<story><title>The Tech Worker Shortage Doesn&apos;t Really Exist</title><url>http://www.businessweek.com/articles/2014-11-24/the-tech-worker-shortage-doesnt-really-exist#r=read</url></story><parent_chain><item><author>jrochkind1</author><text>If there was really a tech shortage -- and had been for years -- wouldn&amp;#x27;t the labor supply rise to meet demand? Wouldn&amp;#x27;t there be people willing to work less than the going rate (which is far above a living wage), wouldn&amp;#x27;t the going rate be dropping?&lt;p&gt;I don&amp;#x27;t know the answer, I think what is going on may actually be kind of complicated.&lt;p&gt;But that&amp;#x27;s the kind of question raised, you can&amp;#x27;t explain away the question of whether there&amp;#x27;s a shortage or not by saying &amp;quot;It&amp;#x27;s just that people aren&amp;#x27;t willing to pay the going rate.&amp;quot;</text></item><item><author>mgirdley</author><text>Running a coding school (Codeup), I get this email all the time from recruiters:&lt;p&gt;&amp;quot;Dear xyz,&lt;p&gt;I&amp;#x27;ve been hired to fill this not-so-great job THIS WEEK and we want this crazy exclusive unicorn skillset that about a dozen people in the world have and, you know, we aren&amp;#x27;t going to pay much anywhere near going rate and we&amp;#x27;re going to hire as a contractor so we can fire you any time and we&amp;#x27;re not really interested in training a person who&amp;#x27;d actually want this gig at the rate we&amp;#x27;re wanting to pay. So, do you know anyone?&amp;quot;</text></item></parent_chain><comment><author>mindvirus</author><text>There are a few things going on here.&lt;p&gt;I don&amp;#x27;t think the world has fully realized this yet, but there&amp;#x27;s huge divergence in skill of developers. I know a few developers who are worth $500k&amp;#x2F;year, if not more. And I know plenty of others who are not worth that, but are easily worth $100k&amp;#x2F;year. With all of them under the same label of &amp;quot;developer&amp;quot;, it can be hard to distinguish what you&amp;#x27;re getting.&lt;p&gt;Car example! Imagine wanting to buy a car, but not knowing anything about cars. So you call Kia, and ask how much a car costs, and they say, $15,000. Then you call Honda, they say $20,000. A few others, similar prices. Then you call Rolls Royce, and they say $500,000 and you think they&amp;#x27;re trying to pull a fast one on you. And to compound this, if you were to list everything that you want in a car, you&amp;#x27;d probably come up with something closer to a Rolls Royce than a Kia. So you&amp;#x27;re shopping for a Rolls, and you&amp;#x27;ve budgeted for a Kia. Also remember, you don&amp;#x27;t know anything about cars, so you don&amp;#x27;t know how to distinguish important features (ie. wheels, a functioning engine), from luxury ones (ie. a fancy sound system, heated seats).&lt;p&gt;In terms of people not being willing to pay the going rate - plenty are! All of the big west coast tech companies pay handsomely for developers. Outside of big cities though, things are slow to catch up. So I think that a lot of the sentiment comes from people not wanting to move to SF or NYC or Seattle, but also wanting to get a competitive rate. Eventually these companies will have to adapt, but it can take time, especially if there are enough people who don&amp;#x27;t want to leave the city they&amp;#x27;re in. There&amp;#x27;s also the quality divergence taking place - as much as we&amp;#x27;d all like to think we&amp;#x27;re good, Google and co. are very selective.&lt;p&gt;In terms of working for less than the going rate (which as you said is generous) - for sure that&amp;#x27;s happening. But there&amp;#x27;s adverse selection happening there, in that people who are taking jobs below market are either desperate and will quit when they find something better, or are of low quality. Developers aren&amp;#x27;t paid well out of the goodness of the company&amp;#x27;s heart, they&amp;#x27;re paid because they make money for the company. And bad developers can have extremely negative productivity even ignoring their salary.&lt;p&gt;Finally, labor takes time to catch up, especially skilled labor. From no programming knowledge to junior developer at a top company takes typically five years - ie. an undergraduate degree in computer science and some tinkering on your own (yes there are exceptions). And we are seeing supply increase - enrollment in computer science programs is up across the country. Imagine we had a severe shortage of doctors - you can&amp;#x27;t just suddenly triple the supply of doctors over a couple of years. Now if you have a huge shortage of brain surgeons, which might take a decade or more to train you&amp;#x27;re in for a lot of trouble.</text></comment>
<story><title>The Tech Worker Shortage Doesn&apos;t Really Exist</title><url>http://www.businessweek.com/articles/2014-11-24/the-tech-worker-shortage-doesnt-really-exist#r=read</url></story><parent_chain><item><author>jrochkind1</author><text>If there was really a tech shortage -- and had been for years -- wouldn&amp;#x27;t the labor supply rise to meet demand? Wouldn&amp;#x27;t there be people willing to work less than the going rate (which is far above a living wage), wouldn&amp;#x27;t the going rate be dropping?&lt;p&gt;I don&amp;#x27;t know the answer, I think what is going on may actually be kind of complicated.&lt;p&gt;But that&amp;#x27;s the kind of question raised, you can&amp;#x27;t explain away the question of whether there&amp;#x27;s a shortage or not by saying &amp;quot;It&amp;#x27;s just that people aren&amp;#x27;t willing to pay the going rate.&amp;quot;</text></item><item><author>mgirdley</author><text>Running a coding school (Codeup), I get this email all the time from recruiters:&lt;p&gt;&amp;quot;Dear xyz,&lt;p&gt;I&amp;#x27;ve been hired to fill this not-so-great job THIS WEEK and we want this crazy exclusive unicorn skillset that about a dozen people in the world have and, you know, we aren&amp;#x27;t going to pay much anywhere near going rate and we&amp;#x27;re going to hire as a contractor so we can fire you any time and we&amp;#x27;re not really interested in training a person who&amp;#x27;d actually want this gig at the rate we&amp;#x27;re wanting to pay. So, do you know anyone?&amp;quot;</text></item></parent_chain><comment><author>killface</author><text>The real problem is that to compete in today&amp;#x27;s world, your website:&lt;p&gt;1. Needs to have great design
2. Needs to be rock-solid in terms of stability
3. Needs to be snappy to use
4. Needs to be able to handle a Reddit traffic swarm
5. Needs to have individualization and customization
6. Needs to play nicely on computers, tablets, and phones&lt;p&gt;The person (or people, more likely) who is good at all of this just isn&amp;#x27;t available at rates &lt;i&gt;the companies want to pay&lt;/i&gt;. This is the important distinction. Hiring somebody for 100k&amp;#x2F;yr is pretty much the minimum ante for a good developer in a tech city. But these &amp;quot;entrepreneurs&amp;quot; and &amp;quot;founders&amp;quot; think that is too much money, and instead claim there&amp;#x27;s a shortage.&lt;p&gt;In reality, if you&amp;#x27;re competing for &lt;i&gt;top&lt;/i&gt; talent, 150k&amp;#x2F;yr should be your ante, and be prepared to go well into the 200s. This shouldn&amp;#x27;t be a surprise. To get even average talent from a consulting&amp;#x2F;contracting company, you&amp;#x27;re paying about 125&amp;#x2F;hr (of which 60-70 goes to the developer). That&amp;#x27;s 250k&amp;#x2F;yr. So why are companies freaking out at paying over 100k&amp;#x2F;yr for a full-time person who they can invest in? Hell, cut out the contractors and pay your people 200k&amp;#x2F;yr, and watch the good people come talk to you.&lt;p&gt;This is what Amazon and the like are doing now. I&amp;#x27;m hearing 22 year old kids who haven&amp;#x27;t coed a line of code in a professional capacity, getting offers of 120k&amp;#x2F;yr with a 20k signing bonus. Netflix pays a significant chunk of its engineers over 200k.&lt;p&gt;The only real problem is that it&amp;#x27;s getting more expensive to do business in a tech world. But compare the skill sets that used to draw 100k&amp;#x2F;yr, and the skill sets now required to get 145k&amp;#x2F;yr (100k&amp;#x2F;yr in 1998 dollars = 144k in 2014 dollars). Before, you could just know HTML and some shell scripting. Now, you need to know multiple frameworks, how to deal with scalability, multiple data stores, &amp;quot;full stack,&amp;quot; etc.&lt;p&gt;If anything, the good talent in this industry is still dramatically under-paid. A common metric is that the company should make from you about 7x your salary to justify your position. So if a company is making 2.1 million, you should be getting 300k. But we all know that&amp;#x27;s not what&amp;#x27;s happening. Instead, our wages are being capped and forced down due to illegal collusion between the top tech employers.&lt;p&gt;This all comes down to the people who own the businesses wanting to treat tech people as interchangeable cogs, despite all the evidence to the contrary.</text></comment>