This I fully agree with, companies want to move back to very low wages and are doing all it can to force a recession. So far not going well for them.
On goes my Tin Foil Hat: So, SVB failed due to a Bank Run by rich people who mainly own their business. Coincidence???
I know people in retail, right now they are job hopping because those wages have risen a lot compared to Tech. Granted, those wages are not good at all, but some are now able to put a little away instead of living on those future payday loans.
Most people let go in Tech, seems there is plenty of work out there anyway.
Of course, you'll have to answer a few questions for your conspiracy theory:
Why wait until 2023? Why do it after hiring at such a rate that you effectively increased your company's headcount by 50%+ in the last 2 years? What events are currently happening that would allow for this to happen?
You can pretend like you have a standing for your theory all you want, but it's all nonsense compared to the simple fact that Powell and Yellen are here to force a recession.
What if these companies did not hire some concrete number of people but had a pipeline set up to pass a certain fraction of applicants? Seeing how people get hired by Google, for example, and then get into a "team assignment" it certainly looks to be a possibility.
Then, what happens when the stock price doubles over two years and a significant fraction of the compensation is pegged to the stock price? Compensation grows too. And when compensation grows they get more applicants, I'd imagine. It's not like they had been getting few before but their hiring pipeline had been set up for the old rate of applicants, if this suddenly grew, they'd naturally get more hires. Especially considering that the additional applicants come from a cohort that had been compensated well enough to resist the pre-stock doubling comp numbers.
When the headcount had hit backstops, some hard headcount limits they likely have had, only then they realized how much did they hire and now react to this by doing layoffs and, probably, revising their HR policies.
Facilitating a bank run on your own bank is quite silly. Which again reinforces the proverb “never attribute to malice that which can be explained by stupidity”.
> Are there any known ways to counter attack an artificially induced recession?
You can hedge for recessions. If you think the central banks are blowing stuff up and the economy is going to go into a recession putting capital into government bonds like TLT is a flight to safety trade. The reasoning is if a recession comes then the central banks will have to lower rates and money will come pouring in from risky investments and from savings accounts.
I think all recessions are artificially induced since the creation of the fed.
government bonds trade opposite interest rates. Interest rates down TLT up. Interest rates down cash needs more yield comes running to tlt. A lot of data out there that stocks crash after the pivot meaning they see the pivot as a recession and go racing into safety. Doesn't all happen in a straight easy line though.
Headline from decemeber and I checked tlt and its near top of etf inflows ytd.
TLT saw its second-largest inflow ever, with a gain of $1.5 billion, Bloomberg reported.
2008 was probably the Fed waiting too long to decrease rates (because of the meme that housing was a bubble, and failing to notice the spillover from super high price areas, due to that the housing stock is missing millions of units)
> It seems there is plenty of well paid work though
I've been wondering this. I've seen lots of chatter about a retreating job market in the US, but here in London I'm still getting daily recruiter emails and LinkedIn requests. I could be wrong, but it doesn't feel like it's slowed down much here.
to assume that there is a big effort to fight labor implies things that seem to be simply not true.
what's more likely is that both the wage gains and the inflation are caused by the same thing(s), covid: stimulus, supply chain shocks, missing millions from the labor force coupled with historically low immigration rates (of course due to administrative limits).
The sucky reality is that employees at big tech companies have little interest in running a sustainable and resilient business. We want constant team growth, never-ending promotions, ever-growing salaries. If another company is growing more aggressively and paying even less sustainable salaries, we tend to jump ship. It's not necessarily wrong, but we really shouldn't act surprised when that backfires every now and then.
Tech leadership bears blame for nourishing that "there's no tomorrow" / "growth will continue forever" culture, but it's such an unhelpful take to portray this as some sort of a class struggle with shareholders. Especially since for a good number of big tech companies, shareholders don't actually have much say and founders hold controlling interests.
As a regular “individual contributor” it is very hard to fight ill thought plans coming “from above”.
Those who complain are usually cast as “negative thinking folks” and get subtle punishments.
If you are on a mid career senior salary range, are you going to pick a fight and risk being punished or carry on getting your good salary, bonus, stocks, insurance, retirement plan and perks - in exchange for slighly useless work?
Not even just fighting ill fought plans but whether we decide to execute well or dial it in. The pressure to ship ship ship comes from a lot of places, and relatively few of them have the technical competence to assess, care about, or evaluate code & quality. They don't actually understand what they're pressuring forward, so often.
And most of them face no real consequences. They don't have to maintain or repair some grossly abomination of a system, that's the engineers job. They'll be leading new feature dev new business dev forever & ever.
As a regular IC, the things you do are largely disconnected from whatever leadership is thinking. You have a lot of leeway to do what you want as long as it implements things that leadership cares about.
Eg. You can build a section of a tunnel to be wider where you think there should be a subway station, even if the president's wife doesn't think there should be a station there. Eventually the station will exist
We don't want constant team growth. It's the managers, the psychopaths, the ladder-climbers that do. And they are rewarded for any growth, as that's the only measure the higher-ups know, and the one they used to get where they are so it can't be so bad.
For startups, it's the investors who know only to measure growth because there is no expected profit until the bing bang happens.
I’m going to go out on a limb and claim that the large majority of big tech workers would be perfectly happy with a few promotions over a career and annual inflation-matching pay rises.
Except you rarely get inflation-matching pay rises, so the only way to prevent the annual erosion of your situation is the constant team growth and never-ending promotions.
True. Those who never complain about salary and are perceived as “happy” are in the bottom of salary increase priorities.
I learned that the hard way a few years back, then got my act together and made sure I’m always perceived unhappy with salary - to pull that off, you need to be backed by delivering stuff and being seen. Do your homework, and ask for the recognition, that’s my tip.
They expect that the competition will do the same--raise wages below inflation. Then you've got nowhere to go to make more. Even if it doesn't work out that way, most employees complain a bit but don't leave.
Competition will do the same initially, until the growth curves reverses. At that point, when you really need your experienced staff to drive growth, moat of them will be busy finding new positions.
I have noticed that recruiter outreach to me has picked back up. I'm pretty senior and they're offering me senior roles that could pay more. My current employer has benefitted from current events though so I'm staying put. But if I ever want to fuck off, I easily can.
I have a friend who is very junior. He got promoted but still fucked off to a new better job because his current employer treated him poorly.
I think people are gonna start remembering they can fuck off again, and we're gonna end up somewhere between here and where we were when the job market was on fire pandemic and pre-pandemic.
I think the dynamic I would be most afraid of is employees who have enough years experience to get a more senior position using this as catalyst to move on.
Except that making lateral moves has almost always resulted in higher salaries regardless of macroeconomic trends. The competition may be giving current employees sub-inflation raises as well, but odds are that they're willing to pay more than your current company on an initial offer.
All but the most naive (or small) companies will do market analysis on the market rate of labor and have internal churn targets. I'm sure the accountants did the math and upper management decided the expected bump in churn is worth the savings. They probably noticed a recent decrease in churn at the company, and a recent stagnation of tech wage growth and thought this was a fantastic opportunity to manage labor costs. Not giving labor a 5% wage increase now will have an impact on their labor costs for years, as wage growth compounds.
The prevailing engineer perspective is that this behavior causes the smartest engineers with options and ambitions will move on. Other top engineers will leave simply because they prefer working with other great engineers. Three years of small plays like this from management is enough to cause complete brain drain, as even those waiting for more vesting will lose optimism. It's one thing to have 6% churn from engineering/product in a year. It's another if you lose the most qualified and respected 6%.
> It's another if you lose the most qualified and respected 6%.
I doubt that’s the case. The people deciding to lay off are just getting rid of 6% of their ‘resources’, they don’t consider that those 6% might be doing 50% of the work.
So 3 years on they’re just wondering why their engineering team is so useless, and thinking back to the good old times.
1. My comment was on managing churn rate, not layoffs.
2. My comment described a process in which talented engineers self select to leave companies, and management only had indirect input on which engineers leave.
We got raises across the board this year that are about 2/3 of the current annual inflation rate, which is not a lot of money month-to-month but is more than I expected tbh.
It's also important to note that wage inflation and the inflation of goods and services are separate and not always correlated. Just because milk and bread and cars cost more doesn't mean that the value provided to a company by an hour of an employee's time has risen by the same amount (or at all). I'd love raises that beat inflation every year, and for most of my career I've gotten them, but now that I'm not it doesn't necessarily mean the company is just trying to screw its employees.
The correlation between "value provided to the company" and "salary paid to retain a worker" is much lower than you might believe.
Also, critical parts of employee retention include "keep the worker alive" and "keep the worker satisfied". If housing goes up 20%, the wage better increase by 20% as well. Homeless or unstably housed engineers are not productive engineers.
It's important to keep in mind we're talking about engineers, who make good money. Unless you're already making very bad financial decisions, nobody on HN is getting evicted because your raise is 4% instead of 6%.
These are all very good arguments for why people making $15/hr should get regular raises to keep pace with inflation as a matter of course, not a very good argument for why someone making $200k copy-pasting JavaScript from StackOverflow should.
>nobody on HN is getting evicted because your raise is 4% instead of 6%
That's an unfounded assertion. I know plenty of software devs & other tech industry folks who cannot afford a house and are being squeezed by relentless rent increases (myself included). Many on the lower end of the pay range are a layoff away from homelessness.
Well, they hope other companies will do the same, or even fire people, so that there will be no hirings, and so people wont have a chance to jump ship...
You're not wrong - The real problem is I don't give a shit about the product. I'm here to make money and retire. It's the companies job to either figure out to how to eliminate needing me or make the job compelling enough that I give a shit (which is extremely difficult).
I always tell our candidates that the only thread connecting all our employees — some as young as 20, other 50+, some are mechanical engineers, some technicians, others are algorithm researchers etc - is that all of them personally care about doing a good job, just like a craftsman of old who is proud of their work. It makes for an awesome work environment, even if slightly emotionally elevated.
It's wild host so many companies make doing the right thing extremely hard. I've never been at a big org, and sometimes we are super profitable & trying to make big long term investments in the future, and folks seem to want to rush & smash code & go go go.
My pace has almost always felt a bit off, but I've always hated shipping subpar systems. Whether it's other engineers or some local managers or the business, there's always been extreme pressure in competition with my desire to just do a good damned job.
It's been isolating & draining. Sometimes it's just a matter of spending 3x as long as it would have taken to line up the 300 reasons why at each spot the shit slapdash plan is shit and the good plan is good. Trying to be OK with the process, walking through people who really barely can understand any of... You have to just keep saying to yourself, fine, this is my job, I'm the expert, it's OK that you don't know, & I'm not sure that you do need to know, but here we are & this talking it through is how we're going to decide where we go I guess.
I’m usually on the other side of this. I regularly request that people spend 3x the time it would take something to prove to me that it’s a good idea, so maybe let me offer you some perspective - the outside view, if you will.
The primary job of an executive is risk management. Let’s say I run an engineering team where people have good ideas 70% of the time, and bad ideas 30% of the time. Famously, it takes 10x the number of resources it originally took to develop and deploy, to remove a bad system from production and replace it.
.7 * 4 + .3 * 3 = 3.7
.3 * 11 + 0.7 = 4.0
An engineering team that doesn’t take 3x the time it takes to do something to verify it ahead of time is actually slightly less efficient overall ( assuming that 3x the time it takes reduces the error rate to 0)
Yea there are lots of simplifying assumptions here, these are all averages, plans don’t all take the same time, etc, etc, etc, and a more sophisticated system would take it all into account. But the results don’t usually change, unless in very special circumstances.
They are paid to be there instead of somewhere else that would also pay them for the same craft. You can care about compensation and your craft together.
Say you took pride in your skill as a smith. That’s hardly incompatible with finding an employer who will pay for making quality armor.
Pride in their skill has nothing to do with staying at a company. They can take pride in their skill as a smith elsewhere too. Even better at their hobby projects.
Pride in the end product might, but most companies make nothing to be proud about, except the skill itself.
So, let's be real, they are at the company to make money, and if they have a better chance, they'll take it. Lack of those, good enough salary already, inertia, and "the devil you know" is closer to the reason they stay.
Reflecting, I think people who take pride in their skill do like to work with others who feel the same way. So that could be a factor for why here for $X instead of there for $X
I pay my employees 30% above market rate. I know that because I negotiate their salary to hire them, then 6 months later I add 30%. I also care deeply about then finding a girlfriend, a house, a motorbike or anything that’s good for them and that they say they want, and I’m happy when they do.
I also have to tell, honestly, they give me shit. They act like “Yeah we don’t care that your business survives, it’s your job to make your company earn money. At worst we’ll find a job elsewhere.” I’m constantly tempted to fire them before they tank my company.
* How do you account for candidates who might be faking enthusiasm due to need for a job?
* How are you measuring this enthusiasm within the company (ie are you having high employee survey scores compared to what you are paying them)?
Like seriously the "we are making the world a better place" only goes so far - especially in a climate where employers have shown who they truly care about. And may be you are suggesting that you might not be messaging that you are making the world a better place and instead everybody gets to be a davinci?
I think the mistake you make is assuming that being proud of your work also means being proud of where you work.
I personally do care about doing good work and ensuring what I do is well thought out and performant. However that does not mean I always care about the company. And what little care I do have can rapidly be eroded.
Workers nowadays are more aware than ever that you pay a passion tax. If you want to work where you really want to work, then companies know this and will take advantage of it.
If this is the commitment offered by employees is there an equivalent offered by the employer? I.e. how does that affect lay off decisions? If the assumption is that employee passion will keep the ship afloat, then how is that reflected on compensation and profit shares? I am all for dedication and have mostly been passionate about my work, but with my eyes open that this is a one way game, and I play it to feel better myself with a risk of even bigger disappointment when reality hits.
I care about being a professional, and delivering quality work. That's not the same as caring about a product/company.
Right - it isn't altruism; it's basic professionalism - and the only psychologically healthy thing to get through the day, actually.
"They're paying me decently, they don't take me for granted, don't get in my way of helping them and they definitely aren't jerks. So why not do a good job?"
Actually caring about the product/company doesn't need to factor into it.
I can believe that's a common value at a company, and I'm a little surprised that some others here can't believe it.
I'd add to that: for all but the most intractably huge companies, there's a somewhat different, or additional, atmosphere that I think is even more important: everyone is focused on the success of the project/company.
Put another way: if you could somehow omnisciently and top-down get each person individually coordinated such that all they need to do is their complete their assigned tasks on schedule and with high quality, that'd be great. But, realistically, you can't (well, not in innovative startups, nor in a lot of tech work). So, if you can get people thinking and coordinating towards goals beyond whatever task someone told them to do, then then you can be more effective collectively.
Maybe you the craft you had in mind already implicitly encompassed this focus towards larger goals. But if you look at popular modern methodologies, organizational incentives, etc., it's pretty clear that's not implied many places.
Inflation has a made it that FAANG salaries aren’t really excessive, just slightly better than middle class. Salaries are really just messed up related to costs ATM.
We need to get a handle on inflation and the housing bubble first before we can figure out what reasonable salaries are again, and that’s going to hurt all around.
I disagree with that. First, Faang salaries are way over middle class. If inflation reduced your salary by a bit, think about how much more ia reduction impacted the salary of an average middle class person. As you make more money you have more disposable income so the impact of little bit less money when you make more is smaller.
FAANG salaries are not over middle class and this kind of rhetoric is used to fuel class warfare by businesses and companies among the poor and middle classes.
The fact is that in the modern day even on a FAANG salary a lot of people cannot afford to buy a home of their own. And the salary band at those companies is incredibly wide, owing in fact due to the wide disconnect in salary between engineers, middle management and the c-suite.
What are you talking about? Maybe for entry level with only a couple years they couldn’t own a home but come on? You think there are mid/senior level people with 5+ years working there who cannot afford a home??
Yes, thank you. That's the exact point I've been getting at. Median salaries for workers in the US is far too low and should be brought up, rather than fighting to bring FAANG engineers lower which is exactly what businesses want.
I think the point they're making is that salaries should be higher, given the discrepancy between productivity and pay that started appearing in the 70s [0].
Uhhhh, if I go to levels right now, the Google Entry Level L3 total comp is $190k[0]. The US median household income in 2021 was ~$71k [1]. Where do you think the middle class line lands?
Above what even your average senior engineer is making.
I'm not a FAANG worker; I make well below what they make. I simply do not ascribe to the crab-in-a-pot mentality that a lot of posters here seem to have in attempt to further divide what is ultimately a large range of middle class workers. Total compensation also only matters depending on the total CoL because a lot of those companies require you to live in areas with incredibly high rent, especially with the attempt to remove remote work. And even with FAANG the salary between an engineer at Amazon and one at Google is going to vastly differ, especially depending on what part of Amazon you're working at.
For reference, Pew Research defines middle class as 1.66 - 2x the median salary in America. That would make most tech workers middle class, and FAANG engineers in the lower upper class. In places like San Francisco where the cost of living is significantly higher, you would need to be earning ~230k a year to be in the upper middle class [1]. Though that's by one narrow definition.
The fact is that even your senior tech worker making ~200k a year is barely a blip on the radar compared to how much executives and investors are stealing. If you want to fall for their rhetoric and wonder why things are getting worse for everyone then you shouldn't be surprised.
In your CNBC article everything is based on household income. Many SWEs would be classed as not middle class based on their own income let alone household income.
If you take increased salary due to location and partner salary into account, the majority of SWEs are easily upper middle class.
> In places like San Francisco where the cost of living is significantly higher, you would need to be earning ~230k a year to be in the upper middle class
A solo entry level FAANG engineer basically qualifies for upper middle class. Add a partner and you're definitely upper middle class.
> And even with FAANG the salary between an engineer at Amazon and one at Google is going to vastly differ, especially depending on what part of Amazon you're working at
What are you talking about with "especially depending on what part of Amazon you're working at"? As far as I've seen Retail vs AWS doesn't have different comp.
A test engineer, a software engineer and a QA engineer all working at either Amazon, Amazon Games or Twitch are going to have often vastly different comp levels and often lower than what's reported on those sites from my experience. Since Washington now requires companies to post wage/salary range, you can simply look up job postings in that state to get an idea of how wide the band is. Sites like what you share are often going to be representative of the upper band of the salary range since that's who self-reports.
My argument has always been that they exist in the middle class. The fact that median income being low isn't indicative of them not being middle class, but rather that the continued squeeze on salary among all middle class workers has resulted in a shrinking of who actually is middle class and what that income means.
> Sites like what you share are often going to be representative of the upper band of the salary range since that's who self-reports
Many people have corroborated that levels.fyi is accurate for large tech companies like Amazon and Google. It's accurate for my company as well.
If FAANG comp is middle class, at what point does it become upper middle/upper class? I believe ~$500k is 1% income in the US. Some SWEs who are "workers" break that. Is someone who has top 1% income really middle class?
A lot of SWEs also receive equity compensation (I.e. ownership), which is very much not a middle class phenomenon.
I'm sorry but your idea of what middle class is seems to be way out of wack with the reality that people face. Avg people make a lot less than the mentioned 190k, and if you make over 100k, you are close to being in the top 10% band of salary. If you make 200k are you definately in the top 10%. Most people make vastly less than software engineers. With avg salary around 55k, and that should be included in "middle class". Can you find some statistics or reports that backup your claim that "middle class" is so much higher?
You are missing the point. “Middle class” lifestyle, especially in high cost areas, is not making around $55K. It is making roughly $150K or more.
The point is that salaries should have increased for everyone. Middle class is not struggling to make ends meet and living paycheck to paycheck. It is living a modest life with modest savings and a discretionary income.
I am not sure how that helps make this clearer though. It almost doesn’t matter at this point. We all know making $55K/yr in the Bay Area is rough. People are getting screwed over.
Our buying power isn’t much more than our parents, it is noticeably less when it comes to housing. My dad got a mortgage on a $100k home in the late 80s when he was making above that per year contracting. There is simply no way a FAANG job at below director level would allow for that.
From that perspective, yes a lot of people make less, but that just means life is becoming impossible for most people making normal salaries.
> That's due to NIMBYism and people not wanting to construct more housing, not due to wages per se.
Not really. Housing is simply becoming more expensive to construct, even in places where land is cheap and building regulations are open. But let's say even if NIMBYism was significant factor: why are all the good jobs where people want to live correlated with higher factors of NIMBYism? Why doesn't everyone just want to move to Houston (which is losing population these days, even if the metro is gaining)?
> why are all the good jobs where people want to live correlated with higher factors of NIMBYism?
What a strange question, as if it reverses the correlation. People who buy a property before new people come in, such as SF during the 60s, will inevitably see their home prices rise and want to capture that value without wanting to build more housing. The places where people don't want to live simply...don't see this phenomenon, because people don't want to live there. Of course supply and demand still matters, you can't just build houses in some random part of the country and expect people to move there. You need to build where people want to move. This doesn't really have to do anything with not building more housing, and indeed NIMBYism explicitly denies housing construction approvals.
People have been property in SF after the 1960s. In fact, much of its housing stock was built since 1980.
> You need to build where people want to move. This doesn't really have to do anything with not building more housing, and indeed NIMBYism explicitly denies housing construction approvals.
Just because everyone wants to live in SF, which has a density much higher than Houston, doesn’t mean everyone can live in SF. If SF was a dense as Manhattan, it wouldn’t be any cheaper than it is now, it might even be as expensive as Manhattan.
Whose fault is it exactly when staying at a company results in my salary going down over time?
No one is asking for endless growth on the employee side. But growth should match responsibilities, and if I gain more responsibility over time then pay should match. And if my salary can't match inflation at minimum then you're telling me I should be paid less for my current work.
Companies prefer to funnel that money to investors and as a result this is where we're at. Note that privately owned companies or worker owned companies avoid this issue more often.
Yes, it's the employees fault. They were "asking for it", dressing their LinkedIn profile too provocatively /s
Employees in tech wanted, and were fine with, and even cherished "a sustainable and resilient business". That's the golden age IBM, Intel, AT&T, and so on employee for example.
Then companies started being about the stock market, and short term profit, throwing them under the bus whenever they had a chance, while still paying nice bonuses to the C-level and middle managers even when they run the companies to the ground.
So, yes, they felt little loyalty not to "jump ship" to a company didn't give a shit abotu them. Hell, the C-level execs that are paid 10-100x better than the employees would not think twice to jump ship at any chance they got, and somehow the employees are at fault for doing the same?
I mean I half agree. There's been factions in side the tech industry for years trying to get people to think about what would happen in this sort of scenario, to understand that "tech workers" have more in common with working-class factory workers in the 50s and 60s that with Peter Thiel and Sam Altman. That faction has pointed how IBM or HP acted when they were on a downward slope. To think about collective action, solidarity, other measures that might help ensure that good jobs don't become bad jobs become no jobs to further enrich a handful of factory owners.
But the braying voices places like here have always shouted those down. Always.
Wow. This is the most amazing take I have seen. It is truly boggling to see somebody trying to lay this at the feet of the employees.
It’s not that activist billionaire, shareholders are demanding layoffs. It’s the workers fault for wanting a share of the pie and not just taking what they’re given quietly and meekly.
You’re right, it’s not a class struggle. For it to be a struggle both parties have to recognize that it’s actually a struggle.
This argument would make sense if the companies doing the layoffs were largely unprofitable, and not spending huge sums of money on stock buybacks and inflated executive salaries.
To further elaborate, a big part of running a sustainable business is the leadership.
I keep seeing this idea that people need to work harder and you’ve got the Mark Zuckerberg‘s of the world pushing this idea that the Meta employees aren’t working hard enough and that’s why they are flailing. Not that the actual core strategy and shit like the Metaverse are bullshit. Or Google that has had some thing like 3 to 5 different chat systems over the past 10 years and utterly baffling product strategies along with a reputation of killing products or neglecting them.
But it’s clearly the employees fault and it doesn’t have a damn thing to do with completely bullshit leadership.
Some idiot (Musk) decided to axe 90% of workers, and the company hasn't completely evaporated (Twitter). Investors; therefore, are jumping on the signal that a bunch of capital is allocated to non-productive work.
Therefore, Welch it, trim the fat, give me back my money so I can stop being a source of welfare for techies, and start pouring money into something interesting.
> Etymologists can find no firm evidence that the verb welsh, meaning "to swindle a person by not paying a debt" or "to fail to fulfill an obligation," is derived from Welsh, the people of Wales."
Twitter has almost evaporated. What would someone buy it for today? A billion dollars? Maybe two? He couldn't have more effectively destroyed its value I don't think.
By what metric? I’ve been using it every day since Musk took over and the only time I notice things is when people point them out (and people love to point them out).
By contrast I couldn’t Netflix to stop buffering last night and the last I heard they haven’t had really any layoffs.
It's complicated. He offered way too much. He made an incredibly poor deal with them. The market went down after he made his offer. So he put himself into a bad position. Anything is worth what people will pay for it.
I thought maybe 10b was what it was worth. And he could have gotten out of it by paying a $1 billion cancel fee, something like that. It appeared his ego prevented him from considering that. But it all goes back to him signing a terrible agreement in the first place.
> And he could have gotten out of it by paying a $1 billion cancel fee, something like that
I'm not sure why people are still repeating that. No, he couldn't, that fee would have been due if external influence would have prevented him from completing the transaction (e.g. the government banning the sale somehow).
My WAG is their revenue has fallen to under 2 billion a year, maybe less than $1B. Since they stopped paying the bills for things, their costs have gone way down ;-)
The narrative around this round of big tech layoffs seems wrong.
The article opens:
> Since the start of 2023, more than 150,000 people have been laid off at tech companies, large and small. That’s a staggering number of people who have been put out of work.
Who says those people have been put out of work? There are lots of startups that have wanted to hire engineers that couldn't because the FAMAG paycheck money firehose made it nigh impossible.
These people are mostly not going to be out of work. Most of them will still be earning way more than almost anyone in the country.
This is a good thing for startups, as now the (frankly anticompetitive) big tech hiring practices are getting rolled back to sane levels.
> Who says those people have been put out of work?
The... the people who fired them? They made them stop working. Whether they find somewhere else to work doesn't undo that fact. And I don't think you should be so quick to assume that all of them will be just fine. Give it five years and then see how everyone feels about it.
> This is a good thing for startups
Incredibly so what. I can picture a wonderful world without startups I cannot imagine one without workers. Startups have "disrupted" a lot of the stability out of the world to the benefit of almost no one. They have contributed almost nothing positive for at least a decade now and it's not because of a shortage of workers.
At the risk of being snarky, a world where no new businesses are started possibly does not look how you think it might look. Such countries exist today in the world and some of them will even let you visit!
Ah yes, thank god the anticompetitive hiring practices of * checks notes * paying people a lot and treating them really well are finally ending.
Look, we can argue about whether big tech salaries are a good or bad thing, but calling paying people more than your competitors, an anticompetitive practice is absolutely absurd. If anything it’s the most competitive thing a company could do to hire.
And because many of them see less sales, and they want to stay profitable. That's the obvious reason. Yeah some of them are just following the herd but some companies see less spending.
This is a technically correct explanation but doesn't tell us anything. Obviously they did it because they can, otherwise they wouldn't have done it by definition. But why did they do it? Why did they go from "can't" in the years leading up to it to "can" a year or so ago?
Because they've been gripped by a collective monkey-see, monkey-do type insanity of valuing the short-term savings of not having to pay those laid off over the much larger long-term opportunity cost of the work those people would have done. The entirety of this "current economic reality" is a self-fulfilling prophecy from those using those words to self-justify their actions.
I am curious at what point this violent recurring "dawn" to software engineers (in Silicon Valley specifically) is going to lead to the creation of a Guild.
Consider that remote work is more prevalent, the healthcare situation is not getting any better in the U.S. and in this space it has become more common for employees to have to move between companies regardless.
Then the certainty of having a comfortable job at Google or Meta evaporates violently. To the point, where mothers while giving birth learn they are fired. And then we have things like ...Twitter.
Say you were laid off by FAANG or a notable startup and the same or adjacent company reaches out to you a year from now to rehire you, as the "bull market is here." What will you do? The instability is here to stay for a while. This can happen in 2025 again pretty easily.
What is that critical mass of engineers that would demand a startup gets guild approved to join? I can see that happening if one of FAANG becomes a guild company but they will fight tooth and nail to avoid that.
As an investor that is a nightmare, if a minority of startups are in this situation. On the other hand if that is the status quo to getting great people, I can accept that overhead.
Because we’re smart enough to see the difference between a craftsman’s guild and a traditional workers union.
For starters guilds tend to have progression by merit, requiring an apprentice prove they are competent enough to be considered a journeyman.
And you know … not wanting to be exploited… healthcare sounds nice… ( on this point, I’d like to point out that as an Australian software engineer, I long ago resolved to never start a company in America because of how insane healthcare in America is. I can understand the guns, the polarised politics and all the rest of the things that make America what it is… but healthcare is just so fucking insane that i haven’t even seriously considered taking a holiday there to see the museums that have been on my bucket list for half my life… the idea of starting a business there is just an immediate non starter… I’ll take US cash and setup a holding corp if they demand US incorporation and employ people elsewhere… so having a guild where healthcare was provided would make American developers more competitive in the job market)
We should just eliminate H1bs and expand the green card program together with eliminating per country quotas. Relying on a union to protect workers with precarious visas is really just trying to address the symptom rather than the cause.
Are they any Real World examples of "guild" vs "union"?
About the US healthcare expenses: When you travel on holiday, you can buy pretty reasonable travel insurance. For example (no shilling): You can get one week of healthcare coverage from World Nomads for 130 AUD. Not so bad.
Unfortunately the only “real world” examples I can personally think of for craft guilds are from more than a century ago, making them quite poor examples of the practice in a modern context. However if your not opposed to a little bit of history, I’d recommend checking out the history of craft guilds which goes back well over a millennium and it represents one of the earliest forms of “qualification” outside of religious or spiritual contexts (since determining if you have a suitable priest of Zeus, etc… has basically been a thing since forever)
I certainly wouldn’t join a union (and a “guild” would not be legally distinguishable from one).
I don’t want a levelling effect in our industry. I don’t want gatekeeping either. We aren’t interchangeable cogs, and people who do better than average should not be held down. Promising people with nontraditional backgrounds should not be prevented from entering the field. Despite what people claim, unions would definitely hold people down and lock out new people.
Things are going really well for us actually, compared to people in other professions. That’s partly the case because our industry has been able to remain dynamic and innovative. Much of the success we’ve seen was built by people with nontraditional professional backgrounds and would not have happened if we got bogged down by gatekeeping and credentialism.
When the pie stops growing and we need to fight management over how to divide it, maybe a union will be attractive. But right now the pie is growing rapidly and workers are getting a huge amount of it in the form of both cash and stock. I’m all for continuing with this free, dynamic, and incredibly successful model.
By the way, unions don’t make layoffs a thing of the past. Look at what happens in the auto industry. The beat thing we can do for laid-off tech workers is ensure that we keep our industry dynamic, so there will continue to be new employers to work for.
No, I meant that above average achievement is not rewarded. (And in that case, why would anyone try harder than the bare minimum?)
One of the first things a union would do is decouple compensation from performance and introduce a standard compensation structure for all workers, segmented by job level. (And somehow the people who are personal friends of the union leaders seem to rise in job level faster than the others…)
The kind of people who are attracted to that kind of structure are not the ones who build successful industries, and they are demoralizing to have as coworkers.
> One of the first things a union would do is decouple compensation from performance and introduce a standard compensation structure for all workers, segmented by job level. (And somehow the people who are personal friends of the union leaders seem to rise in job level faster than the others…)
This argument is a strawman, and really is a worsr-possible-case caricature of union activity. I've worked in a number of workplaces having a unionised workforce my entire professional career (~25 years, private industry and government) and I've never observing anything like the scenario you describe. Ambitious, talented people are promoted and improve their compensation. Average-performance clock-punchers reach a certain level and stop. Poor performers are managed out of the organisation. Union membership is no ticket to a cushy job for life.
I'm not denying that the worst-case scenario could happen, but it's by no means a given. IMO this kind of fundamentalist opinion is unhelpful, and doesn't reflect the reasonable balance of priorities and opinions which people have out there in a modern society.
Yes, I'm primarily a software engineer. Unions are quite often sector-based rather than profession-based. For example, the union I belong to currently covers the public sector in Western Australia rather than any specific profession. As to what it does for me: negotiates on my behalf for any required changes to my award, provides a counselling service to assist with localised work issues or general mental health, provides a travel insurance policy that covers my daily commute, provides a purchase negotiation service for appliances and furniture, and provides a number of other discounts at various stores.
That's a difficult question for me to answer, given that 1) I'm in Australia and 2) "tech workers" is a very general term. Given the current exchange rate, I can say that I'm currently paid in the range of US$70000-80000 per annum (it varies a bit based on voluntary deployments to bushfire incidents that my org manages). It's a full-time role, mainly software dev but with the mix of sysadmin, BA, DBA and other odd IT jobs that any tech worker does. I coordinate 1-2 more junior software devs to a small extent.
I have no idea how that compares to a similar role in the US, but over here that's a pretty comfortable middle-class wage.
I estimate 50% higher in tech-focused places in US. However, that would ignore worse work-life balance and insanely high living costs in those places! I sounds like you are being paid well. I would love to live in Perth for few years, then explore the beaches, reefs, and bush in my free time.
Yeah, it's difficult to compare wages across countries while also taking into account the differences in living costs, etc. Recent data on purchasing power parity between the US and Australia puts Australia at around 1.44 (which would pretty much eliminate the difference in exchange rates). Further, the cost of living outside of our biggest cities (Sydney, Melbourne) is a _lot_ lower. I don't think that it's well-known around the world, but I'd wager Perth as one of the best places to live in the world. Infrastructure, safety, stability, environment, cost of living, etc. are all first-class.
There are many legitimate criticisms one can make of American unions, but this isn't one of them. I am not a union cheerleader by any stretch of the imagination, but you obviously don't have the slightest clue what you're talking about. Hard work and valuable contribution are recognized, celebrated, and rewarded as much or more among union workforces as otherwise.
The original case of tech startups was that if you gave people a living wage (such they were comfortable), then the fact that they're not keeping up with the Jones's becomes meaningless, and then how they thrive is about how interesting their job is to them.
This is seen, at least partially, as what drew a lot of people to the current "big tech" companies. They wanted to work on interesting problems. The pay was high, but it mattered a lot less than that the work was actually rewarding.
Onboarding or 'getting someone up to speed' is a far more invasive and disruptive task than many believe. Manager probably dream about adding and removing employees as easily as buying more or less food for a catering event. Institutional knowledge and employee quality are no where near that easy.
It is more like they want to fire and hire to show shareholders they want maintain status quo. Business don't really save money firing and hiring over and over. It is the share holders who think nothing good is coming from employees who stick around or have earned too much annual increase in pay to keep them. If you make 180k a year and you get an annual bump of 4% pay every year, you'll get 7.2k bump. So 194, 202, 210, 220... in five years. It is a sizable bump. They fire rehire to sometimes reset those annual bumps.
I don't see how this position is tenable after seeing what generative AI can do for code.
> Things are going really well for us actually,
Not right now anymore. Have you seen the layoffs? Things went well because of years of cheap cash. The music is stopping and there will be even more layoffs before this is all done.
I forget who wrote this, but there was a famous CS-related paper from a while back that made the point that when we automate the easy stuff, the only remaining problems are the really hard ones that require human expertise and domain knowledge to solve. So there will always need to be human software engineers.
AI being able to code is going to be like what happened when construction workers started using power tools: now that one man can saw boards as fast as 5 others with handsaws, wouldn't we see a lot less demand for carpenters? What happened is that per-worker productivity went up because of the new tools and the construction materials and techniques they use were adapted to take advantage of that, there was still plenty of work, and we can build better things faster than before.
In software, imagine how much more effective engineers can be if the grunt work could be more automated. People loved autocomplete and smart IDE features and graphical debuggers because they made coding more productive. A lot of those things already do write some code. AI provides a much better version of that.
People whose only contribution to software is the grunt work of writing simple code might need to worry, but there is a lot more to working as a software engineer than grinding code. These AIs are also repeaters of existing solutions -- maybe they can solve simple problems that have pre-existing solutions in their training corpus, but an AI is not going to be able to create the next Redis or Kubernetes or AWS simply by recombining existing text.
Regarding layoffs:
Even after all the layoffs most companies still have more employees than they did in 2020. Many of the people being laid off today joined since then. They will get other jobs, maybe not in a few weeks like what used to be possible, but still. This is not like 2001 when entire companies were going out of business and laying off 100% of their employees.
A lot of the the American tech industry developed when interest rates were higher than they are now. What we had in the past decade was not normal, and in some ways it was pretty crazy -- investors didn't care if companies were sustainably operated, and now they do, and that's good for the long-term health of the industry.
Tech is not immune from the business cycle, because nothing really is, but this really is not as bad as previous downturns. Even if it gets worse before it gets better, the tech industry is fundamentally strong and will handle it.
Regarding your points on automation - it's an inherently contradictory position. If automation didn't save time/money/labor costs, we wouldn't invest in it. Carpentry being in demand has to do with external factors, not technological factors. There was no demand for carpentry in 2009, for example.
New industries will have to spawn from generative AI for there to be a net positive. Most IT and tech jobs are lower level coding positions. This will all but eliminate these roles. SWEs especially top ones will likely be safe. But that doesn't solve the societal problem.
Regarding layoffs - we've barely touched the surface. We haven't even entered recession yet, and a financial crisis looms. Most are on hiring freeze now and just in the last 2 weeks both meta and amazon slashed additional jobs. More will be coming. The industry won't completely collapse because it's a mature industry now - FAANGs are now like Coke. Blue chip. This says nothing about its workforce though - there's nothing these companies would love more than to be able to reduce the cost of their software devs.
There isn't really such a thing as "external factors" when the entire economy is an interdependent ecosystem. Construction getting cheaper and more productive actually created more demand for it, made it economical to build large suburban subdivisions, etc.
> Most IT and tech jobs are lower level coding positions.
I don't really buy that. It's true that most positions are IC positions, i.e. not managers, but quite a lot of them require domain knowledge and human intervention in edge cases which can't be handled by automation. If automation could solve all the problems, why are so many people oncall?
Construction hasn't gotten cheaper in the US, though. In fact, it's more expensive than ever. Yet, individual labor wages have not increased, So...what's going on? Other factors. You can't ignore them just because it suits your argument. The fact is, it's demand driven, and why in 2009 there was no demand (despite how much automation was available.) And workers aren't seeing the gains of automation (e.g. many are being replaced by them.)
> I don't really buy that. It's true that most positions are IC positions, i.e. not managers, but quite a lot of them require domain knowledge and human intervention in edge cases which can't be handled by automation. If automation could solve all the problems, why are so many people oncall?
I don't mean IC vs manager. In any case, at my company our support staff has been reduced by 75%. In my previous life as a mechanical engineer, I've seen control systems replace 90% of powerplant staff. Also, generative AI just became a thing - because SWEs can be more efficient, you simply need less, UNLESS there is growth or a new market emerges (certainly possible), in any case millions will be left behind, just as what happened in the rust belt when manufacturing collapsed.
Specifics on using an API, configuring a deployment, or describing best practices for a tool are relatively easy, and ChatGPT had been amazing answering questions in these areas.
Designing large coherent systems for a business use case is hard. I don't think ChatGPT will ever manage that.
Even if it does, it will simply mimic the systems other companies have created and documented, because GPTs don't create anything new. They recombine what already exists.
Plus let's be honest, the technical problems are the tip of the iceberg for software architecture. If an AI ever manages to convince my director to pay for things I'd be happy for the help.
There will be no guild or union. Guilds exists where the market has difficulty moving/outsourcing. If you have a mine in Alabama, you can't mine it from China. You are going to mine it with the most powerful group of the closest community (that happens to be the "union" of mining).
In tech, a union/guild is massive hamper on efficiency and control. Tech will quickly be outsourced to other places. It has become easier and more possible to outsource to other countries now (English is becoming more common, and education has improved in third-world countries). This will accelerate that.
Wrt your guild-proposal specifically, one concrete outcome I'd like to see is accreditation, something similar like certification exams administered by society of actuarians.
High bar standardized exam on fundamentals of CompSci, which waives every whiteboarding/leetcode interview. It sort of exists today, if you have a CompSci degree from reputable college, but this way people can get the certificate without the formal education, just pass the exam. It's ok if it's difficult.
The case of Amazon amazes me. This is the company that famously refused to worry about what investors thought 20+ years ago and just kept on being unprofitable (and instead, investing heavily in growth) to the considerable benefit of investors who stuck with them.
Google is crazy too: they will spend more on stock buybacks than they will save through the layoffs, yet are investing nothing in fixing their actual, deep structural problems.
I worked for a company like this as well. It’s easy to ignore investors when you’ve had an upward trajectory year after year. They’ll put up with almost anything when the stock price keeps going up.
But as soon as your growth slows or stops, reality hits like a ton of bricks.
Investors have lots of place to put their money. If Amazon cant deliver what these investors want, they’ll put their money elsewhere.
Amazon is free to ignore them, they’ll just have to deal with the consequences of that.
I mean, as an employee, would you stick around for less compensation? No, most people would find a better paying job.
Amazon was in a somewhat unique position where they could ignore their investors, because they were raking in plenty of money.
Choosing to reinvest that money in the business caused some consternation, but the consistent revenue and growth let them ride out periodic misadventures and hits to the stock price. It turned out to be a good move in the long run, because they weren't bluffing about their business fundamentals.
> Amazon is free to ignore them, they’ll just have to deal with the consequences of that.
The consequences aren’t necessarily that significant: mainly the cost of raising further cash from the markets, which doesn’t look like Amazon will have to do for many years, if not decades.
> The consequences aren’t necessarily that significant: mainly the cost of raising further cash from the markets, which doesn’t look like Amazon will have to do for many years, if not decades.
Many people who decide on these things, though, are mostly compensated in stock. They need a good price to sell their stock at.
If the stock price doesn't go up Amazon (and every other company compensating with RSUs) will have to fund raises out of their own pockets.
Yes I'm aware stock-based compensation is also an expense. But as I understand it, that expense = the initial value of the grant. So if the stock price goes up it's like the employee got a handsome raise funded entirely by Wall Street.
Amazon (at least used to, when I last looked at joining them) had a cash compensation max of around 175k-200k for essentially all engineers, with all comp greater than that coming as equity (with, according to what I heard, a 15% per-year assumed increase in the stock price factored into your comp package). So the employees really do care about the value of the stock, since a very large % of their comp comes from that going up.
Amazon revised the bands last year (at the height of pandemic comp craziness), so it’s now theoretically possible to get something like $300k in base. But the second half is correct. Amazon comp assumes 15% IRR. This wasn’t true for 2022, and it’s not true for 2023, leading to lots of complaints on Blind.
Amazon also sets compensation targets, and if the stock price goes high enough for the employee to reach the compensation targets without new stock grants, no new stock grant is given.
So there is no motivation to stay for long, even when the stock is doing well.
Good point. I didn’t mean the stack ranking thing, which is also degrading, stress inducing, and bad for morale! Much less the scandalous hire-to-fire.
I was specifically addressing the phenomenon described in the article, where the threat of the large number in future is demoralizing and destructive.
Reasonable people can consider them facets of the same phenomenon.
I believe the intoxicating idea that companies will not need employees soon is driving more of this than we think. Once the hype wears off things may normalize again.
I say this as a heavy chat GPT user. I really love it but not nearly like sending and email to a senior engineer: “please make X” - which then turns into the senior engineer scheduling meetings with the required teams / individuals - navigating the technical and (unfortunate) political issues, coming up with a design and implementing it - getting things done in other words. I don’t know what future versions of GPT will look like but the current one is light years away from having that level of capability.
Even a simpler task like fixing a bug cannot remotely be handled by ChatGPT.
It is almost like LLMs are a new dimension - we used to have X and Y, now we also have Z. Yet, we are thinking that this is just more “Y”.
If it was about LLMs then it wouldn't have to be preemptively rushed. Like, they could wait a year or two, their bank account isn't going anywhere. The users and data of big tech are the real value. By waiting a year for LLMs to take effect you evaluate properly, long term lose nothing, and don't have to go through massive hiring to compensate. It's not about LLMs.
The real reason is these companies have been overpopulated and produced basically no visible changes in 5 years. Google search is worse with auto-generated results not written by humans, YouTube has become super rabbit hole instead of discovery, Twitter shipped NFT profile pictures and Spaces.
I think the Occam's razor hypothesis is the stated one: economy looking cloudy, money getting more expensive. However, I'm certain LLMs are part of it as well - when you are the one writing the cheques you certainly do want to believe in a future where no more cheques need to be written while maintaining the same revenue.
I suspect it is more likely that the benefits will accrue to start ups as they will not have so much inertia working against them in terms of leveraging AI. People with ideas and limited means will likely be the primary benefactors due to AI amplification I think.
> I believe the intoxicating idea that companies will not need employees soon
Look, if you want to not need employees, you need to do capex. If you spend more money on stock buybacks than you save in payroll by doing layoffs, you're taking money away from capex.
Reason is simple. Back in the day the founders – armed with majority voting power and "fuck you" money in the bank – were in charge at these companies. Now it is the standard board-approved bean counting Harvard MBA CEO who has no choice but to buckle under investor pressure or risk getting fired.
Zuckerberg has absolute control of Meta, he is the one calling all the shots. Bezos doesn't have total control on Amazon but sits on the board and has the most voting power amount shareholders, so was the case with Benioff until a few years ago when he started dropping stock to buy expensive toys like Time, but he is still the single largest owner of Salesforce. So, many of the original co-founders of these companies are still there, they just have much different goals and interests than their younger selves.
I heard Zuck is behaving more like a majority shareholder than a CEO in day to day operations and management, Meta restructuring is handled by a consulting a firm. Could be wrong though.
Looking at their corporate filings, it looks like between Dec 31 2021 and Dec 31 2022 Amazon sold off about half of their "marketable securities". I don't know exactly what those were, but that sort of change makes me think "company is facing a cash flow crunch" -- just like when SVB started liquidating their marketable securities.
If stock buybacks were against the law, corporate taxes were higher, capital gains taxes were higher, and loopholes were closed, we wouldn't see this. The only way to earn more money in the environment I described would be to actively focus on growing your business, which means only letting people go you don't absolutely need.
In my area, Amazon has tripped up so bad I can't even have the basic necessities delivered to my house due to a staff shortage (they throw an error at checkout claiming multiple items can't be delivered to my address...items I've ordered for at least 4 years straight on a monthly basis without issue) so I am going to go from spending tens of thousands per year with Amazon to zero. I am in a city in the United States. Amazon will happily sell, ship, and deliver some no-name brand item from a third party seller within 2 hours of ordering, but they can't be bothered to do the same with the stuff I ordered.
If they weren't making money off me (which I doubt, I spent $23,967 on Amazon last year, and their products are only slightly cheaper than local stores...like CENTS), why were they willing to sell to me to begin with? I've switched to a combination of Costco/Walmart for most of my stuff, and will soon be independent from Amazon completely, all because they refuse to deliver my core products that they've delivered for years on a monthly basis without issue (toilet paper, a 12 pack of my favorite energy drink, my favorite brand of protein shakes, etc)
Really Amazon? (note the error I receive says that the item cannot be delivered to my address, and to select another. It is a residential address tied to a house and I've ordered the exact same item month after month. they also blocked subscribe and save.)
The first line itself struck me as amazing! What is the purpose of a company? Do you think a company would exist/ be funded if the company did not pay back the investor in some way?
We may argue that this particular buyback was ill timed, but still, banning all buybacks is a very very strange idea
I did not claim it was secret, and you provide no explanation. The example you provide is 1985 Soviet economy, no coop names (for other readers).
I wanted to ask instead of assuming before making the following argument to the previous claims:
> You might be surprised to learn that companies still existed/exist under communism, with not a single investor around ;)
> Those were not actual companies that existed. They were just another part of the government with a different name.
> no, there were worker owned coops.
As I suspected, these "worker owned" cooperatives are completely dependent on the party (unlike current cooperatives). That is not my idea of "owning", since party members that are "workers" of the cooperative only in name would be deciding a lot of things in how the cooperative is run.
> Many cooperatives were vulnerable to exorbitant taxation by local officials, high interest rates on loans, and protection rackets run by criminals, the cost of which inevitably were passed onto consumers in the form of mark-ups. “Kooperativshchiki” (cooperative owners) thus became a term of abuse in ordinary Soviet speech.
So I agree with user nradov here: "Those were not actual companies that existed. They were just another part of the government with a different name. "
I must concede, at some point the lines can become blurred.
Hungary. No specific companies. These were always small. Think like 5-6 people.
The obvious problem with USSR-style communism was/is the authoritarian dictatorship, so everything had to be integrated into the power structure, so only very small companies were allowed to be independent.
If you became successful without the Party? That's a no-no, so thanks and the Party will take it from here.
If you became successful with the Party? Great, now here's a bunch of chinovniks to help you.
What pricing power? Under communism it was not about pricing at all - getting supply materials required hustling more than money. Buying things in bulk gave no discount at all - sometimes quite the opposite.
As for individuals starting their own entrepreneurship - only in certain specific, government allowed situations. And even then it was frowned upon both by the government and by the society.
Also, being entrepepreneur didn't make much sense anyway, because money didn't matter as much as talons for items. That's why used cars (not requiring talons) cost way more than new ones -- as in, the taxi corp could buy new cabs, drive them for a few years, and then sell with a profit.
Worker-owned coops were nothing like what we know under capitalism. They were huge semi-governmental structures filled with bureaucracy.
> If they weren't making money off me (which I doubt, I spent $23,967 on Amazon last year, and their products are only slightly cheaper than local stores...like CENTS), why were they willing to sell to me to begin with?
Because they are making money off you. You are forgetting what the end price does includes the store margin (while in America it doesn't include taxes, lol).
Not only they are making money, they do it regularly. Maybe profits aren't big per user, but there are hundreds of thousands of such users so ARPU is quite high.
> they refuse to deliver my core products that they've delivered for years on a monthly basis without issue
I've started to notice this too - they seem to be experimenting with trying to push people to different "stores" within Amazon that are not unified: Fresh (which is now gone?), same day vs not etc.
I already didn't order high-margin items from Amazon because of the risk of counterfeit products, and Prime no longer meaning "this will be shipped from Amazon inventory within this defined time Window" makes that a useless marker too.
I cannot be bothered with any of this, and got myself a Costco membership, so Amazon (.com) have effectively lost all my business as I try to extract maximum value from that at this point.
"If stock buybacks were against the law, corporate taxes were higher, capital gains taxes were higher, and loopholes were closed, we wouldn't see this" ... we would see the same thing but only with dividends.
It doesn't change the decision whether it's better to reinvest in growth or pay out the profits to the owners; the primary reason for buybacks is that in the current tax law it's a slightly less tax-burdened way of paying out profits to shareholders as "dividends-that-technically-are-not-dividends".
I generally agree (and think stock buybacks are just better because they let investors time their tax realizations), but I'll point out that the way dividends are reported makes it more public when a company is not reinvesting in growth. Perhaps stock buybacks should be reported as prominently as dividends, rather than buried in cash flow statements.
Since you mention support, customer service is just atrocious.
My Pixel 5 phone is still under warranty and has developed a battery fault. I contacted Google support:
1. No option to repair, only replacement and only by post (unnecessarily inconvenient given that it's just a straightforward battery swap that any number of local shops can do -- I did this myself in the past except that this phone's still under warranty and I'm too pressed for time to be sourcing parts etc).
2. I got repeatedly prompted to confirm that I was using the charger that came with the phone (this seemed to suggest there might be warranty implications if I wasn't -- not sure this is even legal in the UK).
3. I had to consent to a page worth of legalese, including granting Google permission to access my phone usage data -- wtf is that?
In the end, I chose to walk into a third-party repair centre and just pay for an out-of-warranty repair. Took an hour, £50 ($60) and a voided phone warranty -- IMO a great deal compared to getting warranty service from Google.
A little bit off topic, but I have to vent somewhere...
I don't know about Chrome, but if Android is their most high-quality thing, then at the very least they are also losing in developer experience. The churn in libraries and frameworks there is, from what I've seen, only second to Web frontend, and bugs in newer things are really embarrassing. "Ready for production" (they claim in the FAQ) Jetpack Compose is great when it works, but even the Android Studio-generated Compose template crashed the IDE several times, while manually setting it up crashed Kotlin compiler[1]. WorkManager and Room are important things that bugged out for me, too. And I'm at it for just 5 months - there's got to be way more dragons that I'm yet to see.
I was mostly thinking about Android userspace/kernel/UX. The DX is of course tragic, and has been going down the drain since ... well, since the good old days of the first few years of Android Studio. But even back then it was a shitshow. When documentation wasn't completely useless then the APIs themselves were. (NDK is worth a dishonorable mention.) In-app payment APIs are also pretty meh - which directly make money for them!
And yeah, there's Flutter, and now there's this new Jetpack/Compose whatever. But as is tradition it's nowhere near production ready. And when it becomes finally solid, they just abandon it.
Angular went through the same cycle. I'm looking forward to their new React++ :D
google has essentially one product (85% of revenues, after fiddling revenue sources) which was developed almost 5 years ago. Everything else is a rounding number and most are money losers.
The company has been drifting all that time, seemingly unable to release any new products of significance. Google cloud is an also-ran. Android worked in that apple isn’t a monopoly, but no money spinner and seemingly abandoned. New “products” appear and then are dropped. Even the layoffs (source of this thread) were conducted in a ramshackle fashion.
They even let a random small company swoop them in machine learning. They had the pole position in that race but after jg left they seemingly lost interest.
Is GCloud really less than 15% of revs? Also, I think GSuite, Google Maps (create custom maps by API), and other commercial subscription services must make good money. Even Google Play to stream films must make good money.
This is because now corporate finance leads those companies, and its strategy is usually focused towards moving the numbers in the way investors read them (SOX rules for Earnings Report) and using all the tricks in the book to pass some short term sensation on improvement, which result in the carrot they are all after. The bonus.
Amazon had the no profit strategy because Bezos had ideals and as the Czar of the place, finance would not convince him to change strategy (But I bet they tried, must have been a fund meeting to watch). Now he is worried about his yacht and pet projects, so he let finance rule the place for the benefit of his stock price.
Same with Google. L&S don't have their ideals anymore and just want their money protected. Finance has this covered. There is no care for the brand nor its other stakeholders anymore.
They basically became another IBM, Microsoft, etc...
There is no other way. If they want something done they need someone to do it. Layoffs make them less attractive. So they will have to either rise the wages or accept less qualified candidates. The difference in performance between average and top engineers can be time. Or even infinite, when one simply cannot do the thing.
And this is, BTW, applicable through the whole range. Just check Intel market capitalization, and guess what? It's now smaller then AMD, and 6x times smaller then NVidia. The reason: top management, they failed on AI, graphics, they failed on Cloud. Yes, they did something, not enough.
Wait, what? Why would layoffs make it harder for them to hire? If anything, it’s tge opposite, they can raise the bar significantly now, esp since it’s a buyer market now.
I'm, for example, even not considering Amazon/Google/Facebook now. Job switch is quite stressful. There is no point without stability or fat paycheck. And looks like personal level doesn't matter much when the whole team is terminated.
a lot of founders also owe banks money tied to the value of their equity posiitons.
As stock price goes down, they are incentivized to either pledge more stock, have their collateral liquidated, or take actions to move the stock price back up.
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[ 2.9 ms ] story [ 165 ms ] threadOn goes my Tin Foil Hat: So, SVB failed due to a Bank Run by rich people who mainly own their business. Coincidence???
I know people in retail, right now they are job hopping because those wages have risen a lot compared to Tech. Granted, those wages are not good at all, but some are now able to put a little away instead of living on those future payday loans.
Most people let go in Tech, seems there is plenty of work out there anyway.
edit: typos
Why wait until 2023? Why do it after hiring at such a rate that you effectively increased your company's headcount by 50%+ in the last 2 years? What events are currently happening that would allow for this to happen?
You can pretend like you have a standing for your theory all you want, but it's all nonsense compared to the simple fact that Powell and Yellen are here to force a recession.
Then, what happens when the stock price doubles over two years and a significant fraction of the compensation is pegged to the stock price? Compensation grows too. And when compensation grows they get more applicants, I'd imagine. It's not like they had been getting few before but their hiring pipeline had been set up for the old rate of applicants, if this suddenly grew, they'd naturally get more hires. Especially considering that the additional applicants come from a cohort that had been compensated well enough to resist the pre-stock doubling comp numbers.
When the headcount had hit backstops, some hard headcount limits they likely have had, only then they realized how much did they hire and now react to this by doing layoffs and, probably, revising their HR policies.
My only idea so far is to accummulate as much as I can and not get into long term debt.
If I lost my job today, I estimate I could live ok without a job for about 2 years in my worst forecast inflation (in UK terms, something like 15%)
It seems there is plenty of well paid work though (again UK reality).
Are there any known ways to counter attack an artificially induced recession? Join a union and fight, perhaps?
You can hedge for recessions. If you think the central banks are blowing stuff up and the economy is going to go into a recession putting capital into government bonds like TLT is a flight to safety trade. The reasoning is if a recession comes then the central banks will have to lower rates and money will come pouring in from risky investments and from savings accounts.
I think all recessions are artificially induced since the creation of the fed.
Headline from decemeber and I checked tlt and its near top of etf inflows ytd.
TLT saw its second-largest inflow ever, with a gain of $1.5 billion, Bloomberg reported.
2008 was probably the Fed waiting too long to decrease rates (because of the meme that housing was a bubble, and failing to notice the spillover from super high price areas, due to that the housing stock is missing millions of units)
I've been wondering this. I've seen lots of chatter about a retreating job market in the US, but here in London I'm still getting daily recruiter emails and LinkedIn requests. I could be wrong, but it doesn't feel like it's slowed down much here.
microeconomics works.
to assume that there is a big effort to fight labor implies things that seem to be simply not true.
what's more likely is that both the wage gains and the inflation are caused by the same thing(s), covid: stimulus, supply chain shocks, missing millions from the labor force coupled with historically low immigration rates (of course due to administrative limits).
Tech leadership bears blame for nourishing that "there's no tomorrow" / "growth will continue forever" culture, but it's such an unhelpful take to portray this as some sort of a class struggle with shareholders. Especially since for a good number of big tech companies, shareholders don't actually have much say and founders hold controlling interests.
By “employees” in your first sentence I assume you mean the C-suite?
Those who complain are usually cast as “negative thinking folks” and get subtle punishments.
If you are on a mid career senior salary range, are you going to pick a fight and risk being punished or carry on getting your good salary, bonus, stocks, insurance, retirement plan and perks - in exchange for slighly useless work?
And most of them face no real consequences. They don't have to maintain or repair some grossly abomination of a system, that's the engineers job. They'll be leading new feature dev new business dev forever & ever.
Eg. You can build a section of a tunnel to be wider where you think there should be a subway station, even if the president's wife doesn't think there should be a station there. Eventually the station will exist
And what is your explanation for why it took you twice as long as it did Bob who just plowed that thing with uniform width?
For startups, it's the investors who know only to measure growth because there is no expected profit until the bing bang happens.
Except you rarely get inflation-matching pay rises, so the only way to prevent the annual erosion of your situation is the constant team growth and never-ending promotions.
I learned that the hard way a few years back, then got my act together and made sure I’m always perceived unhappy with salary - to pull that off, you need to be backed by delivering stuff and being seen. Do your homework, and ask for the recognition, that’s my tip.
I have noticed that recruiter outreach to me has picked back up. I'm pretty senior and they're offering me senior roles that could pay more. My current employer has benefitted from current events though so I'm staying put. But if I ever want to fuck off, I easily can.
I have a friend who is very junior. He got promoted but still fucked off to a new better job because his current employer treated him poorly.
I think people are gonna start remembering they can fuck off again, and we're gonna end up somewhere between here and where we were when the job market was on fire pandemic and pre-pandemic.
The prevailing engineer perspective is that this behavior causes the smartest engineers with options and ambitions will move on. Other top engineers will leave simply because they prefer working with other great engineers. Three years of small plays like this from management is enough to cause complete brain drain, as even those waiting for more vesting will lose optimism. It's one thing to have 6% churn from engineering/product in a year. It's another if you lose the most qualified and respected 6%.
2. If we wanted to use a number with authority we would probably use 6.5%, which is the US Buerau of Labor Static's number for 2022 CPI.
3. My level of precision (one digit) should have been an informal indicator that I was using a rough estimate.
I doubt that’s the case. The people deciding to lay off are just getting rid of 6% of their ‘resources’, they don’t consider that those 6% might be doing 50% of the work.
So 3 years on they’re just wondering why their engineering team is so useless, and thinking back to the good old times.
2. My comment described a process in which talented engineers self select to leave companies, and management only had indirect input on which engineers leave.
It's also important to note that wage inflation and the inflation of goods and services are separate and not always correlated. Just because milk and bread and cars cost more doesn't mean that the value provided to a company by an hour of an employee's time has risen by the same amount (or at all). I'd love raises that beat inflation every year, and for most of my career I've gotten them, but now that I'm not it doesn't necessarily mean the company is just trying to screw its employees.
Also, critical parts of employee retention include "keep the worker alive" and "keep the worker satisfied". If housing goes up 20%, the wage better increase by 20% as well. Homeless or unstably housed engineers are not productive engineers.
These are all very good arguments for why people making $15/hr should get regular raises to keep pace with inflation as a matter of course, not a very good argument for why someone making $200k copy-pasting JavaScript from StackOverflow should.
That's an unfounded assertion. I know plenty of software devs & other tech industry folks who cannot afford a house and are being squeezed by relentless rent increases (myself included). Many on the lower end of the pay range are a layoff away from homelessness.
My pace has almost always felt a bit off, but I've always hated shipping subpar systems. Whether it's other engineers or some local managers or the business, there's always been extreme pressure in competition with my desire to just do a good damned job.
It's been isolating & draining. Sometimes it's just a matter of spending 3x as long as it would have taken to line up the 300 reasons why at each spot the shit slapdash plan is shit and the good plan is good. Trying to be OK with the process, walking through people who really barely can understand any of... You have to just keep saying to yourself, fine, this is my job, I'm the expert, it's OK that you don't know, & I'm not sure that you do need to know, but here we are & this talking it through is how we're going to decide where we go I guess.
The primary job of an executive is risk management. Let’s say I run an engineering team where people have good ideas 70% of the time, and bad ideas 30% of the time. Famously, it takes 10x the number of resources it originally took to develop and deploy, to remove a bad system from production and replace it.
.7 * 4 + .3 * 3 = 3.7
.3 * 11 + 0.7 = 4.0
An engineering team that doesn’t take 3x the time it takes to do something to verify it ahead of time is actually slightly less efficient overall ( assuming that 3x the time it takes reduces the error rate to 0)
Yea there are lots of simplifying assumptions here, these are all averages, plans don’t all take the same time, etc, etc, etc, and a more sophisticated system would take it all into account. But the results don’t usually change, unless in very special circumstances.
If you stopped paying them, would they stay?
Say you took pride in your skill as a smith. That’s hardly incompatible with finding an employer who will pay for making quality armor.
Pride in the end product might, but most companies make nothing to be proud about, except the skill itself.
So, let's be real, they are at the company to make money, and if they have a better chance, they'll take it. Lack of those, good enough salary already, inertia, and "the devil you know" is closer to the reason they stay.
I can take pride in my skill anywhere I want. What I care about is that my employer takes pride in my skill.
Even if another pays more, I’d prefer working for someone that appreciates my skill (and shows that in ways not necessarily salary based).
Of course there’s a limit to this, but it’s generally true.
I also have to tell, honestly, they give me shit. They act like “Yeah we don’t care that your business survives, it’s your job to make your company earn money. At worst we’ll find a job elsewhere.” I’m constantly tempted to fire them before they tank my company.
* What response do you get from the candidate?
* How do you account for candidates who might be faking enthusiasm due to need for a job?
* How are you measuring this enthusiasm within the company (ie are you having high employee survey scores compared to what you are paying them)?
Like seriously the "we are making the world a better place" only goes so far - especially in a climate where employers have shown who they truly care about. And may be you are suggesting that you might not be messaging that you are making the world a better place and instead everybody gets to be a davinci?
I personally do care about doing good work and ensuring what I do is well thought out and performant. However that does not mean I always care about the company. And what little care I do have can rapidly be eroded.
Workers nowadays are more aware than ever that you pay a passion tax. If you want to work where you really want to work, then companies know this and will take advantage of it.
I care about the quality I'd work I do, I feel it's a reflection of me, even though it find the product to be pointless
Right - it isn't altruism; it's basic professionalism - and the only psychologically healthy thing to get through the day, actually.
"They're paying me decently, they don't take me for granted, don't get in my way of helping them and they definitely aren't jerks. So why not do a good job?"
Actually caring about the product/company doesn't need to factor into it.
I'd add to that: for all but the most intractably huge companies, there's a somewhat different, or additional, atmosphere that I think is even more important: everyone is focused on the success of the project/company.
Put another way: if you could somehow omnisciently and top-down get each person individually coordinated such that all they need to do is their complete their assigned tasks on schedule and with high quality, that'd be great. But, realistically, you can't (well, not in innovative startups, nor in a lot of tech work). So, if you can get people thinking and coordinating towards goals beyond whatever task someone told them to do, then then you can be more effective collectively.
Maybe you the craft you had in mind already implicitly encompassed this focus towards larger goals. But if you look at popular modern methodologies, organizational incentives, etc., it's pretty clear that's not implied many places.
We need to get a handle on inflation and the housing bubble first before we can figure out what reasonable salaries are again, and that’s going to hurt all around.
The fact is that in the modern day even on a FAANG salary a lot of people cannot afford to buy a home of their own. And the salary band at those companies is incredibly wide, owing in fact due to the wide disconnect in salary between engineers, middle management and the c-suite.
But how do we do this?
[0] https://www.epi.org/productivity-pay-gap/
[0] : https://www.levels.fyi/companies/google/salaries/software-en...
[1] : https://www.census.gov/library/publications/2022/demo/p60-27...
I'm not a FAANG worker; I make well below what they make. I simply do not ascribe to the crab-in-a-pot mentality that a lot of posters here seem to have in attempt to further divide what is ultimately a large range of middle class workers. Total compensation also only matters depending on the total CoL because a lot of those companies require you to live in areas with incredibly high rent, especially with the attempt to remove remote work. And even with FAANG the salary between an engineer at Amazon and one at Google is going to vastly differ, especially depending on what part of Amazon you're working at.
For reference, Pew Research defines middle class as 1.66 - 2x the median salary in America. That would make most tech workers middle class, and FAANG engineers in the lower upper class. In places like San Francisco where the cost of living is significantly higher, you would need to be earning ~230k a year to be in the upper middle class [1]. Though that's by one narrow definition.
The fact is that even your senior tech worker making ~200k a year is barely a blip on the radar compared to how much executives and investors are stealing. If you want to fall for their rhetoric and wonder why things are getting worse for everyone then you shouldn't be surprised.
[1] https://www.cnbc.com/2023/01/02/middle-class-income-in-major...
https://www.census.gov/content/dam/Census/library/visualizat...
In your CNBC article everything is based on household income. Many SWEs would be classed as not middle class based on their own income let alone household income.
The median SWE salary in the US is $110k: https://www.bls.gov/ooh/Computer-and-Information-Technology/....
If you take increased salary due to location and partner salary into account, the majority of SWEs are easily upper middle class.
> In places like San Francisco where the cost of living is significantly higher, you would need to be earning ~230k a year to be in the upper middle class
A solo entry level FAANG engineer basically qualifies for upper middle class. Add a partner and you're definitely upper middle class.
> And even with FAANG the salary between an engineer at Amazon and one at Google is going to vastly differ, especially depending on what part of Amazon you're working at
What are you talking about with "especially depending on what part of Amazon you're working at"? As far as I've seen Retail vs AWS doesn't have different comp.
Google and Amazon also have pretty similar comp: https://www.levels.fyi/?compare=Google,Amazon&track=Software....
Their comp bands likely have a lot of overlap. Differences are more likely to be based on negotiation than working for Google vs Amazon.
My argument has always been that they exist in the middle class. The fact that median income being low isn't indicative of them not being middle class, but rather that the continued squeeze on salary among all middle class workers has resulted in a shrinking of who actually is middle class and what that income means.
> Sites like what you share are often going to be representative of the upper band of the salary range since that's who self-reports
Many people have corroborated that levels.fyi is accurate for large tech companies like Amazon and Google. It's accurate for my company as well.
If FAANG comp is middle class, at what point does it become upper middle/upper class? I believe ~$500k is 1% income in the US. Some SWEs who are "workers" break that. Is someone who has top 1% income really middle class?
A lot of SWEs also receive equity compensation (I.e. ownership), which is very much not a middle class phenomenon.
The point is that salaries should have increased for everyone. Middle class is not struggling to make ends meet and living paycheck to paycheck. It is living a modest life with modest savings and a discretionary income.
This random article claims the 90th percentile in the Bay Area is $384K. https://www.kqed.org/news/11799308/bay-area-has-highest-inco...
I am not sure how that helps make this clearer though. It almost doesn’t matter at this point. We all know making $55K/yr in the Bay Area is rough. People are getting screwed over.
From that perspective, yes a lot of people make less, but that just means life is becoming impossible for most people making normal salaries.
Not really. Housing is simply becoming more expensive to construct, even in places where land is cheap and building regulations are open. But let's say even if NIMBYism was significant factor: why are all the good jobs where people want to live correlated with higher factors of NIMBYism? Why doesn't everyone just want to move to Houston (which is losing population these days, even if the metro is gaining)?
What a strange question, as if it reverses the correlation. People who buy a property before new people come in, such as SF during the 60s, will inevitably see their home prices rise and want to capture that value without wanting to build more housing. The places where people don't want to live simply...don't see this phenomenon, because people don't want to live there. Of course supply and demand still matters, you can't just build houses in some random part of the country and expect people to move there. You need to build where people want to move. This doesn't really have to do anything with not building more housing, and indeed NIMBYism explicitly denies housing construction approvals.
> You need to build where people want to move. This doesn't really have to do anything with not building more housing, and indeed NIMBYism explicitly denies housing construction approvals.
Just because everyone wants to live in SF, which has a density much higher than Houston, doesn’t mean everyone can live in SF. If SF was a dense as Manhattan, it wouldn’t be any cheaper than it is now, it might even be as expensive as Manhattan.
No one is asking for endless growth on the employee side. But growth should match responsibilities, and if I gain more responsibility over time then pay should match. And if my salary can't match inflation at minimum then you're telling me I should be paid less for my current work.
Companies prefer to funnel that money to investors and as a result this is where we're at. Note that privately owned companies or worker owned companies avoid this issue more often.
Employees in tech wanted, and were fine with, and even cherished "a sustainable and resilient business". That's the golden age IBM, Intel, AT&T, and so on employee for example.
Then companies started being about the stock market, and short term profit, throwing them under the bus whenever they had a chance, while still paying nice bonuses to the C-level and middle managers even when they run the companies to the ground.
So, yes, they felt little loyalty not to "jump ship" to a company didn't give a shit abotu them. Hell, the C-level execs that are paid 10-100x better than the employees would not think twice to jump ship at any chance they got, and somehow the employees are at fault for doing the same?
I mean I half agree. There's been factions in side the tech industry for years trying to get people to think about what would happen in this sort of scenario, to understand that "tech workers" have more in common with working-class factory workers in the 50s and 60s that with Peter Thiel and Sam Altman. That faction has pointed how IBM or HP acted when they were on a downward slope. To think about collective action, solidarity, other measures that might help ensure that good jobs don't become bad jobs become no jobs to further enrich a handful of factory owners.
But the braying voices places like here have always shouted those down. Always.
It’s not that activist billionaire, shareholders are demanding layoffs. It’s the workers fault for wanting a share of the pie and not just taking what they’re given quietly and meekly.
You’re right, it’s not a class struggle. For it to be a struggle both parties have to recognize that it’s actually a struggle.
This argument would make sense if the companies doing the layoffs were largely unprofitable, and not spending huge sums of money on stock buybacks and inflated executive salaries.
I keep seeing this idea that people need to work harder and you’ve got the Mark Zuckerberg‘s of the world pushing this idea that the Meta employees aren’t working hard enough and that’s why they are flailing. Not that the actual core strategy and shit like the Metaverse are bullshit. Or Google that has had some thing like 3 to 5 different chat systems over the past 10 years and utterly baffling product strategies along with a reputation of killing products or neglecting them.
But it’s clearly the employees fault and it doesn’t have a damn thing to do with completely bullshit leadership.
Come again? What is this supposed to mean?
Some idiot (Musk) decided to axe 90% of workers, and the company hasn't completely evaporated (Twitter). Investors; therefore, are jumping on the signal that a bunch of capital is allocated to non-productive work.
Therefore, Welch it, trim the fat, give me back my money so I can stop being a source of welfare for techies, and start pouring money into something interesting.
> Etymologists can find no firm evidence that the verb welsh, meaning "to swindle a person by not paying a debt" or "to fail to fulfill an obligation," is derived from Welsh, the people of Wales."
https://en.wiktionary.org/wiki/welsh#cite_note-AHG-1
Besides, Occam's razor applies. The term was coined in England, which is adjacent to Wales and historically has a degree of anti Wales sentiment.
Where are any alternative etymologies? There are none.
By contrast I couldn’t Netflix to stop buffering last night and the last I heard they haven’t had really any layoffs.
https://twitter.com/nytimes/status/1640049750966665218
I thought maybe 10b was what it was worth. And he could have gotten out of it by paying a $1 billion cancel fee, something like that. It appeared his ego prevented him from considering that. But it all goes back to him signing a terrible agreement in the first place.
I'm not sure why people are still repeating that. No, he couldn't, that fee would have been due if external influence would have prevented him from completing the transaction (e.g. the government banning the sale somehow).
I'm pretty sure that's you and not Netflix.
The article opens:
> Since the start of 2023, more than 150,000 people have been laid off at tech companies, large and small. That’s a staggering number of people who have been put out of work.
Who says those people have been put out of work? There are lots of startups that have wanted to hire engineers that couldn't because the FAMAG paycheck money firehose made it nigh impossible.
These people are mostly not going to be out of work. Most of them will still be earning way more than almost anyone in the country.
This is a good thing for startups, as now the (frankly anticompetitive) big tech hiring practices are getting rolled back to sane levels.
The... the people who fired them? They made them stop working. Whether they find somewhere else to work doesn't undo that fact. And I don't think you should be so quick to assume that all of them will be just fine. Give it five years and then see how everyone feels about it.
> This is a good thing for startups
Incredibly so what. I can picture a wonderful world without startups I cannot imagine one without workers. Startups have "disrupted" a lot of the stability out of the world to the benefit of almost no one. They have contributed almost nothing positive for at least a decade now and it's not because of a shortage of workers.
and how do React devs help a battery startup make better batteries?
Look, we can argue about whether big tech salaries are a good or bad thing, but calling paying people more than your competitors, an anticompetitive practice is absolutely absurd. If anything it’s the most competitive thing a company could do to hire.
why are tech companies laying people off?
because they can
a company can grow profits by moving the top line up or the bottom line down
if they can't move the top line up, they will move the bottom line down
Consider that remote work is more prevalent, the healthcare situation is not getting any better in the U.S. and in this space it has become more common for employees to have to move between companies regardless.
Then the certainty of having a comfortable job at Google or Meta evaporates violently. To the point, where mothers while giving birth learn they are fired. And then we have things like ...Twitter.
Say you were laid off by FAANG or a notable startup and the same or adjacent company reaches out to you a year from now to rehire you, as the "bull market is here." What will you do? The instability is here to stay for a while. This can happen in 2025 again pretty easily.
What is that critical mass of engineers that would demand a startup gets guild approved to join? I can see that happening if one of FAANG becomes a guild company but they will fight tooth and nail to avoid that.
As an investor that is a nightmare, if a minority of startups are in this situation. On the other hand if that is the status quo to getting great people, I can accept that overhead.
Why would software buck the trend?
For starters guilds tend to have progression by merit, requiring an apprentice prove they are competent enough to be considered a journeyman.
And you know … not wanting to be exploited… healthcare sounds nice… ( on this point, I’d like to point out that as an Australian software engineer, I long ago resolved to never start a company in America because of how insane healthcare in America is. I can understand the guns, the polarised politics and all the rest of the things that make America what it is… but healthcare is just so fucking insane that i haven’t even seriously considered taking a holiday there to see the museums that have been on my bucket list for half my life… the idea of starting a business there is just an immediate non starter… I’ll take US cash and setup a holding corp if they demand US incorporation and employ people elsewhere… so having a guild where healthcare was provided would make American developers more competitive in the job market)
About the US healthcare expenses: When you travel on holiday, you can buy pretty reasonable travel insurance. For example (no shilling): You can get one week of healthcare coverage from World Nomads for 130 AUD. Not so bad.
I don’t want a levelling effect in our industry. I don’t want gatekeeping either. We aren’t interchangeable cogs, and people who do better than average should not be held down. Promising people with nontraditional backgrounds should not be prevented from entering the field. Despite what people claim, unions would definitely hold people down and lock out new people.
Things are going really well for us actually, compared to people in other professions. That’s partly the case because our industry has been able to remain dynamic and innovative. Much of the success we’ve seen was built by people with nontraditional professional backgrounds and would not have happened if we got bogged down by gatekeeping and credentialism.
When the pie stops growing and we need to fight management over how to divide it, maybe a union will be attractive. But right now the pie is growing rapidly and workers are getting a huge amount of it in the form of both cash and stock. I’m all for continuing with this free, dynamic, and incredibly successful model.
By the way, unions don’t make layoffs a thing of the past. Look at what happens in the auto industry. The beat thing we can do for laid-off tech workers is ensure that we keep our industry dynamic, so there will continue to be new employers to work for.
Turns out we largely are, just like in most other industries. Probably like to think we’re irreplaceable snowflakes. But we’re not.
> people who do better than average should not be held down
Ah yes that old chestnut, that unions mandate No Employee May Achieve Above Average
One of the first things a union would do is decouple compensation from performance and introduce a standard compensation structure for all workers, segmented by job level. (And somehow the people who are personal friends of the union leaders seem to rise in job level faster than the others…)
The kind of people who are attracted to that kind of structure are not the ones who build successful industries, and they are demoralizing to have as coworkers.
This argument is a strawman, and really is a worsr-possible-case caricature of union activity. I've worked in a number of workplaces having a unionised workforce my entire professional career (~25 years, private industry and government) and I've never observing anything like the scenario you describe. Ambitious, talented people are promoted and improve their compensation. Average-performance clock-punchers reach a certain level and stop. Poor performers are managed out of the organisation. Union membership is no ticket to a cushy job for life.
I'm not denying that the worst-case scenario could happen, but it's by no means a given. IMO this kind of fundamentalist opinion is unhelpful, and doesn't reflect the reasonable balance of priorities and opinions which people have out there in a modern society.
I have no idea how that compares to a similar role in the US, but over here that's a pretty comfortable middle-class wage.
This is seen, at least partially, as what drew a lot of people to the current "big tech" companies. They wanted to work on interesting problems. The pay was high, but it mattered a lot less than that the work was actually rewarding.
Onboarding or 'getting someone up to speed' is a far more invasive and disruptive task than many believe. Manager probably dream about adding and removing employees as easily as buying more or less food for a catering event. Institutional knowledge and employee quality are no where near that easy.
> Things are going really well for us actually,
Not right now anymore. Have you seen the layoffs? Things went well because of years of cheap cash. The music is stopping and there will be even more layoffs before this is all done.
AI being able to code is going to be like what happened when construction workers started using power tools: now that one man can saw boards as fast as 5 others with handsaws, wouldn't we see a lot less demand for carpenters? What happened is that per-worker productivity went up because of the new tools and the construction materials and techniques they use were adapted to take advantage of that, there was still plenty of work, and we can build better things faster than before.
In software, imagine how much more effective engineers can be if the grunt work could be more automated. People loved autocomplete and smart IDE features and graphical debuggers because they made coding more productive. A lot of those things already do write some code. AI provides a much better version of that.
People whose only contribution to software is the grunt work of writing simple code might need to worry, but there is a lot more to working as a software engineer than grinding code. These AIs are also repeaters of existing solutions -- maybe they can solve simple problems that have pre-existing solutions in their training corpus, but an AI is not going to be able to create the next Redis or Kubernetes or AWS simply by recombining existing text.
Regarding layoffs:
Even after all the layoffs most companies still have more employees than they did in 2020. Many of the people being laid off today joined since then. They will get other jobs, maybe not in a few weeks like what used to be possible, but still. This is not like 2001 when entire companies were going out of business and laying off 100% of their employees.
A lot of the the American tech industry developed when interest rates were higher than they are now. What we had in the past decade was not normal, and in some ways it was pretty crazy -- investors didn't care if companies were sustainably operated, and now they do, and that's good for the long-term health of the industry.
Tech is not immune from the business cycle, because nothing really is, but this really is not as bad as previous downturns. Even if it gets worse before it gets better, the tech industry is fundamentally strong and will handle it.
New industries will have to spawn from generative AI for there to be a net positive. Most IT and tech jobs are lower level coding positions. This will all but eliminate these roles. SWEs especially top ones will likely be safe. But that doesn't solve the societal problem.
Regarding layoffs - we've barely touched the surface. We haven't even entered recession yet, and a financial crisis looms. Most are on hiring freeze now and just in the last 2 weeks both meta and amazon slashed additional jobs. More will be coming. The industry won't completely collapse because it's a mature industry now - FAANGs are now like Coke. Blue chip. This says nothing about its workforce though - there's nothing these companies would love more than to be able to reduce the cost of their software devs.
> Most IT and tech jobs are lower level coding positions.
I don't really buy that. It's true that most positions are IC positions, i.e. not managers, but quite a lot of them require domain knowledge and human intervention in edge cases which can't be handled by automation. If automation could solve all the problems, why are so many people oncall?
> I don't really buy that. It's true that most positions are IC positions, i.e. not managers, but quite a lot of them require domain knowledge and human intervention in edge cases which can't be handled by automation. If automation could solve all the problems, why are so many people oncall?
I don't mean IC vs manager. In any case, at my company our support staff has been reduced by 75%. In my previous life as a mechanical engineer, I've seen control systems replace 90% of powerplant staff. Also, generative AI just became a thing - because SWEs can be more efficient, you simply need less, UNLESS there is growth or a new market emerges (certainly possible), in any case millions will be left behind, just as what happened in the rust belt when manufacturing collapsed.
In any case, I hope you're right and I'm wrong :)
Designing large coherent systems for a business use case is hard. I don't think ChatGPT will ever manage that.
Plus let's be honest, the technical problems are the tip of the iceberg for software architecture. If an AI ever manages to convince my director to pay for things I'd be happy for the help.
In tech, a union/guild is massive hamper on efficiency and control. Tech will quickly be outsourced to other places. It has become easier and more possible to outsource to other countries now (English is becoming more common, and education has improved in third-world countries). This will accelerate that.
High bar standardized exam on fundamentals of CompSci, which waives every whiteboarding/leetcode interview. It sort of exists today, if you have a CompSci degree from reputable college, but this way people can get the certificate without the formal education, just pass the exam. It's ok if it's difficult.
Google is crazy too: they will spend more on stock buybacks than they will save through the layoffs, yet are investing nothing in fixing their actual, deep structural problems.
I worked for a company like this as well. It’s easy to ignore investors when you’ve had an upward trajectory year after year. They’ll put up with almost anything when the stock price keeps going up.
But as soon as your growth slows or stops, reality hits like a ton of bricks.
Investors have lots of place to put their money. If Amazon cant deliver what these investors want, they’ll put their money elsewhere.
Amazon is free to ignore them, they’ll just have to deal with the consequences of that.
I mean, as an employee, would you stick around for less compensation? No, most people would find a better paying job.
Choosing to reinvest that money in the business caused some consternation, but the consistent revenue and growth let them ride out periodic misadventures and hits to the stock price. It turned out to be a good move in the long run, because they weren't bluffing about their business fundamentals.
The consequences aren’t necessarily that significant: mainly the cost of raising further cash from the markets, which doesn’t look like Amazon will have to do for many years, if not decades.
Many people who decide on these things, though, are mostly compensated in stock. They need a good price to sell their stock at.
Yes I'm aware stock-based compensation is also an expense. But as I understand it, that expense = the initial value of the grant. So if the stock price goes up it's like the employee got a handsome raise funded entirely by Wall Street.
I was specifically addressing the phenomenon described in the article, where the threat of the large number in future is demoralizing and destructive.
Reasonable people can consider them facets of the same phenomenon.
I say this as a heavy chat GPT user. I really love it but not nearly like sending and email to a senior engineer: “please make X” - which then turns into the senior engineer scheduling meetings with the required teams / individuals - navigating the technical and (unfortunate) political issues, coming up with a design and implementing it - getting things done in other words. I don’t know what future versions of GPT will look like but the current one is light years away from having that level of capability.
Even a simpler task like fixing a bug cannot remotely be handled by ChatGPT.
It is almost like LLMs are a new dimension - we used to have X and Y, now we also have Z. Yet, we are thinking that this is just more “Y”.
The real reason is these companies have been overpopulated and produced basically no visible changes in 5 years. Google search is worse with auto-generated results not written by humans, YouTube has become super rabbit hole instead of discovery, Twitter shipped NFT profile pictures and Spaces.
I suspect it is more likely that the benefits will accrue to start ups as they will not have so much inertia working against them in terms of leveraging AI. People with ideas and limited means will likely be the primary benefactors due to AI amplification I think.
Don't forget fleets rip
Look, if you want to not need employees, you need to do capex. If you spend more money on stock buybacks than you save in payroll by doing layoffs, you're taking money away from capex.
In my area, Amazon has tripped up so bad I can't even have the basic necessities delivered to my house due to a staff shortage (they throw an error at checkout claiming multiple items can't be delivered to my address...items I've ordered for at least 4 years straight on a monthly basis without issue) so I am going to go from spending tens of thousands per year with Amazon to zero. I am in a city in the United States. Amazon will happily sell, ship, and deliver some no-name brand item from a third party seller within 2 hours of ordering, but they can't be bothered to do the same with the stuff I ordered.
If they weren't making money off me (which I doubt, I spent $23,967 on Amazon last year, and their products are only slightly cheaper than local stores...like CENTS), why were they willing to sell to me to begin with? I've switched to a combination of Costco/Walmart for most of my stuff, and will soon be independent from Amazon completely, all because they refuse to deliver my core products that they've delivered for years on a monthly basis without issue (toilet paper, a 12 pack of my favorite energy drink, my favorite brand of protein shakes, etc)
Really Amazon? (note the error I receive says that the item cannot be delivered to my address, and to select another. It is a residential address tied to a house and I've ordered the exact same item month after month. they also blocked subscribe and save.)
Sorry, this is a rant, please carry on.
We may argue that this particular buyback was ill timed, but still, banning all buybacks is a very very strange idea
starting a company allowed some pricing power, plus individuals could start their own entrepreneurship (but weren't able to hire anyone)
This is not secret knowledge
I wanted to ask instead of assuming before making the following argument to the previous claims:
> You might be surprised to learn that companies still existed/exist under communism, with not a single investor around ;)
> Those were not actual companies that existed. They were just another part of the government with a different name.
> no, there were worker owned coops.
As I suspected, these "worker owned" cooperatives are completely dependent on the party (unlike current cooperatives). That is not my idea of "owning", since party members that are "workers" of the cooperative only in name would be deciding a lot of things in how the cooperative is run.
> Many cooperatives were vulnerable to exorbitant taxation by local officials, high interest rates on loans, and protection rackets run by criminals, the cost of which inevitably were passed onto consumers in the form of mark-ups. “Kooperativshchiki” (cooperative owners) thus became a term of abuse in ordinary Soviet speech.
So I agree with user nradov here: "Those were not actual companies that existed. They were just another part of the government with a different name. "
I must concede, at some point the lines can become blurred.
The obvious problem with USSR-style communism was/is the authoritarian dictatorship, so everything had to be integrated into the power structure, so only very small companies were allowed to be independent.
If you became successful without the Party? That's a no-no, so thanks and the Party will take it from here.
If you became successful with the Party? Great, now here's a bunch of chinovniks to help you.
As for individuals starting their own entrepreneurship - only in certain specific, government allowed situations. And even then it was frowned upon both by the government and by the society.
Also, being entrepepreneur didn't make much sense anyway, because money didn't matter as much as talons for items. That's why used cars (not requiring talons) cost way more than new ones -- as in, the taxi corp could buy new cabs, drive them for a few years, and then sell with a profit.
Worker-owned coops were nothing like what we know under capitalism. They were huge semi-governmental structures filled with bureaucracy.
Dividends aren’t great tax wise but some big SV companies like Intel pay them out.
Tax code can always be fixed if the gov wanted. For some reason, they don’t like profit sharing, only speculation. More tax payout I guess!
The companies want it that way, so they buy the politicians who will want it that way.
Wow. Are groceries that expensive in America or are you buying for a family of 8? My family of 4 only spends about 8 to 10k on food stuffs.
Because they are making money off you. You are forgetting what the end price does includes the store margin (while in America it doesn't include taxes, lol).
Not only they are making money, they do it regularly. Maybe profits aren't big per user, but there are hundreds of thousands of such users so ARPU is quite high.
I've started to notice this too - they seem to be experimenting with trying to push people to different "stores" within Amazon that are not unified: Fresh (which is now gone?), same day vs not etc.
I already didn't order high-margin items from Amazon because of the risk of counterfeit products, and Prime no longer meaning "this will be shipped from Amazon inventory within this defined time Window" makes that a useless marker too.
I cannot be bothered with any of this, and got myself a Costco membership, so Amazon (.com) have effectively lost all my business as I try to extract maximum value from that at this point.
It doesn't change the decision whether it's better to reinvest in growth or pay out the profits to the owners; the primary reason for buybacks is that in the current tax law it's a slightly less tax-burdened way of paying out profits to shareholders as "dividends-that-technically-are-not-dividends".
at this point I think Android and Chrome are their most high-quality things.
Calendar is okay too, but it does what it did 10 years ago, oh, sure, it has Meet integration too (which sucks, and 720p)
Maps' mass transit things are getting better, but it's not going to save Alphabet
My Pixel 5 phone is still under warranty and has developed a battery fault. I contacted Google support:
1. No option to repair, only replacement and only by post (unnecessarily inconvenient given that it's just a straightforward battery swap that any number of local shops can do -- I did this myself in the past except that this phone's still under warranty and I'm too pressed for time to be sourcing parts etc).
2. I got repeatedly prompted to confirm that I was using the charger that came with the phone (this seemed to suggest there might be warranty implications if I wasn't -- not sure this is even legal in the UK).
3. I had to consent to a page worth of legalese, including granting Google permission to access my phone usage data -- wtf is that?
In the end, I chose to walk into a third-party repair centre and just pay for an out-of-warranty repair. Took an hour, £50 ($60) and a voided phone warranty -- IMO a great deal compared to getting warranty service from Google.
I don't know about Chrome, but if Android is their most high-quality thing, then at the very least they are also losing in developer experience. The churn in libraries and frameworks there is, from what I've seen, only second to Web frontend, and bugs in newer things are really embarrassing. "Ready for production" (they claim in the FAQ) Jetpack Compose is great when it works, but even the Android Studio-generated Compose template crashed the IDE several times, while manually setting it up crashed Kotlin compiler[1]. WorkManager and Room are important things that bugged out for me, too. And I'm at it for just 5 months - there's got to be way more dragons that I'm yet to see.
[1] https://issuetracker.google.com/issues/249653885
And yeah, there's Flutter, and now there's this new Jetpack/Compose whatever. But as is tradition it's nowhere near production ready. And when it becomes finally solid, they just abandon it.
Angular went through the same cycle. I'm looking forward to their new React++ :D
google has essentially one product (85% of revenues, after fiddling revenue sources) which was developed almost 5 years ago. Everything else is a rounding number and most are money losers.
The company has been drifting all that time, seemingly unable to release any new products of significance. Google cloud is an also-ran. Android worked in that apple isn’t a monopoly, but no money spinner and seemingly abandoned. New “products” appear and then are dropped. Even the layoffs (source of this thread) were conducted in a ramshackle fashion.
They even let a random small company swoop them in machine learning. They had the pole position in that race but after jg left they seemingly lost interest.
Amazon had the no profit strategy because Bezos had ideals and as the Czar of the place, finance would not convince him to change strategy (But I bet they tried, must have been a fund meeting to watch). Now he is worried about his yacht and pet projects, so he let finance rule the place for the benefit of his stock price. Same with Google. L&S don't have their ideals anymore and just want their money protected. Finance has this covered. There is no care for the brand nor its other stakeholders anymore.
They basically became another IBM, Microsoft, etc...
And this is, BTW, applicable through the whole range. Just check Intel market capitalization, and guess what? It's now smaller then AMD, and 6x times smaller then NVidia. The reason: top management, they failed on AI, graphics, they failed on Cloud. Yes, they did something, not enough.
https://en.m.wikipedia.org/wiki/Mimetic_theory
As stock price goes down, they are incentivized to either pledge more stock, have their collateral liquidated, or take actions to move the stock price back up.