Ask HN: What a universal remote job salary should be?
the salary of remote job depends heavily on the current location of the person
but if we took out rent from the equation what should a person be getting? This is a nonsensical question and of course there is no answer. Any time you are asking about universals in regards to the lived experiences of human beings you need to take a step back. This principle applies to issues many orders of magnitude less complicated than employee pay which i think goes to show how absurdly far off track this question is. To illustrate the point,say you conclude some "universal pay" (good luck even defining what that means, who it applies to and when it applies) . Why do I care? I'm still going to go live my life and maximize my pay for my particular situation. So your universal pay is already not universal after the thought experiment of trying to apply it to the first person who you cannot directly control . You'd be just as good debating how many angels can dance on the head of a pin. I second this opinion. From experience, as I was on both sides of hiring desk, if market offers better pay than the one candidate accepts, it is almost certain candidate will be gone a few months later. I cannot imagine how "universal pay" would work here. If market is forced to pay X then one of the sides would be unhappy and would seek to change the situation. Also people face different circumstances, like person with mortgage vs person without mortgage, person with savings vs person without savings, person with family vs person with no family. Different circumstances will translate to different pay that will look good in the one's eyes. Maybe we have some opportunity at the moment (on both ends) - that opportunity will probably be gone after some time, as more people take advantage of it. Market will even out until "the next thing".. Living in a poor country shouldn't be a reason to get a low rate. But this is really common, mostly because companies look for people in third-world countries to get the same level of employees waaay cheaper. I'm from Uruguay and have had interviewers thinking they're doing me a favor for extending me an offer in USD, even if it's ridiculously low for my experience. In the end it depends on how the potential employee negotiates their salary ha, I'm also from Uruguay. A couple months ago I received 3 offers. One of them explained their offer was "the salary from Philadelphia adjusted to the local market". The other two offers where comparable to what I've been making (similar to a US salary). I didn't go for the "local-market adjusted" one. The only thing they're doing is missing on some talent, but that could be ok for them. Also: nice to see you here as well, this is a small scene :P it took me a bit to recognize you! hahha no waaay who are you? I live in Malaysia. I'm getting paid USD24k annually right now. If someone wants to offer USD40k, I'd take it right away even if it's the lower end of the US standard rates. At some point, you're competing with other remote offers though. Totally, and probably from there it would be easier to find a 60-70k job. That's why I think assuming people from "poor countries" will be necessarily cheaper is a huge misconception In most countries to hire a remote foreigner requires to jump over some legal, and accounting complications. So yes, they do it because they want to find a cheaper deal abroad. It's pretty much the only reason why it makes sense for them, besides searching for very rare skills. And there's nothing wrong with it. Nobody is prohibited to try to negotiate the same rate as in an expensive city in US, and good for you if your qualifications allow you to have success with it, but in most cases it means a company would be better hiring a US employee instead of outsourcing. Sometimes it's not just about finding people that work for less money, it's because they know there's also talent out there. Even for companies that pay good salaries it's very hard to hire local senior-ish engineers, most of them already have a job, so they have to hire somewhere else. Long ago I was part of startup based in developed country which was hiring people from one of developing countries. Salary offered was lower than if it was somebody from startup's area, but it was very competitive on the market where developers was recruited from. Developers was very happy to be offered salary higher than their peers, in the same time startup was happy to get qualified engineers for less money than it would have to pay if sourced locally. This would not work today because salary expectations are now similar in both countries - this same startup is now bringing those jobs back to the local market. I was observing similar situation 15 years ago in one of big corps who outsourced everything to India. For a price of one engineer from developed world they was getting many engineers in India, and those engineers could afford services like personal chauffeur. I could not believe when I heard it first time from friends I have there. Again - situation now is much less in favor of big corp, which is now trying to bring some of those jobs back to the local market. I worked at a remote first company once, where EVERY developer in the team earned 150k USD. We had one person from Nigeria, a bunch from Austin and a few all over Europe! This is great, but extremely rare what was the salary for the person from Nigeria? "EVERY developer in the team earned 150k USD" We have that now and it's called the market-based salary. > if we took out rent from the equation Then we only need to consider A thing I never understood is, what happens if, let's say, I stay in a HCOL area until I am doing interviews (eg Switzerland) and then when hired I move back instantly to a LCOL area (eg Albania): what happens now to my salary? Do I get a cut just because I decided to move? And what if I am a digital nomad and know I want to change nation in which I stay every x months? I think it depends on the company. Some companies (GitLab) seem to (or used to) build location into their salary calculations. Others (Automattic, where I work) don’t, or at least try not to. But even expanding that to situations where you move, both companies I mentioned state that they don’t reduce salary in general. At Automattic, that means you would get paid the same if you started in HCOL and then moved to LCOL. But at the same time, you might theoretically start out making a bit more than average in LCOL or a bit less than average in HCOL, depending on your situation and experience. Some more info: https://techcrunch.com/2020/05/26/how-automattic-pays-its-re... Disclaimer: I don’t know the exact specifics of these programs, just sharing some basic info :) Even if, why not just legally live of your uncle who has an apartment in San Francisco, while you defacto live in South Alabama. With remote jobs I don't understand why someone living in a cheaper City should get less. It's not a matter of should. It's just that, on average, someone in a cheaper city will accept less than someone in an expensive city because what is too little to cover rent in some places allows you to live like a king elsewhere. It's just supply and demand. Give 50k in a poor country, and (assuming there are enough qualified people), you will have quite a lot of choice. Give 50k in SF and people will be laughing at you. Why give 200k in the first instance when there's enough supply with 50k? At least in America no one who makes 50k in Alabama will be worth 200k in SF. There's nothing legal about that. If you claim that you live in SF to get SF salary but live in Alabama. You are committing tax fraud. You need to file state taxes based on your location. If you live in both places, tax forms allows you to set how long you have lived in both places. You will be earning the benefits of Alabama but paying no tax to them. That's why it's not legal, so if you wish to be legal you shouldn't lie about your location. Also your unemployment tax will be paid to SF and not to say Mobile, Alabama. Outside of taxes, different states have different rules on say over time, paternity leave, termination process, non-compete, discrimination laws that companies need to be compliant with. You're not getting less, the world doesn't have a global currency with fixed price. It's all about earning power. If a company has an office in Alabama, and another office in San Francisco and another in Accra, Ghana. Employees won't expect to be paid the same, so why should they expect the same because they are remote? Agreed, globalized salaries should also consider people moving around and shouldn't depend on current location (unless of course money is not enough to live in the current location). I had an interview the other day with a local company that offered very sweet remote packages and a not-that-sweet on-site one. I said I would leave the country when I got the job and work in a digital nomad way, and they said that because of my current location I would only be offered the local package. Weird situations like this make me think we're not quite there regarding fair remote work yet Some studies suggest happiness per dollar salary peaks around $65k to $90k USD. So for an international corporation where obviously most people will have cheaper cost of living than the United States, that seems a good starting point. This is low for Silicon Valley salaries so it may dissuade those accommodated to salaries in that high range. This isn't how any of this works. You're completely ignoring the rest of the job market. "It may dissuade" - no, you're moving your operations abroad with extra steps. For Los Angelrs such a happiness per dollar will only buy you homelessness when average rent is $4000 a month and suppose you have family obligations some studies suggest some studies are full of BS They should be paid relative to the value their skill set provides the employer. Not all employees are equal. Assuming that there should be a universal salary, I seem to recall a lesson an economics lesson on the interaction of supply and demand in determining price. The bigger question is whether there should be a universal job salary for remote working jobs. It should be dependent solely on the negotiations skills of a candidate most devs will take whats given or just ask for lowest possible
alot of people in the dev community never negotiate on a thing
https://news.ycombinator.com/item?id=26932978
this thread highlight it well Interesting
and what if i work remotely from a poor country?
would i be subject to the same salary as them? You can always apply for those remote jobs and ask for the same salary. As someone who has always been on fully remote teams, I've found that ease of communication and time zones are a big deal. If someone is harder to communicate with (English is a second language) or doesn't overlap with the rest of the team's work day and costs the same as a dev in the US, I may end up going with the dev in the US. People who says pay should be about value provided are ignoring several things, including: 1) I have no idea how valuable someone is before I hire them, and 2) it's much easier to trust employees who are in the same legal jurisdiction as me (which has a value). For example, I have two devs in South Asia who cost half of a US dev each, but they're also not very independent and they have very limited skills. They make a lot of money for their country and the price for the value is exactly right for me. This is my experience too. People, including myself initially, vastly underestimate the impact of a language barrier and time zone issues. I'm not in charge of how we hire where I work, but if I were, I'd happy trade 5 Asia-based devs for 2 U.S.-based devs. And the offshore folks I work with have solid skills, but the communication challenges and time zone differences really hamper productivity. If you aren't able to estimate how much value somebody would bring to the team before hiring them, you maybe should oil your hiring process a bit. Also assuming you can trust somebody more or less depending on their legal jurisdiction says a lot about your company's culture > If you aren't able to estimate how much value somebody would bring to the team before hiring them, you maybe should oil your hiring process a bit. I can't interview someone for a few hours and predict how they will be as an employee. No one can. Sometimes you hire people and are under-paying them, sometimes you're over-paying them. > assuming you can trust somebody more or less depending on their legal jurisdiction says a lot about your company's culture So are you saying that all countries have the same laws, and all those laws are equally enforced? If one of my US employees embezzles money from a client using Stripe credentials, I can easily find and prosecute that person (as long as they're still in the US). Anyone US employee would know this and weigh it against their reasons for wanting to embezzle in the first place (if they have any). If one of my employees in (let's say) Pakistan did the same thing, there is absolutely nothing I can do. I have no recourse. They would easily get away with it. It is common and normal to trust people more when they're in the same jurisdiction as you and abide by the same laws. You may underpay or overpay people, that can also happen with local people. I bet you don't leave much space for overpaying a foreigner if they are already getting 50% of what a local would get. Regarding the criminal related comment, you should first and foremost trust and empower your employees independently of where they come from. And then you should also have controls in place to make it really difficult to steal your clients' money. > I bet you don't leave much space for overpaying a foreigner if they are already getting 50% of what a local would get. They are getting 50% of what a very senior dev would get. They each make 4x the market rate for their country for this type of work (based on Upwork rates), which is 27x the average salary there. > Regarding the criminal related comment, you should first and foremost trust and empower your employees independently of where they come from. And then you should also have controls in place to make it really difficult to steal your clients' money. Thank you for the philosophy lesson. Do you have experience hiring people from many countries, or is this theoretical for you? It isn't theoretical for me. What you are saying is exactly what I do. I trust all of my employees completely, but literally everyone who is betrayed made a mistake in trusting someone. I am not arrogant enough to say that my trust is 100% correct. So how do I make it difficult for people to steal money? I rely on my country's law enforcement. It is impossible to keep devs away from at least some sensitive data, like API keys. The "control" you're talking about is partly to hire people who have more incentive not to steal than to steal. If that impersonal approach works for you and everybody is happy with it, that's fantastic. I haven't hired myself but I have worked with people from all over the world with different backgrounds for many years and have had literally zero close cases of anybody misusing an API key on their benefit for whatever reason. It wouldn't have made any sense for them to do so. And the control I talked about is security logging, monitoring, alerting systems, etc. I've worked for a banking company and also for a fintech one and all the money movement operations were duly logged and monitored. Literally nobody would risk doing anything malicious in an environment like that plus people are happy with their salaries Yes. Products companies produce aren’t cheaper in say India or Mexico then they are in the US.. because they are valued at a certain dollar amount they deem fair. Why should a human being be any different? A good engineer produces certain value, regardless of where they live Because it isn't about the value you produce and it never has been. It's about your and your company's positions in the rest of the labour market. The people who are wishing for globally universal remote salaries are joining a sad race to the bottom. The value you produce is just the upper bound of you salary. The salary you need to survive is the lower bound. Then what you get is in-between, based on supply and demand. Humans aren't products. Companies price discriminate. The person should get what the market process decides.
If a person lives in a "poor" country, it changes nothing. They can spend less? Sure, but peeping in other's pocket under capitalism is a huge communist red flag :-) Maybe the person has opportunities to relocate to a "developed country", but chose deliberately to get more money instead of "social support". no when you look at it
they are not spending less(beside rent)
they are just buying lower quality stuff to sustain life
an iphone is an iphone all around the world you wont find it for 50$ if you are getting paid 100$ What do you mean by "lower quality stuff"?
(edit:typo)
- employee's age
- employee's education
- employee's experience
- industry
- job requirements
- local, state, federal taxes (income, sales, excise, tariff, etc)
- number of family members supported
- public transportation availability
- local auto insurance premiums
- local school district
- local cost of food
- local cost of health care
- local cost of child care
- union requirements
- hours working
- pay period
- local/national requirements for paid/unpaid vacation / sick days
- inflation
- if employee would rather own a home than rent:
- avg local property taxes
- avg local homeowners insurance (basic, flood, fire, earthquake, tornado)