Yes, almost everyone does this. It's just opaque in most cases. I will say that, assuming they follow their adjustments literally, you do have some odd situations. Your ideal strategy to maximize comp vs. cost of living is to live in a state where the comp for the whole state is set by a relatively high CoL city but to live in a lower cost area in that state. (At least that was the case last time I looked.)
[ADDED: Although it looks as if they've made their calculator more granular so that high CoL city doesn't carry over to other areas as much.]
I totally understand why a company won't hire from Iran, North Korea, Syria, Sudan, Cuba, Crimea – exposure to US sanctions threatens to cause severe negative repercussions.
But, why single out France, Italy, Spain, Romania, Sweden and Austria out of EU member states? What problems do they have which other EU member states lack?
Similarly, if Argentina and Brazil are a problem, what about Chile, Uruguay, Paraguay, Venezuela, Colombia, Ecuador, Bolivia, Guyana, Suriname, etc?
Likewise, why would UAE be a problem, but not Iraq, Kuwait, Saudi Arabia, Qatar, Oman, Yemen, Jordan, etc?
Must be related to employee rights, either something highly specific that is a dealbreaker to them (what would Austria have that Germany has not?) or it's a growing list based on precedence, likely full of permanently encoded biases depending on whoever was the initial candidate.
It's mostly related to employment entity complexity vs. organizational demand for that location.
To operate legally as a business in most of those countries on that list adds complexity that leadership has deemed "not yet". Doesn't mean forever, just means, not yet. I've seen countries come and go off of the list.
In Argentina, same pay for the same job is a constitutional right. If they hire someone here they would get a lawsuit asking for Silicon Valley payment.
UAE has weird bans on many VOIP solutions, also VPNs are in a bit grey area - I guess that would make remote work too problematic with the tools they use internaly.
I ran into this while doing work for several companies in Oman, their state telecom provider is in a monopoly position for voice calls, and the VOIP ban is to push business to them.
They had some pretty ridiculous workarounds, like using teamviewer for its voice chat function.
When you sell physical stuff worldwide, nobody will be surprised if you won’t ship to some select countries because of local safety regulations, bad postal services or other local difficulties. When you hire people, these local difficulties increase tenfold, and I can totally understand why GitLab does not hire everywhere.
You may also notice that in most “first world” countries they hire through a proxy (listed in the same file), and it seems like in “no hire” countries they just couldn’t find a proxy yet.
Ouch, even within Australia they have large discrepancies between capital cities. One of the reasons why remote work appealed to me, was that I was hoping to escape the unfair wage difference between cities. The fact GitLab maintains it despite not having to pay for real estate in the city you work from is totally unreasonable. Same work, same pay. I'll never apply for them.
Is it unreasonable for a random Indian company not to pay the same wages as one in SF (assuming the work is the same)? What about if both companies are consultancies doing projects for Gitlab? If differences in those cases are fine, why is there a sudden change if the employees of the above companies start working for Gitlab directly rather than through a proxy?
But I think that if GitLab is able to pay somebody in the US one wage for work, and they hire somebody equally qualified in Australia that will be producing the same work, they should be paid the same. Well, it's up to GitLab to decide what they're paid, they shouldn't be forced to pay them the same, but I wouldn't work for a company that didn't.
I'm also surprised GitLab are away to get away with it with all the fuss made recently about discrimination. Is this a form of geographical discrimination in terms of unequal pay?
I'm not sure anyone here is a big advocate for off-shoring as a cost savings measure, and I don't see anyone in this thread defending it as a practice.
They can set their salaries however they want I guess - none of my business. And it must work for them if they're hiring the people they want.
But I looked at GitLab's compensation recently when I was switching job, and even when I maxed every thing out (not saying I'm that good) the pay for the UK was terrible - completely unworkable for a professional software engineer on the global market. I think they had the UK as having lower cost of living than places like the Czech Republic. I know for a fact that cost of living in the UK is not lower than in the Czech Republic. But worse than that they had these little islands of reported higher cost of living. Individual cities like Bristol. I suspect someone influential lived there and wanted to be paid more and they managed to get a special case.
I think I earned more as an intern while a university student with another company, than GitLab's top-tier engineer salary.
The location factor applies to anyone living within commutable distance or 1.75hours / 1hr 45 mins. So someone living in central Brighton would be in the London location factor.
I hate to break it to you guys, but the reason Shitsville, TN has has a higher multiplier is not because someone at Gitlab is terribly confused about the relative cost of living in Shitsville, TN vs Paris and London.
Google does the same thing, they just aren’t this transparent about it. In fact every company I’ve worked for has a COL multiplier in their comp plan. It’s odd seeing everyone bandwagon on this about Gitlab as if it’s an uncommon practice.
> What I don't agree with is the pay scale they use based on your location. If you have the same skills, you should be paid the same.
This chain seems to have lots of excuses for not paying same salary for same value added, but I think it is about the same as the thing with sweat equity being somehow less valuable than cash equity.
Only real reason they f#ck you is because they can.
Salaries are in large part determined by local factors: cost of rent, food, gas/public transport, tax rates, etc. There is no "universal" salary for a particular position. Developers in San Francisco are not paid 3x of those in Des Moines because their skills are 3x better. Their salaries are higher because living in SF is more expensive. If the cost of living in SF were lower, the salaries would be lower, too.
If anything, pushing for a worldwide universal salary would likely lower earnings of the top X%, simply because most of the world isn't as expensive as SF/NYC/London.
Software companies like Gitlab don't address a local market. They target a global market, which is the same no matter where you're based and no matter where your employees live.
If you can afford to pay San Francisco developers a given salary, you can afford to pay Des Moines employees as much.
Let the employees benefit from their cheaper location rather than taking that away from them. Otherwise where is the incentive to declutter cities?
> If you can afford to pay San Francisco developers a given salary, you can afford to pay Des Moines employees as much.
That’s not really true. There are companies with a few employees in expensive locations and many in low income regions. If you switched everyone to the same salary you’d bankrupt the company. I certain don’t assume to know what Gitlab’s financials look like.
What if a company is paying above market rates for all their employees in their chosen locations? As a thought experiment, assume each of those people was the most suitable employee in their field. You’d pay them what they wanted in order to make it work. What if one of those people had a special situation with say dependants? Would you pay them a little more to relive that so they could work for you effectively?
> That’s not really true. There are companies with a few employees in expensive locations and many in low income regions. If you switched everyone to the same salary you’d bankrupt the company. I certain don’t assume to know what Gitlab’s financials look like.
There's a slight of hand going on here, where you at first assume all employees are fungible, to mention it's not possible for some firms to pay all employees the same.
But then you ignore that, before someone is hired, when they're merely a potential-hire, they _are_ (basically) fungible with all the other potential-hires. If you can afford the most expensive one, you can afford the cheaper one.
No one suggested paying everyone the same huge amount. But if you are paying Huge Amount X, that can go anywhere.
But that is the reason why San Francisco has higher pays, there is a huge competition between employers. In practice what you propose is not to hire in expensive places.
Which is what many companies do in practice. Say there's a company that's not in the Bay Area and has some potentially remote openings. As a Bay Area resident, go in demanding a FAANG in-person salary and most of them will laugh at you unless you're someone very unique who they need.
I mean, I strongly encourage all people who, when presented with the option of getting a very good deal on an expensive and valuable thing, to take it.
In equilibrium, you'd expect someone's programming skillset not to massively drop in value because they moved slightly far away in essentially the same legal jurisdiction. Until we reach that equilibrium, there is money waiting to be collected by firms who hire American engineers to work remotely.
In my understanding when you move away from hot-spots like San Francisco it is not your skill that loses value, but you that lose power in asking for an higher salary.
Also it is not that devs in SF are especially good; I would guess that the distribution of skill is power law (specifically the number of devs in the global n-th percentile as a function of the total number of devs in the hiring pool) and it might be argued that the competitions is counterbalancing any positive effect of that.
In the end it is a position of which job market do you want to be in.
Are the employees in San Francisco required to be there? If so, yes they should get San Francisco wages. However for people who can work anywhere it should be the same wages - if you want to live in San Francisco don't work for us we will hire the cheaper people in Des Monies who are just as good. If they can't hire people in Des Moises cheaper that means they are not paying enough
I am making a more fundamental point, which is that the current developer salaries (in general, worldwide) would not be as high if the cost of living were not high in the specific places where software companies congregate. These high salaries would otherwise not exist, because they are not based on an objective skills or supply-based metric. It is not as if SF developers are 3x more skilled than Des Moines ones. Clearly the assumption that salaries should factor in the cost of living is a factor.
In a lot of ways, this extremely high baseline benefits everyone else in the industry, even if they don't directly work in SF/NYC/etc. The salaries of Des Moines developers are probably higher than they would otherwise be, as compared to other professions.
And while it's nice to think that companies should pay people the maximum amount of money that they can afford, this is unfortunately not a rational economic move and it will collapse the moment any financial difficulties come into play.
> because they are not based on an objective skills or supply-based metric
Then you have to ask why do these clusters exist - with high skills, high salaries and high costs?
In my view, that's because there is value created by proximity.
It is more productive to have people co-located in the same office.
Also if you live in a major university town, or high tech area then that accelerates the exchange of ideas, particularly outside peoples direct areas of interest. This makes for better networked, more creative employees.
Co-location of companies also increases the chances of collaborations and deals.
The context here is an all-remote company though. As such they have rejected the advantages of proximity. They should be searching out the great but cheap people who want to live elsewhere.
But if those great people have any sense they will be working for a company that recognizes and rewards their skills and not simply offers a rate based on the area of the world they are in.
ie great people don't want to be competing on cost for work, unless they can capture some of the value of their greatness.
eg price for work completed rather than by the hour - so if they finish it in the half the time then they keep that value.
On the other hand, people currently average skill or below ( half... ) are more likely to be better off being paid by the hour.
So if you take a pure economic view, and everyone was behaving rationally, then a cost based hourly recruitment model gets you average and below workers.
ie you get what you pay for at equilibrium.
Of course what they are hoping is to exploit not being at equilibrium - countries with relatively high skills and low costs.
However they are going to be competing with companies based in those lower cost countries ( eg India ), who have both the low cost environment advantage and the ability to recruit locally and better select and retain employees.
My experience of working with even locally based companies that compete on price is high staff churn ( as the good ones find better employment ) - which really damages productivity.
TBH, if I were running an all-remote company, I'm not sure how hard I would try in general to match comp with big Silicon Valley employers. It's actually not clear to me that GitLab really does either. The pay scales for other popular cities are only about 10-20% below SF.
The phenomenon where of Googles/Facebooks/etc. offering mostly very attractive comp in spite of Bay Area CoL is actually relatively recent. Going back a couple of decades I looked at some employment options in Silicon Valley and the comp uplift wouldn't have covered the higher CoL relative to Massachusetts. And the companies freely acknowledged this.
We are addressing a global market too at TransferWise and London developer salaries are way different than Budapest salaries. We are also not a remote company... until next week :)
It's reversed. Living in SF is more expensive _because_ the salaries are higher but space is scarce. Salaries are higher because of concentration of high-tech companies which make a lot of money and are not neccessarily pressed to hire cheap. If they were, they'd move these jobs to India anyways.
People come attracted by good jobs, but it turns out it is hard to find a place to live with a good commute. The demand drives prices high.
> Salaries are in large part determined by local factors
Salaries should be a function of value produced amortized across the convenience and reliability of a predictable salary for the employee. Where I am sitting has no bearing whatsoever on the value produced and it is the primary thing that prevents me from pursing a job at gitlab.
Also this argument ignores the side benefits having an enormous salary offers you. (e.g. X% into your pension is a bigger number)
> If anything, pushing for a worldwide universal salary would likely lower earnings of the top X%
If you're refusing to pursue a job at Gitlab because it would pay less then the market rate where you live then the issue isn't that their salaries vary geographically but just that they don't pay enough in your area. If you you object even though they pay higher than your local market rate then you have a weird aversion to money that I don't see a reason for anyone else to care about.
I currently live in a major city but have plans to move to a lower cost rural area. If I did that while I was working at Gitlab they would slash my salary and reap my cost saving, do you think I would be generating less value for them in exchange?
There are two answers to this. One is "No, but prices aren't determined by 'value'. Having air to breathe is very valuable, but it's free! You've got to consider supply as well as demand." The other is "Yes. Previously you were the most efficient source of code per dollar they could get (on the margin). Now you aren't."
> Salaries should be a function of value produced amortized across the convenience and reliability of a predictable salary for the employee
Salaries should be the equilibrium price where an employers willingness to offer a salary meets an employees willingness to accept one. The only surprising thing about their scale is that they’re willing to hire people in high cost-of-living locations at all.
There are lots of things, but one valuable thing is to build strong social connections [1] and trust [2] with your remote colleagues. For example by regularly getting the team together on video calls to discuss topics unrelated to work. And sharing a meal at the same time. Small things that make a surprisingly big difference.
> If you have the same skills, you should be paid the same?
Why is that? I don’t necessarily disagree with your statement. But why would it be fair for someone of equal skill to be able to afford less food and healthcare just because they live in a place with higher prices and higher taxes?
Should everybody be incentivized to relocate to a developing country or tax haven because of the internet and your equality rule?
Why would it be fair for someone of equal skill to be able to afford less food, less healthcare, less living space and fewer gadgets for themselves just because they have a bigger family and more kids to support? ;)
Generally what you do with your money should not be a business of your employer.
> Should everybody be incentivized to relocate to a developing country or tax haven because of the internet and your equality rule?
You're silently assuming the quality of life in developing countries is the same as in other countries and the only thing they differ with is the level of prices or taxes. This is generally not true.
Why would it be fair for someone of equal skill to be able to afford [less food, less healthcare, less living space and fewer gadgets] for themselves just because they have a [smaller family and fewer kids to support]?
Generally what [your employer does] with [your employer's] money should not be [your] business.
Indeed. There are two views of employee compensation - you can have people that you compensate as a share of value added/profit share (this is very common for sales:its easy to record who sells what;selling more means more revenue - giving a share of that revenue to the seller aligns goals. In theory, and for commodities; in software you also get sales people that overpromise and lead to developers working themselves into an early grave, never having a hope of satisfying any customers..) - and you can have "wage slaves": people you pay wages to for a share of their time.
In the latter case, from a strictly economic standpoint, you'd prefer workers to pay you (eg us prison labour...).
In a strictly value-add/profit share the more value a worker produce, the higher the compensation and the higher the company revenue.
Now software business (knowledgewwork) is typically somewhere on the scale between these two.
I'd personally say that given gitlab's product and business - they would probably be better off leaning a bit more towards the latter - allow a great softare engineer in rural UK or eastern Europe get (locally) silly rich;and allow those that feel like it to move to less crowded locations without docking their compensation. As long as they only get a share of generated added value, this should be a win-win.
Games aren’t sold for the same price regardless of where they were produced? Sure they do. They sell for different prices in different places they’re sold, but where they were produced has little impact on the price in each location.
The fact that I make X here while pay is 4X in SF is the only proof needed to show job markets and pay levels are local.
If a SF company wants to hire me remotely, I'll take the job at 1.5X, so they won't pay more than that. The simple reason is this: If I don't want the job at 1.5X the local pay, I my neighbor does, and he's every bit as good an engineer as I am. When they do hire me at 1.5X my current pay, they have bought my skill at the local market rate.
You make a good point: as an employee you are not the product, you are part of a team — and the team is just one ingredient in the manufacturing of a product. An important ingredient, but not the whole story nonetheless.
Taking that further: as a human you are also part of the physical community that you live in. A developer in a small town might help out the local library, whereas a developer in a big city might organize tech meet-ups to help their peers.
I'm not saying one situation is better than the other, but I can imagine not just different price points, but also different valuations for equal skill depending on location.
>Should everybody be incentivized to relocate to a developing country
Absolutely. I am living in an Eastern European country, and yes, the local market would absolutely need people with western income: all the restaurants, local services, and the local economy would benefit from this. With practices like Gitlab, our local market would be locked into this shitty state it is in right now. Basically they lock us into not being able to export our only product for a good price: we export our 'knowledge' for cheap.
But I think if all-remote will be a thing, this will be unsustainable. People will fight these immoral practices with 'cheating': what stops me pretending to be living in a western country (even renting a cheap flat there), but staying most of the year in my country? Will they examine my nationality or citizienship? Pretty scary stuff, but I might apply for a western-country citizienship then. If they fuck with us, we will fight.
Ok, lets say we live in the same street, work in the same office, do the same work and we both provide exactly the same value to the company.
Lets say your mother has given you her old car to drive and you just pay insurance and gas.
Lets say I bought a Ferrari Roma.
What you are saying is that you'd find it unfair if I were paid 'as little' as you, because I have to deal with the expenses of paying off my Ferrari. I'll take that deal.
pay your local in-house employees based on what suburb they live in, workers who live in expensive areas should be paid more because it costs them more
>Should everybody be incentivized to relocate to a developing country or tax haven because of the internet and your equality rule?
Yes, actually. Well, tax havens shouldn't be legal in the first place, but getting people with good salaries into poorer countries is good, because they pay taxes there.
Of course, the vast majority of people would actually not go to poor countries, they would simply leave cities. Which is also something that should definitely be incentivized.
> Well, tax havens shouldn't be legal in the first place
Why not? Why can’t each country decide for themselves how much tax they want people and corporations within their jurisdiction to pay? Shouldn’t be legal in what jurisdiction? Why should any other country get any say with how a different country conducts its taxes?
That assumes that all money is of equal value. Which on one level it is, but on another level, the relative purchasing power in different geographic areas is a real thing. Normalising based on that means that in effect you're paying people for the same relative quality of life, rather than same absolute value, which can be very different relatively.
The average global relative purchasing power is already reflected in the currency exchange rates.
But generally there is no such thing as a "single" purchasing power. Some local goods may be cheaper in developing countries, but some others can be more expensive. If you don't know exactly what an employee is spending their money on, you can't really tell the purchasing power of their money. A big family with more kids may spend more money on local goods, transportation and housing, but a single person may want to just save-up 80% of their salary for a new Tesla, which costs just the same everywhere. Therefore adjusting the payouts to the local prices level will always be unfair to someone.
If one could get a Tesla at a 70% discount just because they live in a developing country, then the story would be different. But they can't.
Currencies are too broad though; as has been stated, cost of living in SF is a multiple of that elsewhere, and that's just in the EU. It's similar in the Netherlands (where Gitlab is from), where living in the urban western cities (Amsterdam, Rotterdam, the Hague, Utrecht) is unaffordable for the vast majority of people, but that's where all the tech companies decide to settle because that's also where a lot of the tech people have moved to. Somehow. The fact that a lot of people live in run-down overpriced housing or shared student living spaces seems to be ignored there.
I for one would love to be encouraged to move further out to the countryside. That's the long-term plan anyway.
They pay people less not because of "relative purchasing power" or because they want them to have the "same relative quality of life" or some such sentimental nonsense but because they can get away with it.
The cost of life is totally irrelevant, the alternative options someone has in he market-place based on their location are. Did you look at those numbers at all?
I wonder how this works. If someone could work remotely for GitLab, they could also do another remote job for another global player, so local prices don't matter that much. Maybe this strategy can work now when there are only a few remote jobs to choose from. But I guess the coronavirus will accelerate growth of remote jobs when more companies see remote has some benefits.
This is absolutely the case. About a year ago I was looking for new work and, having previously enjoyed managing a GitLab installation, was very keen to interview with them.
It felt like it would be a perfect fit, based on our shared cultural values regarding remote work, transparency, open source and other technology choices.
After seeing the calculator, I decided not to interview at all, and had another remote job a few days later with more pay than I had in Boston and New York. I live in Bangkok, Thailand.
As someone who lives in South Africa, it's quite frustrating to travel when you realise your money isn't worth shit in most developed countries. It financially restricts where you can go for how long and how often. Many imported things, like cars or computers, are actually more expensive here than in the States. Food, housing and other costs of living might be cheaper. It makes somewhere like Cape Town a great place for people with first world savings/income to holiday/retire. In a global economy someone earning local rates don't have the same kind of options.
> What I don't agree with is the pay scale they use based on your location. If you have the same skills, you should be paid the same.
I've studied the system a while ago when considering to apply there and found some areas with comparatively low cost of living while having a large conversion factor. People only complain about conversion factors if they are low but there are also higher ones. If you are ready to move, you can still make lots of money (the priority for this part of my career).
With Gitlab I could stay inside europe with the european healthcare system while not worrying about US visas, working remotely and asynchronously (an improved version of just "remotely"). That puts Gitlab well above other companies in my home country of Germany.
The Gitlab response to this system is that it allows them to employ more people. If the system allows me to be employed, I'm very happy for it, even if I make less than my colleauges in SF.
> The Gitlab response to this system is that it allows them to employ more people.
Sytse is a good person but I'd never trust any company to hire more people than it absolutely must. I used to think no company will spend more in employee compensation than it must but i recently learned that board members get paid so together with runaway executive pay clearly I was wrong about that.
As an Eastern Europian such practices really sadden me.
Cannot this be hacked though? Could I somehow apply from a rich country and then spend 360 of 365 days in a year in a poor country?
Even if you pull this off, you'd be in a situation where the company that hires you (outside the US they mostly use 3rd party employment providers) and/or you are committing tax fraud in a way or another.
In many cases, you'd be working without a work visa. Of course, many people do it and get off with it. But there are occasional crackdowns. [1] Perhaps more to the point, as the sibling comment asks, "Whose promise?" GitLab explicitly requires you to obtain permission from your manager before moving elsewhere for an extended period. [2]
Would it even made a sense to hire you then? When local employee costs the same? One of reasons to hire remotely is to optimize cost of conducting business. Without it a lot of these positions wouldn't exist in the first place.
That's another valid reason, but it doesn't allow to dismiss factor of cost of employee entirely.
Company, I work for, has office in capital city, and offices in smaller cities. Talent pool of capital city would easily accommodate us. Other offices exist because it's cheaper to hire there. If cost would be the same, they would simply cease to exist. Cost difference in means of the building is less than 5% of overall monthly budget, so, while helping it's not deciding factor.
Yes, you should get paid the same. That's exactly what they are doing. Stop thinking about it in terms of cost to them and think about compensation to the employees. The cost to Gitlab of paying a competitive salary in London vs Berlin is going to be very different. But both developers will receive the same benefits relative to their location. Remember, you can't eat money, you can't drive money or live in money. Paying people the same dollar amount means the actual lifestyle of employees doing the same job will be vastly different.
A mid-level dev on a local salary in India can afford to take taxis everywhere and have a live in cook/cleaner. I know mid-level developers in Ukraine who outright own their apartments (i.e. no mortgage). Mid-level developers in London are lucky if they can buy an hour from the city center.
So are people in SF, London and other locations are actually underpaid on the global market?
The answer is maybe, because those locations have other benefits too which are less tangible. Measuring quality of living is subjective, some of my Indian and Ukrainian friends will not consider moving to western europe or the US because their quality of life drops signficantly.
It's a market, and if I'm sitting in india working for an SF company, then the SF company needs to compete for my skills mostly with other companies in india, because local employment is still the norm.
Once remote employment is so widespread that an SF company hiring someone in india actually competes for their competence with every company in the world - then that will change.
Does McDonald's burger flipper gets paid same everywhere in the world? Or for any other local service or product do these people will pay Silicon valley prices? Otherwise it would just mean software people do think of themselves as a superior species that earthly rules of economics must not apply to them.
Gitlabs wants to hire people from everywhere. If they don’t pay people enough, they won’t be able to compete for those employees. If they pay everyone SF rates, they will have far less engineers than their competitors and will overpay unnecessarily.
Paying the same will be unfair to those living in an expensive location, finding the means of living while others retain more for the same amount of job.
Could you explain to me how it is unfair for people who choose to live in expensive places that people who don't choose that lifestyle get paid exactly the same amount for the same work?
It's cute, you really think it is a choice to move to an expensive place for a high paying job?
Believe me, you have no choice, you MUST move there! Then work hard to hang on otherwise you are f*d, paying a lot just for your bare existence!
Also some are born there perhaps, all human connections tie them there...?
So the people who are living the life in the developing world are the ones who should take they pay hit because you want to socialise with hipsters?
Also, why must you move 'there'? I understand that my life is more expensive where I live than it is in the developing world, but I get a in return for living here. I wouldn't find it fair if a remote colleague made less money than I do just because of them living somewhere else.
It also works (and is similarly disgusting) in a single country where the salary discrepancy is large.
I live in Poland, where the gap between IT and non-IT is staggering. Teaching programming easily nets me 5 times as much money as a regular public school teacher would get. Same goes for regular development work: developer salaries here are 4-6x the average salary. Are we making that much of a bigger impact on society?
Any time I visit a hairdresser, a car mechanic or anyone from the services sector and I wonder why things are expensive, I compare their hourly rates to mine. The hairdresser may be getting something like 20% of the money I'd make in that time – and they have to support the salon for some of that as well (also, they're just someone else's employee, so they get maybe half of that in the end). No longer does it seem expensive at all, and it goes for any service I can imagine.
Make these people better compensated... and I'd no longer be rich. We'd all be pretty much the same. Perhaps that's where the fear you see in some other comments here stemming from – "but this will lower the salaries for the top X%!". Yes. We'd have to admit that we're not special in terms of our contribution to society – just lucky enough to be in a booming industry. Or perhaps a growing bubble.
And sure – my work has the potential to produce a lot of value. I recently wrote software that will (indirectly) enable a large warehouse operator to essentially fire their entire workforce and replace them with robots. Last I checked, the individuals currently in that workforce make something like $5 an hour, and the business owner is proud enough to put that on their job ads. When the automation machine is finished, these people will be unemployed. How will they be making their living? Nobody in the process cares. So how has my work improved the society? In the end I'll still be stuffing myself with delivery sushi and roaring a big car on the highway – thanks to the growing supply of more and more cheap labour.
I've now digressed very far from the original discussion. But being aware of this is an endless source of frustration for me, and every discussion about "what is fair compensation" awakens it :|
If you feel you're being paid unfairly in contrast to others, move to a high tax, high income country like any in Scandinavia where everyone makes a decent income and everything is more expensive that your software engineer salary won't seem so high anymore.
But be careful what you wish for as now you'll be able to afford much less. Nice house in a family friendly neighborhood like back in Poland? Forget about it!
There's no fair. There's supply, demand and people trying to make their ends meet in between. You are just the same hired worker as everyone else, and if your bosses found a way to get your work for less money, they would gladly do it - it's just they can't. People with other professions are not paid less because of you, they are paid less because of capitalists, who get much more money than you and maintain this system. It's capitalists who should feel sorry for these people, not you.
Do you really feel "rich" as a hired employee? Eating sushi and owning a car is "rich" for you?
Relatively rich, yes. I don't think any other kind of rich exists – there's always a bigger fish :) Were we on a different website with a different audience we may be having this conversation about private jets – or a dinner at a restaurant. Perhaps "rich" was the poor choice of the word (no pun intended), but I think the meaning is preserved.
And yes, you're right: it's not because of me, I'm just a bigger cog in the same machine, and similarly exploited, just for a bigger share. It is because of the capitalists – but I believe that's what the discussion is about here. Gitlab deciding that it's not worth it to them to pay everyone equally (or according to their value) because it's “not worth it” for them – they won't be able to keep as much to themselves. Their arguments for it[1] are as weak as it gets: they literally say that they don't want to pay people better because they'd rather acquire more companies – that surely makes the underpaid employees feel better.
There are many definitions. I think the most useful and wide-spread one – even among non-economists – is from the OECD: you are rich if your household equivalised disposable income is ≥150% of the median of the country.
If you want to find out whether you meet the criterium, then try to find some newspaper articles on the Web about the poverty line or poverty gap that embed JS calculators. Otherwise see http://enwp.org/Equivalisation if you want to crunch the numbers yourself.
This issue here is, I think, that employees _at Gitlab_ aren't paid the same for the same work depending on where they live. The issue isn't that in general developers are paid depending on where they live.
If you would increase the price of goods and also the salaries of everybody doing the same work - that would lead to you buying the same amount of stuff or less for more money.
Or just work for Basecamp, which locks all of their salaries at the San Francisco avg even though everyone works remotely and they are based in the Midwest.
Probably has something to do with how few people they employ.
So you're saying everyone at Gitlab should have their wages slashed? I wonder how good their company would run if they couldn't afford employees in all major tech hubs.
What I don't agree with is the pay scale they use based on your location. If you have the same skills, you should be paid the same.