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Ask Slashdot: Why Are American Tech Workers Paid So Well? 587

Slashdot reader davidwr is "an American-born, American-educated mid-career IT professional." But he's still curious about why American geeks earn more than their IT counterparts overseas: If I'm a mid-career programmer looking for a job, why should I expect to be paid a whole lot more than my peer in India when applying for a job that could easily be outsourced to India? If I do get the job, why should I expect to keep it more than a year or two instead of being told "your job is being outsourced" before 2020? Is my American education and 5-25 years of experience in the American workplace really worth it to an employer?

Should we, as an industry, lower our salary expectations -- and that of students entering the field -- to make us more competitive with our peers in India and similar "much cheaper labor than first world" economies? If not, what should we be doing to make ourselves competitive in ways that our peers overseas cannot duplicate?

What's the secret ingredient that justifies those higher salaries? Leave your answers in the comments. Why are American tech workers paid so well?
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Ask Slashdot: Why Are American Tech Workers Paid So Well?

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  • Supply and demand (Score:3, Insightful)

    by Anonymous Coward on Monday November 07, 2016 @12:48AM (#53226773)

    Employers wouldn't be paying it if we weren't worth it.

    • Short but quite accurate. Supply and demand sets wages.
      1) Living costs are also much higher in the US than the nations with much lower labor costs.
      2) If a remote worker were really worth the same value to an employer as a local US worker, the difference in salary would not be so great. (Note: H1B workers fall between the two endpoints, indicating there is likely some value also created by "culture," mindset, or other non-strictly C.S. skills related attribute.)

      • by AK Marc ( 707885 ) on Monday November 07, 2016 @04:54AM (#53227585)
        Nope. Value sets the cap. If the person doing the job creates $1M in value for the company, then that position is worth $1M, and would pay 50-75% of that if there was only one person on the planet who could do that job. You hire that one person, or you lose out on $1M in value.

        But if 1M people could do that job, and they would work for $1 per day, then the value of the job is still $1M, but you'd pay someone $1 to do it. So the workers set the minimum at $1, and the company sets the maximum at $750k. So the supply and demand is a factor, but far from the only one. As there are billions of people that would work as a CEO for $20M a year, but the pay for that position is still insanely high. So supply and demand fails, as it's only just one piece.
        • Re:Supply and demand (Score:4, Informative)

          by slew ( 2918 ) on Monday November 07, 2016 @01:07PM (#53230349)

          I think you misunderstand supply. There isn't a supply of billions of CEOs that will work for a $1. There is a supply of a several thousand (or so), the others are more-or-less "unqualified" (not that they can't do a similar job, but they are unhireable because the boards of directors don't want to get in trouble for hiring outside the expected hiring pool). Similarly there isn't a supply of billions of IT folks, and similarly hiring managers generaly don't want to get in trouble by going outside the "standard" hiring pool. This used to be called nobody got fired for buying IBM (but that probably goes the other way these days)...

          The problem is that there is probably no good way to evaluate employees (including CEOs) before hiring, so most people simply pay the going rate, and hope for the best. The going rate is set by the limited supply and how desperate companies are (e.g., the demand side). The outsourcing comes in when the demand at the lower price point exceeds the supply and gets supplanted by a demand at a lower price point (and potentially larger quality variance) which matches the supply.

          This used to be called the resistor tolerance dilemma. 1% tolerance resistors are much more expensive than 20% tolerance resistors. You might think if you bought enough 20% resistors you could cherry pick the ones that had lower tolerance, but in reality, the vendor pre-sorted for this, so if you bought the cheaper resistors you could almost guarantee they were crap. However, it was reasoned that by sophisticated design choices you could theoretically reduce the problem of high variance resistors so people started doing that. So you could solve your circuit design problem with a simpler scheme, but pay more for resistors, or have a more complicated circuit (with more things to manage that could go wrong) but get it done with cheaper resistors.

          As expected, managers in 2nd rate companies didn't grasp this inherent tradeoff and wanted both cheaper resistors and the simpler circuits designed by novice designers. They bought loads of cheap resistors and put them in these simple circuits as a cost cutting move expecting the distribution of resistors to have normal statistical characteristics. Lo-and-behold they would eventually get a batch of resistors that were all low by 15% resulting in a 100% escape rate from their production line.

          • by AK Marc ( 707885 )
            That's simply not true. A poo flinging monkey wouldn't have done much worse than Ken Lay, Carly Fiorina, or a variety of others I could name.

            CEO is easy. It requires all the qualifications of an entry level used car salesman. And yes, I've been both. Wasn't bad at CEOing either. They pay for past success, even when past success isn't an indicator of future returns. Simply put, the selection isn't rational. It's an inbred nepotistic game, not a rational business decision.
    • Re:Supply and demand (Score:5, Informative)

      by Z00L00K ( 682162 ) on Monday November 07, 2016 @01:56AM (#53227061) Homepage

      The US total cost of living is also higher, just because the salary is high and you get more in your hands don't mean that you actually earn more since a lot of that money is used to pay for your living like property taxes and various fees.

      The US citizens pays property tax and a lot of fees, Europeans pays income tax - so the overall tax pressure isn't that different. The main difference is that cost of consumer products is relatively viewed lower in the US compared to Europe so a TV is cheaper.

  • OK so I don't live close to the bone, but contracting means moving around a bit even within the same sate as contracts change. Renting, cost of living, etc takes my "higher" salary. I could cut out my humble bundles and loot crates, but frankly it's a drop in the bucket compared to general living costs.
    • *same state as
    • Re:Cost of Living (Score:4, Insightful)

      by myowntrueself ( 607117 ) on Monday November 07, 2016 @01:40AM (#53227011)

      OK so I don't live close to the bone, but contracting means moving around a bit even within the same sate as contracts change. Renting, cost of living, etc takes my "higher" salary. I could cut out my humble bundles and loot crates, but frankly it's a drop in the bucket compared to general living costs.

      Cost of living in places where tech workers in North America are forced to live largely cancels out the higher salary. When it comes down to it, apples for apples, they end up being paid less.

      I've worked in tech companies in 3rd world countries. The salary I was earning was like a kings ransom in local terms. I work in North America now and I get a normal salary in local terms but, boy, it doesn't add up to a kings ransom and my quality of life is, if anything, lower. There are plus sides to working in 1st world countries but at the end of the day it feels like you make less.

      What it comes down to is that a dollar in one place isn't worth the same as a dollar in another place which anyone with any international experience should already know.

  • by sigmabody ( 1099541 ) on Monday November 07, 2016 @12:54AM (#53226809)

    Obviously this is not applicable to all tech workers, but...

    In many cases, there's a fairly substantial difference in expectation of work product, both in terms of quality of work produced, and in ability to execute anything more than rote work. While it's true that those qualities may not matter for those organizations who choose to outsource tech labor, there can be a very quantifiable increase in product quality from workers who are more vested in and capable of producing a higher quality product, which can be translated into demand for higher compensation.

    It's kinda the same as the difference between a certified general contractor, and a guy you pick up at Home Depot to do some work for you. You don't expect to pay the general contractor a small amount of cash under the table, and he doesn't have any need to make his rate "competitive", because he'll be able to find people willing to pay for a higher quality of skill, knowledge, and ultimately work product. There's a reason that most tech companies who outsource their high-skill labor to inexpensive countries don't stay competitive long...

    That's my experience, anyway.

    • This is pretty close to correct. But tech folks like to pretend that the split is domestic vs foreign. Sorry, but most domestic tech talent is not competent. Outsourcing occurs because foreign incompetent talent is far cheaper than domestic competent talent, and management needs are similar. Meanwhile, there is a cutthroat bidding war for competent domestic talent, which is in seriously short supply.

      • This is very true. In the software industry, especially, there is a vast difference between people who are good developers, and people who are "just able to write code". For the organizations who employ a lot of the latter (either though legitimate need, or simply inability to attract and/or hire the former), outsourcing can be economically viable... as long as you are able to still stay in business, that is.

        I know, anecdotally, that several "smarter" organizations who experimented with outsourcing software

    • by Anonymous Coward

      Disclaimer: I am a lucky white dude that grew up in the United States and I have worked with a few teams in India and tons of people that moved to here from India and other countries, and I have nothing against them and have several Indian friends. They are just like you and I, they want to work hard to provide for their family and make a better life for themselves. Don't hate the individuals for just trying to work hard and get ahead in life. If you want people to blame and be angry at for job loss, direct

      • I'd like to add that there are plenty other cheap countries besides India and China. i'm talking about countries where communication barrier simply doesn't exist. Yes, those countries are much smaller in terms of population, both compared to the USA and the giants that are IN and CN, and that's why most people aren't even aware of them, but they exist.
        Now, large companies are increasingly hiring people from these countries, and the findings are that people hired there would work almost as cheap as people fr

    • by AmiMoJo ( 196126 ) <mojo@NOSPAM.world3.net> on Monday November 07, 2016 @04:46AM (#53227549) Homepage Journal

      The UK might become the new India for outsourcing. Perfect command of English, only 5 hours time difference so at least there is some overlap, similar culture... But much lower wages. As the value of our currency continues to decline and we push for cheaper labour and lower pay, we will start to become very competitive with India for highly skilled developers.

      • by Kagato ( 116051 )

        Well, you're bolstered by Russia messing with the former Iron Curtain countries. For a while it appeared that Ukraine was going to upset India for sub-contracting. High quality English, smaller time zone difference and they had no problems pushing back on tech issues and coming up with alternative solutions. Now Western countries are fearful about placing all their bets on a place that could go up in smoke overnight.

  • by Mean Variance ( 913229 ) <mean.variance@gmail.com> on Monday November 07, 2016 @12:55AM (#53226815)

    Sometimes outsourcing to lower cost countries might work, but often it just doesn't work as expected. My employer tried India outsourcing 10 years ago and it was a failure. First, while the direct employment costs are cheaper, there is overhead that is complicated and expensive: protecting intellectual property, management from 12 hours away, project planning, code culture and standards.

    IT and software engineering pay well especially in Silicon Valley and other major areas because it's worth it to pay that. Proximity has its own intrinsic value. I work with 50% Indian workers, but they are here in SV and paid well, most 100k+ because that's what the work is worth.

  • by Anonymous Coward on Monday November 07, 2016 @12:57AM (#53226831)

    As a guy that owns a small IT security startup and has some developers on contract in India and as many full time North Americans as we can afford right now I would say this:

    Creativity. Understanding the why as well as the what (aka seeing the big picture), and a general drive to see the company succeed.

    None of my contractors give a shit if my company succeeds beyond their next invoice. None of them really seem to care to understand why we are doing what we are doing, they are only focused on their silo of work. And OMG if you don't give them EXACT to the letter specs, the work wont get done. Likely because of the other two things I mentioned, but also I think it might be a culture thing where they are taught both at home and in school to never question, and just memorize and regurgitate to succeed. Yeah they are kinda like human robots in some cases.

    I will always pay more for an innovative self-starter that's in my time zone.

    • Do your domestic developers have equity? If not, they don't have any more incentive to care about your business than your contracting partner. The cost of finding another job is similar to the cost of finding another customer. And employees get unemployment compensation. Salaried employees don't have much skin in the game.

      • by Anonymous Coward

        Some people have pride in their work and the company they work for. Not all companies are soul sucking demons.

      • Do you have equity? If not, then what incentive do you have for caring about the success of the venture you're involved with?

        I own my own company now. Before I owned my own company, I realized that my success, and the success of the organization I worked for, were tied together. If I succeeded, and the company did not, that would be very short term for one of us. The same if the company succeed, and I did not. This is how Americans, with any understanding of economics, sense of connectedness, and general wo

      • Equity is mostly pointless. It amounts to a tiny fraction of annual compensation. A small fraction of companies may have equity pay off more than a normal annual bonus, but you can't count on that (though there are enough gamblers out there who are suckers for it that it keeps the startup industries alive). Salaried employees have skin in the game because that money keeps the food on the table and the mortgage paid off. Unemployment insurance is nearly worthless, it won't cover even a fraction of the cost

    • by Malc ( 1751 )

      How much do you invest in making them feel like part of the company and its future? Are you talking to them live everyday, and visiting them for a week at a time once per quarter?

  • Tech workers who have been in the field for long enough are unable to analyze it like you have. You are detecting a market issue. Partly, wages are sticky. For jobs where this is the problem, you see complaints about outsourcing and H1-Bs. Secondly, the market is actually extremely tight for competent domestic tech workers, and employers are in a constant bidding war for these few folks. This bleeds into the majority of less-than-competent domestic tech folks through a number of mechanisms, including employ

    • by eWarz ( 610883 )
      Yep, for the financial industry (which I don't work in FYI because the hours suck balls) it's up to a quarter million dollars for a competent C++ developer in NYC. I've seen 5 different job listings for $250,000-$275,000 + stock this year.
  • by diesalesmandie ( 4523641 ) on Monday November 07, 2016 @01:01AM (#53226847)
    I used to work as a DW analyst in a british bank who off-shored the ETL development to Chennai, India. The manager of the ETL team was earning 1/3 of what I was and I wasn't even a senior member of the Analyst team, there is no way to compete with that unless you yourself live in India.
  • by mtippett ( 110279 ) on Monday November 07, 2016 @01:04AM (#53226863) Homepage

    Some numbers from my personal experience.

    1) Salary Growth. In general, the Indian Salaries are increasing by 10%, US Salaries are increasing by 3%.
    2) Salary Scalability. In general, Junior staff are about 5 offshore to 1 onshore. Mid level staff are about 3:1. Senior staff are 2:1.

    China used to be a good low cost offshore location, however senior staff are now more or less the same cost (assuming remote team management). You offshore to China for reasons *other* than cost reduction. India will ultimately be no different.

    Mid to senior engineers will be generally cost neutral within a decade, junior engineers - not so much.

    Near-shoring will likely replace the off-shoring - in some cases it already does.

  • by localman ( 111171 ) on Monday November 07, 2016 @01:08AM (#53226883) Homepage

    For my dollars, I'd much rather work directly with people who are a committed part of a team. It's tough enough to achieve that with direct hires; I don't think you can do it with outsourcing.

    I think part of this relates to the nature of software. People always talk about writing software - but that's the easy part. The hard part is *expanding* and *maintaining* software. And generally speaking people who have a history with the code are going to do a better job of it: faster, and more precise. You can also have a much tighter development loop between developers, testers, and users if you have them all in-house. I used to have my developers spend some time using the tools they built with the people who actually used them for the job (I did this myself as well). You learn practical details that are hard to communicate any other way. And speaking of communication: I had a few outsourced workers (forced on me by upper management) and communication was always inferior.

    I'm not saying that there's no use for outsourcing, or that it's always the wrong choice. But my experience is that proximity matters. And history matters. And personal familiarity matters. So one needs to factor all that in when making the choice. And yeah, I think I got about 4x the quality and productivity out of my in-house people as my outsourced people.

    • by AlanBDee ( 2261976 ) on Monday November 07, 2016 @01:36AM (#53227001)
      I swear, half my career has been fixing outsourced code.
      • I swear, half my career has been fixing outsourced code.

        Me too!

        The other half of my career has been fixing internally sourced code!

        No, that's not really true, sometimes I'm writing the code the next guy will look at and insist on replacing, er "fixing."

    • by Malc ( 1751 )

      I've been working with and managing off shore teams since 2006. You're right about communication, and this where the management toll strikes.

      What a lot of domestic works don't see is that the same applies to telecommuting versus being in the office everyday. Face time counts for so much as even the most introverted developer is still human, and people actually contact with other people.

      Being together just works out way more efficient in terms of time and effort. Off shoring only really works if you can g

  • Availability is the biggest issue for most companies I see; the secondary issue is the wage inflation rates, especially in the context of a "cost-center" vs a profit center. If IT wages go up 5-7% per year in recruiting new talent, but an average for the company is only 1.5-2%, IT stands out as high-risk.

    Most companies want to retain some level of control, but the value of the service provided doesn't always warrant the cost. There are only so many things that a business can cover as necessary evils that
  • Location (Score:5, Interesting)

    by Anonymous Coward on Monday November 07, 2016 @01:09AM (#53226891)

    North American companies are absolutely idiotic about this. They will happily employ remote employees from India who (obviously) never come into the office, ever for a discount. Typically the quality of work output is low as is the knowledge level. At least that's been my experience.

    Yet those jobs aren't offered to Americans, and I don't get why not. If you have low skill with computers, but an aptitude to learn, you could do the same quality of work that's being outsourced for $20 - 30k a year. So why not offer the job over here with the same standards? (100% work from home, no expectations that you'll work any standard hours, ever. And if you get the project done early, enjoy the vacation time.) You would be surprised at how many people would take such a job and find it is enough to keep them going and give them the experience they need to enter the field. Sure, if you live in NYC $20k means you'll be dead inside of 12 weeks, but move to Mississippi and it's enough for a single guy to live frugally for the year while he ups his skills.

    In fact, honestly, I don't get why companies don't offer work from home for most tech jobs. You get to pay lower salaries for the same work because people don't have to live in extremely expensive cities and you get to save further on not having to have an office.

  • Work life balance? (Score:5, Interesting)

    by Nkwe ( 604125 ) on Monday November 07, 2016 @01:10AM (#53226895)
    The United States is known for the hard work of its people. The rest of the world has criticized the US's lack of work/life balance (many say the US spends too much time working, more than anywhere else.) Assuming this is true, it would be a reason that US workers are worth more - in general harder working people are more productive. I would say this is especially true in Information Technology, particularly software development where the amount of time required to stay current and keep up with changing technology is enormous.

    As others have posted, the ultimate answer that the marketplace dictates the value, and the labor market place currently values American tech workers highly.
    • in general harder working people are more productive

      The only thing that is certain is general harder working people burn out faster and that productivity is short lived. All this has nothing to do with tech workers being valued highly, but you are right about one thing the marketplace dictates the value. Cost of living and cost of doing business comes into that. The local cost of living for tech workers in major hubs skews the pricing upwards. This local competition can't really be offset by outsourcing as that comes with downsides that make the result less

    • by AmiMoJo ( 196126 ) <mojo@NOSPAM.world3.net> on Monday November 07, 2016 @06:01AM (#53227785) Homepage Journal

      Another way of looking at it is that US workers are more exploitable. The lack of safety nets, the need for private health insurance, incredibly high student debt, lack of unions. They all work to make it easier to exploit US workers with long hours and poor conditions.

      It seems like the high wages are just to cover living costs, especially in places like Silicon Valley where rents are insane. It also creates a race to the bottom where everyone is competing to work longer and harder than the next guy.

      Japan and the EU have laws to prevent exploitation and limit the number of hours people can work a week, specifically to prevent all that from happening. Wages are lower but so is the cost of living. Except for the UK most students don't have massive debts, and getting sick isn't the leading cause of bankruptcy. Except for the UK, there are often rent controls too.

  • by Facekhan ( 445017 ) on Monday November 07, 2016 @01:10AM (#53226897)

    There is simply a completely different type of employment culture in India than in the US. In the US we are used to interacting with a self-selecting group of immigrants who work really hard and often put up with a lot of stuff under H1 or other visa programs that American citizens wouldn't tolerate from employers.

    Back in India though, there is a culture of treating employees like shit, and consequently a culture among employees of working as little as possible. Employers also don't screen candidates well for off-shore call centers and the like because if they are working on a large contract, all the accountability is based on metrics that can be manipulated and the US based business that contracted them probably only cares about reducing their costs.

    My Indian and other immigrant coworkers work their asses off. The support teams I deal with in India can't even be bothered to show up to a phone call and are usually incapable of anything more than opening up a ticket with the software/hardware vendor directly.

  • So Go Ahead... (Score:4, Interesting)

    by rally2xs ( 1093023 ) on Monday November 07, 2016 @01:13AM (#53226911)

    ...and hire all foreign staff. When they eventually leave, hire someone else that wants to learn the code base, waste however long it takes them to learn it, and then say goodbye to them when they too go back to wherever they came from.

    Or go ahead and outsource the whole thing to half-way round the world, so's you have to talk to 'em at 2 AM when you're tired as F and get stuff screwed up, or alternatively, they're working at 2 AM when the human being is at his worst and they get stuff all F'd up.

    We're worth it 'cuz we're here, and won't necessarily be saying goodbye so's you have to retrain a whole new crew every couple-three years. You won't have to repeat yourself to be understood nor listen very, very closely to understand what we're saying either.

    But the American business is always going to go for the short-term gain, so go ahead - the people that would have graduated from American universities with software degrees are also smart enough to realize that you're going to skimp on wages, and make them compete unfairly with the rest of the world, and decide to get into some other line of work that is more steady and maybe doesn't even require all that study. There's lotsa jobs with decent, but not breathtaking pay that don't require accumulating a huge debt - maybe they can be OK with being a welder, or a railroad locomotive engineer, or 1 of a 100 different things to do that can't be outsourced and don't commonly involve a lot of layoffs. Hell, some of those jobs even have unions, something that makes it hard to feel sorry for the uppity software bunch that think they're too good to need a union, in spite of actors and pro sports players using them - but nooooo.... software people are too proud to form a union that would sue the asses off some company like Disney that (illegally) hires 250 software people from overseas to replace 250 of their US Citizen software people simply because the furriners will work for peanuts.

    If the furriners are at all better at this than than US citizens, then its probably because the smartest US citizens are too smart to put in that sort of time and expense to compete for a job with a US company that's going to s*** all over them and fire them simply for wanting a salary commensurate with living well in the USA for the efforts required to acquire similar knowledge for other more lucrative careers.

    So, suck it up, US industry. You created this situation. Just go ahead and suffer when you can't control your cheap labor because... losing your penny-pinching salary isn't worth enough to do what you want them to if they want to go home and you want 'em to stay. Y'all deserve each other.

  • Cost of Living requires it. Businesses pay it because the area's talent has defined the computing era. A random "senior" group (read: just about anyone in SV) knows second-nature Agile, Scrum, code smell, architecture, multiple languages, tools & technologies they've used to build amazing things successfully.

    A marketable product idea and a 5 - 20 SV senior engineers will usually have a high % chance of success. Investors know this. No extra layers. Meanwhile patents & novel solutions (thought leader

  • As having worked in tech in another country, and moved to the US to work in tech, it's 100% to do with the US understanding the value of the engineers. Among my other expat acquaintances, it's not just my old country, either.

    A couple of good engineers can pull off the next google, instagram, Facebook etc. Folks in the US know this and harness that power. Other countries see an computer engineering degree like an accounting degree. Until other countries clue in, the US will continue to be a power house.

  • by Tony Isaac ( 1301187 ) on Monday November 07, 2016 @01:26AM (#53226969) Homepage

    I currently supervise a team in Bangalorre, along with a couple of junior developers here in the US. The US developers, though only a year or two out of college, easily outperform even the "mid-level" developers from India. The price our company pays for Indian developers is about 1/3 the cost of US developers, but so far, we have not been able to make the math work. Even 3 Indian devs cannot produce the same quantity and quality of output as a single junior US developer. This is a pattern I've observed numerous times at different companies.

    This disparity has not been missed by accounting departments. Bringing offshore tech jobs back to the US has become so commonplace that it has come to be called "reshoring." I don't think US tech salaries are in any kind of jeopardy.

    • by eWarz ( 610883 ) on Monday November 07, 2016 @02:02AM (#53227087)
      Not only that, but in healthcare you are practically required to do so. Having foreign developers touch medical data in 2016 is considered to be a violation of HIPAA. You can attempt to get around the rules, but these days regulators want to see that all code was written by people that can be held accountable if things go wrong. If your app is breached and they find out you used a company in India, you could be in serious trouble.
    • by TheSync ( 5291 )

      The US developers, though only a year or two out of college, easily outperform even the "mid-level" developers from India.

      So why do you think this is? Are the Indian colleges not teaching well enough?

  • The cost of living is one obvious factor to look at; the cost of living is much lower in many developing countries.

    It may make more sense to look at the relative rates of professions within a given country. For example, how much do Indian accountants and cops make compared to Indian coders?

    If the ratios are about the same, then the question is not really about IT salaries in the US, but why general salaries and the cost of living is different between countries.

  • by Opportunist ( 166417 ) on Monday November 07, 2016 @01:30AM (#53226981)

    After all, it's even easier to outsource being unproductive.

  • More then half of my co-workers have immigrated to the U.S. and obtained citizenship. At the same time, almost every company I've worked for had bad experiences with outsourcing development, inside the U.S. or overseas. This leads me to conclude that it's the process of outsourcing development that is the issue, not that there aren't talented people overseas that can do the job. Companies have figured this out and mostly try to hire Senior Software Developers who live locally because they tend to be the mos
  • The Secret ingredient is DON'T just be a technical resource, understand the business, add value at architecture, design and analysis of projects and problems, if you have government customers then things like security clearance and customer knowledge etc. As a purely technical resource you are a commodity item that is readily replaceable, as part of the business you are much more valuable. Their is this myth that still perpetuates that outsourcing to cheap overseas labour means poor quality, that is not the
  • The real answer is you can't be so easily replaced by someone in India:

    - You're available. Is the guy in India available to work now? Why do you think he is?
    - You have the skills and the experience needed. Why do you think the guy in India does?
    - Presumably you have a history of staying at a job more than a year and not demanding large raises ever year to stay. Check out page 12 of this report [actuariesindia.org]. India salaries grow at ~12% per year according to this. If the guy in India is really good, he's probably ge

    • by eWarz ( 610883 )
      Not to mention that most indians program like they are baking a cake. Same recipe every time. Actual development is more like painting a piece of art without knowing what you are going to paint first...while having your superiors determine what that piece of art will look like.
      • by Kohath ( 38547 )

        If that's true, it's because some Indians are getting into the field for the money, even when they have little actual aptitude for it. That can probably happen in the US too, but it seems like it would be a less prevalent.

  • I've been in this field since I was old enough to work professionally. One thing I see is a ton of wannabe foreign programmers that read a book and pretend to know everything about programming. A job I had 12 years ago had a director of IT that learned classic ASP and T-SQL on his plane ride over for a job he had just gotten hired for! Most of what you learn as a developer has nothing to do with language or syntax and most foreigners that only work consulting jobs for the US don't realize that. They ten
  • I expect my employees to not only be responsible for their product, but accountable for the quality of it. Maintaining data integrity and security is worth paying for. Also, it directly translates into revenue for the company. Like a chef, use cheap ingredients and have a cheap (low quality) product... nobody will come back to your restaurant.

  • Just like Swiss watchmakers or German car manufacturers. When there is Indian Google, Chinese Apple or Vietnamese Facebook, their engineers will be paid well too.

    Only they need to make equivalent technological breakthroughs for future technologies, not copy actual Google, Apple or Facebook. And, a country that wants to create their own Silicon Valley may discover that involves things they are not gang ho about. Like intellectual freedom and startups with unhealthy work hours that hurt diversity. This is har

  • by superwiz ( 655733 ) on Monday November 07, 2016 @03:00AM (#53227235) Journal
    Well, IT workers might be paid more than developers because they need to be in closer proximity to the clients for many of the IT tasks. But developers are generally paid much less than equally-intelligent and equally-educated professionals in legal and medical fields. Despite all the fear, Indian post-secondary education is not as good as US private university education when it comes to either applied math or CS. There is a lot of factors which cause this, not the least of it is that the best students from India come to the US for their university studies. But this is just one of many factors which influence this. What drives the wages lower is that there is a constant churn in development just like there is physical production. Some of the work simply requires citizenship or ability to impose legal requirements (which can be expected to be followed by US residents), or something similar. Any work which cannot be justified in this manner has already gone to India. Inability to hold people accountable to what they produce does carry a price with it. In many instances, that price is the difference in labor cost. Whatever arbitrage opportunities existed in the labor market, they have already been taken advantage of and, therefore, have diminished to virtually nothing. There are other factors. You might as well ask why Australia ever beats India in cricket given that India adds an Australia-size population every year. If building something in India were as simple as building it in the US, India would simply be a wealthier country than the US and the difference in labor cost would be absent. Wealth doesn't come from money. It comes from being able to buy something useful with the money you have.
  • My workplace is dabbling a bit with outsourcing aswell. It's a scalability attempt, we simply cannot find enough people to keep doing what were doing with the amount of work we are expected to do in the future. We make marketing websites and apps for a wide range of inhouse products. One department is outsourcing to India, they keep doing what we have always done, just with more hands and more management. Another department is changing the techstack, trying to scale differently, make the tech require fewe
  • by melted ( 227442 ) on Monday November 07, 2016 @03:28AM (#53227315) Homepage

    Here it goes: "An old man is lying on a bed in his room. It's year 1917, the Socialist revolution is in full swing. His grandson runs excitedly into the room and proclaims: "The Bolsheviks are winning, there won't be any rich people anymore!" To which his grandfather replies: "Weird, back in our day we revolted so that there wouldn't be any poor people, not to get rid of the rich".

    Which is a long way of suggesting: maybe a better question to ask is why the non-US programmers are paid so poorly. TBH I don't think US programmers are that well paid, outside of relatively few outliers. They tend to live in the areas with some of the highest cost of living in the world. That's out of necessity: all the high paying jobs are there. I'd say a good fraction of US high tech professionals is what real middle class is supposed to look like. Not rich, but with a roof over their head and non-zero savings. I don't consider that a privilege. I consider that a bare minimum.

    • Bingo! I consider myself "comfortable", but far from rich. I have a good house in a tolerable area, I can pay cash if my front porch collapses, and I can buy a reasonable number of "kewl toys". I can't afford Silicon Valley, large mansions, or Teslas.

  • by Khyber ( 864651 ) <techkitsune@gmail.com> on Monday November 07, 2016 @03:32AM (#53227325) Homepage Journal

    A. I can rig your entire building for gigabit wired and wireless transfer speeds. T568B all day.
    B. I can configure your stuff from MPLS to ASA to software-defined stacks.
    C. I can get on-site when your remote access inevitably fails, assuming you're not stupid enough to rely upon cloud-only solutions.
    D. I actually speak and understand English.
    E. I have other skills that your company might want, and I am asked about quite often (Doorbell job after wiring up their patch panels? $40/hr.)
    F. I possess got over two decades of experience.
    G. My warranties and guarantees on my work actually mean something.
    H. I don't read off a fucking script, nor do I ever need to.
    I. And the list goes on.....

  • Recently i was talking to a chinese gamer friend on teamspeak and we where joking about how much one could make goldfarming. Turns out he was dissatisfied of his wage of about $300 US a week working in a resturant. Thats not that far off what an American worker could expect. He was studying to work in IT, and told me his friends in IT are making just north of $1K a week, again not quite as much as an American worker, but still in the vicinity of "Western Wages".

    Turns out in China people are worried about jo

  • The reason is huge (Score:4, Interesting)

    by terminal.dk ( 102718 ) on Monday November 07, 2016 @04:05AM (#53227423) Homepage

    How many great software products have you seen being invented and created in India ? Is the number around null ? Or is it a large NULL ?

    There are many reasons why Indians are not really a threat, and it is not only the language problem. It is their culture. Been in a startup in Bangledesh for 3 months, most employees from Indian universities. They work very hierachical, and not independent. It is almost impossible to make an employee choose between a blue and a red ball, we want hios managers approval first. I could not get my employees to to code things using stuff not part of their curriculum. I had to train them in those chapters in their book from university that was not part of their university education. Their attitude is, that it is better do make nothing than to make a mistake. They don't know the word no. They can't say they can't do it, but would rather delay forever.

    Now I am in a large company, and the code quality we get out of India, no matter what huge front company we use, is nowhere as good as an average local person with a bachelor in CS can deliver. Their missing ability to think and read documentation, and explore is a killer.

    The big threat comes from christian countries, countries with our culture. The threat comes from eastern europe and south america. They think more or less the same way. They can work independent. If they don't get an answer, they will decide on a direction to go. Even if they go the wrong direction, it is stillbetter than looking out the windows until the boss comes around.

    And one important fact that you forget is, that brain workers, including IT developers, has a salary way above average salary in whatever country they are from. Personally, I would say it takes 3-5 average indians to be as efficient as an average westerner. that is $10.000-$15.000/month. So there is not good economi in using indian developers if they are available locally.

    Outsourcing of jobs is mostly operations, where it is accepted that the level will be much worse at half the cost. And partly development because you can't get the skills locally. Operations today is waiting for the server to burn and then piss on it. Nothing proactively, except from scheduled reboots. So whatever is outsourced to india is not the same thing as the comanies used to get. They get less $ for $. They could save more money by deciding on the same service level with inhouse staff, and fire 90% of IT operations staff, and use external consultant when things are bad. They would even get a better service from that solution. Outsourcing to india is the new black. Everybody does it, nobody is happy, but because everybody does it, it must be the best.

  • Access is the key (Score:4, Interesting)

    by AHuxley ( 892839 ) on Monday November 07, 2016 @04:07AM (#53227429) Journal
    The top US universities produced the best students for decades. The US gov and mil looked after the best with funding.
    The US private sector enjoyed contracts.
    The US gov pushed for the world to accept US standards and tech as part of free trade deals.
    So all that creating for a global economy, funding and skill kept other nations locked out and US products as the only option.
    Other nations never had that free flowing cash for science, students, the mil. To them it was limited hard currency, a loan or US charity to only buy a US product.
    Their best had to be careful with funds or could only get so much out of education, the private sector or their mil.
    The US also enjoyed freedom, freedom of speech, freedom to study, read. Its students had a well funded creative and smart side other nations lacked due to wars, poverty, faith, cults or type of gov.
    That all worked well for decades. The changes now are a global workforce and a lack of visa tests.
    US universities are no longer getting the best wealthy students, giving loans to the best middle class and testing for free access to the gifted poor.
    With ever more university students with average ability taking up limited places or been granted limited places for non academic reasons a change will result.
    The few really bright and gifted graduates will command the ability to select work they want. With the rest of their fellow students been well below average they have some option in who to work for and will accept a great offer.
    The secret is:
    The very best US graduates come with security clearances, trust and the ability to attract gov and mil funding. They have been the best in the world for decades.
    But with changes to education, a flood of average students been passed now seeking the same granted access to work only the best will command good wages.
  • by EmperorOfCanada ( 1332175 ) on Monday November 07, 2016 @04:19AM (#53227477)
    Wow, just wow. You haven't been down a darker nastier hole than dealing with an Indian IT company. Employees rotate like there are revolving doors installed in every cubical. No matter how good their English, there is a communication's barrier. Contracts are pretty much brought out on a daily basis. Procedure overwhelms any project; yet the procedure simply protects them while providing no value, but then they bill the shit out of you for that time.

    Then there is this strange touchiness about any perceived insult. You say something doesn't work and they will either pretend they didn't hear you, or they will list off the resumes of all those involved. "Mamdoop, graduated top of his class, in a program that only accepts 100 students from over 1 million applicants. Are you saying that you know C++ better than he?" To which I reply, the program is crashing, it is crashing because he didn't do any tests at all and any client ID over 100 will crash the software.

    Boom contract time: "Your sample set of clients only had 100 clients." This ignores the fact that the contract also stipulated that there will be 100,000-500,000 clients.

    And it just goes on and on and on. Then after you finish successfully managing to sue them in an American court, you see that they are using your company name for a positive reference.

    Then there is the endless changing of the contract. Somehow the monthly billing of $40,000 goes up to $45,000 and the extra is for "administrative excesses" and you say no, but it takes months for them to remove it, and as the end comes closer it goes up and up and up with subtle threats about the software ever being delivered if it doesn't get paid.

    The best is when one of your own employees turns out to be related to the company in India that got the contract in the first place. You are never able to prove that something scummy happened but your employee gets wildly upset when the contract is canceled with extreme prejudice. Like holy shit losing his mind upset.

    Somehow they have created a facade of competence without actually creating the competence. A simple test is how many companies in India are actually making viable software products for themselves. Not the government, not for others, but an Indian Facebook. I don't think that it is possible. I suspect that there are all kinds of Vapourware companies, as they would have that nailed down cold; but a company that does something cool, has lots of customers, makes lots of real money, and doesn't have a government department firehosing money into it.

    Without that excellence, why would we go there again? This is why Western Programmers make the big bucks; they deliver what was wanted.
  • Outsourcing is a non-trivial affair. There are just about as many failures as successes.

    Accepted economic theory is that capital is fungible, however, labor is not yet. That's the bottom line. Despite it's flaws, the Western way of doing business is superior to what happens in most of the world. Anyone who has worked with China, for example, can usually back that up.

  • by mmarlett ( 520340 ) on Monday November 07, 2016 @04:23AM (#53227491)

    Cog making is fine and good anywhere, but, honestly, many bosses want to be able to hold someone's feet to the fire. Someone in the room. Someone in the room with people in their room. If you have a product that requires specific communication and intense deadlines, being able to look someone in the eye is most of the justification for a premium. Managers don't get paid for results — they get paid for the appearance of results. They justify your expense to justify their own expense.

  • by henni16 ( 586412 ) on Monday November 07, 2016 @04:25AM (#53227495)
    Hey, *someone* has to provide the answers for all those barely understandable urgent questions on stackoverflow and mailing lists.
  • by DatbeDank ( 4580343 ) on Monday November 07, 2016 @06:47AM (#53227889)

    It's cheaper for a two big reasons:

    1. India's Rupee is considered less valuable than the USD because the USD is the world reserve currency amongst other currency manipulative tactics.

    2. India neglects basic protections we take for granted in the US. No unemployment insurance, crappy schools, and a lack of a requirement to pay for "pensions". Hence it is more "expensive" to pay a US worker.

    American companies want to pay workers Indian salaries with a massive currency disparity while not bothering to pay for the things that make America great such as a highly educated work force, paved streets, social welfare, food/drug safety, and other items.

  • by RabidReindeer ( 2625839 ) on Monday November 07, 2016 @07:20AM (#53227961)

    Around the year 2000, Indian developers could expect about 1 lakh/year income for each year of experience they held, with a significant number of said developers having 5 or fewer years of experience - except, of course, when being shopped as H1-Bs to US employers wanting 10 years experience in Oracle 11 in the year 2000.

    That's roughly one eighth the pay rate for an equivalently-experienced US developer. Under $10,000 a year in most cases.

    Try living as a professional in the USA on under $10K/year, even 17 years ago.

    So how did they do it?

    Simple. In India, home air conditioning is a luxury, not the essential that Southern locales in the USA consider it to be. Firstly, because the equipment itself is no cheaper over there than in the US, secondly, because residential electrical service back then was extremely unreliable.

    And not just air conditioning. Refrigerators were the "in" thing for the up-and-coming. Look at an Indian cookbook sometime. Most everything in it is either something you'd eat immediately or something that doesn't perish if not refrigerated. Ghee, for example, removes the components of butter than go rancid.

    Electricity was so unreliable that the tech employers would maintain their own private power plants.

    Another thing that tech companies over there would do is run transportation for their employees. This actually was done in my town back in the 1960s, but not any more. Indian tech employees are far less likely to own a car.

    Then there's food. Indian diets are much less meat-heavy and frequently vegetarian. Rice and dal cost a lot less than hamburger and steak.

    And don't forget social nets. The Indian social net is you die in the streets. You can have a free college education, but you have to pay for all the schooling that gets you there yourself.

    Last, but not least, it's a veritable Libertarian paradise as far as regulations go. Not that everything's unregulated, but for a fee, it often can be. No pesky pollution regulations, little oversight to make sure that the food isn't contaminated, toxic fumes wafting from the nearby Union Carbide plant, stuff like that.

    India has advanced considerably in the last 20 years, but it's still a lot cheaper to live there than it is in the USA. As long as you're willing to make some concessions.

    Actually, since Indian developers aren't stupid, whatever you may think of their work as coolie labor, they've pushed up salaries considerably. Still much less than US levels, but significantly. So their side of the coin has been "why should we be paid so little when other countries pay so much? Should we as an industry raise our salary expectations?"

  • by zerofoo ( 262795 ) on Monday November 07, 2016 @08:50AM (#53228303)

    Your question could be better asked this way: If China and India are so cheap, and talent readily available, why haven't all IT jobs simply been outsourced to China and India?

    That does not appear to be happening - frankly the reverse is happening. The US appears to be drawing much talent from those areas with programs like the H1B visa.

    Why would a top-tier IT worker want to pack their bags and head to the US? Simply put, the US is a more attractive place. Thinks like excellent schools, good roads bridges, decent electrical grid, police, fire, and the worlds biggest military for protection make the US a decent place to live and raise a family.

    Companies and workers WANT to operate here in the US. If they didn't - the H1B visa wouldn't exist.

    The reasons they want to operate here cost money - and that means corporations and individuals alike must pay the tax bill to fund those things.

    TL;DR: The US is nice and costs money to keep nice - therefore salaries must be higher to pay for that.

"And do you think (fop that I am) that I could be the Scarlet Pumpernickel?" -- Looney Tunes, The Scarlet Pumpernickel (1950, Chuck Jones)

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