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Comment by jdminhbg | Hacker News Reader

> These types of automation have been in place for decades, and all of them cut costs for the owners of them and reduce the number of workers needed.

They reduce the number of workers needed to produce the same amount of output. What is slightly counterintuitive is that having done so, they may actually increase the demand for workers, because they now can produce far more output in the same amount of time.

Modern languages and tools have made programming much more productive, and now there are lots more programmers and they get paid more.

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> What is slightly counterintuitive is that having done so, they may actually increase the demand for workers, because they now can produce far more output in the same amount of time.

They may do that.

Too many people take it for a guarantee that technology by itself must do that, and can never result in a situation that a human hand is needed to steer us away from.

https://en.wikipedia.org/wiki/Jevons_paradox

> Modern languages and tools have made programming much more productive, and now there are lots more programmers and they get paid more.

Well not really. Computer industry pay is increasingly becoming bi-modal at least for a decade. The highly paid programmer is just a US phenomenon and that too in few major IT hubs.

There are lot of programers/IT admins who would make pretty decent money in late 90s to 2000s. And they make less than they were 20 years ago and yes all hadoop/big data training did not really make any better paid.

Inflation adjusted IT salaries have gone down in lot of places in the world. Of course 1 percenters of IT in FAANG+ make it sound like IT salaries are going up heavily for everyone.

> The highly paid programmer is just a US phenomenon and that too in few major IT hubs.

That's simply not true. Programmers around the EU are among the best paid professionals in their local markets, even more so for young people (out of college/school/university). The salaries are far away from Silicon Valley levels, but are still very high locally.

Think this depends on market. Sure, salaries in Germany are decent to good, but Italy? Ehhhhh.

According to some sources online, the average salary for a junior developer in Italy is around 24k[0]. Indeed that isn't a lot, however it's not that much below the average salary in most regions [1]. Furthermore, in a per type of job, IT and tech are the highest paid bar "management" and "top management"[2].

0 - https://www.payscale.com/research/IT/Job=Junior_Software_Eng...

1 - https://www.statista.com/statistics/708972/average-annual-no...

2 - https://www.paylab.com/it/salaryinfo

I guess it depends on what you define as 'highly paid', which is what you were originally discussing. More senior developers making 35-40k EUR doesn't sound 'highly paid' to me, even though yes, the local market isn't as strong. High-er, certainly, but it's not far above the GDP per capita for Italy as a whole.

The thing about management is what I've heard Italian devs complain about (and it's a common complaint is tech-weaker countries), that to get decent money you have to transition to management, whereas countries with stronger tech sectors like the US have more companies that let engineers continue to grow as engineers (or architects).

> Programmers around the EU are among the best paid professionals in their local markets, even more so for young people (out of college/school/university). The salaries are far away from Silicon Valley levels, but are still very high locally.

Was my original comment and point. Salaries for tech are very good for the local markets, even if they might be considered low compared to other markets.

You said they're "very high" locally, which doesn't appear to be the case. "Slightly above GDP per capita" just isn't very high. If everyone in one country makes 40k EUR except for one dude who makes 40,001 EUR, he has the highest income in the country, but his income still isn't very high at all.

Of course, part of this may be that the wage spectrum as a whole is compressed compared to the US, but that's an explanation, not a contradiction.

> "Slightly above GDP per capita" just isn't very high.

Yes, it is in any capitalist economy, because income distribution isn't normal. In the US, for instance, per capita GDP is about $64k, but median personal income is a little over $35k, and median pay of a full-time worker income, annualized, is just under $45k. An individual worker making just over the per capita GDP is doing quite well.

In the US, the median software dev comp is more like 2x GDP per capita though. The BLS says 110k for devs + QA testers median salary, and IIRC that doesn’t factor in stock.

I'd say 40k EUR isn't high for someone living in Milano (Italy's main tech hub), for example, it's decent, but not high. The cost of housing is what gets you.

> that to get decent money you have to transition to management

This is the main Problem. Technical excellence is not valued and rewarded enough. The best Engineers get promoted to Mediocre managers because that's the only way to move forward. The result is an economy focused on micromanaging for small gains instead of innovation for big gains.

Yeah, and that's why lots of IT jobs are outsourced to Eastern Europe; why pay 70k€ per year for people doing devops in the Nordics, Germany or the Benelux countries, when you can get a Romanian to do it for 20k€?.

The situation in the EU is the same as in the US, and outside the local hubs, wages are lower.

I'd say it depends on the EU markets. I have the feeling that IT professionals from Eastern Europe (I'm from there) are a lot better paid, comparatively speaking, to IT professionals from many other Western countries (with the focus on "comparatively").

I've heard from a lot of my colleagues that they couldn't afford to have the same lifestyle in an Western capital city with equivalent IT salaries. I know I wouldn't be able to rent in downtown Amsterdam, Paris or Milano with my equivalent IT earnings were I to live in those cities the same way I now do in Bucharest.

I wouldn't be able to rent - or buy - in Amsterdam either even though I was born there and lived there for half my life. The prices there are simply insane. It's ok with me because I wouldn't want to either but between AirBNB, businesses using residential real estate as fancy offices (half the inner circle of the canals is like that now), the crime and the tourists you probably would have to pay me to live in Amsterdam.

Having visited Amsterdam, but mostly the tourist bits, I'm curious: where do reasonably paid tech professionals live in that city? Can you give me some examples of areas to look up?

Amstelveen, de Pijp, Overtoom and surroundings, the nicer parts of East and West.

>I'd say it depends on the EU markets. I have the feeling that IT professionals from Eastern Europe (I'm from there) are a lot better paid, comparatively speaking, to IT professionals from many other Western countries (with the focus on "comparatively").

It's true. Unless you work for a FAANG, or some Fin-Tech or a unicorn flush with cash, dev wages in Western EU are not higher than Eastern EU anymore.

I know devs in Poland and Romania making way more than me and some friends do in Austria/France/Belgium.

It's because of huge amount of outsourcing from US companies moving directly to Eastern EU, pushing the wages higher than what Western EU based companies can offer locally, coupled with the higher taxes in the Western countries, meaning devs in the West taking home lower wages than their counterparts in the East.

Someone here said it well, but I don't have the original post to quote anymore: {a cleaner in Sweden makes way more than a cleaner in Poland, but a dev in Poland can end up making as much or more than a dev in Sweden}. That's whack but that's the reality of supply and demand caused by the bleed from the US tech boom to certain regions.

> Programmers around the EU are among the best paid professionals in their local markets,

That's not really true. I live in Austria and many more skilled professions earn better than most devs here as the local SW industry sucks, almost no product-based companies and a market overabundant with talent.

I'm sure in hot markets with plenty of product based companies like London, Berlin, Amsterdam or Eastern Europe the situation is better.

> Computer industry pay is increasingly becoming bi-modal at least for a decade.

Source?

I really doubt this. Programming doesn’t have the kind of cartel dynamics mixed with prestige obsession that resulted in dualists labor markets. It doesn’t have licensing based on credentials that have no effect on how well you do your job like K12 teaching, nor is it remotely as prestige obsessed as law firms.

Any evidence?

Theoretically yes, but in practice the given industry as a whole often does not need much more output even if the per unit cost of the output declines. Like, you don't need significantly more accounting just because you can use spreadsheets now.

And not all automation increases worker productivity, lots of it just eliminates workers from certain jobs altogether, e.g. self driving cars / trucks.

This can indeed cut both ways. Instead of needing huge numbers of manual workers to harvest the wheat, one guy can sit in an air-conditioned combine harvester cab for a few hours listening to tunes, and we get the same food. Humans can (and do) eat slightly more food given it's cheap and readily available, but there's a limit. So, the percentage of workers engaged in agricultural work fell.

On the other hand, turns out that once a shirt is cheap humans will buy not just one extra so there's one to wear and one to wash, but a dozen, or hundreds. And they'll throw it away when it's a little worn not when it falls apart. So while industrialisation of fabric and clothing production made clothes cheap, the result wasn't that fewer people were employed in that work but that we just all bought more clothes.

> one guy can sit in an air-conditioned combine harvester cab for a few hours listening to tunes,

I hope he's not listening to tunes. A change in the sound it's making is often the first warning that your $500,000 piece of machinery is about to self destruct.

I see it all the time, from combines to snowplows.

> A change in the sound it's making is often the first warning that your $500,000 piece of machinery is about to self destruct.

Whose machine?

Anything that's got risk of becoming expensive will give you tactile or olfactory feedback.

More likely some warning light will illuminate on the dash first.

I’m not very familiar with accountancy, but there seems to have been a lot of growth in internet-based tax prep for individuals who would previously have done their own. I couldn’t find historical data, but forecasts I found all agreed the number of accountants needed would rise over the coming years.

We don’t even have self-driving cars yet, how can you know what effect they have?

Well, yes you do, because the spreadsheets make it easier for the regulators to add more regulation.

Think: there used to be a theoretical limit to how much regulation could exist, because the regs had to be known by a person (otherwise how are they enforced?).

Now we have regtech. A whole industry built on automating compliance.

How long before each individual needs a regtech software program (or two!) just to function in society? I'm not talking about tax filing, that's just the start.

This only works to an extent. US manufacturing output is higher than before outsourcing manufacturing became a thing, but US manufacturing jobs are far fewer, because the total demand for a whole lot of products can be met with far fewer people.

When there's an inequality in productivity, more productive firma will see an increase in labour, bit that doesn't mean the whole sector does.

In theory people work because they want something from someone else (says law). So in theory there can never be unemployment.

In practice some people want money itself, which is an empirical contradiction of says law. There are also people who hoard jobs because they like them, which is bad for people who want the money to actually spend it.

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