Exactly right. That opportunity cost seems perpetually ignored. Also, when we talk about "value in the market of an employee's skillset", we're obviously talking about how much total compensation they'll receive. What ALSO seems to get ignored is the fact that the people you're hiring (particularly in software!) are or should be generating a multiple of that salary, so worrying about "90k" vs "110k" is laughable when they may be generating value of 500k-1M, even after you factor in health care and all the other benefits. Does anybody actually believe that those few tens of thousands of dollars (should) make or break anything? We're not talking about the cost of eggs or something here; we're talking about software, a huge force and value multiplier.

The (IMO very weak) counterargument here is "well, budgets are set to blah blah blah" - but in that case, you're allowing a difference of a few dozen thousand dollars dictate whether or not you get someone, which can be the difference between shipping, getting out a new version, or whatever and not doing so. If your budgeting is that inflexible, maybe your organization has other problems it should address first.

When it comes to software, cost-based pricing should not be anywhere near the discussion. Software developers and their output should judged on value. It's crazy that anyone is still in this mindset after nearly two decades of software eating the world. We may be getting paid a lot relative to the median, but it's still just a fraction of the value it creates - otherwise, why would anyone bother? Hire a dev for 135k for example (includes benefits), and have them only generate 150k worth of value? Come on.