It correlates with how much a business will be ultimately willing to pay a developer, if they have to.
If I'm making a $1M profit on you, I'll be willing to pay you up to a high fraction of this amount if I have to. Financially, even if I pay you $950K, I'm still making money. Assuming my business scales, I'd hire as many engineers like you as possible, and pay them the same. Why not? I'm making a profit for each one. Great deal for me.
Of course, if you're willing to work for $100k, I'd rather pay you that instead. Hell, I'd rather you worked for me for free!
If I'm making a $1M profit on you, I'll be willing to pay you up to a high fraction of this amount if I have to. Financially, even if I pay you $950K, I'm still making money.
Where does the money come for dividends, taxes, and overhead?
If there is enough supply of engineers at the same quality, no one will pay more.
Obviously, I'm keeping it simple. My point is, profit per engineer does have a lot to do with how much I'm willing to pay that engineer. I'd rather pay as little as possible, but if necessary, I'll pay almost as much as I make in profit, because I'd still be making money.
Agreed. SV is different from the rest of the markets, and it is the main reason why it attracts so many engineers from all over the country (hell, from the world).
Although I don't regret the time I spent outside of SV, from a financial perspective as a single young engineer, it absolutely, 100% makes financial sense to consider opportunities in SF that compensate you so well.
>Agreed. SV is different from the rest of the markets, and it is the main reason why it attracts so many engineers from all over the country (hell, from the world).
In my case, SV is so different that it actually made me want to leave. Personally, I can't recommend SV to anyone if monetary wealth isn't the only goal.
That does not necessarily correlate with salary. At least it doesn't outside of SV.