wanted out.
The lawyer examined the service contract and told me that by the terms of the contract, I would have to either serve the service contract or reimburse the company for what they would lose. Maybe another lawyer would say something different, or things changed since 2013.
They can terminate your freelance contract with a one week notice, but on the other hand, we can't terminate the contract on our side under any circumstances.
All we can do is wait for the contract to finish and then not renew it. Its perfectly legal, a lawyer told me.
Well that should be easy to fix. Just keep showing up at the office but don't do any work. It shouldn't take too long before your employer gets sick of it.
They can fire you on disciplinary grounds (you ruining labor discipline or they can even try and prove you are actively sabotaging them). And then you can be liable for damages in court.
I agree, its pretty close to slavery. Theoretically, they could sue you if you don't work, although what happens in practice is that if the freelance is really fed up and talks to the end customer saying they want out (which the hiring company does not want you to do), they want to avoid problems with the customer and they will replace you with someone else after a few months.
What they really don't want to do is to lose the billable position. In practice, a lot of people will just suck it up to the end of the contract and then leave, especially if the contract is less than a year.
What if you just don't show up for work? They fire you, right? Do you have to pay some big cash penalty? Or is the hesitance just that you can't get a reference for your next gig?
Legally, they could sue you for the same value that they were charging the customer for your work until the end of the contract, which is the money that they lost by the contractor not working.
In practice, they will probably not do that as the HR team is busy with other things and the lawsuit might be bad PR, although a hiring manager that wants to get back to you for doing that might have the HR department sue you, legally they could do that.
This seems like it's begging for a test case to strike this down on humanitarian grounds. I can't imagine any western judge of any serious level (possibly some county judge in West Texas or something) would take seriously the claim that this wasn't a violation of basic human rights (in US terms, the 14th amendment, though I assume similar principles apply elsewhere), and that such contracts were unenforceable. IANAL and I'm certainly not a limey lawyer, but our notions of justice on both sides of the pond share a lot of DNA.
They can't actually force you to work but the contract can definitely have really bad early termination clauses for the contractor which make it extremely expensive to break the contract.
In the US, one-sided contract clauses are supposed to be thrown out (judge's discretion though). If they can terminate free and clear while you cannot, that contract is very one-sided and I wouldn't personally sign that contract for any price.
Sometimes I think an international one-week walk-off by IT staff would do wonders for the worker-employer relationship.
Paiment in Europe is often late, from 30 to 90 days. So if relations between the contractor and the company go bad, there's quite a bit of money that can be caught up.
I started doing this later, but it can get complicated. If they have two freelancers that have passed the interview, and one is asking for contract amendments while the other is not, we can see what would happen.
But in general, if you insist that they add a termination clause of 15 days on your side, they usually do it although only after some insistence and negotiation, which if you have several interviews ongoing and are waiting for other responses might puts us in a precarious position.
I generally do this as a rule of thumb. Every engagement is a partnership between equals. I have the skills they want. They have the capital I want. We exchange on terms that suit us both or we don't at all. It also sets out the stall as to how the relationship will play out. I've been in enough contracts I need to get out of to save my sanity to know that it's not worth compromising on certain points. Everything on equal footing. The clause will always read something like "either party". There is no way they can legitimately argue against that.
My job takes me to Frankfurt and Brussels once or twice per year for four weeks at a time.
Every time I am inundated by queries from the local engineers and developers about how to get work either directly with for my employer or any other US company.
For the same level of skill and experience I'm paid more than double the typical EU engineer and the cost of living (including health care and retirement planning!!!) is much lower where I live.
On top of all of that, I'm 49.5% moron. Most of the guys I work with here in the US and in the EU are much better than I am. The only reason I go on these trips is because nobody else wants to be away from home for a month.
So I just shrug, say "I don't know man", take their business cards and resumes and forward them to HR where I assume nothing happens.
edit: and my understanding is that Frankfurt is a relatively high-wage area.
>On top of all of that, I'm 49.5% moron. Most of the guys I work with here in the US and in the EU are much better than I am. The only reason I go on these trips is because nobody else wants to be away from home for a month.
This sounds like a job that would be perfect for me. Where do you find a software job like this?
> All tech companies in Finland are like "We can't find enough competent coders!" and newspapers are publishing that as is.
To me, if a tech company claims in a newspaper that it cannot find competent coders, to me it says that they are uncapable of detecting talent. Which means "we have a really incompetent human ressource team". This is clearly not something that I would like journalists to print if I were a company owner. :-)
On the other hand, journalists should change their headlines towards "We can't find enough competent coders for xxx €/$!". Giving this information would be a strong service to the reader.
>To me, if a tech company claims in a newspaper that it cannot find competent coders, to me it says that they are uncapable of detecting talent.
Nah, you see the pattern in pretty much every first world country.
1. Government makes law protecting citizens saying companies must hire local unless as a last resort
2. Big tech companies post job listings with unreasonable qualification requirements, while offering wages so low that few people would accept
3. Nobody applies/accepts offers from those companies
4. Companies start whining to the government about how they can't find workers (at these wages) and that we need to increase the amount of visas from India/Bangladesh/wherever.
5. Government falls for it hook, line, and sinker. More cheap foreign labor is approved.
6. The market value for all programmers in the region drops.
Repeat steps 1 through 6 until the average programmer salary hits minimum wage. If local citizens resist at any point, just accuse them of being racist.
> Repeat steps 1 through 6 until the average programmer salary hits minimum wage
Did it ever happen? I mean, some active high-tech markets that have a lot of hiring going on and have been around enough to run these cycles if it's indeed what is happening. I don't know about other first world countries, but I am seeing in the US software developer's salary is nowhere even near the minimum wage. In fact, they are substantially higher than average wage for all the other comparable occupations (i.e. not bank CEOs and board members for Fortune-500 companies). I also am not seeing them precipitously dropping. So I am not seeing it happening as your model describes. Why do you think it is so?
Met a Indian in Sweden who was exploited in exactly that way. He made 27k while the market rate for a native with his skills would have been 40k at least. He got fed up with the bullshit and is now working on his PhD at a top university.
Is it really worth to invest so much money into "marketing" and "lobbying" the skill shortage instead of simply increasing the salaries to make the job more attractive? Just wondering...
Yes, lobbying has an incredibly high return on investment.
>After examining million records, including data on campaign contributions, lobbying expenditures, federal budget allocations and spending, we found that, on average, for every dollar spent on influencing politics, the nation’s most politically active corporations received $760 from the government.
>In a recent study, researchers Raquel Alexander and Susan Scholz calculated the total amount the corporations saved from the lower tax rate. They compared the taxes saved to the amount the firms spent lobbying for the law. Their research showed the return on lobbying for those multinational corporations was 22,000 percent. That means for every dollar spent on lobbying, the companies got $220 in tax benefits.
True enough, but most of this is corporate welfare lobbying (e.g. getting favorable legislation or direct subsidy or tariffs or taxes or something like that) not specifically about employment and immigration.
Is it really worth to invest so much money into "marketing" and "lobbying" the skill shortage instead of simply increasing the salaries to make the job more attractive?
Well it keeps the money in the Management caste rather than any of it going to the Worker caste.
A certain huge multinational once tried to hire me, and disappeared when they were supposed to send me a test.
Cue some months later I see in a magazine a interview with them, and complaining they can't find someone for that job.
So I applied again, they apologized profusely, blamed old HR company. Sent me to talk to new one.
New HR company approves me, then multinational refuse me explicitly because corporate policy is that this particular job must be done by someone experienced.
Thing is: they wanted a local, and they were the first company here offering that job... So good luck finding a experienced person when you are the first one offering that job in first place.
Steve Chandler has a great piece on "How to versus want to" that is somewhat relevant. People will say they don't know "HOW" to find talent, when in reality they just don't "WANT" to find it.
Can you read this article? I'm in Europe and run into a message saying "Unfortunately, our website is currently unavailable in most European countries. We are engaged on the issue and committed to looking at options that support our full range of digital offerings to the EU market. We continue to identify technical compliance solutions that will provide all readers with our award-winning journalism." with the LA times since the GDPA.
If I were to guess; they will start inserting their own content into these filtered pages, after some time. Newly created ones will be nice and clean, but after some months perhaps, mysterious stuff will start creeping in when those URLs are viewed.
I just tend to move on when I see a message like that. If you rather block access to 400-500 million people than sort out your privacy policy and how you manage sensitive data, then so be it. Stay away from such websites!
Would you pay for an LA Times subscription? Do you know anybody that would?
The newspaper business is struggling as is. Every time a publication is blocked in Europe people complain. Ads were the answer for most online publications, but showing targeted ads now pose a legal risk.
I don't know about their business ops, but I'd suspect they've done the math and decided it isn't worth the effort to change their platform so people can read for free in Europe.
You don't need to be not-GDPR-compliant to display ads and do user tracking. Just inform the user and give them the option to opt out of tracking / storing data. Ads won't be as optimized for the user, but they'll still be there.
Item one: I wouldn't subscribe to any old school newspaper from the anglo-saxon world because they make it extremely hard to unsubscribe. About the same respect for their readers as their targeted ads they can't give up on.
Item two: I wouldn't subscribe to a newspaper just because i read articles linked from HN occasionally, so I'll just pass on LA times.
Item three: whenever someone comes up with a working micropayment platform, I might throw them 2-3 cents if they get linked on HN. No more.
Yes, I haven't read the original article. I won't even through the free links. They don't want me, they don't get me.
Oh, hey, wait, let's not forget the daily standup rituals of agile scrum behavior modification.
Every day, justify your existence. Every day, beat that same dead horse. Every day, grab your coffee, sound off, and then listen to 20 other people bark at the empty air under their nose to show their devotion to a product that has the slimmest utility, and is coated in slippery, greasy dark patterns intended to screw the users that UX/UI supposedly cares so much about.
I have also experienced it in person. The customer, which was their only customer, and works with many similar contractor businesses, made noises that they want their contractors to "be more agile". So a lot of them just cargo-culted something and said, "we're more agile now!"
My previous employer declared a daily stand-up meeting--with mandatory attendance at 8:45 AM, the flexible hours be damned--crammed the entire team (minus customer support) of ~20 people around the walls of the manager's corner office, and proceeded to waste 45 minutes every morning, as everyone listened to everyone else justify their existence to the boss. Needless to say, I was already looking for other jobs, and doubled down on the application rate after that.
At my current employer, we just changed the day and time of our weekly status meeting, moved it to the conference table in the server lab, where the testers in adjoining offices can theoretically hear it and elect to participate, and said, "we're more agile now!"
The customer has absolutely no in-house ability to evaluate the effectiveness of external software development teams, so they just have to take their contractors' at their word.
I think you can probably guess who the customer is.
Sometimes backs will join in the scrum in order to push their forwards over the line to score a try. It's rare but it does happen and is legal under IRB rules.
Agile means small teams focused on one project communicating constantly with the client in a feedback loop.
If any of these elements is missing, you are not doing agile, you are doing the same thing most companies do, but with some agile pieces and labels attached to it.
It's like saying you are on a keto diet, but you eat ice cream, or that you are for democracy as long as the press is controlled by the state.
It's kinda saddening that from everything OP said, the only take you got from the message is whether a soul-crushing mouse-wheel is buzz-word compliant in your opinion.
If you're a senior software engineer, come to Sweden. You'll at least get 6000 usd/month as an employee. Management usually has a background in tech, you get lots of vacation, parental leave, etc. You're not expected to stay longer than 5 pm and working from home is common. There are many interesting jobs in finance, telecom, automotive, entertainment, medicine, defence, and there are plenty of startups.
I work as a contractor in Stockholm (long term assignments; basically like employment but I pay my own taxes), and I can save ~80k usd per year (after expenses and taxes, no family though, but I live in the city center). To get paid more, I either have to specialize hard or move to Silicon Valley.
Maybe, but what's the cost of living in Switzerland? And is it easy to get a job for someone only speaking English?
And don't you have to pay for your own healthcare?
The cost of living in Switzerland is high, that's true. But in IT the office language is English. And you have to pay your own healthcare insurance but afaik that's the case in most of Europe.
In my experience it is a bit more difficult to find a job here compared to the rest of Europe, and that's because there normally are more candidates for every job offering.
That's sort of the dilemma I see - living in the US and make more money compared to EU friends, but the lifestyle component of US work life is much behind EU. I can see how working in the US to earn more money during younger years might be good, then moving to EU later in life to enjoy the social benefits. Even in Silicon Valley, there are many people I know who make 6-figure salaries, but spend 2+hrs per day commuting, live in small apartments since rent is so high, and basically spend any time not eating/sleeping at or around work.
Does $72K go far in Sweden? I would assume not due to taxes...? I'm in a position of ignorance so I'm just looking to get a better idea of what it's like there :)
$72K is about $50K post tax (including one month of paid vacation). $72K is also a lower bound: I often see positions for ~95K-100K. And if you work as a contractor, ~$160K.
The national median wage is ~$35K ($27K post tax) afaik, and people live good lives on that, albeit in smaller towns.
And if you have a mortgage, you can deduct 30% of interest payments.
>The national median wage is ~$35K ($27K post tax) afaik, and people live good lives on that, albeit in smaller towns
That doesn't sound like much help for a single expatriate coming to Sweden for software work. They're going to want to live in a city where there's lots of other people (including other expats) to network with, date, etc.
True. A common starting salary in Stockholm is $50K ($37K), with that you can afford a nice and central apartment (~$20K without a mortgage, otherwise [potentially much, of course] lower).
Note that you don't rent apartments, you buy them. It makes a comparison harder.
The first two ones aren't much worse than London (actually -- it seems Stockholm gets more sun on average per year: http://svemet.org/stocompare.htm). The property market isn't a problem if you make this much; also, the buildings tend to be well-kept.
I have worked for 5 diferent french companies as a developper and this is so true. They all complain because they can't find developpers, sometimes its not even that they can't find "good" developpers its just that they can't find any developpers willing to work for them. Then when you see what they wan't to pay i just laugh. Someone helping on a kitchen in a restaurant can earn the same as a developper here in france. Most of the devs in Paris earn like 2000 per month after tax. Its just a joke, and when you get paid a decen't salary the marketing/finance/lawyers complain beacuse you are "just a developper".
The sad truth is that Big Companies are always cutting prices. It's impossible to get contracts at decent prices to shovel it down to the devs. I see both sides of the equation and in France you can't get clients if daily rates are too highs ; then you struggle to pay people what they truly deserve.
Our devs are not paid enough to save projects poorly down by half-competent team from big SSII that undercut everyone else.
And then the client is saying : "how can it takes so long ? I am only asking for this feature from Dropbox, that one from Google, a Facebook like feed and some Whatsapp notifications, all synchronised with these existing applications ! NOTHING HARD to do here !"
> And then the client is saying : "how can it takes so long ? I am only asking for this feature from Dropbox, that one from Google, a Facebook like feed and some Whatsapp notifications, all synchronised with these existing applications ! NOTHING HARD to do here !"
People use these fancy features for free by companies having billions of budget and income... then they want the same features from you, also for free:)
How and where did you find a US remote job whilst being/remaining in the EU? I'm a bit in the same street as you (freelancer, Belgium, previous experience with remote work).
More on topic, I hear the same in Belgium, they want someone to work 24/7 basically for free and then they are surprised that the guy they hired isn't some kind of magical being that knows every language (for some reason this goes for both natural and programming languages) and framework and whatnot.
> How and where did you find a US remote job whilst being/remaining in the EU?
I worked in Africa for a while, and got many American contacts there.
I also have a very high ranked stackoverflow profile, and get offers from there.
And I'm extremely active in the Python community.
I'm not actively searching a job with an american company, but if I were, I would just apply to any american job offer that interest me as I would do in France. Just be very clear on the situation. A lot of job offers seem definitive, but the people behind it are often ready to make many concessions.
> I'm not actively searching a job with an american company, but if I were, I would just apply to any american job offer that interest me as I would do in France. Just be very clear on the situation. A lot of job offers seem definitive, but the people behind it are often ready to make many concessions.
Well, most people don't understand IT at all. They can barely use their computer. What we do is very foreign to them, and they can't assess at all the difficulty of anything, or the skill of anyone.
Also, the fact something is "virtual" gives it less value. People thing that google is just a page with a button. They can't imagine the complexity behind it. Form then, the UI is the product. For them, stealing a banana is a crime, but a mp3 is ok. So your work seems easy.
Hmmm, should seriously up my github / stackoverflow game then.
My clients tend to be in the more closed branches, not much opportunity to work or give back to the community.
After this client I'll apply to job offers more aggressively, see if that helps. Honestly, I just want to work from home most days instead of wasting my time in traffic.
I agree on business/management not comprehending the complexity of IT, it's one thing we need to try to do a better job of, at least to some degree.
But I have turned down / terminated jobs because clients are unwilling to even try to understand what we do and simply want to stay stuck in their pre-computer/pre-internet way of thinking and working.
IT is here to help your business move forward, but if you are unwilling (which includes paying the right people correct wages) there is nothing I can do for you.
I see this a lot in the UK, and it's why I'm now a contractor.
You will have 10 years experience, a relevant degree, security clearance and no boundaries when it comes to overtime.
We will pay you £35k!
The sad thing is, they will fill that position, with someone not very good, with low expectations and no confidence in themselves. And they will get mediocre work, which they expect.
The difference in pay between contractor and permanent position in the UK is almost weird. The job is exactly the same, often for a duration of several months to years, and full time, except as a contractor you get paid like 2 or 3 times more. There are advantages to work in a permanent position but that doesn't make up for the massive loss in revenue.
Job security is a huge psychological factor. I'm starting on my own this very month, and deep down I'm incredibly scared that in a year I might be without a roof on my (and my children's) head.
I do contract webdev work for a multi-national in the middle of nowhere in Connecticut. The london office posted a job that is exactly what I do but is paid 5 times less. At the Edinburgh office, 7 times less.
Same company, same upper-upper-upper management, but VASTLY different pay scales. Its nuts to think about, especially when I can rent a full 3 bed/3 bath house with basement and garage for about 2 times less than a 1 bedroom flat in London.
I completely get that, but I'm paid for the same position 5 times more. The wage they are providing my position in London isn't even livable without roomates. I could (if I wanted a terrible commute) afford a nice apartment in NYC for what I'm paid. If the UK gov't wasn't so anti-immigration, I could actually afford a pretty decent flat in London for what I'm paid as well (on top of the house I currently rent).
Anecdotally, it doesn't seem so. Even straight out of University with 0 years experience, salaries among my cohort seemed to be between 30-40k GBP and this was some years ago.
Not to say that there isn't companies making terrible offers in London, but I don't know people working for them.
This is also amplified by tech companies in "non-tech" areas. I know I make less than I should, but my options are very limited unless I want to add a long (and extremely dangerous) commute. Moving is more expensive than I can afford right now.
And when I say extremely dangerous, I mean the highway I'd have to take to the larger cities with more jobs is consistently in the top five most dangerous roads in the US, and has been #1 a few times. I can really only hope wouldn't end up in the hospital (with a massive bill) or dead before I earn enough to move. I just kinda have to stick it out unless someone wants to hand me a fairly sizeable signing bonus. I can always negotiate, but it seems like it would foolish to rely on that perk being there.
Your job listing example describes me pretty well, that's what I found striking. At least I do enjoy my job for the most part.
Right now, not that often. However, we're attempting to educate a lot more people in this skill set, and the increased supply will help reduce the cost.
White collar is the new blue collar. Business is incentivized to make this happen.
First, I've seen the attempt to dumbing down on the workforce for programming (delegating offshore, hiring only interns, etc). It almost always fails in terrible ways.
Second, the demand for devs is exploding because of the society we live in: all activities uses programs. Shopping. Driving. Listening to music. Working. But the universities are nowhere close to match the demand with their output. Not in quantity, and not even in quality.
Third, there is a limit to this. Not all people can be programmers. A lot of them hate it. And a lot of them don't have the abilities for it. But here we are not talking about just any programmers, we are talking about decently skilled ones. I know that 90% of the people in my classrooms in the 11 schools I went to wouldn't be able to do what I do. Just like I wouldn't be able to boxe professionally, even with a good training, or be a surgeon thanks to a bootcamp.
And finally, complexity is exploding. A simple website was just HTML before. Then we added css. Then a server side language. Then JS. Then JS libs. Then a server side framework. Then quality tooling (version control, ci, task runners, packagers, etc). Then a client side framework. With preprocessors. And all that are moving targets, and must be integrated together. Not to mention is somebody throws in the server admin / deployment / database maintenance / nosql setup / microservice thingy to the mix.
I pity the new comers to the field. The things we can do have never been so amazing, but the thing but they become also mroe and more complex to the point everybody specialized. I know now some people that do only DB, or only server side, or even "only security". We used to comfortably do it all 15 years ago. But the job offers often still want us to do it all.
There is a reason the GAFAs pay premium: they have high quality services, and they know it takes a lot to make them work.
The China and India may change that though, as they are numerous, and skilled. But it won't come from our our societies.
Maybe, but you have to be pretty smart to be a competent software engineer. Most people just aren't capable of it (just like most people aren't capable of being a lawyer or a civil engineer).
How many people are experts in a non-JS server language and CSS at the same time? Assuming anyone even falls into that category, how many of them want to work for someone else as opposed to just doing their own thing?
No, all sides are fine if the argument is made within the site guidelines. We need you to make your comments more thoughtful and informative because readers are here to learn something substantive.
How do I know my comment is not thoughtful and informative enough to meet the guidelines so I won't make such mistake in the future?
If I had added more details regarding the taxation and who benefits the most from it, would that been enough to not trigger such response?
Imagine a reader who is not you, and imagine whether or not such a reader would learn something intellectually interesting that's grounded in our shared reality. The guidelines themselves give a lot of other specific advice, so you may find it helpful to re-read them closely.
> and yet you have to give away sometimes more than half of it
It's not being given away. How are the roads, police, schools, defense budgets funded?
> so that people who don't give a flying toss get their benefits
I just checked. The US and the UK both have a 4.1% unemployment rate. Many of those people are unable to work at all. our social security net means that if you're disabled you shouldn't end up honeless. Note it also pays for healthcare, so there's no chance of me being bankrupted from being hit by a car.
When I was living in NYC I paid 39% federal + 13.5% state/city - that’s over 50%. Healthcare and children education not included. I was not a home owner, and my other deduction amounted to almost nothing thanks to AMT.
After federal taxes you'd be left with 81710.5, so 7k for property taxes and healthcare seems reasonable. Except that you are neglecting to calculate in your higher sales tax that the state of Texas uses to generate tax revenue as well as oil sales which are a non renewable energy and can't be relied on forever
If I made $100K in NYC I would have likely had the same $75k .... which would have left me with $0 after housing and child raising costs. If I made $10k, I would have had the entire $10k. You are comparing big apples to oranges.
I didn’t say I had problems in NYC. I just said US taxes can be as high or higher than European taxes.
Yes, if you make $100k you are better off in Texas. There are way more jobs that pay $100k (not to mention $400k) in NYC than in Texas though. I’m not sure what the apples are or what we’re comparing; if it’s tax rates than the US isn’t as low as people believe.
Every one is better off in Texas compared to NYC financially. Apples to apples. But it's true, if you insist on the Euro experience, you'll have to pay for it...
In the UK the marginal tax rate between £100000-£123700 is 60% as you gradually lose your tax-free allowance, so even though the tax is technically 40%, you're losing another 20% at the other "end" of your income - https://eqinvestors.co.uk/library/avoiding-the-60-percent-ta... .. Admittedly this never means 50%+ of your entire salary is tax (you keep 59.6% net of even a £1M salary, for example) but is a real pain point for earners around the £100K level.
Above 70k, you are supposed to start your own business and optimize your expenses through that. Despite recent squeezes on related practices, it's still much better. Not doing it, is basically a gift to the taxman.
Agreed, though I think it's even more a disincentive to pay yourself more than 100K, even if you're mostly on dividends, once you've already seen ~20% come off for corporation tax.
For third parties unfamiliar with the setup, to pay yourself those dividends that take you from £100k to £110k, you need to take £12500 of biz profit, then £2500 goes to corporation tax, then £6000 to the taxman in personal taxes, leaving you with £4000 from that initial £12500 profit(!) which "feels" like a 68% tax to, say, a contractor in that situation (note: I am not a contractor).
But that's the thing, you don't pay yourself in cash - you move most of your expenses to the company (cars, houses, investments, pension payments etc), so that money is only touched by corp tax. You take out the bare minimum that you cannot reasonably claim as business expense, squeezing your taxable income all the way down. When you reach a point where that's not possible, either you are making way more than 150k or you have a poor accountant.
Employer spends 4k€ on salary.
Gross salary will be 3k€ (Bruttolohn) due to social security the employer pays for you.
Net salary (Nettolohn) after taxes and your social security is 1850€.
This example is from 2010 back when I was a student. Since I only worked 6 monhts, I got back 300€ per month, so effectively received 2150*6 = 12,9k out of 24k paid by the employer.
Note that when you spend money, you'll most likely additionally pay 19% VAT, so out of your standard 1800€ another 324 are spent on VAT.
Hopefully you don't buy gasoline, electricity or products that are produced or transported using gasoline or electricity, because then the taxes paid will be higher.
The highest tax rate in the Netherlands is 51,95% (Note that this only covers anything you make over ~70k+ a year, 0-20k is taxed ~35%, and 20-70 is taxed 40%). Then you pay 6-21% VAT over anything you buy, so yeah, in some scenarios you definitely lose >50% of your gross income to taxes.
You don't just count VAT, let's count everything: 150%-250% taxes on energy, ridiculous amount of fees and duties. As a Dane, we're probably the most taxed in the world and for a high earning software engineer it's approaching 75%.
The state enables a lot of stuff for you in return though, which we'd also have to count as a benefit if we "count everything". It's just infeasible to come up with a concrete number of how much they "take away" from your earned money.
I have the same benefits in the US as in Denmark (more or less). In the US the government take 25% of my income in Denmark it was around 75%. Personally I don't think the extra 50% is worth it. The only ones better off in Denmark is the minimum wage earners.
@rglullis: Well. There is social security, health care, retirement funds and there are taxes.
Well: I gladly pay health insurance in Germany instead of having an American system. Could it be better - hell yes. There is so much bullshit being paid for and so much in the system is made to extract money. But first: taxes are not the culprit here. And second: Pay for healthcare in the US yourself and see what system you like better. Esp if you get older.
It is a false dichotomy. I don't mind the health insurance being mandatory, much like I don't mind people being forced to pay for car insurance if they drive a car. What I find absurd in Germany is that you pay based on your income, just that. I would accept it being factored in, but not being the sole metric to determine pay.
Most health insurances will give you benefits for staying healthy (e.g. visiting the gym or a nutritionist). Visiting the dentist at least once a year will also give you a benefit. There might be other stuff I can't think of right now.
So income isn't the sole metric which determines the pay.
Please tell me how I can reduce my TK payment by showing them my gym membership, and I will be very grateful. No sarcasm here.
Also, as far as I know there is no benefit in going to the dentist, except as "We pay one dental check-up and one clean-up for year, more than that comes out of your pocket". That is at least what I was told when I went to the dentist.
> Also, as far as I know there is no benefit in going to the dentist, except as "We pay one dental check-up and one clean-up for year, more than that comes out of your pocket". That is at least what I was told when I went to the dentist.
Some public insurances tried giving benefits for going to a gym or having reduced membership fees at partners but this has been shut down by the regulator.
Bear in mind this is only income tax. If you put deductions like health insurance (mandatory, and also dependent on income level) my take-home pay was indeed less than 50%.
Paying health insurance is apart from the income tax. So in this particular case your income tax money is not getting you anything in return, healthcare-wise.
Worst in case of health insurance, the amount you pay is dependent on your income, not your actual actuarial risk. This means that, indeed, the healthy people working are subsidizing the costs of the ones "who don't give a flying toss".
And don't get me started on things like Künstlersozialkasse...
I consider "health insurance" to be somewhat of a scam, just less so in Europe than the U.S. I feel like I'm forced to pay into a black hole with no accountability.
Don't know anything about Künstlersozialkasse - "artist social fund". Is that like a tax to (supposedly) support cultural activities..?
No, more like a social security system separate for the artist "class". If you manage to declare yourself as an artist, they pay a substantial part of your health insurance, social security, etc... All funded by us, poor feeble minded workers with no creative bone in our bodies, to support 20-somethings and eternal Peter Pans who can't keep a job.
You are technically correct. In practice, I had colleagues working as "web designers" who were working right next to me and would not get a substantial part of their salary taken out for health insurance. So, they were still funded by the non-artists.
Why the distinction? Because this work involved Photoshop and mine used emacs?
As I said, the portion they don't pay is taken from companies using creative work. Not from you and not from me.
It is only available to freelancers. People working in those fields usually don't have the option of regular employment. For that reason was decided that companies using their work still need to contribute to health insurance (as all regular employers need to do as well). For everybody else the answer is: seek regular employment if you want someone else to pay half of your health insurance.
Alright, then. One could argue that the costs that companies have with this still get passed along to the consumers and other workers, but I will concede it is not "funded by us".
Still does not explain why there is a distinction. Why do artists get to have companies paying them part of their social security while other freelancers still need to make this out of their own pocket? If this is a good idea for the artists, why not for other professions?
That’s factually incorrect. For example the max tax band in the U.K. is either 40 or 45 %. So you don’t give more than half of your earnings. Also every country in Europe decides how to tax ppl in that country.
If it wasn't for "socialist Europe", our health care would be shit (see the US where people die on the streets because they can't afford an ambulance), my brother would be homeless and probably dead, my dad would've been without any income at age 60, years before his retirement, my sister wouldn't have been able to attend university, and I wouldn't have been able to attend college and land a job in Amsterdam where I ended up out-earning my dad within a couple years.
This "taxes pay for lazy fucks" meme needs to die.
Then maybe GP should say that instead of making false statements about ambulances for dramatic effect. Ambulances are for emergencies. Nobody has ever died because they couldn't afford an ambulance to take them to their chemotherapy appointment.
- About $20k/y to provide health for a family, regardless of income. Median wage is barely double that amount. So most people in that situation forego health coverage (or pick the cheapest catastrophic-only coverage they can afford, and then are on the hook financially for any health issue).
- Still have 33% income tax
- Retirement: it's entirely up to you to save. Good luck! (rule of thumb is 15-20% of income)
- Child care: $12-24k/year/infant should your spouse have to work.
- College education: similar figures, maybe less with some assistance programs, maybe more if children go to prestigious schools. Or you can punt the bill to them and have them be on the hook for a loan.
- Oh, and nursing home for the elderly is about $30k/year so better get that retirement fund full of money. Though it's an undue burden to place on someone else, the traditional view is that having children can help reduce that cost.
In short, the US' system is not optimized for the median citizen ($59k in 2016), it's optimized for those who are in the 75th percentile or above.
>Then there's VAT syphoning an extra 20% of the remaining cash.
UPTO 20% of what you SPEND. In the UK you pay 0% VAT toward most food and child stuff. Then 5% toward essential goods and services. THEN full VAT on the rest of the stuff.
But that doesn't equate to 20% of your remaining cash unless you are only buying pre-prepared foods and furniture with your salary, and spending every bit of it.
You don’t have to pay VAT if you don’t buy anything. You can just invest your money.
A new passport costs money. You need to pay for one if you want it. That shouldn’t be part of your income tax because nobody knows how often you will need one. Essentially those fees are on per person basis.
The NHS is very useable. I never used to pay for any private health insurance for about 5 years. It might not be convenient for you to wait but that’s your problem. That system works and saves lives... so it is usable.
I don’t even know what you mean by “lost”. Money doesn’t magically disappear. Maybe it’s a more complex system than you can imagine or haven’t thought about it hard enough.
> In the end you get healthcare, but in general the service is practically unusable and you end up having to pay for health insurance anyway.
Yeah this is just wrong. I have friends who have moved to the US, and said things like - "I wouldn't be as annoyed at how massively expensive health insurance here is, if you got any better service, but you don't"
It’s interesting how much momentum there is in these processes. After several decades of big wage gains, during the 1940s, 1950s, and 1960s, the nominal increases could not be stopped, even as the economy weakened in the 1970s and 1980s. Back then all the wage cuts had to done through inflation. Nowadays there is no inflation, and no momentum to restart wage increases. This part of the article says it right:
“””The underlying cause of the “labor shortage” is hiding in plain sight. It’s the long-term trend of funneling the gains from labor productivity not to the workforce, but to shareholders. As with any addiction, this process produces short-term euphoria, reflected in share prices, but long-term pathology, reflected in income inequality, poverty and social unrest.“””
This is absolutely correct however the one dichotomy is that we are also the collective shareholders (obviously not majority). People love seeing their 401K go up 15% annually year over year. That is only happening because of this funneling.
Collectively we need to stop wanting it both ways. We want cheap goods but then complain about offshoring and outsourcing of labor. Look at dollar stores: Their boom happened almost immediately after Clinton re-opened trade with China. Wal-Mart went from "proudly made in the USA" to cheapest crap they can buy. It annoys me when some people talk about changing X but neglect to even try to think about what change that might cause for Y and Z.
> we are also the collective shareholders (obviously not majority)
It's that 'not the majority' thing that's the fly in the ointment. I owe this claim a link, but most shareholders are part of the wealthy and/or the professional classes, skewing stock gains toward a few, and away from the many.
EDIT: Added link supporting claim. Per WP article, chart 'Stock ownership is heavily concentrated', top 20% of US households by wealth own 90% of stock, and even that's skewed heavily to the top.
Most shareholders (holders of the wealth represented by companies) are members of the wealthy class? :P You don't say.
I'm of two minds on this. Wealth and income are not the same. You get wealth by not consuming all of your income, and instead by investing it. Of course, if you have just enough income to survive, then you cannot accumulate wealth. But most people (in the US) are not in that boat. One of the phenomena that continuously fascinates me are the differences in wealth accumulation between people in the same income brackets. Sometimes there are good reasons for it (e.g. medical issues), but my sense is that in the vast majority of cases, there is simply a difference between the elective consumption levels of different households.
For example, I have a sibling whose wealth is in the 98th percentile for his age bracket. However, his income has never been above the 60th percentile, and has often been lower. This is an example of how a certain attitude about consumption can have a strong impact on wealth accumulation.
I definitely think that the rich (broadly defined -- both via high income or high wealth) need to be contributing more back to society than we are. But, as a saver, I'm biased towards targeting high-income more than high-wealth.
> I definitely think that the rich (broadly defined -- both via high income or high wealth) need to be contributing more back to society than we are.
If the goal is to spread wealth more evenly, wouldn't it make sense to tax wealth rather than income? As a general principle of incentives, you want to tax the thing you want less of.
> If the goal is to spread wealth more evenly . . .
If the only goal was to spread wealth more evenly, then what we should do is simple appropriate all wealth beyond (num_wealth / num_people), and give it to all the people who don't have that much wealth. Then it would all be even stevens. :)
But there is not just one goal. Another important goal is to still have a functioning economy after applying your policy choices. All tax policy must at a minimum consider efficiency as well, from a purely pragmatic standpoint. Otherwise you end up in a situation where you have destroyed your economy by eliminating important incentives.
There is are also moral arguments about what is "right" (for those who believe in such a concept). If Bob and I both did work worth $10k, but Bob used the money to have a fancy vacation and I saved the money against future needs, should I be taxed more? Maybe! It depends on your moral outlook, and also your beliefs about how spending and investing affect the economy -- both are needed to some degree or another.
Historically, wealth taxes have been tried. They are generally not very popular, and do not raise very much money. They have a tendency of hitting middle and upper middle class retirees, as well as high income people. They also can't be very large in magnitude without seriously degrading investment returns (and thus incentive to invest). They also tend to target a group of people who are a "flight risk." Unlike income, which is often not possible to relocate out of a given nation, wealth is easily transported across national lines to jurisdictions without a wealth tax. Read about France's wealth tax on Wikipedia for more information on this.
Yes you should. Bob supported a host of vacation-related workers and kept the economy moving. You sucked money out of the economy and sat on it.
Saving capital so as to be wholly self-sufficient outside the functioning of a society is not in any sense a societal benefit. It's sort of the 'eat your own dogfood' issue: let's say you don't think retirement on Social Security is bearable, and you're alarmed by public healthcare and the state of roads. So, you do everything possible to suck all the capital you can out of that whole system, in order to privately retire off your own capital, going to better doctors and flying between them in a helicopter.
You're hardly going to be working to better the state of the public sphere, as you're constructing a walled garden for just you: is this the moral purpose of your saving money for years? You end up in direct competition with the public sphere, and we've seen this dynamic play out for decades, pretty much my entire lifetime and I'm 50.
You're basically ruining money velocity, and should indeed be punished for that choice. There is nothing moral about hoarding, especially when your argument (maybe not specifically yours…) is 'the public sphere is horrible and ruined, therefore abandon it and ruin it more'. That's the argument of an economic saboteur.
> Yes you should. Bob supported a host of vacation-related workers and kept the economy moving. You sucked money out of the economy and sat on it.
Eh. I'd rather say that Bob diverted labor toward supporting his luxury consumption, whereas I made capital available for increased production (of cars, houses, food, etc.). The truth is somewhere in between. I think your read on this is a little too simplistic.
It seems to me that the burger Bob bought (and the check the restaurant wrote to its supplier for the ground beef, and the check the supplier wrote the farmer for the cow) is a direct payment into the food production system, while 'making capital available' may or may not land anywhere near the real economy. What's the sophisticated view here?
There's an enormous amount of complexity here. For one thing, it's not like there is an infinite amount of beef available at a fixed price. Bob's eating that burger probably on the margin increases the supply of beef, but it also on the margin increases the cost. Now everyone else has to pay 0.0000001c more for their hamburgers.
Or what if Bob bought a filet mignon instead of a hamburger. Maybe farmers will now be (on the margin), breeding cows that produce less hamburger but more steak. This could increase the price of food that poor people eat. If Bob buys a Tesla, maybe Bob helps expand the supply of Teslas, but now buying a Corolla is slightly more expensive, because there are slightly fewer economies of scales in sedans. (This is actually happening, BTW, as Americans buy larger cars.) I also spoke of Bob taking a vacation. He spent a thousand dollars on plane tickets, which has serious deleterious environmental effects, and for the most part represents a purchase of oil, not labor services. Oil workers wages may have gone up a bit, but most of the money just went into the pocket of whoever owns the oil.
These are just some examples of possible things that could happen. Without empirical testing, we could not know what the exact impacts of any given decision are, and realistically, we do not have the resources to track the impacts of each decision through the economy.
You make a lot of good points. I think we should also consider the fact that if you invest your money rather than spend it, the firm may not invest directly into capital projects for increased productivity. So much money is returned to shareholders via buybacks and dividends these days. So in those cases, your wealth isn't transferred to labor, instead it's transferred to other shareholders who already have wealth and a flywheel effect occurs. This creates more and more distance between labor and capital.
I could be completely off here but am interested in opinions on this.
You're not wrong that that effect can exist. And I'm not saying that investing is a totally altruistic, virtuous action. However, the criticisms of the stock market as not being "real investing" are largely off-base. Liquidity encourages investment -- illiquid investments are universally less preferred than liquid investments, all other things being equal. Even if non-IPO investors/subsequent issuance investors are not directly providing capital to a company, nobody would participate in IPOs or other stock issuances unless they were confident of a market for that stock in the future. Therefore participation in the secondary market for stocks is necessary for a primary market to exist in any meaningful way. (In a similar way, if the public market did not exist, there would be much less private investment, much fewer startups, etc.)
You raise fair points about the spending of money on physical assets/consumption. Can you elaborate similarly on the potential problems with how saved/invested money is allocated?
Well, at a very high level, banks can use saved money to lend to businesses or individuals at a given multiplier. If a bank has insufficient deposits, it can't lend any more money. This is called fractional-reserve banking. https://en.wikipedia.org/wiki/Fractional-reserve_banking So when you make a deposit, you are effectively causing a fraction of that deposit to be available for lending. This is what you're getting paid for when you get interest.
On the other hand, when you invest in a stock, you're providing liquidity to whoever held it last. That doesn't directly provide money to a company. But it has an important function: people only buy stocks when they are confident they can later sell it. If there were no buyers for stocks in the secondary market, nobody would participate in IPOs.
As far as which is better for the economy, this is beyond my knowledge. However, any normal person with any financial savvy knows that market returns are much better than deposit returns, so most of the time when such people say "save" they mean "invest in the market."
> If a bank has insufficient deposits, it can't lend any more money.
That's not actually true, banks effectively create money when making a loan, and the only constraints on this are the interest rate set by the central bank, which affects both demand for credit and the cost of providing it, and liquidity requirements set by legislation.
The "liquidity requirements" you refer to are the fraction in "fractional-reserve." If I deposit $1, and then the bank's capital requirements are 75%, and they lend out $0.75, the total amount of money is now $1.75. This is what people are referring to when they say banks create money.
Banks "create" money by making loans, but those loans aren't made from other deposits. A bank with a 10% requirement that has $100,000 in reserves can loan $1,000,000 to somebody even though they don't have that much deposited there.
> any normal person with any financial savvy knows that market returns are much better than deposit returns
And, if I understand the arguments, that's confirmed by Piketty's r (return on capital) > g (economic growth rate). My concern is that more money is getting tied up in chasing financial assets than in the real economy (houses, hamburgers, cows, etc.) If you have financial assets, that's good. If you don't, that's bad. Most people don't have financial assets. Sooner or later something's going to correct that trend. It'd be better to find a non-violent solution.
"Money" isn't resources. It's just numbers in databases. The whole point of financial assets is so that real resources don't get tied up, so I think your outlook is totally backwards. If people don't understand this and get violent, it will just be another civilization destroying seizure, signifying nothing.
You do not understand correctly. r vs. g has little to do with the return of debt vs. the return of certain classes of securities (since neither is pegged to economic growth). Rather, the return on deposits and the return on stocks are both part of a composite (r) that is meant to be greater than g.
Having $X in a bank account is not the same as taking $X in capital machinery and shoving it somewhere to rust "out of the economy". In fact, it's kind of the opposite, which is why the financial system exists and saving is a good thing.
There are certainly bad ways to move toward wealth equality. In terms of implementation, I was actually thinking more of either a George-ian land tax [0], or through some form of encouragement for the wealthy to spend their money into the physical economy rather than the financial abstraction economy. If I figure that part out, I'll run for office.
Which is somewhat great because if they don’t pay well startups can exploit opportunities that open up as a consequence.
However, my experience lately from Germany is that large companies are becoming more and more popular for developers. This was also reflected in a recent HN discussion
It seems like a very poor financial decision to turn down 300k from Google to make 150k + fairy dust money from a Startup. Even if the 300k is lower than what Google ought to be paying.
Lifetime? Not sure what you mean. Given that the vast majority of Startups fail and any equity you were granted would be worthless and even those that do payout are usually just getting you to parity to people who were at a FAANG over the same time frame I fail to see how a Startup would benefit. Even Resume wise, recruiters won't care that you worked at a startup that had a $100M exit but they definitely will if you worked at Google for 5 years.
It's a little more than that. It is the financialisation of the economy. If you stop paying workers, then they don't have the money to buy your output and you go out of business. That's the basic philosophy behind Ford's approach - high wages = high sales.
However if you deregulate banks then you can replace wage growth with credit growth - increased private debt - which keeps the plates turning. You don't increase wages, you increase the debt people put themselves in overall - student debt, mortgage debt, credit cards. That has the advantage of putting a huge monkey on people's back forcing them to work ever harder in a system that structurally has fewer jobs than people that want them.
Then when that falls apart, you plead with the government to plough huge amounts of public money into the banks, so they can restart the credit engine.
The cycle that lead to 2008 will repeat again with ever lower interest rate peaks in each cycle.
But people have been working for a decade and a half to open up global migration of workers, as well as allowing China and others to export whatever it wants at any price (and several other "details", like IP theft of course). When 2 markets merge, prices converge.
What are engineer wages in China, the Phillipines, India, ... ? Oh wait ...
Second: with opening up markets, ... if there is one well-known fact in economics it's that when money can move over a wider area it concentrates into fewer hands. The bigger the markets operated, the fewer rich there are. And therefore, the more "ultra" the ultra-rich are. The shareholder "wealth transfer" seems to me to be this effect playing out.
That explains some of it. And that's with the minimal opening up of borders that has occurred over the past 2 decades (ie. mostly the EU and America, and in terms of population it's not that much).
That's a bit of a question I have for globalists : global average wage is $2000. Not per month, not net after tax. Not actual dollars. That's yearly, before tax, PPP dollars, not actual dollars. (PPP dollars means it's $2000 worth of, say, food (say strawberries or big macs), but it's actually only $400 worth of things like Gold or perhaps more relevant, iPads/Phones, that have global prices)
If one opens up global labor migration, that's the average wage that will be seen worldwide, and that's the expected result. Note: I am NOT saying that letting 1% of people migrate will drop wages like a stone immediately. But it will move in that direction. Nor am I saying that this has anything to do with work attitudes or ...
The "big secrets" about the economy that must be denied because they are thoroughly at odds with policy that we want to pursue:
1) there is a global oversupply of labor. You could pick ~16% of humans worldwide, disappear everyone else, and have almost zero effect on the economy. That means wages everywhere (even in places with dismal wages like Bangladesh) are too high in market terms. And I would like to point out that at least 2/3rds of those 16% work for governments, directly or indirectly, and "if everyone just behaved correctly" we also wouldn't need them.
(and note: this cannot be fixed with minimum wage laws for obvious reasons)
2) The global economy is demand-limited. Producing more goods would NOT result in more sales. We have "everything we want" (in economic terms, that means everything you're willing to work extra for). This means, loosely stated, that the above problem does not just apply to workers, but to companies in general as well.
I have seen that at the top end of the market it's not unusual for engineers to be paid salaries that compete with SV. Not sure about run of the mill engineering jobs though?
If profits don't grow or profits don't reach or surpass expectations, board members get fired. If board members are threatened, management is threatened. If management is threatened, workers are threatened.
Profits change by increasing revenue and/or decreasing costs.
Wages are an obvious way of optimizing wages further.
Maybe, show me your math proving that number is correct.
I can't speak for the US, but in Canada the housing component of the CPI has utterly no connection to actual observed costs of owning or renting, at the national level as well as the municipal level.
You don't have to take this as a fact (I can't really prove it if the government doesn't share their data or calculations, can I), but moreso something to think about in the formation of your world view.
"The CPI used to include the value of a house in calculating inflation and now they use an estimate of what each house would rent for -- doesn't this switch simply lower the official inflation rate?"
"No. Until 1983, the CPI measure of homeowner cost was based largely on house prices. The long-recognized flaw of that approach was that owner-occupied housing combines both consumption and investment elements, and the CPI is designed to exclude investment items. The approach now used in the CPI, called rental equivalence, measures the value of shelter to owner-occupants as the amount they forgo by not renting out their homes.
The rental equivalence approach is grounded in economic theory, receives broad support from academic economists and each of the prominent panels, and agencies that have reviewed the CPI, and is the most commonly used method by countries in the Organization for Economic Cooperation and Development (OECD). Critics often assume that the BLS adopted rental equivalence in order to lower the measured rate of inflation. It is certainly true that an index based on home prices would be more volatile, and might move differently from other CPI indexes over any given time period. However, when it was first introduced, rental equivalence actually increased the rate of change of the CPI shelter index, and in the long run there is no evidence that the CPI method yields lower inflation rates than some other alternatives. For example, according to the National Association of Realtors, between 1983 and 2007 the monthly principal and interest payment required to purchase a median-priced existing home in the United States rose by 79 percent, much less than the rental equivalence increase of 140 percent over that same period."
Now, one can certainly make a reasoned argument that this is a reasonable change to tracking shelter costs in the CPI, but it is a fact that housing purchase prices are not included in CPI calculations for shelter, and it is also a fact that the majority of people choose to own their home, for very good reasons.
"Home Ownership Rate in the United States remained unchanged at 64.20 percent in the first quarter of 2018 from 64.20 percent in the fourth quarter of 2017. Home Ownership Rate in the United States averaged 65.24 percent from 1965 until 2018, reaching an all time high of 69.20 percent in the second quarter of 2004 and a record low of 62.90 percent in the second quarter of 1965."
And again, I don't know about the US, but in Canada it is a little known fact that our government "just so happens" to choose their representative rental properties for CPI calculations such that the numbers they produce don't even remotely resemble the actual increase in renting costs.
The fact of the matter is, in the current environment of skyrocketing housing costs in much of the Western world, the CPI does not reflect actual cost of living increases for the citizens whose tax dollars pay the salaries of the people printing the numbers, and for statistical agencies to dismiss this by simply pointing at some technical "reason" tucked away on a website (that almost no one knows about) is a failure of democracy.
Housing purchase prices are largely an investment, not a cost. Including purchase prices in the CPI would be just as silly as including 401(k) contributions. If all goes well you're going to get that money back plus gains.
> Including purchase prices in the CPI would be just as silly as including 401(k) contributions.
If 401k contributions were deemed by 60% of Americans to be a ~necessary part of their life.
And whether or not you're going to get it back....you may, yes, but then again, you may not, in a very big way. For example, perhaps there's a gigantic bubble going on.
It's a bit of a philosophical question really - is the government's role to inform people of reality, or to shape their perception of reality.
At least a partial role of the CPI is to measure inflation, and reflect the real world costs to real world citizens. If not, then why fund this department?
Would you be philosophically opposed to publishing two CPI numbers: one as is (that uses estimates), and one that uses actuals that are consistent with the actual economic environment citizens experience according to the way they have chosen to arrange their lives?
Yes I would be philosophically opposed to the government publishing CPI numbers that include durable investments of any kind. CPI should only be consumption. People can always choose to rent instead of buy.
60% of people choose to buy for reasons that are their own business.
The question is whether two numbers should be printed, so taxpayers know what is actually happening in their economy. So, you are supporting deceit. Which is your choice, of course.
Please don't post ideological rants to HN. We're looking for substantive comments here. That means comments that contain information rather than rhetoric.
Right, the bread and circuses are the bit that keep us distracted from the important bit, which is our disenfranchisement as citizens. Now it takes the place of shareholders/bankers/pension fund managers seizing all the power in society by buying politicians, setting themselves up as monopolists (and, for labor, monopsonists), and generally being in charge of every decision that citizens (as consumers and producers) might conceivably make in a way adverse to those in power.
The great thing about our system is that the ruling class even make money on the bread (farm subsidies, school lunch programs designed mainly as more farm subsidies rather than as a way to feed schoolkids healthy food, more farm subsidies) and the circus (monopolistic ISPs, cable companies, media holding companies, and content aggregators, now seemingly in the process of all merging into one by gobbling each other up) parts too!
As far as I remember it was more about the moral decline of the people who do not want anything besides bread and circuses :) Just checked Wikipedia: "People who once upon a time handed out military command, high civil office, legions — everything, now restrains itself and anxiously hopes for just two things: bread and circuses." (Juvenal).
I worked for a Canadian company that's absolutely hemmoraging talent because they refuse to pay well. I'm now paid about 50% more to work remotely for a US company in an environment that is far far more fitting of my life goals of being with my kids as they grow up.
It's beyond bizarre to watch them continue to refuse to pay anyone properly despite their imminent collapse.
It's bizarre. Even Amazon Seattle pays 2x the salaries of Amazon Vancouver, even although they are separated by only 200km and are the same company! I ask every Canadian developer I meet, why are you still here? I like living in Canada, so I work remotely even although I don't really like remote work. Instant 70% raise.
Yeah I've had a number of jobs I turned down because I simply don't want to live in the US. There's just something about the calm nature of where I live that's worth a lot to me.
There are a lot of calm nature locations in the U.S., I'm just sayin'. You won't make Silicon Valley wages, but you may still have an improvement looking in alternative city centers with varying proximity to nature: Austin, Chicago, Boston, Denver, Salt Lake City
Is there any difficulty in working across the border like that? I work for a Canadian company due to having my roots here and find the thought of dealing with remote work in another country intimidating. Is it much hassle?
I setup a company and structure the employment as a contractor with no benefits. Most companies are happy to structure things that way, and all jobs are basically at will employment anyway, so there's little practical difference. US companies are used to spending a lot on benefits, so you can negotiate a higher salary instead.
Compared to what you do every single day at work, it's not really much trouble at all.
It's been completely painless because the company is using a Canadian company to handle my salary and tax info, and they got me Canadian extended health insurance.
It's actually kind of awesome. They bump up my Canadian salary to match their USD official salary any time the exchange rate goes bonkers. So the more Trump does Trump, the more I'm paid.
It's not for everyone. It's definitely for me. I see my family every lunch. I can just wander off and go so stuff with them if I'm not feeling it, and then just do some work at another time. I've counted all the "moments" so far in my son's life that I'm so glad I didn't miss but would have at a traditional job: 106 since February.
There's remote job boards like https://weworkremotely.com/, you can filter by remote on stackoverflow, and search remote in the monthly HN who's hiring thread.
Remote work is not for everyone, and you have to be self-motivated and disciplined. It can be a lot harder to get work-life separation.
Other than that it's no different than looking for any other kind of job, you want a strong resume and to practice the coding interview and assignments.
But stay away from companies that have a Canadian presence, they often have a Canadian HR department that sets Canadian level salary guides. If you do interview with a company like that, be clear up front that you're looking for a US level salary, not a Canadian one.
Wish I did. I think it helped that I have a very unique skillset: web dev + robotics + GIS. So when I reach out I generally get quite a bit of excitement in return.
The Great Recession caused a huge disruption in the labor market for 7 years. Companies got used to having all the bargaining chips.
My company my brother works for put in place a lot of policies during that time frame that no longer make sense. Things like making it hard to give employees raises. And setting Byzantine salary ranges based on job title.
To complicate matters, when I was a student in the public school system, economics lessons were eschewed by teachings that salary is determined by skill level, starting with the lowest skilled workers being paid minimum wage and increasing from there.
Now that my age cohort is older and the ones who are now often running the businesses, I expect many of them are still hanging onto those false ideas. If they see the work as requiring low to medium skill, they are only going to offer low to medium pay as that is what they were taught they are supposed to do.
That's completely fair. They're struggling in a lot of ways. They've always insisted that they're simply not underpaying for any external reason and claim that's what everyone is worth. But maybe the truth is that their model can't afford to pay engineers properly. Which is a pretty bad model for a tech startup. Because then all your talent leaves, which all but dooms you.
I was in a similar boat. I worked for Canadian companies 2003 up until 2011. From there I have worked exclusively for US based companies, while I work out of my home office in Canada (Quebec). At my last job, we were acquired by a big company that had a Canadian (Ontario) presence and at that moment the gravy train stopped. Working remotely from another province meant I had to pay 2 provincial taxes throughout the year (I got some back at tax time) and forced benefits costs and I was forced to receive a Canadian standard salary, just as the US -> CAD exchange rate started increasing from $1.09 to $1.4x. I was netting exactly 50%... I got out of there pretty quick to go back to having US-Only based clients and will never go back.
It's not perfect, and there are always trade-off no matter what your choice:
US Remote pros
--------------
- (US in general) Salary is higher and competitive
- When exchange rate is good, it's so good
- you can enjoy all the benefits of living in this great country of Canada while not worrying about salary
- you generally have to work as a contractor, which generally means you have more autonomy and say in how/when you work.
US Remote cons
--------------
- You generally have to negotiate to have your Canadian holidays, and you work during American ones. Employers don't always go for this one.
- Canadian benefits/rights employment laws do not apply to you, and your job can be terminated without cause really. You are not protected by Canadian labor laws. I have been openly discriminated against (according to Canadian labor laws) and had to take it. In my US employer's defense, there was no such comparable US standard that their company was held to. I looked into it, my choice was to accept it and move on or leave.
- In 7 years working for US based companies with American colleagues, each with their own employment stories, I have come to realize that American companies work their employees to the bone, compared to Canadian companies. I have had to work 60-80 hour weeks before (for one company) and had to fight to be compensated even for time in lieu (1 hour for 1 hour), which really annoyed the owner. You may have to work weekends, you may be called in during holidays, I've had surprise deadlines for surprise features for an upcoming trade show in a week. Not negotiable. All this can be acceptable if you REALLY love your job, and/or you are compensated for it, but if not, you will hate your life when this happens.
- you have to take care of your own taxes, since you are a contractor. But tbh, the difference in salary is so vast that I hire an accounting firm to take care of it all, and I still come out way ahead (more so if you consider all the professional advice that has saved me money)
CAN Pros
---------------
- You are entitled to benefits (this can also be a con, since the average person would spend less in a given year if they only had to pay for procedures/appointments etc... as they come up)
- you are protected by labor laws
- you have automatic deposits
- you have automatic tax deductions
- you have your Canadian holidays EVEN when it falls on a weekend and you have to take it on the Monday
CAN Cons
---------------
- Salary is just silly small. Especially in the Maritime provinces and Quebec. Quebec is a surprising one, but many attribute this to the vast majority of employees being monolingual, speaking only French, thus not being qualified to work in other provinces without learning English first. Employers then theoretically have candidates at a disadvantage and exploit them by paying them WELL below industry standards. Don't like it? Move.
- Remote-exclusive work is very rare and many companies frown on the idea. Canada is so crazy behind the times in this area.
Those are really the only 2 cons for working in Canada that I have seen. Unfortunately the salary one is so bad that it makes working in Canada just not worth it at all imo. Choices
"....As with any addiction, this process produces short-term euphoria, reflected in share prices, but long-term pathology, reflected in income inequality, poverty and social unrest."
Addiction is right, but it's not limited to wages in a corporate environment. The same addiction in our overly-concentrated power structure is driving the decisions to underfund schools, infrastructure, healthcare, etc. The same "me-first" philosophy produced the recent tax law that will add billions to the deficit in the coming years.
Love it when people compile montages of article headlines that circulate every year to encourage the importation of more cheap labor.
Here's a recent favorite byline: "America’s labor shortage is approaching epidemic proportions, and it could be employers who end up paying [their workers more].
You get those incredible dueling headlines from the same media outlets of how wages are not rising fast enough, and how we need to have open borders allowing in unlimited low skill, low wage labor. Who will pick the strawberries if we don't import ten million low skill laborers in the next decade? The Koch brothers must have their cheap labor or their industrial profits will suffer. Wages must be carefully constrained or inflation might tick up a bit after a decade of the Fed proclaiming they desperately want more inflation (of course what they actually mean by inflation risk is that business profit margins will take a hit and prices might climb some - if the businesses have pricing power - due to the bottom half of workers earning more).
And that income stagnation at the median? It's amazing what happens when the middle class moves up [1], your natural population growth drops toward zero, but you import tens of millions of low skill, cheap laborers over 30-40 years: your median doesn't move up because you're treading water by offsetting everyone that moved up.
I've been thinking about this. Let's say a company has 1000 employees at $50,000 per year.
They were able to find enough workers at that rate. Now let's say they need 100 extra workers.
They'd expect their labour costs to go up 10%. But, it turns out there isn't a supply of 100 workers at $50,000. To pull in extra workers, they'd need to offer $60,000.
So far, so good. Extra labour costs are only $6,000,000, and only $1,000,000 are from higher wages. Prior total was $50,000,000.
But, you can't just pay the old workers $50,000. Humans don't work like that. You can't say "you were happy before, but these new people needed more money, so they get more"
Instead, you pay everyone $60,000. So your new labour costs are $66,000,000.
That's a 32% increase in wage costs for a 10% increase in labour.
Is there a name for this? And does this explain why companies avoid raising wages when they want a higher number of workers?
Yes, but I can't find the name for it right now. It is also the reason companies have people work overtime even though it costs +50% more because it is still cheaper than hiring more workers.
If you are still reading this thread and have not read any economic textbooks, I HIGHLY recommend you start reading some economic textbooks. It is my favorite subject, I read dozens of textbooks on my own after I read my first introductory one, and I am a software engineer who majored in computer science.
I think it is highly useful in learning the "science" behind how businesses operate and I definitely think it is useful to learn regardless of what industry you work in since all businesses are subject to the "science" of business in capitalism.
I quote "science" because you cannot really test economic theory but it is as close as you can get and it brings a lot of insights into businesses when you learn it.
I actually majored in econ :) It was extremely useful in fact. But I don't recall hearing this wage theory, possibly because it deals with a semi-irrational aspect of wages. Econ historically wasn't good at irrational things. (Using irrational in the strictly literal, econ sense)
We did talk about wage stickiness, and this is related.
I'm not sure of an exact name for that but what you're describing can be considered the theory of marginal productivity[1].
Your argument that the 10% cost in labor (to hire those 100 extra workers) is where the additional cost ends is a common logical fallacy -- those 100 extra workers will not be operating at 100% efficiency from the get-go. They will need to be trained and there will be a ramp-up period, and up until then they will likely have a negative return on investment.
What this means is that the value derived from these new employees will be net-negative for a period of time. One could say that ~10-30% of that $6M in new labor costs for the next 12 months will not be recovered.
Your theoretical scenario could result in:
* current employees departing (taking institutional knowledge with them, decreasing the efficiency of your organization)
* current employees using their hours at work helping ramp up their new co-workers (decreasing the efficiency of your organization)
* new employees taking on tasks they're not yet trained for (decreasing the efficiency of your organization)
Furthermore, some new employees will not stick around for multiple reasons (eg: family events like a spouse moving to another city, being unqualified but passing the interview process, etc), and therefore the significant investment in them will be gone for good.
Now, that said, is it better to give everybody a 10%? Of course not, but only because everybody is not equal. Raises should be handed out based on competence-based metrics (be it qualitative reports from co-workers and managers or self-reported quantitative data pertaining to their individual impact). Real bottom-line pushers would even qualify for 20% raises.
I was simplyfying to make the example clearer. The overall point I was trying to make is that adding marginal workers can raise average wages if employers pay the new workers more. (And thus, they don't, and complain of a supply shortage)
Is there a word for that?
Pointing out the "fallacy" in an incidental point I made isn't really constructive. Because I think you're agreeing that if new hires get more pay then so should existing workers.
You took as arguing that that shouldn't happen, but I wasn't arguing that.
Expecting public companies to do anything except optimize for shareholder value, is pure folly. We can debate morality all day, but there's a more practical reason for this: shareholders hold all the power over management. Regardless of how unhappy you as a customer/employee are, you do not have the direct power to fire the directors/executives. You only have the indirect power of pressuring the shareholders, and hoping they will pass it along.
Hence why CEOs and Board of Directors will optimize for shareholders interests above customers/employees/society. Because if they don't, they will get fired and get replaced with someone else who does. This is textbook Evolution and Natural Selection.
If we aren't happy with the way corporations are paying their employees, the solution has to come from outside the corporations. Demand that your government increase the minimum wage, increase the capital gains tax rates, raise tax rates for the 0.1%, and use the proceeds to fund basic income or a better social safety net. he private sector does a great job of generating wealth, but don't ever expect it to distribute it fairly.
I agree with you, however it's not easy to force government to act in the common people's interests either. You can say voting, but it's getting harder and harder to find any honest representatives to do work in good faith.
Take this example, the people voted that DC tipped workers should get a higher minimum wage, but now it's being repealed by the DC city council:
It isn't that simple. A company that does "good things" for their employees can in turn reap results from those "good things". Better employees, or employees that stay long enough to have experience both have a value that returns back to shareholders.
Of course how much so spend on those "good things" is an optimization problem.
> Better employees, or employees that stay long enough to have experience both have a value that returns back to shareholders.
You're making the argument that companies should be nicer to their employees, because that is in the best interests of their shareholders. The linked article is implying that companies should be nicer to their employees, despite the best interests of their shareholders. These are 2 completely orthogonal arguments. The first is a moral argument, whereas the second is a business-tactics argument.
Since you brought it up, I certainly agree with the business-tactics argument to some extent. Companies like Google have certainly done well for their shareholders, by keeping their employees happy. But then again, companies like Walmart have shown that in some markets, employee happiness is barely correlated with shareholder returns.
Actually WalMart is very concerned about employee happiness. The things they do about it are very different from other industries, but they results are employees that are generally happy. Of course outsiders look at it and wonder how their employees can be happy.
From what I've read, Costco is extremely generous with how much they pay their (retail) employees, whereas Walmart doesn't even try to compete with Costco wrt (retail) employee happiness and satisfaction.
Whoa, you are trying to compare WalMart to Costco. They are different companies with different concerns.
WalMart is concerned about employee happiness and satisfaction. The actions they take are not the actions that other companies take. Their employees are happy enough with the results for WalMart to be satisfied with them. That others do different things (which may or may not achieve different results) is not important to WalMart. What is important is their return on investment, they have determined that more investment wouldn't be worth it.
Of course as outsiders we can look on WalMart and make value judgements. I wouldn't want to work there. I wouldn't want to work for Costcot either. YMMV.
Raising wages however should increase shareholder value by helping them lure better talent in a competitive market. It only proves that corporate America is an oligopoly.
I'm not really familiar with any either. I'm convinced it could work well though. Especially if it starts as a consultancy and then moves into building things.
I keep reading stories about how it's a puzzle that more jobs are being created but wages aren't going up. Part of it seems to be this new ingenuity at finding marginal workers and getting them to take jobs.
Paul Krugman has a theory that the recession has made companies averse to raising wages, because it's hard to claw wage gains back if there's a recession. So instead they are offering bonuses, because if a recession hits you can just say "we don't have money for bonuses this year" which is a lot easier than saying "everybody's salary is going down." I'd say, while the cause (recession) is right, the companies are doing even more than switching to bonuses: it's also aggressive recruiting, allowing remote work, making workplaces cool, inflating the job's prestige, etc.
I wonder how other aspects of compensation like paid vacation time play into this.
I've fielded interest from a lot of recruiters and interested companies. Moderate pay increases seem easily available - the sticking point is that they will all fight tooth and nail for anything beyond the bare minimum of vacation time. I'm in my late 30's with kids, and my wife is a doctor. There really isn't a realistic pay raise that is worth losing weeks with my family every year.
I wonder how many other people in prime earnings ages with families are running into this resistance from HR departments - it feels like a successful anti-competitive strategy to tamp down on turnover and wages.
The tech industry is unwell, in our case despite abundant cashflow it's based in the completely irrational.
Your salary would be a full 10-20% higher with average turnover numbers if it weren't wasted on modern tech recruiting practices. And your company would quickly have less than average turnover number to boot. You'd get organic interest, and would properly pay attention to employee and manager referral.
Hiring practices are almost entirely cargo cult, and much more value for companies is being destroyed in all these terrible HR practices that have been latched on to. To me it appears like empire building and a complete lack of understanding in how and who works.
I remember working for a startup a few years back. When I joined it was kind of "scrappy," and I really couldn't negotiate for market rate. It didn't matter, though. I loved the job, and really wanted the early-stage startup experience.
A year later we were in a nicer office, and definitely not "scrappy." We interviewed a lot of candidates, and when we made an offer, it was always rejected. Why? We were too far below market rate. At the time, I still loved the job. (It was also a very short commute by bike.)
Another year later (two years after I started,) we were acquired by a large, and very profitable company. People started demanding market rate or leaving.
The point is this: People work to get paid. Crumbs work for a short period of time, but at a certain point, people's lives move on. That's when employees jump ship because they need the extra $20-50,000 / year. Many people will choose better working conditions over the highest salary possible, but the difference should be very, very minor. No one's making a lifestyle change because your office is cooler than the one down the street.
I wonder to what degree company size and current employee wage plays a role in this (in the U.S. the pressure to not share salary with coworkers tried a wrench in this theory).
Given a shortage, raising starting wages would encourage people to change jobs, however employees (recently hired or existing) before the increase would also want that new increased rate.
Combined with companies hiring thousands (think Walmart) a wage increase becomes multiple millions per year (that's a lot harder to sell to a board)
"That money won’t disappear, of course—it will go into the pockets of workers, and then find its way back into the coffers of corporate America via higher sales."
Do people really go out and spend money immediately if they get raises? Personally, if I get a raise, I may treat myself to something nice, but then I immediately go back to my old spending habits so I have more money to save.
For anyone who hasn’t already, I would strongly suggest that you read/listen the “Rich Dad, Poor Dad”. It speaks of the “Rat Race”, where once you increase your income by a fraction, you almost immediately and subconsciously adjust your needs to absorb that increase.
I think this is one of the books that everyone over the age of 15-17 should read as it gives a crash-course on the fine art of making money.
This book, together with the minimalists’ work influenced me to change my work style and other habits and now I feel more focused, clutter free, and with significantly more €$£¥ in my pocket.
I have read this book and I would recommend as an alternative "The Richest Man In Babylon." It is more clearly a book of parables about building wealth and less about the route one person took to financial success.
I'm not saying there isn't usable advice in that book, which I have read, but in full disclosure, the book's author, Robert Kiyosaki, fictionalised most of the anecdotes contained within it.
Additionally, he operates a real estate "investing" school that advocates and instructs semi-legal, morally questionable predatory practices.
It is openly modelled after Trump University, Trump being Kiyosaki's business mentor and aspirational avatar. They have authored at least one book together.
> Additionally, he operates a real estate "investing" school that advocates and instructs semi-legal, morally questionable predatory practices.
Yeah, it's 90% trivial platitudes about "buy low, sell high" and "invest your money wisely", and then a few pages about how he actually made his money (if that part is true, anyway): Haunt foreclosure auctions to flip the houses. Skeezy.
So he says to buy low and sell high, and he made his money by buying real estate cheap and then selling it higher? I have absolutely no background on the guy, but that doesn't sound "skeezy" or even inconsistent; what am I missing?
Why is that skeezy? If the house is at a foreclosure auction, it's being sold whether he buys it or not. If he buys it, he's paying more than anyone else was willing to.
I assume anybody reading that book understands that "Rich Dad" is mostly literary device, probably loosely based on an actual figure(s) and a few key events or experiences.
Nobody remembers conversations they had word for word an hour afterward, let alone decades.
..and the “Rat race” I mentioned on a previous comment above is that exactly perpetual effort to cover that +25% as you very correctly stated of “more expensive lifestyle” that we impose to ourselves.
It doesn't really make sense to say it because it's not as if there's a general cultural tendency towards shrift. Most people aren't saving enough, what's the point in popularizing the message that we should continue on that same course?
Saving never really makes you happy, it makes you feel secure. Seeing a number in an account rise over the years is great, but also a constant reminder of money you’ll never get to touch until you are old and gray, if you even make it that far. And even if you do, what if the world of the future is no longer worth exploring or even living in?
Is it more important for people to feel happy, or secure?
Security is a part of happiness. It is finding the right balance.
Modern medicine is advancing all the time. You could be old an grey for many years. You could live to be 170. If you live to 170 and save well you could retire at 65 and live the last half of your life with more income from savings to enjoy life than if you work until 170 and spend every penny as you make it.
Of course you could also die in the next few minutes. You need to find that balance.
Drop natural population growth toward zero. Import one million low skill, very low income persons per year.
Welcome to the non-merit, non-point based immigration system treadmill of never getting anywhere because you perpetually flood your system with cheap replacement labor.
Tens of millions of Americans moved from the middle class into the top two economic tiers since 1970. And we replaced them with vast amounts of low cost imported labor. If you keep doing that, you will not see meaningful wage growth at the median, you'll only see it in the top tiers.
Most other developed nations are once again correct: the US should move to a common sense points based immigration system. We could merely exactly copy Canada on immigration, and that would dramatically improve the conditions for workers at or below the median.
I don't think the hedonic treadmill or that link has anything to do with your statement "the average person spends almost exactly as they make as income rises." The hedonic treadmill says that happiness is eventually independent of income and savings. So, eventually, whether someone makes $1mm/year, saves none of it, makes $1mm/year, saves $500k, or makes $30k/year, saves none of it, s/he'll have the same happiness.
Also, your statement is false. The average higher-income person saves both more money on an absolute basis ($ amount) and on a percent-of-his/her-income basis.
An individual employee may do almost anything. But most of them won't decrease spending when given a raise. Some may spend exactly the same as before. The rest will spend more. Do those who spend more outnumber those who spend less? I have no data, but I would be astonished if those who spent less outweighed those who spent more.
That's not a claim that I make, nor one that I think is relevant.
What would I do with more income? Well, I'd probably save some of it, use some of it to pay down debt, and spend some of it. I don't have to be spending 100% of my current income for that to be true.
For most people? Yes, absolutely. Most people aren't paid enough to cover their needs + enough of their wants to keep them happy, never mind savings. We have a very different perspective to the average worker in tech, where we're usually paid well above our needs + many wants.
I guess my experience differs. Before I moved into the tech world I worked at a law firm for peanuts. When I got a $1/hr raise I went out, bought a bottle of whiskey to celebrate, and then didn't increase my spending at all. Any money I got from that raise went right to my savings account.
When you say "peanuts", do you mean "peanuts relative to what we get paid in tech" or "peanuts relative to the actual average wage"? For reference, the overall average wage is in the range of $6-800/week.
Don't buy that. I think it's the media. There are so many reality TV shows and the participants are living in nice houses, driving nice cars. Even movies are fucking unrealistic, you can watch a movie about someone earning minimum wage, yet they live in NYC, in a massive apartment with high ceiling or drive a nice car. The rubbish on TV, both fiction and nonfiction are so far from reality. Yet most consumers desire for that false reality and spend more than they ought to.
Looking at my companies parking lot, I see BMWs, Mercedes, Range Rovers, Escalades, Maserati, Porsches, and tons of new cars, etc I'm in Detroit of all places. We're not getting paid like that!
Most people have new iphones, ear pods, the other day I was in a meeting with about 12 people, 9 of them where wearing iwatch. I can assure you that for the majority it's a fashion statement more than a need.
Fancy phones and watches are, given the current state of most carriers, not actually _that_ much more significant an expense than a cheaper device month to month.
You can "buy" that explanation or not, but there's a lot of research and evidence backing up the idea that a huge fraction of the western world lives essentially paycheck to paycheck, and it's not because all of them are less financially savvy than you or I, who just happen to get paid well above average too.
A good TV and nice phone are not usually the kind of expenses that drive people into having no savings. If I go grab an example from t-mobile...
A brand new, shiny iphone x for somebody with good credit is gonna run us $30/m. That's kinda pricy, so let's go a few generations back and get a refurbished iphone 6s plus - they won't let me go to older generations. That'll cost $22/m. So sure, yes, that cost adds up - but $8/m extra in savings is not going to be the difference between somebody living paycheck to paycheck or suddenly being flush with savings.
Never mind reality TV - _actual_ reality is that a large percentage of the population of basically every first world, western, developed country is paid at such a level that any raise is just going to go directly back into the economy because they aren't paid enough for savings to be a high enough priority to happen. This isn't financial illiteracy - both of us put a _lot_ before savings, it just happens that once we've done that we still have a bunch left over. Lots of people don't.
My advice is you make sure you have your savings in gear and then live paycheck to paycheck. That is you fund your 401k (IRA, HSA, ...), and set aside some emergency savings. However unless you have a specific short term goal in mind you should be spending everything else and enjoying life to the best of your remaining income.
Of course that $8/month difference isn't much savings, but it is a lunch out vs heating leftovers one day. Or you can eat leftovers everyday, save that $8/month on the phone and use all of that savings to buy membership at a golf club. This is your life and your choice, what do you want?
yes and no. Most people do live that way by choice, but they don't really realize they are making a choice. You need to pay rent, but very few people live in the cheapest apartment they can find. You have to pay bills, but you can make them much cheaper (it means you hang out in local parks because there is no TV, internet, and you avoid even so much as turning on a light). You need to eat, but beans and rice are cheap.
How much savings you need is an open question of course. To live as above without income doesn't require a lot of savings, so you start saving less and add some luxury.
Placing your wants in check does wonders to keep cash in your pocket. If some people burn through their cash to feed their conspicuous consumption then obviously that doesn't mean they are poor or in need.
You're right, that line doesn't make sense, although not for the reason that you are giving.
It doesn't really matter if you spend your raise or not. If you put your raise in the bank, the bank will spend it by either lending out more money or investing it.
For the same reason, for the economy it doesn't matter much if the company spends its money on employees or on shareholders.
In the situation of low wages what is supposed to happen is the best workers either (a) move to competitors or (b) just strike out on their own and start their own business. If businesses are colluding on low wages (and it's very clear they are) then eventually we should see people starting new businesses.
This dynamic by the way is absolutely clear in East Asia and China, in particular. Wages are rising fast and the best workers aren't afraid to bounce away for higher salary or, if it comes down to it, to buckle down and strike out on their own.
But this dynamic has been completely lost in the US. Even as the economy "improves" we are seeing labor market fluidity has collapsed the US [1]. This has been going on since the 80s. Entrepeneurship and new firm formation have been declining for the last 40 years [2]. The end result: lots of people stuck in jobs they don't like and businesses, knowing full well that their workers are stuck and won't go, offer essentially zero wage increases.
My advice to employers is what a lot of companies started doing when there was a gold rush of developers and people were scarce. Find a few average devs or newbies with little or no coding experience, train them into your "system" and then work to promote them up into senior positions and give them a reason to stick around.
My advice to devs is get a role at a company, get into the habit of being able to code on a daily basis, grow your skills, then jump ship, or angle your skills for an increase in pay. The important part is coding every day and getting better at your craft. Sometimes getting paid less and acquiring skills is more important for the long run than simply turning offers down because you think it's not a good salary or hourly rate.
But be careful... I did this back in the late 90's; I changed jobs four times in four years, getting a 25-30% pay increase each time. Then one day I tried to do it again, and they told me up front, "we're not interested in hiring you because you change jobs too often". Although I eventually did find something and have kept each job I've had since for at least 3 years, I'm pretty sure my "shady job hopping past" cost me a job opportunity just a few years ago.
Job-hopping is no sin when you can get a 25% pay increase whenever you do it, and companies will only give their retained employees 2.5% raises (while cutting their benefits by 5%).
Job-hopping is no sin when you are an "at will" employee with no contract. Some companies think nothing of firing 10% of their employees every year, and replacing them with fresh faces. Is that not the same thing from the other side of the table?
The company who rejects you for job-hopping is explicitly rejecting your self-agency and your right to continually re-evaluate your business relationships, in exactly the same way that companies do when they fire bad employees. You fire bad employers. It is no different. The relationship is work for pay. If they want you to stay, they have to ensure that relationship stays mutually beneficial every week that you work for them.
No, don't be careful. If there is no contract specifying otherwise, you owe your employer nothing next week, and they will owe you your pay for this week. That is all. Corporate loyalty is dead, and the corporate employers killed it. It is not our fault that the harvest they are now reaping is bitter in their mouths. If you are offered higher pay somewhere else, start there next Monday, and tell your current employer on Friday that you won't be back next week.
We have all done it in this industry. 25% more is too good to pass up, and they know it.
Let them be the ones to start offering contracts with severances and notice periods and guaranteed raises and bonuses. That company who won't hire job-hoppers will find that word gets around, and qualified people will simply stop sending their resumes and entertaining interview requests.
In the north you get paid more but I think your buying power is pretty much the same.
From a quick google, a postdoc can expect something like 2500per month in sweeden,
but how much do you need to spend on rent and food etc there?
In any case, I did move some 7 years ago, but the whole thing is depressing, you know?
I can give my work to some capitalist megaCorp and get paid nicely, or to the public and get paid shit...
Yes, many employers have deflationary expectations in an inflationary environment. The most difficult part about disabusing them of this notion is that there are still too many current and potential employees who are all too willing to encourage this.
That's why I implore people to 1) know the value of their labor; 2) do the math concerning their (long-term) cost of living. Lots of folks seem to think that they can take a pay hit here or there just to get a foot in the door or tide themselves over, not understanding that they generally setting the bar for their future pay 1) because many (at least US) employers will ask for salary history; and 2) even if they don't, the information is probably available via a data broker.
Why would they pay more, if they just hold out long enough, someone will take the job. If enough companies do this, a new wage rate is established.
We are in a strange time with globalism, companies are in a race to the bottom in regards to employee pay. Employees are losing negotiating leverage as their employer can simply turn to emerging markets to hire talent for half the price. Granted that talent may not be as good but they also save on benefits.
There is also a critical level where if enough companies are paying low wages, the employees cant just threaten to go somewhere else and make more, there is no where else. So they have to eat and take the lower salary job, setting a new lower median wage for the market place. Meanwhile the cost of basic goods continues to rise.
Communism is nonsense, but Marxism has a very important point in that the primary driver of world power is not countries but classes, those that hold the means of production and money against everyone else.
You have to be dumb to believe the employers and their lobbying industry that there is a shortage. By definition, there cannot be a shortage. This is basic economics 101. Workers exist and they want to work. If business owners won't pay them, that's not a shortage of workers, that's a shortage of competent business owners. In other words, these business owners are not competent enough to run their own business. I hope all of them go out of business because of that. What a bunch of inept, greedy scumbags. Instead they go on the internet and other places and cry about shortages like babies. These people have no human decency at all. They will do anything for their greed. I wish the masses weren't so dumb to fall for this kind of stupidity. This particular article is rather refreshing as it cuts through some of the bullshit. Here's some ideas for these incompetent business owners of how to get and retain employees:
* higher salaries
* work from home
* 25 - 35 days vacation to start, increasing every year
* guaranteed 2-8% raise to compensate for inflation every year
* bonuses
* Fridays off in the summer
I could go on and on and on but it's stubbornness that makes these business owners so greedy, not the lack of good ideas in how to hire. I hope the market turns against them and they go bankrupt.
I'm not sure the premise of the title - that employers will do almost anything (or anything at all) to find or retain workers - is accurate. Setting aside pay - will they offer livable working conditions, or will they cram everybody elbow to elbow in a noisy airplane hangar with no dividers like cattle? I don't see that any employers, anywhere, are doing anything to find good employees, paying more being just one of the things they're not doing.
Labor ‘shortages’ are simply an excuse to import cheap labor. There exist talent that will take a discount on pay for the fringe benefit of immigrating. This in effect is a community subsidy to the company. This is one reason why lobbying is a hugely profitable enterprise. Eventually the community becomes too taxed and social problems occur and we get populist uprisings. I consider this both an unfortunate and an entirely predictable outcome.
It'd be funny to change some of them and show the problem as being caused by the companies. Instead of "Great job openings, no candidates" it could be "Great skilled workforce, no employers".
https://money.cnn.com/2009/11/03/news/economy/jobs_sit_open/...
Well, I guess, this may be good. If a lot of dollars seek few resources, and resources pool does not increase much, you get unbounded price increase.
Which is not good. Developer have to do something productive for economy. Their wages should be bound to value they produce. If they are consistently paid more then they are producing, whole sector is heading into collapse.
In healthy job market, job ads are going to attract employee with salary based on value that employee is going to produce. Failure to attract her does not mean someone is irrational or wages are low. It just means there is a lot of low-value work for developers in this world. Someone will notice that and maybe innovate those jobs away or something.
Replace Developer with maid in your post and read it again.
I don't have a maid, instead I clean my own house, and drive my own car. My understanding is in India people with half my income would have maids to do those tasks. However in my country the value a maid produces isn't as much as their value and so I don't pay one. I know what a maid would cost (some advertise in my local newspaper), and they are not worth it.
Same with developers. If the wages go too high some things we could automate will no longer be automated.
Quit rewarding these companies but staying at your job. No one gets the golden rolex anymore and there's no pension. The advice of 'find a good company and stick with it' no longer applies.
yeah i work currently as contractor around 30 hours per month from home for Chinese company without any commuting anytime i want to cover expenses of my family
on the other hand i could work 160-170 hours per month for local EU employer and get like double salary (a bit more with bigger retirement savings and paid vacation)
somehow i am not rushing to get stable job and get employed locally to work five times more plus wasted time on commuting (so make it six times more hours wasted on work) to earn double salary
I work 30 hours a week for a US firm, working remote and finishing up raising my kid. I could probably multiply my income by 1.5, but I'd have to work 15 hours a week more and come into an office.
I've had several interviews with people but no one seems to understand how much they would actually have to pay me to come into an office because they are used to discounting the time spent commuting as if weren't time they should pay for; they think I am crazy for calculating that as time for which I should be compensated.
similar, though i said 30 hours per month, not per week
also i have two small children, nobody will pay me for priceless time away from them now they are both under 3, i feel sad for people seeing their children in evenings or just weekends
Yeah, I caught that... I haven't figured out how to get the hours down to that, but I am working on it. Mostly I just end up doing stuff like visiting my parents while I'm at "work".
I have a 17 year old and basically have ended up remote working just to be around him and his sister. For me, that's definitely a thing that I feel like was a great deal for both our lives. Also, now I'm just turning 40 and he's graduating high school, I've started traveling and working that that's also quite fulfilling.
I feel sad for those folks to- it's not a judgment thing, I just know how much I got from being around my kids and how much I personally would have lost out on.
The phrase "the harvest" is used at least two times in this piece in a similar way:
But it didn’t take long for CEOs to divine the wisdom of a viewpoint that hit them where they lived, in their wallets. The harvest has been decades of increasing income and wealth inequality.
I find it to be very odd, the author is Pulitzer winner, so there's that I guess.
This makes sense. It’s very hard to 1) pay new hires more than existing employees, or 2) ever reduce anyone’s salary. So raising salaries to hire people means raising everyone’s salary in the company, permanently. Not a good idea if your employment needs may be the temporary result of a bull economy.
Maybe software developers should create a union or something like that? Maybe the fact that unions have been destroyed since the 1970s has something to do with the wages not increasing that much anymore?
Wages are not the only issue here. If you look at inflation, the price of food and energy has increased massively since 1999. I know economists like to exclude these figures in their computation of inflation, but they sure do put a dent in the regular workers wallet. I can remember paying 99 cents a gallon for fuel in the late 90's. Now its $3.49 a gallon. I can think back even farther to the 1980s when you could get a meal for $3 at a fast food chain. Now your shelling out $8 - $10 for the same meal.
Unfortunately, our website is currently unavailable in most European countries. We are engaged on the issue and committed to looking at options that support our full range of digital offerings to the EU market. We continue to identify technical compliance solutions that will provide all readers with our award-winning journalism.
You might want to indicate that this is a quote from the web site, not a statement of yours. I'd suggest to edit it and to add asterisks around the text to make it render in italics.
Maybe they don't care about European readers. I'm European but they are from Los Angeles so I don't complain. Would I comply with a US law if all my customers were in the EU?
To be fair, they're probably blocking also US readers occasionally or permanently in Europe. They could be annoyed by that.
> Maybe they don't care about European readers. I'm European but they are from Los Angeles so I don't complain. Would I comply with a US law if all my customers were in the EU?
But they say, "We are engaged on the issue and committed to looking at options that support our full range of digital offerings to the EU market." Surely a company wouldn't lie on the Internet?
> To be fair, they're probably blocking also US readers occasionally or permanently in Europe. They could be annoyed by that.
I am. I'm a registered voter in LA county living in the EU, so I consider it pretty important to stay informed of LA, California and US issues, and the LA Times used to be an important information source for me.
I’d like to earn more, but I also want the market to keep on going up for my retirement investments. At mid career, my 401k performance over the next 20 years is now market driven, rather than by contributions over the next 20.
So at this point, I’d rather have better investment returns than a higher salary.
Everyone does. Hell, I do too. But it's not realistic to expect this music to keep playing. The ratio of workers to retirees keeps getting worse, from 10:1 in the 1950s to 3:1 today, and falling.
The economy can grow over time, but on any given day it's a fixed pie, and it has to be divided among workers (who are doing the labor now) and retirees (who accumulated the capital in previous decades that today's labor uses to magnify their productivity).
Everyone is feeling squeezed as individuals because of falling incomes, but the real culprit is a falling ratio of income-makers (labor) to income-takers (capital, whether retired individuals or just wealthy).
This cannot last. The ratio of labor income to capital income will eventually be restored (hopefully in a peaceful manner, but we can't rule out alternatives). The reasonable fix will be raising retirement ages, but good luck getting a sufficient raise there to restore a 10:1 ratio.
And Wal-mart shares rose by 8% in the year after they announced wage increases.
The broader issue is that shareholders have deluded themselves into thinking that they are the end-all-be-all of a company when in fact their contribution is limited.
Taking the French example: I'm an freelancer, but I used to have a contract with an American company.
They gave me 3x the salary most of my French colleagues would get, while keeping the exact same social advantages (they paid me through a French branch).
However, to them, the salary was twice lower than what they would have paid for the same guy in the Valley.
Now as a freelancer, I move a lot from companies to companies, and I hear the same complaint over and over: we can't find good devs.
But when I look at the job offers they publish, it's full of buzzwords and cool attitude, yet the pay is not remotely matching the skills they are hiring for.
You want somebody speaking 2 tongues, coding expertly in 3 languages (e.g: server lang + js + css), knowing a bit of sysadmin, ergonomics, architectural design, data base, and capable of understanding your undocumented stack du jour + infra.
No, you can't pay that $2500 a month.