Tech Workers Aren’t as Rich as They Used to Be | Hacker News Reader

Tech Workers Aren’t as Rich as They Used to Be

wsj.com

63 pointsCreateWonders46 comments

> Ms. Voigt, 27, paid off her student loans and bought a car in cash. She maxed out her 401(k) and socked $500,000 away in a brokerage account. She easily covered twice-weekly therapy sessions and costly visits to the hair salon every few months. When she felt burned out by the pandemic, she took a year off from work.

> “I used to be able to kind of spend whatever, and it would be fine,” Ms. Voigt said. “Now I’m having to think about it a lot more.”

> She recently started using Mint to track spending and is making small lifestyle changes such as bathing her dog herself instead of relying on groomer. The group chat discussion has turned to talk of whose company is doing layoffs.

This is wonderful privilege on display, lol. The average 27 year old in America and Europe doesn’t make anything near enough to stash $500k in their brokerage account.

She got a job with a higher base salary, and now has to adjust her spending by, among other things, bathing her dog herself…The average worker would kill for a life like this.

So, they stashed $500,000 away in a brokerage account, but feel it's important to mention "costly visits to the hair salon ". How costly must they be?

At least $200 to $250 per visit. Female realtors used to spend $1000 a month every month in 2008, based on a conversation with a female hair stylist. That's the Bay Area rate in 2008. Now add inflation.

Wow. Is there anything equivalent for men? I can’t imagine spending 1K a month total. How could you even spend it

With a $500k down payment, your costs on a basic 2BR could be as low as $9,000/mo!

Or, you could go buy a house in a normal COL region and then lose it to unpaid property tax bills because you're unemployable locally and Silicon Valley companies don't need to tolerate remote anymore.

The supply of engineers has also massively increased compared to the supply of high paying tech jobs.

Your salary is capped by what you produce for your employer but your salary is determined by how hard it is to replace you. In the Bay with more companies than you could count, they had to fight tooth and nail for these incredibly productive workers, pushing wages higher and higher - capturing the value the workers create. Add in ZIRP and all the startups that creates and you’re looking at a cage fight between employers over workers.

With remote work and the end of ZIRP, suddenly the bay has less startups and the Googles of the world can more seamless employ workers in Cleveland or Bangalore. What does a Bay Area worker gain from this, access to tech jobs in Cleveland?

> Your salary is capped by what you produce for your employer but your salary is determined by how hard it is to replace you. In the Bay with more companies than you could count, they had to fight tooth and nail for these incredibly productive workers, pushing wages higher and higher

Companies don't seem to hire this efficiently in practice, and a large number of these big tech workers seem to receive far more value than they create. I've personally seen no change in usability of social media platforms despite a ton of layoffs. I think we will see more efficient hiring by necessity (higher rates).

> Googles of the world can more seamless employ workers in Cleveland or Bangalore

Aren’t they busy trying to rush everyone back into office now?

Can someone with a Wall Street Journal account tell me if my hunch is correct and the article is completely wrong? (I can no longer afford WSJ so I can’t check myself.)

Love your joke. Sad nobody caught it yet

It’s partially about people entering tech from other fields as a way into the middle class and home ownership.

I saw a surprising amount of this after Covid. I knew people prior who were non technical accountants or marketing people, but when meeting thanksgiving after the pandemic, they were suddenly talking to me about C# and SQL.

https://archive.is/XgDd8

After reading the archive.org article, I’m now hoping other professions never learn of the indignity of having to bathe your dog yourself.

Headline is "Tech Workers Aren't as Rich as They Used to Be" and to save you a click, the TL;DR: is the death of ZIRP erased the inflated paper value of public and private tech stocks.

Key takeaway here is you should never plan your life around the value of stock-based compensation. The story is also very specific to people who thought that stock comp was real enough that it was a sure bet they could buy homes in insanely expensive markets like the Bay Area, Seattle, etc.

The stock compensation was crazily high that it was unbelievable.

Back in 2014, I told my family I earned 600k/year after joining as a new grad (with promo in a few years). My company went IPO and etc.

My family and cousins just couldn't believe it and insisted that I didn't understand the compensation and that it was for 4y. My cousin who is a lawyer in a top US law firm just couldn't believe it lolz.

I consulted a tax accountant, and they were "oh you are doing pretty well?".

I quitted the job after 4y and wanted to travel around Europe. I had to get a visa, and the German consulate just couldn't believe it too. They called and asked why I quitted my job... it didn't make sense to them.

People just didn't grasp the gravity of tech compensation.

I predict a major decline in salaries and demand for software engineers. For three main reasons: AI, lack of funding to startups, remote work. A fourth reason would be overall economic growth decline. As an (aging) engineer myself, the best bet is to double down on AI, and continue to improve higher level biz and communication skills (and save more money LOL)

A while back I predicted that consolidation among tech would lead to an all out assault on tech worker jobs/salaries that mirrored the industry consolidation followed by the joint assault on auto workers in 1950s Detroit by the big 3.

I also predicted that when it happened to tech they would blame AI, because the inevitable march of progress makes a more comfortable scapegoat than sundar pichai and satya nadella and mark z. if you're them.

It looks like we are right on track.

The really scary part is that tech workers not only aren't unionized, they aren't even correctly perceiving the attack on them as an attack.

And there is no resistance. No will to break these abusive monopolies (now acting as labor monopsonies) apart. No will to fight the 2nd round of illegal wage fixing. Just "oh well I guess ChatGPT can so my job now lol" of "economy sucks I guess".

The article is discussing mostly how RSU-based compensation isn’t quite as valuable as it once was, considering the 2 year decline in tech stocks and delayed IPOs.

While I don’t disagree that your longer term hunch may be right, declining stock prices aren’t really an assault on tech wages.

Nonetheless you can't discuss the reduction in tech worker compensation without discussing the synchronized layoffs.

makes a more comfortable scapegoat than sundar pichai and satya nadella and mark z. if you're them.

You mean, those execs will start to use the "AI" excuse that they have to cut salaries because it's the only way to keep people employed ?

Yes: "IBM to pause hiring in plan to replace 7,800 jobs with AI, Bloomberg reports"

https://www.reuters.com/technology/ibm-pause-hiring-plans-re...

Since when did IBM pay well?

I agree this will probably be a trend for the industry as a whole. But I doubt this trend will hold for the top paying companies.

There is so much software work (bugfixes and features) that we can't afford to do today. AI will create bugs at a faster rate than ever, and they will be harder to fix.

We are nowhere near a demand collapse.

As someone not living in the US, remote work is a plus for me.

Few US firms pay US salary to not US, but it may still be better than local wages

50% of Silicon Valley pay is still pretty good in most places.

But thats not how it goes. They will pay 10-20% over market of wherever you live.

How is AI affecting software development in any meaningful way?

Are you a programmer or a PM/CEO looking for a technical cofounder type of person

I doubt it. I predict a small temporary decline, mostly due to inflation. Demand will remain high. TC will recover when the stock market rebounds in a few years.

Saving as much money as possible, the future is too uncertain right for me to want to spend like I used too. Just too much disruption both from a business and now career perspective.

I believe many people are now doing this and it will have detrimental effects economically.

It feels like capitalism is kind of reaching some kind of maximum. Kind of starting to eat itself? Of course this is just an opinion, not claiming it's a fact. Just an observation based on my own sentiment, I can't be alone.

This is what I think as well, I think we will see just another failure mode of capitalism, accumulation of wealth in hands of the few to the detriment of the rest, bubbles popping etc. . I think that the system was kind of designed for infinite growth, which worked well for sometime, but we might be reaching some ceilings here and there.

Kinda sad that I've just got my first full-time gig, I mean I'm very happy and grateful, but I feel like I should have been born 5 years earlier to really get enough funds and traction to feel safe.

Exactly how much was that new grad SWE was making at Block to pay off their student loans, save $500K, buy a car with cash and splurge on things at the same time

A lot lol. $300+?

Nah.

Share price went up 10x.

Only need 50k to hit 500k excluding base salary, 401k match, etc.

American tech workers were really lucky and still are lucky. I envy their salaries even in the midst of the current "tech winter". North of the border we are paid a hefty discount - probably why we're employed at all - with income tax and costs of housing eating into the savings we could have. Still enough to sock away a bit every month, but it feels like swimming upstream sometimes.

https://archive.is/nshRv

Some of these people are now being forced to budget now that the stock has plunged. They can't spend lavishly on things that most regular workers can't even dream about. They are special. Or were.

Tech will have a slow death Salary will be realistic and jobs will be less stable. It will be a offshoot of the gig economy.. make quick buck ...with less stability. The future of work in general is going to be loads of flexibility and less certainty. That's the only way forward.

Interest rates will eventually come down again. Just have to keep the skills sharp and pick up a couple more in the AI field. All will be alright for those who do.

There you go. Less programmers in general and the party is over.

Learn to adapt.

If the party truly be over, I'd call the first sign of taking away the punch bowl as having been way back when they kicked programmers out of offices and into cubicles. (it should be needless to say that I don't see why anyone would put up with open plan)

They were also in the office back when they were richer.

Maybe they should learn to code.

Unionize your workplace

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