Engineers Allege Hiring Collusion in Silicon Valley

http://www.nytimes.com/2014/03/01/technology/engineers-allege-hiring-collusion-in-silicon-valley.html

by vwinsyee • 12 years ago

242 143 12 years ago

nerfhammer• 12 years ago

It also offers a portrait of Silicon Valley engineers that differs sharply from their current caricature as well-paid villains who are driving up the price of real estate in San Francisco and making the city unbearable for others.

What? "unbearable"? That seems a little out of place. Would most NYTimes readers have any idea what he's talking about?

From the author's recent articles list:

In little more than a decade, Google has become essential and omnipresent. Now the question is whether people will start to resent and oppose it.

As entrepreneurs invade regulated industries and evade traditional watchdogs, the question of who is responsible when something goes wrong looms large.

Airbnb likes to say that it gives more people the money they need to pay their bills. But new research suggests that as the sharing industry spreads, more people are going to need that money, because they’ll be unemployed.

Uber and a Child's Death

Hard-hit by recession, many in Europe have questioned whether jobs at Amazon’s warehouses there are good for the economy or dehumanizing.

seems to exclusively write negative stories about bay area tech

dhoulb• 12 years ago

Wow, did Eric Schmidt run over his dog or something? Guy's got a serious bias!

chetanahuja• 12 years ago

No. It has worked out well for his career.

http://topics.nytimes.com/top/reference/timestopics/people/s...

"In 2013, Mr. Streitfeld was part of the team awarded the Pulitzer Prize for Explanatory Reporting “for its penetrating look into business practices by Apple and other technology companies that illustrates the darker side of a changing global economy for workers and consumers."

lostlogin2• 12 years ago

Some people, myself included, find fault often (too often) and look for the flaws. Assuming the worst leads to pleasant surprises. Assuming the best rarely does. My 2c.

walshemj11• 12 years ago

yeah it's CP Snows Two nations repeating its self - Arts Grads vs the oily engineers.

Some of his angst is that as a child of a major columnist in a broadsheet he feels that he should have a proper job on a proper news paper which in previous generations he woudl have stood a good chance of like say Polly Toynbee on the Guardian.

Due to the decimation of the traditional print media he can't get a nice job on the NYT as a columnist and has to slum it in a tabloid and they are using typical tabloid "monstering" techniques

bowlofpetunias• 12 years ago

We could use a bit more self-reflection and a little less shooting the messenger around here.

If you only want to read happy happy joy, disruption yeah, cheerleader stories about how awesome the tech industry is, I suggest TechCrunch.

Our industry has a pervading attitude of treating anybody who is not "us" as roadkill on the highway to progress. That's going to turn against us a lot harder then these few relatively mild articles.

calibraxis• 12 years ago

Yeah, when I want to learn why some startup failed or the reality of some tech, I don't listen much to the public tech world. I have to reach out to people and probe to get a better picture. Because then they won't be so busy applying spin for public consumption.

Like recently, there was some article here about a failed startup, and it felt like most of the discussion was pointless. Killing time of people's lives for no end. Because I knew people at the company, and there was such massive dysfunction which severely cut the chances of success regardless of virtually any other factor. I mean really goofy, where elements should be on a sitcom.

Or when you read about some tech which "everyone uses", and there's fundamental issues with it which inevitably bite people hard when they actually try to apply the thing, but everyone's like rah-rah.

hanswesterbeek3• 12 years ago

Exactly. The tech-industry is horribly naive. It operates based on the idea that the general public perceives them as those friendly shy nerdy guys from school.

Wake up, guys. People have had tech giants invade their life way too much and they've all seen in The Social Network what kind of person a poster boy like Mark Zuckerberg really is.

wavesounds• 12 years ago

Can Software Engineers in California that weren't working at one of these companies get in on this class action? I mean even if you weren't at one of those companies its easy to see how suppressing wages at the largest companies would suppress wages for the entire industry.

doktrin2• 12 years ago

Doubtful.

Out of curiosity, why do you want to?

walshemj11• 12 years ago

for the $$$$

Though this action by major company's would depress wages across the board so its not a totally worthless suit.

WildUtah2• 12 years ago

What can the villains in this drama use as power to force their illegal price fixing on reluctant companies?

Just what you'd expect.

"Mr. Jobs proposed a no-poaching deal to Edward T. Colligan, Palm’s chief executive. Mr. Colligan responded that such a deal would be unfair to employees as well as “likely illegal.” Mr. Jobs then threatened to unleash Apple’s patent lawyers on Palm."

Yep. It's our badly broken patent system yet again.

RachelF• 12 years ago

Interesting, since most of Palm's ideas on smartphones pre-dated the iPhone. No wonder we've changed the patent law to first to file, rather than first to invent.

rz2k• 12 years ago

I agree that the biggest liability to the economy at large of huge patent portfolios, little seen so far, is the ability of multiple incumbent corporations to collude and increase barriers to entry so they collectively are not threatened by innovation from upstarts.

That said, most of the time that Palm (and Handspring etc.) devices existed, they were PDAs, and the reason Palm beat out Apple's Newton is probably that they chose a subset of functionality that was more modest and probably more appropriate to the hardware of the time.

For example, while Newton's handwriting recognition was often unreliable, Palm devices asked its users to use a an arcane script that was easier to process. (Later lost in a patent-related issue, if I remember correctly)

Probably someone here was actually involved in the history of developing the devices, but as I remember it, the revolution of Palm pilots and other models was that they worked more smoothly, and they synced more reliably with your computer than any competitors. That involves a lot of good engineering and attention to detail, but it does not necessarily mean that there can't still be overlaps with patents held by companies which invented something earlier but with an implementation that didn't win over enough customers to survive.

stock_toaster• 12 years ago

Don't forget the newton!

dredmorbius4• 12 years ago

Size of portfolio matters.

This is the reason that tech companies seek to acquire large rather than technically sound patent portfolios.

Briefly: defense against infringement runs around $1-$10 million per patent )(it may be higher, my information's somewhat dated). Defeat one patent, and the company with the larger portfolio presses suit with another, and another. Even if the plaintiff successfully defends itself against these suits, it's still out $1-$10 million per patent. Often far better to strike a licensing deal for $40k (or some value less than $1-$10m).

It's possible to countersue, and this happens, usually with the result that the companies reach a cross-licensing arrangement.

zcarter• 12 years ago

Some relevant points for engineers addressed here: http://blog.mightyspring.com/post/74827679281/battling-outsi...

Know who (with)holds information

Avoid information asymmetry

Nate75Sanders• 12 years ago

It's standard to mention that you work for the company you're promoting.

suprgeek2• 12 years ago

I have personally witnessed the frustrating side of this "no poaching" pact. A close friend was tired of the "Manager Arrogance" at one of these colluding companies.

He quietly put out the word,pretty quickly got approached by a hiring manager at another company - things were going swimmingly.

Then the Hiring manager put in the Req to HR - a V.P. called him personally and but confirmed this "no poaching" B.S. The wage hike would have been considerable for my friend (you can guess the two companies - Arrogant vs Top Payer) & he was pretty upset to learn that the real reason was Jobs being a Huge Asshole and bullying everybody into such a blatantly illegal pact.

So this is a very real "wage theft" collusion case. Unfortunately most of the parties involved had the "good" sense to NOT document it officially so the Smoking Gun might be hard to prove conclusively.

There was even a "no hire" list at one of these companies tacked on the wall of a HR Manager with the Caption "If you hire from there, we will fire (u) from here."

raverbashing2• 12 years ago

What about quitting first after knowing of this fact?

watwut• 12 years ago

I guess it is risky. Many people see finding next job before leaving previous one as the responsible thing to do. Especially if you live in an expensive location or have family or other financial obligations that simply needs to be paid.

Technically, you can find "temporary" job in smaller company and then move to the company you "really" want to work in. It just seem to me somewhat jerk move toward that smaller company.

jhart33332• 12 years ago

You mean everyone quit together? That's called a strike.

Bahamut• 12 years ago

The article mentions that Apple also put that former employees were also off limits.

smtddr• 12 years ago

Back in AT&T around 2005-2006 a "change of guard" occurred and a very technical team supporting SAP systems lost about half their staff to HP within 3 months. Rumor has it that at&t upper-management had a conversation with HP and a few other people who wanted to go had the door shut in their face.

I know of at least one person who had to quit her job... wait 2 weeks... then HP picked her up. Risky indeed if HP couldn't make good on their promise, but it worked that time.

dlitz• 12 years ago

That's sometimes hard to do. For example, if you're here on an H-1B visa.

walshemj11• 12 years ago

The CIPD and other HR regulating bodies need to permanently disbar any member found guilty of this. and for HR directors the the Judge should name them as "not fit and proper persons to be a director" and probably the CEO on Chairman for good measure.

Of course if the Hr director turned states evidence they might be let off with a slap on the wrist.

smsm4214• 12 years ago

Wait, HR has the bar that you can be disbarred from? Thanks for expanding my horizons, I had no idea.

ma2rten• 12 years ago

Why not name the company? These companies deserve to be called out.

suprgeek2• 12 years ago

He posts regularly on HN so (I guess) has almost certainly seen this thread. Up to him now.

asdfologist• 12 years ago

I'm guessing "Arrogant" = Apple and "Top Payer" = Google.

mrtree• 12 years ago

ONLY 6 COMMENTS?

People should be virtually rioting for this.

doktrin2• 12 years ago

Huh?

This isn't breaking news. It's just the latest development in an old and ongoing story.

pekk• 12 years ago

It doesn't have a strong enough tie-in to Snowden to cause rioting. But seriously, some responses are more productive than others.

cgriswald• 12 years ago

Am I the only one that loves the fact that it involves 64K programmers?

leoc• 12 years ago

Well, the C64 was an Apple-beater...

dredmorbius4• 12 years ago

As with earlier numbers: sounds like it should be enough for anybody, but I can think of a number of other companies which have been excluded from the suit which should be included. Cisco comes to mind.

rapind2• 12 years ago

I think he's saying he loves that it's 2^6 (K) programmers.

patrickmay• 12 years ago

64k programmers ought to be enough for anybody.

smprk• 12 years ago

Wouldn't a better idea than putting up a 'no poaching' kind of exit barrier be to give 'bonus every X period of time' kind of incentive, for employees you value and would like to retain?

I wonder if in the world of technology it makes sense to retain a demotivated employee?

vinceguidry• 12 years ago

I wonder if in the world of technology it makes sense to retain a demotivated employee?

It absolutely does. The nature of tech work practically demands that every employee develop intimate knowledge of the very specific domain his work touches. It takes so long for new hires to become productive that in most cases the bottom line begs you to hold on to anyone who already has that intimate knowledge.

On the other hand, keeping a tech employee motivated often looks like a fool's game to management. If he's good at what he does, he doesn't see the world the same way as they do. If you're a growth-oriented engineer, it makes sense for you to bounce around different companies so as to maintain a sense of movement and there's not much your employer can do to "maintain your sense of movement" because it's a completely alien concept to them and often presents as "unnecessary shit that will cost time and money and be risky". Your career goals will often clash hard against your company's needs.

End result? This situation where top talent sinks collude to reduce their engineers' inherent negotiating advantage. This practice would be widespread, if only technology weren't such a wide field that any engineer with any desire at all for something better can very quickly find something. It only happened at the top level because that's the only circle in which there is no more upward mobility except among the same cloistered few.

twic2• 12 years ago

That would cost money. The point of the no-poaching deals is that they were free for the colluding employers.

thinkcomp• 12 years ago

Case docket and documents here:

http://www.plainsite.org/dockets/index.html?id=1860459

MarkPNeyer• 12 years ago

how can i join this lawsuit?

shitlord• 12 years ago

see: https://news.ycombinator.com/item?id=7323443

birken• 12 years ago

FYI, the exact definition of the class here is people who "worked as a salaried Technical Employee":

(a) for Apple from March 2005 through December 2009;

(b) for Adobe from May 2005 through December 2009;

(d) for Intel from March 2005 through December 2009;

(e) for Intuit from June 2007 through December 2009;

(f) for Lucasfilm from January 2005 through December 2009; or

(g) for Pixar from January 2005 through December 2009.

Source: https://hightechemployeelawsuit.com/faqs/#q0

If you fall into this group and want to file a claim to be part of the settlement, you have until March 19th to do so (which you can do via the above website).

raverbashing2• 12 years ago

What happened in December 2009?

pron7• 12 years ago

The Justice Department intervened.

fidotron• 12 years ago

Supposedly Facebook didn't play along.

tn132• 12 years ago

This is really pathetic. I can understand companies being ruthless in maximizing their profits but this sort of move is seriously counter productive. If the wages are not competitive it also means less incentive for bright youngsters to get into these professions. If this kind of agreements become more common, I think that will be like we killing our future.

twic2• 12 years ago

Even with the suppressive effect of this collusion, wages remain more than high enough to make this industry an attractive option.

hga2• 12 years ago

Well, it was one way of getting around California's unique non-competes are unenforceable law.

I believe that more than anything else, that's responsible for the Bay Area's long term technological ecosystem success.

sergiosgc• 12 years ago

Companies do not, usually, plan decades ahead. They manage the next quarter and plan the next three years. Youngsters entering or not a professional area is something that takes 20 years to produce a measurable effect.

Government, is the one that should do the multi decade planning.

smsm4214• 12 years ago

Except it never does. All those decade-long budgets and long-term plans are a sham that survives in the best case until next 2 year election, but more commonly till the next budget skirmish that happens once a couple of months. Specific people can have long-term agenda but government as a whole is incapable of that.

tn132• 12 years ago

"I am from government and I am here to help" you can only shudder at those words irrespective of the context.

I will be surprised to see if Google or its investors do not care about their long term future. I will be less surprised to see someone like Obama planning only for re-elections and short term popularity ratings.

drakaal3• 12 years ago

This is the 99% lead charge that annoys me the most. (especially since many of the people leading it aren't 99%'ers they just think they are)

The assumption is that the only places to work are the big companies. Anti-Poaching agreements are rarely about the Money and more about the "I won't steal your trade secrets if you don't steal mine" types of "we can't patent this stuff" stand offs.

It is also protection against having a company put another company out of business by "poaching".

You look at some of the teams at companies and you can see where a group of 10 guys went from company to company. When they all left most the time that company failed. You can't withstand a blow of having 40% of your team walk, and take everything they were working on to a larger competing company.

"Salary Fixing" doesn't work. Someone always offers 15% more to get better talent and when that eats in to the talent pool everyone else has to ante up as well.

Silicon Valley just feels entitled. Yeah it costs more to live there, but the expendable income of SV engineers is vast compared to engineers anywhere else in the US, and the world.

Zigurd• 12 years ago

If you are in a non C-level salaried position, and you don't have a few million in liquid assets, it is exceedingly unlikely you are a 1%er.

walshemj11• 12 years ago

exactly a BART train driver earns about the same as a developer and will have overtime and a much much better pension.

Same in the UK a tube driver earns far more than the average developer does in London and has a Final Salary pension plus overtime.

drakaal3• 12 years ago

For the world is any engineer in Silicon Valley is a 1%'er.

For the US at $200k you are a 95%'er At $550k you are a 99%

That's a lot different than "C-Level" and "millions in liquid assets"

A lot of people at Google, Yahoo, Facebook, Twitter, and Microsoft are 95th percentile.

Quite a few are 98th percentile.

http://www.whatsmypercent.com/

curiousDog• 12 years ago

I'm still surprised Google was in on this considering they are developer friendly and are a "do-no-evil" company to a considerable extent. It was probably pressure from Jobs. Developers hurt by this should squeeze them for every penny possible.

tostitos1979• 12 years ago

I am going to respond to this with a quote from the Batman reboot: it is not who you are inside, but it is what you do that defines you.

pron7• 12 years ago

Google is no more a "do-no-evil" company than most. They might be slightly above average. Their "employee friendliness", as far as it goes, is blatantly self-serving, designed to create extreme allegiance to the company and possibly long working-hours. This is not in itself "bad", it's just that it isn't altruistic in the slightest, either.

mratzloff• 12 years ago

What you have described is Google's "brand image". It is carefully cultivated through PR and marketing to result in you having a positive impression of Google. You could uncharitably call it propaganda.

Google is pretty good at promoting this image, but that's all it is.

discardorama3• 12 years ago

It's not "do no evil". It's "don't be evil". http://en.wikipedia.org/wiki/Don%27t_be_evil

Except, today it's more like "Don't be evil*

* except where permitted by law and/or required for profit"

shiven• 12 years ago

This is bound to happen in any industry where supply of talent exceeds demand AND the powers-that-be can get away with collusion (either by virtue of being 'private' or simply being powerful and thus not give a shit).

So what if one talented employee decided to quit one crappy company 'A' AND is unable to find work at the non-poach pact company 'B'? The place he quit will always find another willing sucker 'coz the supply is ever present (with, at most, a minor reduction in quality).

gizmo6862• 12 years ago

When supply exceeds demand, you do not need collusion, because there are unemployed workers who you can just hire at your target rate. If that is not enough money to entice them to work for you, then it would still not be enough even if you colluded.

What collusion allows is for the employers to maintain these low prices, even when demand exceed supply.

pron7• 12 years ago

This case is a beautiful demonstration of the dynamics of both "free market" and regulation. Free market dynamics demand (in this case as in all cases) that large players must never compete on prices or wages (as your competitors have the resources to fight back, so competition on price just makes everyone worse off). On the other hand, regulation was used both to stop an exploitation by the market (antitrust), as well as a tool wielded by capitalists to strengthen their stranglehold (patents).

It is perhaps worth reminding that the interplay between regulators and the market, and their co-evolution, have taken a different historical path than in Europe. While in Europe big government preceded laissez-faire, or at least, evolved hand-in-hand, the US was largely unregulated for many years. The result was that Ayn Randian titans took control of pretty much all power in the US, advancing the "economy" but at the same time practically enslaving the population. It was after many years of cries for help by the American people, and a long struggle led largely by the press, that Teddy Roosevelt was able to strengthen the government, wrestle back some power, and save the people from feudalist oppression.

Ironically, many Americans forgot what the US looked like when the government was powerless, and the market was allowed to roam free. People like Ayn Rand, who sadly came to the US just as the wheel was turning, didn't see the suffering that their romantic fantasies had brought about when playing out in the real world.

Obviously, as patent law demonstrates, regulation can be (and is) abused by capitalists. As the world changes, power shifts, and players adapt new strategies in this constant power struggle, both the market and regulation need to evolve hand-on-hand. The big question is what will play the role the press once played in exposing the workings of the intricate system of interests that is the economy?

crazy1van2• 12 years ago

" On the other hand, regulation was used both to stop an exploitation by the market "

I don't see any evidence that regulation stopped the behavior in this case. Perhaps the law will be used after the fact to sue or jail some people, but it doesn't seem to be what actually stopped the problem.

As another poster said, the class action date ranges end in 2009 because Facebook (a private company) wouldn't play ball.

Capitalism is a messy system, but it does tend to self correct in the long run.

pron7• 12 years ago

The practice stopped because of an agreement reached with the Justice Department[1]. I don't know which theoretical model leads you to believe that capitalism tends to correct itself, as historical evidence suggests otherwise: that the free market tends to converge towards feudalism (in the broad sense) – as happened in the US in the late 19th and early 20th century – or crisis; any corrections in course have always been due to public uproar which led to increased regulation.

[1] http://www.nytimes.com/2010/09/18/technology/18google.html

usefulcat• 12 years ago

Capitalism is a messy system, but it does tend to self correct in the long run.

That's quite a generalization; extraordinary claims require extraordinary evidence.

smsm4214• 12 years ago

If large players routinely pay top specialists low wages, they will cease to be large pretty soon, since their talent will be leaving for players paying better money and making those players large instead. Some people, of course, are impatient and want their enormous wage to be even more enormous - and now! And they want it while carrying no risk at all. That's where politicians come in - delivering other people's money while moving risk to somebody else is their specialty. Of course, their primary clientele is the same large players, but minor politicians are not above serving smaller audiences and endorsing extensive and complex regulations that would cost large players a tiny bit of their profits while making compliance so hard that smaller players would find it very expensive to compete. Which is all for good, so politicians can proceed with their good work. At the end, everybody wins - impatient people get a tiny bit of cash from large players, lawyers get a huge pile of cash from large players for managing the lawsuits, large players get higher barriers to entry, politicians get votes for restoring the order and everything is great because nobody ever asks where the money comes from.

sliverstorm5• 12 years ago

You say they will cease to be large, and "pretty soon" at that. You accuse employees of being impatient. But this collusion lasted for nearly five years.

Besides, how can their talent leave for players paying better money when nobody except for the large players can afford top wages? Just because Google can extract $150k+ of yearly value out of an engineer doesn't mean another company can. You need a large, successful business for that...

pron7• 12 years ago

Bureaucracy is annoying, slow, and unjust. But the situation now is much better than when the market was unregulated and robber barons did as they pleased. The American people suffered under the tyranny of the free market, they called on the government to save them, and it did. Nothing is perfect, and everything requires constant work and improvement, but we can use a gentle reminder now and then of how things used to be.

I don't think anyone believes Silicon Valley engineers are a bunch of miserable, oppressed working-class folk, but it's good to know how even the most seemingly progressive of corporations behave.

As to "making compliance so hard that smaller players would find it very expensive to compete", I think that regulation sometimes swings this way, but it is sometimes gradually, slowly, fixed. I don't think anyone would say that all regulation is always good for the big players and bad for the small ones.

Lastly, where does the money come from?

mindslight3• 12 years ago

Ayn Randian titans took control of pretty much all power ... after many years of cries ... Teddy Roosevelt was able to strengthen the government ... People like Ayn Rand, who sadly came to the US just as the wheel was turning, didn't see the suffering that their romantic fantasies had brought about

I'm confused - which side used the time machine?

mpyne• 12 years ago

I know this is HN, but maybe you should try to comprehend the message as it was obviously meant instead of choosing a possible interpretation that is illogical and then beating up on the interpretation you chose.

nnq• 12 years ago

OK, so you can stop the "no poaching" and you'll have:

--> smaller than they should be engineer wages --> higher engineer wages --> even higher engineer wages -->

... --> absurdly high unsustainable engineer wages -->

... --> more outsourcing --> even more outsourcing -->

... --> massive outsourcing -->

... ... ... --> smaller than they should be engineer wages

...I think the "evil masters" of this "no poaching" pact managed to prevent an engineers' job marked fluctuation. And you think about it, such a fluctuation would only have benefited the foreign outsourcing providers and encouraged the displacement of parts of tech industry outside US ...which imho would've have been a great thing for Europe's tech sector and maybe even for worldwide IT innovation as a whole, since lots of new pseudo-innovations start to sound more and more like "american-inbread ideas".

ceras• 12 years ago

Engineers wouldn't price themselves so high that they would be outsourced: that only happens to people who don't have any room left to let their wages fall, either because they already earn too little to sustain themselves or there is a legal price floor (e.g., minimum wage). An engineer making $200k isn't going to starve from taking a 50% pay cut, and they'd certainly rather take that than no job at all.

puppetmaster3• 12 years ago

don't tell me a about shortage if the market is manipulated

hanswesterbeek3• 12 years ago

Yeah those poor high-tech workers have a really rough life indeed, it's time someone did something about it!

JoeAltmaier2• 12 years ago

Laws and fairness are for everybody.

hanswesterbeek3• 12 years ago

There's no disputing that. I'm just voicing the sentiment of main street hoping that we techies take it to heart.

geebee2• 12 years ago

I'm really glad to see that this issue is getting more coverage in the mainstream press. There was an article/editorial a while back (discussed on HN) from the guardian, but unfortunately, the writer used the incident (the collusion) to go on a rant about how valley leaders are hypocritical libertarians. That (reasonably enough) lead to a long debate about whether the leaders are libertarians even if they are mainly democrats, etc...

This article stuck to the point much better. I do think Mr Levy (quoted in this article) went a little far in suggesting that the engineers are a very well heeled class.

"Santa Clara County, in the heart of Silicon Valley, has the highest average wage in the country,” said Stephen Levy, senior economist at the Center for Continuing Study of the California Economy. “San Francisco and San Mateo are not far behind. It would be a mistake to think of these plaintiffs as an oppressed set of victims."

Agreed, programmers in the bay area aren't dust bowl refugees. However, we need to recognize that the relatively high salaries don't go far in high cost regions (where many of these companies are located), and aren't that high relative to the higher wages typical of these regions.

Application developers in SF earn, on average, a tiny bit less than RNs and a whisker more than dental hygienists (links at end). I'm 100% ok with good wages for nurses and dental hygienists, but keep in mind that these tech companies have been almost frantically lobbying congress to do something about a severe shortage of highly educated programmers and engineers.

Well, first and foremost, how about you stop colluding to suppress their wages? That might attract a few more people into the field.

http://money.usnews.com/careers/best-jobs/rankings/the-100-b...

http://blog.sfgate.com/gettowork/2013/12/17/what-the-most-co...

smsm4214• 12 years ago

Is there indeed a shortage of app developers because of the low wages? I was always thinking of software as a segment where entry barriers are relatively low - compared to, say, medicine - and pay is exceptionally good. Of course, everybody wants to be paid better, but it doesn't look like software engineers are suffering especially badly from low pay.

geebee2• 12 years ago

People (including me) often say that barriers to entry are low, but I think it's a bit more complicated than that. There are no legal barriers to entry. But barriers to being a "mathematician" are also low. But would you say that the barriers to doing meaningful mathematical work are low? It's out of reach of most of the population.

Anyone can hang out a shingle as a software developer, but are the barriers to getting through the technical grilling typical of a software interview process really low? Just because there are no legal barriers doesn't mean that it's an easy thing to learn.

I don't think that software engineers are suffering from bad pay, but is the pay high enough that it makes sense to be talking about a severe shortage that the government should start fixing? Based on pay, I'd say we should take the "software developer" shortage about as seriously as we take the "dental hygenist" shortage.

acdha• 12 years ago

The full linked data for that occupation list really makes your point clear:

http://www.bls.gov/oes/current/oes_41860.htm

It's certainly not the case that IT people are hurting terribly but it makes it hard to argue that there is in fact a significant shortage or that we need programs to attract more CS majors rather than, say, simply paying at least as much as some of the other things students choose to major in.

discardorama3• 12 years ago

The sad part is that even though this behavior is illegal, no one will actually go to jail for this. Companies will pay a token fine (like Pixar and Lucasfilm did), and it'll be business as usual, but this time no emails and no documentation.

Unless a few people end up in jail for this, nothing will change.

denzil_correa• 12 years ago

Unless a few people end up in jail for this, nothing will change.

That's pretty much it. Does the govt come down on corporations for such acts? One rarely sees corporate honchos being jailed for such incidents. More often than not, it is a fine and then things move on to find and execute a different loophole.

discardorama3• 12 years ago

One rarely sees corporate honchos being jailed for such incidents.

... except when the corporate honcho refuses to do the government's bidding; in that case, his ass thrown into prison. See: http://www.washingtonpost.com/blogs/the-switch/wp/2013/09/30...

gizmo6862• 12 years ago

You don't need people to go to jail. One solution is to replace the token fine with a fine large enough that it is cheaper to play by the rules.

abofh• 12 years ago

It's a civil case, the companies are being sued by employees for back-compensation, not by the government for shady practices.

tosseraccount• 12 years ago

Gee. Maybe there is a labor shortage.

rdl• 12 years ago

Arguably this helped startups, since an ex Apple guy who couldn't go to Google could found a startup (and then maybe sell to Google later). Still lame though.

wnevets• 12 years ago

but I was told Steve Jobs was a great man

pyrrhotech• 12 years ago

Engineers are so highly underpaid for the value they contribute to these companies. What's the average salary, $140k? It should be $300k, half a million total comp conservatively. Even at that amount, employers would still be getting a 50-75% margin on you. It's insane how much we are ripped off. Good eningeers can literally make or save companies 10s of millions a year, but are never compensated for it.

wildpeaks• 12 years ago

Make your own company if it's that easy to literally make or save 10s of millions a year, that way you can set the amount of own compensation.

collyw2• 12 years ago

I am sure it depends on the engineer. Plenty of crap ones there that's work needs rewritten once they have left.

tomzinter• 12 years ago

Serious question - will this do much? Seems like in the case of a win, the companies will give token amounts (9MM from Pixar for example) and the claimants (given there are 64000) will get a tiny little check.

Am I missing something? Is this worth pursuing for a prospective claimant?

dba7dba• 12 years ago

The drive to maximize profit by those in the executive suite has caused them to do some seemingly clever (according to those in power) things but are in fact stupid in the long term.

A few years ago I overheard a new senior programmer argue with the cfo why developers should get 2 big monitors instead of a small 19". The cfo initially refused to go along. Of course some of it was due to his desire to keep cost down, as every good cfo should. But then he joked every dollar saved would mean more for his christmas bonus. we were a small/friendly company so I guess that's why he felt it was ok to joke about it. But I do believe his ultimate reason was to keep cost down at any 'cost' so that his bonus check would be bigger, as his performance is evaluated on how he manages the cash flow.

What the cfo didn't see was the productivity gain that could be gained by the programmers having bigger monitors. And these programmers were making near 6-figure salary. Their combined man hour cost was greater than his. But a cfo was making a decision to fatten his bonus check. Obviously this was not a good choice for the firm to make but it had been going on for awhile until the new senior programmer spoke up.

And I think this kind of logic in executive suite is probably common everywhere.

Lastly, I think it's about time these big tech companies add profit sharing ON top of the base salary as part of the compensation package. Why should an executive make SO much more than master and phds who are adding real value to the company?

Engineers Allege Hiring Collusion in Silicon Valley

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