Smaller tech firms now pay more than Big Tech

Major tech companies are reserving big pay packages for the most experienced engineers in the industry.

A few years of fierce competition for all levels of tech talent, particularly engineers, among the biggest tech companies drove some eye-popping compensation packages. Often, engineers being hired at lower levels of experience could negotiate a payday at Meta, formerly known as Facebook, or Google well into the six figures. In a new era of tech austerity, those same engineers are more likely to get higher pay at a much smaller company, especially those working in the buzzy fields of AI and AR/VR, according to a new report from Levels.fyi, which has a large database of pay in tech.

For the first half of this year, Netflix is the only company among the best known in tech to make it into the top pay for engineers with less than 15 years of experience, Levels.fyi found. The Median compensation for an L4 level engineer at Netflix, which implies two or more years of experience, was $312,000. An L5 at Netflix, an engineer with 5 or more years of experience, earned a median compensation of $550,000.

Meta only broke into the top seven once for the first half of 2023, with pay for principal engineers, typically people with 15 years or more of experience in their field. The median pay at Meta for this level is close to $1 million, at $978,000. That's changed from last year when Meta was also among the top-paying firms for engineers with around 10 years of experience. Meta is in the middle of what Mark Zuckerberg dubbed its "Year of Efficiency," marked by mass layoffs and cost-cutting. Google was not on the list for 2023 at all, nor were other major tech firms like Apple and Microsoft. All three made the list in 2022 and 2021.

Now, the vast majority of the highest-paying companies in the report are smaller operations.

Databricks, a company of about 5,000 people that analyzes and manages data, is the best-paying tech company for engineers in the earlier stages of their careers, with median compensation of about $275,000 to $585,000.

Stripe is the only company to be among the highest-paying from the lower level of engineer to the principal level, with median compensation starting at $217,000 for an early-career engineer and going to $945,000 for an engineer with a decade or more of experience. Roblox is also frequently a top-paying company for mid-career engineers with five to ten years of experience, as median compensation goes from $370,000 to $683,000.

There are several new entrants to the highest-paying ranks, according to Levels.fyi. Brex, which offers corporate credit cards and an expense management tool, is paying engineers with five or more years of experience median compensation of $450,000. And Coupang, an online marketplace, is offering engineers at the same level $490,000.

OpenAI, the generative AI company behind ChatGPT, is another new entrant to the list, with median compensation of $925,000 for engineers with a decade of experience, which is the highest pay in tech for that level of engineer. The company also has a straightforward pay structure that is somewhat unusual in tech these days.

Are you a tech employee or someone else with insight to share? Contact Kali Hays at khays@insider.com, on secure messaging app.

Signal at 949-280-0267, or through Twitter DM at @hayskali. Reach out using a non-work device.