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The myth of big salaries (it's all marketing)
- metaphor 3y ago(2009)
- em500 3y agoRelevant, as this was written during the last global financial crisis, when everybody outside the financial industry was busy agreeing with each other that people in the industry (especially banking) were hugely overpaid.
- paulpauper 3y agoYeah, a lot has changed since then and his post does not age well. The post-2008 era of trillion-dollar tech companies and winner-take-all markets, like social media and apps, necessitates superlative talent to get products out to market fast to capture invaluable market share. The difference between being early or late can mean missing out on literally hundreds of billions of dollars of valuation. It is not irrational at all for huge tech or finance companies to pay top dollar for talent when the returns are so great and things are so competitive, too. Paying $500k/year or more is immaterial when you're talking trillions of dollars.
- Traubenfuchs 3y agoName the other axes, Seth. What are they? What else is there but money? With sufficient money you can fill your positions instantly with top talent. Anyone pretending there are other answers is probably guilty of lowballing, wanting to lowball or the English translation of my name: a grape fox.
- tester457 3y agoAnother axis is purple
- quickthrower2 3y agoCareer prospects are another axis I would say.
- avery17 3y agoThat's just money with extra steps.
- quickthrower2 3y agoIt is power with money as a side effect. An important distinction. Say you go broke or get divorced or whatever, the experience and connections help you get back on your feet.
- jeltz 3y agoGreat team members. That one is very important too.
- AceJohnny2 3y agoWork-life balance. Job perks. Working on projects that you consider valuable. Non-profits are particularly good at that last point.
- captainbland 3y ago> Working on projects that you consider valuable. Sometimes I imagine all the very wealthy people thinking about where to allocate their capital like "hm, hiring more people to do computational cancer research? nah. Let's try and invalidate people's insurance claims through their ad clicks instead."
- asadotzler 3y agoMost corporations with any power are sociopathic institutions run by sociopaths competing with other similar corporations on who accumulate and deploy the most power. Punching down is always more lucrative than punching up and you don't change things or have breakthroughs without at least a little punching up. As you noted, that rarely happens because it's simply easier and more lucrative to fuck people over.
- ghaff 3y agoIt's really not beyond a certain level. Maybe it mostly is for entry-level but tons of people don't exclusively focus on highest comp.
- kevinmchugh 3y agoEquity? If you have the choice of a million dollars in salary and 100,000 shares or 1.1 million in salary and 50,000 shares, probably you should take the lower salary
- lanstin 3y agoautonomy is a big one for some people. respect. influence/power. As a software engineer I have left jobs because the total traffic was too low, and I was addicted to 10^9 and the like numbers in my counters. Additional salary is ok, but it functionally just means I waste more or less money before having to rein it in. If I saw really rich people doing more awesome stuff with their moneys, I might think otherwise, but having a Lambo or a house so large my kids would be less able to relate to people in general doesn't seem that useful. Get used to luxry clothes instead of my somewhat scruffy true style
- 1-more 3y agoA big one as a developer is internal investment. Who works on internal tooling and infrastructure? How robust is the CI/CD pipeline? How much of an event is it when a deploy happens?
- JumpCrisscross 3y ago> After a million dollars or so in salary, the absolute amount that a person is paid has no real impact on their life. They can't eat more meals in a day or wear more shoes There is more to life than food and shoes? This is one of the dumbest things I’ve read.
- jeltz 3y agoThe point still stands. Beyond some amount the absolute amount of money really stops to matter
- croemer 3y agoNot in the minds of the people competing for the job. They can get a bigger house with more money.
- michalf6 3y agoThe ability to exert power and influence over things you value continues to scale with money. There's more to life than consumption.
- mcguire 3y agoMoney is power. Of course, the people who think that's a super brilliant great idea are those with a lot of money or those who somehow expect to get a lot of money.
- lex-lightning 3y agoI think genuinely most people don’t want to exert power over others, so the value doesn’t increase for most
- JumpCrisscross 3y ago> Beyond some amount the absolute amount of money really stops to matter At national monetary scales, sure, because more spending would be inflationary thereby decreasing one’s spending power. So call it a trillion dollars or so. Not a practically relevant cap.
- j7ake 3y agoBigger salaries attracts more people, so you can have your pick of your favorite candidate. A bad scenario is the public school teacher path: they need better marketing and should be paid on par with the congressman, senators, and other highly paid politicians in government.
- ipaddr 3y agoWould you end up with money seekers like failed politicians?
- mc32 3y agoWe need normal schools that teach teachers like we used to. There are teachers who know less math than students and speak less than perfect English. If you’re a teacher you should have some basic competency thresholds.
- SteveGerencser 3y agoMy wife (engineer) taught a class called 'Math for Teachers', which was designed to teach elementary school teachers basic math. Not how to teach it, just how to do basic math themselves. A significant number should have failed that class but the administration refused to allow her to fail teachers who were failing for 'reasons'. She quit the job.
- mc32 3y agoAbsolutely what I observed as well with SF school teachers. Some were good and knew basic math and basic grade school English but a good number spoke and wrote like dropouts.
- bongodongobob 3y agoNo, because teaching is fucking hard. You aren't accumulating power. And you actually have to show up every day. Being a teacher is probably the opposite of being a politician.
- deleted 3y ago
- pyb 3y agoSavage : "Unable to muster up even a mite of marketing insight, they chose to compete on only one axis: salary..."
- opportune 3y agoThis is a garbage opinion piece demonstrating the archetypical boomer mentality of caring about your pay being passe. Trying to market an “innovative” workplace to save money on employee pay is just a cheap trick. Yawn Also, this should have a [2009] tag
- throwitaway222 3y agoAfter aging I'm starting to have new views on large salaries: 1. The money is just going to be saved. Net gain to the person is they're probably going to live for the rest of their life off dividends. Net gain to society, is any money taken out of circulation fights inflation. 2. If you pay someone a lot of money they will, essentially, spend it on other people. Either through salary or just buying shit. The richest people will make other people wealthy, and those people will make other people money too. Net again sounds like it's a benefit to not just the original person. 3. I've had lots of people say it's not a zero sum game. This is turning out to be true. Someone having success inventing and selling a new ketchup dispensing lid (and making billions) does not prevent someone from starting a successful company that makes Gyroscope toys that stands on its corner that can hold a tomato.
- gerash 3y agoSo you're arguing you can allocate capital inefficiently and it's not a problem. I disagree. Capital should be allocated fairly so those who are doing the work stay motivated and those who are not doing anything aren't disproportionately rewarded. Do you manage your own money this way? Do spend 10 grands on a running shoe because, well, it will eventually make the whole society wealthier and improve standards of living for everyone including you?
- deleted 3y ago[deleted]
- mcguire 3y agoThe neat part about it is that if my friend's buddy, Bubba (Yeah. He's an electrician.) goes to see a congressman, governor, or the president and says he wants something done, he'll get a big shit-eating grin and a "Sure, buddy, we'll work on that!" with a hearty handshake. If I go to them, I'll get offered a cup of coffee and possibly a few minutes to make my case. If the guy making $50,000,000 per year does it, then, well, his wish is your command. Money is power.
- JumpCrisscross 3y ago
- leesec 3y agoTruly a mindless article. Money attracts talent, doesn't matter what the historical rates have been or what the absolute cost to live is. If a good person can get 50 million instead of 3 million they're going to take it.
- n4r9 3y agoFor the record, not everyone is like this. And - one hopes - many of the most talented are not. I've pulled out of an interview process for a job paying 3-4x (with upwards potential) the job I took, because I saw more meaning and social value in the latter. The content of the job can be more important than the salary.
- wonderwonder 3y agoI am not arguing that this is how you live and if you find meaning in it, more power to you. I find value in maximizing my salary, I view work as trading life hours for dollars. The more dollars I can extract from each working life hour, the less I need to work and the more things I can do in my non working hours. It also allows me to establish a higher base level future for my kids. I have no loyalty to a company I work for as they generally have no loyalty to me besides the ROI they get from my work. If they can get a better deal by outsourcing my job to India, they will. We did not create this environment, corporations did so I find myself playing by the rules they created.
- asadotzler 3y agoSo you're pretending to disagree while also agreeing that the OP is wrong?
- toast0 3y ago> After a million dollars or so in salary, the absolute amount that a person is paid has no real impact on their life. They can't eat more meals in a day or wear more shoes. What matters to the manager is the relative amount. Sure, nobody needs more than a million dollars in annual compensation (in 2024 dollars), but relative amount gets you to your never need to work again number faster or slower. You might still work after you don't need to, but it's nice to not need to. And of course, there's economic milestones to be had like flying first class, flying charted, leasing a jet, owning a jet. Those certainly have an impact on your life, depending on how much you travel; and you might travel more if you didn't have to wait at the airport for a flight.
- lukas099 3y agoNumber of millions matters when donating to your favorite charity or political lobby, too.
- shermantanktop 3y agoI'm sure that's important to some people, but I'd be very surprised if that's why most millionaires are still going to work every day.
- lukas099 3y agoTrue.
- red-iron-pine 3y agodunno. after you get enough to meet all needs forever, the question then becomes "what can I build?" and how to steer civilization into something you want -- dictate the shape of things to come. way more motivating than trying to squeeze out an extra 30k per annum to get a slightly nicer condo
- danbruc 3y agoConsuming without working for it is immoral, flying privat jets and traveling more is bad for the environment. Those are not reasons in favor of higher salaries.
- Aqueous 3y agoI guess I'm not sure that there's a practical difference between "It's marketing" and "This is what the market rate is for a CEO." In other words, firms need to pay this much because that's what other firms are paying (at least.) That's not marketing - that's just the unfettered market at work. Which is why it needs to be fettered. I agree with the salary cap idea, because the market will naturally keep raising the price without bound unless there's something to counteract that, and it is terrible for the labor market as a whole (and even the company as a whole) to be paying so much for a CEO when the same amount could buy dozens or even hundreds of workers.
- srackey 3y agoA salary cap doesn’t change the market rate! It just obfuscates it. Salaries for public companies locked at 10M/yr? Ok, now firms have to compete on amenities. (Your current firm gives you a free car? Ours gives a jet, a personal Michelin star cook, and complimentary beverages)
- n2d4 3y agoCompany benefits are also a form of salary. If your company gifts you a free car, they have to tax it as such.
- krupan 3y agoYou'd think so, right? Look up why corporations started providing insurance to their employees. Look into why your compensation is not just a salary, but salary, bonuses, stock (options or RSU's), etc.
- humbleharbinger 3y agoI've worked jobs where I'm paid 60-80k and where I'm paid 100k plus. I can tell you for sure I cared much less about the job where I wasn't getting paid as much. I would never answer an after work call or go out of my way to follow up organizational or systemic issues. For me working overtime is part of the package when I get paid loads more.
- jacobyoder 3y ago> For me working overtime is part of the package when I get paid loads more. I've tended to think this way, but it's all relative. Plenty of people who've never had a $50k job will treat the $100k job as the baseline/minimum, and wouldn't ever think of going the extra mile like you do. For you (and me?) - yeah, you're paying "a lot", I'll make sure I do a bit extra/more when needed. But if you've never had less, that $100k is your bottom, and you might only consider doing 'extra' for a $200k job.
- latexr 3y ago> (Aside: should the guys who drive an armored car that carries millions of dollars in bonds get paid more than the guys that drive an armored car that only carries thousands of dollars in cash? Does the amount of money handled change the difficult of the work?) Possibly, yes. The amount of money handled might affect the likelihood of a heist, and the required preparedness of the robbers. Which in turn requires more skilled drivers facing a higher risk. https://www.youtube.com/watch?v=lsu6AhYzG_4 https://www.youtube.com/watch?v=lsu6AhYzG_4 That aside was an unnecessary bad tangent which undermines the point.
- mcguire 3y agoWant to know something weird? A convenience store or liquor store is much more likely to be robbed than a bank.
- deleted 3y ago[deleted]
- latexr 3y agoThat isn’t weird at all. A residential home is also more likely to be robbed than Fort Knox. It goes back to the required preparedness of the robbers. Either way, I wasn’t the one who picked the example. Seth didn’t ask “should a liquor store employee be payed more than a bank teller”. Which wouldn’t be a good example either, as we’d be comparing too many different axis.
- lex-lightning 3y agoDevil’s advocate: they’re both clerks and the liquor store is more dangerous, so yes they should be paid more
- deleted 3y ago[deleted]
- bluGill 3y agoNot really, banks are well known to have protections such that you are likely to be caught (most of which I don't know - and those who do know are not talking). It is also well known that you don't actually get much money. There are convenience stores that still don't have cameras. Liquor stores have liquor - which is probably what you want not the money anyway (money can buy liquor, but you have to go two places now)
- FredPret 3y agoWhat a tone-deaf article. - Salary is absolutely the key factor when people pick jobs. The difference between a fun hobby and a great job is that you get paid a lot to do the latter. - Here he's saying that companies should create a buzz around jobs; but having good feelings about your low-paid job doesn't help you nearly as much as just having lots of extra new wealth. - Saying that because high-end employees are far beyond the "buying food" stage of Maslow's Hierarchy means more money is unnecessary is just brain-dead. Economic growth anyone? More money = good. - High pay is a great way for companies like Google to prevent competition. Why risk starting a business when you can earn a million bucks every couple of years working for them? - High CEO pay is absolutely not a problem. If a top CEO increases a company's market cap by billions, and is only paid tens of millions, then what a waste of time and emotional energy it is to fixate on the tens of millions. I can't believe this character is actually advocating for lower salaries.
- ghaff 3y ago>Salary is absolutely the key factor when people pick jobs. Eh. It's a key factor. Once you get beyond a certain point, many people take lots of factors into account for jobs that are not otherwise basically interchangeable.
- 5thaccount 3y ago[dead]
- FredPret 3y agoA CEO picking between a $10m / yr gig and a $50m / yr one would have to have rather a lot of soft factors working in favor of the lower paid one to justify it.
- ghaff 3y agoAlmost certainly a lot of that would be variable comp depending upon a bunch of things. And I could also imagine a $10m gig (especially with speculative equity) at a company with really exciting prospects could trump a $50m one for a stodgy company not going anywhere.
- mullingitover 3y agoBeyond a few million a year, the rest of the comp is really providing something that's more difficult to purchase with money: power. So, while there's a diminishing return on the benefits of additional money in a person's life, a certain subset of people have an insatiable desire for more power. It's problematic in what's supposed to be a democratic society with a fairly flat amount of power distributed among citizens. We essentially recreate a hereditary nobility, which reduces the fitness of our civilization as a whole since we no longer have the most qualified people making the decisions.
- Gormo 3y agoMoney only equals political power to the extent that the political power itself is up for sale. Attempting to suppress the acquisition of money via political power will ultimately just create an alternate elite that denominates power via something other than money. The only solution is to reduce the reach of formal political power such that even if it is easier to manipulate it with money, it still can't be used to conduct abuses. Fundamentally, no one is qualified to make decisions for anyone else in the first place, and the way we ensure the fitness of our civilization is to disaggregate and decentralize power.
- mullingitover 3y ago> Fundamentally, no one is qualified to make decisions for anyone else in the first place, and the way we ensure the fitness of our civilization is to disaggregate and decentralize power. This just sounds like one of the libertarian greatest hits, and this line of political philosophy is how you end up with bears taking over your town[1]. I think on the contrary, centralized power is necessary, and the solution to the problem of corruption is extreme transparency. Balkanized decision-making is entertaining, but not a sane way to organize a society. Pick competent people, give them the authority to make the decisions that are best for society, and surveil the living hell out of them while they have that authority to prevent abuses. It's not like corruption and abuse of power doesn't exist in small towns, on the contrary I'd say it's worse. [1] https://www.vox.com/policy-and-politics/21534416/free-state-project-new-hampshire-libertarians-matthew-hongoltz-hetling https://www.vox.com/policy-and-politics/21534416/free-state-...
- fizx 3y agoYou don't need Max Verstappen to drive your armored truck, but you sure do need Steph Curry to sell basketball tickets. The level of competition between companies--the level of talent needed to win--is what drives the salaries.
- jbs789 3y ago“In fact, we need more private companies that innovate and pay their staff a ton. But if you're owned by shareholders..” Private companies are owned by shareholders. That’s just one of the internal inconsistencies. Bit curious. Leads me to question the whole argument.
- asadotzler 3y agoWhat he's suggesting is that the massive public markets drive companies in ways that tiny groups of people who came together specifically to make a company plus perhaps their friends, families, and a few moneyed investors, simply don't. That you can't quite connect with that suggests you are not the target audience for this article.
- wonderwonder 3y agoThis article is pretty shallow and sounds a lot like the people on Reddit calling for the removal of billionaires and how its the fault of the rich that they are struggling without acknowledging the amount of work it takes to become rich. The same people that minimize what people like Musk have accomplished. If I get paid more, I work harder. There is obviously a realistic limit on how hard I can work. The longer I stay at a company though the more knowledge I have and the more effectively I can utilize my time to accomplish my goals and those of the business. If I can get a 20% raise somewhere else and do the same amount of work, I will do so. In order to keep me, my company just has to match my new salary offer. Something that they are free to do or reject based on their valuation of what I bring to the table. A million dollars is a lot of money, but its significantly less if I need to buy a house in California vs Wyoming. The free market does a relatively good job of assigning capital, lets not make up arbitrary caps based on make believe morality.
- manuelabeledo 3y ago> ... without acknowledging the amount of work it takes to become rich Being rich has more to do with background, than work. > The same people that minimize what people like Musk have accomplished. The son of a property developer and part owner of an emerald mine, and a top model, no less. What I'm trying to say is that getting a jumpstart, while not guaranteeing a path to success, does provide a massive advantage over those from poorer backgrounds.
- wonderwonder 3y agoLets say I agree with you and Musk was given a large amount of startup capital (he wasn't). If I gave you say 10 million, could you turn it into 300 billion? 10 billion? 1 billion?
- manuelabeledo 3y ago> Lets say I agree with you and Musk was given a large amount of startup capital (he wasn't). That's relative and debatable. Musk was born to a wealthy family, and had the opportunity early in life to move to California. He founded his first venture the same year he arrived, in 1995. It was initially backed by angel investors, and then received a $3M investment just one year after. That's $6M adjusted for inflation. Only an unfathomable small minority of the world's population, with both the money and the connections, are able to afford this. > If I gave you say 10 million, could you turn it into 300 billion? 10 billion? 1 billion? Maybe. We will never know, because I wasn't given the opportunities Musk had since childhood. I have yet to encounter a rich guy whose parents weren't, at the very least, well off enough so he could go to good schools and live a relatively comfortable life. Most rich people I have spoken to are, in fact, quite disconnected from the struggles of being poor. Many would claim that they are either self made, or come from a lower middle class background, yet haven't gone hungry for a single day in their lives.
- CurtMonash 3y agoThe post is from 2009, and hence shortly after the mortgage derivatives market meltdown.
- roncesvalles 3y ago1. He keeps saying marketing but salary is actually a pretty good indicator for how good a job is. 2. You pay to retain not to hire. You can hire people at practically any price point. Whether they'll stick around for longer than 6 months is a different matter. I've seen multiple startup founders burnt by this.
- ChrisArchitect 3y ago(2009)
- andrewjl 3y agoThis post raises a question I'm curious about: is executive pay higher or lower in private firms compared to ones that are public? Adjusting for confounding factors like size and sector.
- azlev 3y agoSince it's a 2009 article and there is taxpayers in the text, I think he was upset because the great recession bayouts and even with all world crumbling at the moment, large bonuses to C-Level. Now it's 2024 and I expect lower profits in the middle term to companies that pays anyone more than they give in return.
- TrackerFF 3y agoI've said this before, but the managing director of the Norwegian Pension Fund - which currently sits at a cool $1.56 trillion, has a $657k salary. Nothing more, nothing less. The return for last year was around 25% Some of the fund managers there make more than the managing director, but still, we're talking about a "modest" figure in the $1mm-$2mm range. That's paltry pay compared to the big bucks made in hedge funds and private equity. The pension fund could have paid out hundreds of millions to their fund managers, and it would only have been a rounding error in the grand scheme of things...but still they manage to attract top talent. There's this culture on Wall Street (or Connecticut, or London...) that they are the only ones that can bring big returns, because they're the right combination of correct pedigree, professional experience, network, talent, etc. In the end, it's just good salesmanship. Tons of funds deliver mediocre returns, while making bank.
- lkdfjlkdfjlg 3y agoGood example. Yes of course, not everything is about money. There's also 1) prestige and 2) the promise of future money. The Norwegian Pension Fund specifically is very prestigious, and it promises that anyone who can do a good job with $1.5tr probably can also do a good job at one of those 100bn fund that do pay 10m/yr.
- ZoomerCretin 3y agoThe talent available for this position far outstrips supply. So the jobs go to the credentialed children of the elite, who of course require hefty compensation. In the age of index funds outperforming hedge funds, the real question is how long they can keep up the grift.
- krupan 3y agoIs the manager of that fund really "top talent?" How hard is it really to make 25% off of $1.6 trillion? I'll bet you could do it. Also, that's a very different job than working at a hedge fund. Hedge funds have to attract investors. How do they do that? By saying, "look at the expensive managers we have!" A government pension fund doesn't have to do that.
- 3y ago
- lkdfjlkdfjlg 3y ago> (Aside: should the guys who drive an armored car that carries millions of dollars in bonds get paid more than the guys that drive an armored car that only carries thousands of dollars in cash? Does the amount of money handled change the difficult of the work?) Aside from the bigger point of the article, what a horrible analogy. Yes, of course handling more money makes your work more "difficult", where any reasonable definition of difficult has to incorporate the fact that bad people will do crazier things for more money than less.
- stavros 3y agoA bigger bounty means the bad guys can employ more expensive ways to get the truck. If you use the armored truck that transports thousands of dollars to transport millions of dollars, you're asking to get robbed, because the truck only costs "thousands of dollars" to rob.
- throwaway240412 3y ago> After a million dollars or so in salary, the absolute amount that a person is paid has no real impact on their life. They can't eat more meals in a day or wear more shoes. What matters to the manager is the relative amount. Take the now-defunct "American dream" of a single-income family with 3 kids living in a house with a backyard, say, in Silicon Valley and other places that have mobs paying more than $1 million to people, and that goes away pretty quickly. After tax, with standard deduction, and 5 allowances, that $1 million turns into $529k net. With a $7k rent plus $5k in personal expenses per person (pre-school tuition alone is about $3k, so $5k in personal expenses is not outrageous), that leaves at most $145k in savings. With a $12k mortgage (the median price in Santa Clara county for all residential is $1.4 million, I'm using $1.8 for a house), that's down to $85k in savings if you live frugally. But, as other people say, there's more to life than food and shoes.
- achatham 3y agoBut isn't that the "relative" point? A house in Santa Clara doesn't cost $1.4M because it's 3x better than a house in another state, or costs 3x as much to build. It's because there are a lot of other high-salary people in the area who need a house and not a lot of houses being built.
- unbalancedevh 3y ago> that's down to $85k in savings if you live frugally Saving $85k per year, which is way more than the median income in the US, is fantastic for a family of 5, while simultaneously building equity in one of the most expensive markets. And $5k in personal expenses per person per month is hardly living frugally, especially for a 1-income household where presumably child care (and pre-school) isn't necessary. I don't live in an HCOL area, but non-discretionary expenses for just me, besides rent/mortgage, are about $1200/month. Food and clothing aren't 4x as expensive in SV are they?
- Biologist123 3y agoThe job of corporate lawyer is so singularly awful, with awful colleagues, the firms have to pay the salaries as that is all there is.
- krupan 3y agoWow, people used to nearly worship Seth Godin, it's pretty refreshing to see a whole lot of disdain for this article here :-) I think there's something to his point about marketing. There probably is a way for companies to pay a little less but still attract the top talent by selling the job better. But then, why hasn't anyone figured this out and started doing it? Maybe financial workers, CEO's, laywers, and engineers see through it? This part is just hilarious, "an industry-wide tax and trade salary cap will actually help these organizations." I mean, I guess maybe he really is feeling like this sort of regulation would be a charitable thing to do? It's actually a terrible idea though.
- ZoomerCretin 3y ago> it's pretty refreshing to see a whole lot of disdain for this article here :-) This is Hacker News. World peace and Star Trek-style wealth and post-scarcity could be achieved and we'd still have an overwhelmingly negative Hacker News comment section nitpicking the way peace was achieved, or lamenting that life was better with poverty and the threat of war.
- krupan 3y agoI'm pretty sure it was hacker news roughly 15 years ago that introduced me to Seth Godin. Or maybe it was Slashdot. Either way, there was a time when engineers were excited about starting businesses and were drinking up everything they could about marketing because we knew we sucked at it (and probably because PG told us to).
- asadotzler 3y agoThat time is not now. Now HN is half corporate boot lickers defending the status quo, like the temporarily embarrassed billionaires they are, while the other half are using HN as a political soap box to rail against San Francisco or the current federal administration or last year's HN icons who have since fallen off of the pedestals HN put them on. It's become mostly a joke where perhaps 1 of 10 comments are insightful and hacker-y, the inverse of what it was 15 years ago when intellectual curiosity and, you know, hacking, were seen as more important than preening and demonstrations of social status. HN is becoming Instagram or Twitter. It's nearly fully degraded to NextDoor levels of discussion.
- stvswn 3y agoThe argument that "no one really needs more than $X" is always a flawed one, in my opinion. I don't make $1 M a year, but if I did, I'm absolutely certain I'd prefer $2M a year. I can imagine all sorts of things I'd want -- vacation homes, fancy private schools for children, whatever. At $1 M a year I'd end up doing things that put me in contact with people who make more than me, and I'd think "oh, that's pretty cool, that stuff they have." OK, OK, before you comment that "I don't need that," well, who said I did? I said I'd prefer it, therefore it would be an easy decision to switch jobs for it, all other things being equal. So if you disagree, why is the amount _you_ make the defensible amount? Do you need it? Maybe 100k should be the max -- that's twice the median U.S. income, after all? Why do you need more than the median U.S. income, how greedy are you? Etc. etc.
- krupan 3y agoGood economists don't talk about needs vs. wants, it's all wants because anyone can argue just about anything is a want and not a need. You need food, but if you ask for anything more than beans and rice, that food is now a want. Really? No, we aren't going to play that game. You want food. You want a place to live. You want transportation. It's all wants.
- hiq 3y agoThis article seems to put a lot of people into its "big salaries", from CEOs to fresh graduate. I'd argue that, past the million dollars mark, it's hard to claim that n > 0 other people could do the same job for cheaper. Companies don't end up paying these amounts for employees they consider fungible. Their jobs are also more likely to be somewhat unique, somewhat shaped by themselves to a certain extent, such that the company marketing is unlikely to convince them anyway. More generally and even for employees paid less than that, the compensation and especially its constant part (salary) is the one thing we can trust when we sign. The company and its culture might change, my manager with whom I've had a good relationship might leave, but it's still unlikely they'd decide to reduce my salary (maybe it'd be impossible to come back from when it comes to recruiting new hires, reputation-wise?). There are also many companies that are just not known enough, or have team-dependent cultures, such that when you start, you don't know how it's going to be. The compensation is also the one thing you take with you when you start a new job, as a baseline for negotiations. Good luck saying that your previous job had meals or massages on-site, so your new job should figure out a way to accommodate that for you. I think that's a big part of this one-axis marketing, how concrete the compensation is in comparison with most other aspects of a job.
- sequoia 3y agoIt's pretty absurd of him to talk about how it's ridiculous that people are paid $50mil (I agree) then pivot and say that $120,000 per annum for a new grad is another example of "ridiculous comp." These things are not in the same ballpark, they are qualitatively different. I don't know the author but this is so bizarre it makes me question their analysis overall.
- 8f2ab37a-ed6c 3y agoBrings articles like this to mind: https://www.sfgate.com/local/article/under-100k-low-income-san-francisco-18168899.php https://www.sfgate.com/local/article/under-100k-low-income-s...
- krupan 3y agoIn his defense, he (should be, at least) talking about relative pay for each job. It's like talking about the price of milk and the price of caviar (or some other expensive and rare food, I don't know). You can find both at prices that you would call ridiculous and at prices you would say are a good deal, but those prices would never be in the same ballpark. A wise consumer can save money on both by shopping around.
- lowercased 3y ago"Law firms went through this cycle twenty years ago." The reference was to new law grads 20 years ago getting $120k jobs. That indeed was a high starting point for most recent grads from most fields 20 years ago.
- sequoia 3y agoagreed, but this is IMO qualitatively different from a 50mil salary. The $120k job might be classified as normal competition for talent and therefor be outside the scope of what this article is talking about (astronomical salaries).
- nostrademons 3y agoAs with everything, TANSTAAFL. The danger with offering "marketing" instead of salaries is that it locks your company into valuing (and continuing to offer) the boon that got people to join it in the first place. Google (and HP before it) used to distinguish itself with "We take care of our employees, give you decent work-life balance and flexible working arrangements, and let you work on self-directed projects. We will probably not be the absolute highest compensation you can make, given your skill level." This worked great when it actually offered those. At the very first hint of layoffs, or RTO, or manager-directed product priorities, Googlers ask themselves "Wait - why am I working here again?" In pretty short order, the only ones left are those that actually are motivated by money, but couldn't get a better offer. Similarly, Apple offers "the ability to work on products that users love", and tends to pay a bit less than similarly-skilled employees can get elsewhere. This works great, until users cease to love your products. Current Apple is lucky that they are still on top, but historical Apple absolutely went through this sort of brain-drain from 1993-1997, when they were not on top in product quality and so there was no real reason for skilled people to work there. The big advantage of paying a lot is that you know that the type of person you get is motivated by money. If you want them to do something, pay them a lot for it, and make that pay contingent upon them actually doing it. It takes ulterior motives out of the equation and gives the corporation flexibility, because the only reason people work for it is the money.
- krupan 3y agoFWIW, Google and HP back in their days did still pay among the highest if not the highest salaries. But you are right the ideals mattered a lot to the employees and it's really really hard for a company to maintain those high ideals for too long, but I think HP did it for around 40 or 50 years. Google for maybe 15? Different time periods though.
- nostrademons 3y agoThe competition for Google back in the days wasn't a random enterprise software shop, it was usually the financial industry or starting your own company, both of which could have payoffs in the tens of millions. When I got my first offer letter (2009), they explicitly said "Googlers do not generally work for Google for the prospect of outsize financial gains." They paid very well compared to your average software company, but there was no way they could match say Jane Street or D.E. Shaw.
- readthenotes1 3y agoI think the limit of a million dollar annual salary makes a lot of sense and we should start with the entertainment industry. The NFL is on my mind, as of course is soccer since there was a actual football player in one of the commercials during the recent game
- novok 3y agoHahahaha, this is capital complaining about the increasing cost of labor because of supply constraints straight out, which has been increasing world wide recently because of super-ZIRP and COVID killing off a margin of the workforce. Will he suggest a cap and trade wealth tax over the estate tax limit while people are alive next? No. The capitalist here is berating other capitalists for not having enough marketing savvy to get labor at cheaper prices. Seth is a capitalist, he treats his work as a business to build vs. a salary to earn. On top of this, Seth's business is consulting to other businesses about marketing, using the marketing techniques of saying something a bit wrong and agreeing with the common man about some stereotypes to enhance it's virality. It comes to pure supply and demand, and they wouldn't do it if they weren't making more money off of it. It's never about what you "deserve". Anybody on a salary without significant equity ownership is labor, but it's expensive labor in this case. Because if the business could get equivalent quality labor at cheaper prices, they would! He also knows that "Goldman Sachs" is about class, because they make their money via front office sales, and someone lower class is not going to make a good salesman. Anybody who can do spreadsheets, basic algebra and have a cocaine driven work ethic can do banker jobs, it's not a talent issue beyond insane work ethic and social skills.
- tim333 3y ago> claiming that they need to pay CEOs $50,000,000 salaries in order to recruit the very best ... >After a million dollars or so in salary, the absolute amount that a person is paid has no real impact on their life... At the high end it isn't really about employee lifestyle, it's about the value the person can bring to the business. If one CEO will take a $100k salary and keep the business about the same and the other wants $50m but will add £1bn in value to the business then the latter is a better deal for the owners. And the person wanting the $50m may not be greedy but just being offered similar elsewhere because they are good. Of course in real life people often get the high salaries without actually being that good which is a less fair deal.