Overall, this is a great collection. This one puzzled me though:
“The explosive growth of the tech sector … depresses average wages. “
I don’t understand how industry growth would depress wages, since I’d expect it to increase demand for labour.
The growth means the industry is overwhelmingly junior developers, so the average is weighted towards the low end. Think of the average age of two Census tracts, one a perfectly representative sample of the population, and one just like it but adding a primary school or maternity ward - the average age is pulled down. I didn’t read this to imply that salaries for everyone are lower in the same way the second tract isn’t making anyone younger, just a statistical change.
But it has a big effect! Now when the professional community talks amongst itself, the salaries are skewed lower and its intuitive understanding of “normal” changes. Sometimes people flatly don’t believe that 10+ year devs can earn a salary in Chicago of 180k or that similar SV/NYC devs can earn 350k+ in salary + stock at the tech giants (both real numbers).
There’s a further argument that this cultural expectation feeds back into itself for a flat compensation curve at the high end, but I don’t read McKenzie as saying this; he probably would’ve been said it explicitly if he meant to.
Yes, that makes sense. Even 7 years ago I would never have believed how much I’d be making today. I know some of that is due to compensation going up faster than usual in recent years but most of it is that I just had no idea how much stock-based comp big tech companies lavish on their senior engineers.