Money and career has been on my mind lately. Lots of conversations. Here's what I uncovered.
The question folks are asking is this 👉 With global economy in turmoil, why are stocks up? Why are experienced engineers getting hired faster and junior engineers struggle more than ever?
It's a good question.
I think it's because hiring incentives in tech are shifting.
Old incentives in tech
When we talk about "tech", we mean VC-backed startups with the stated goal of becoming a billion dollar unicorn. Some make it, most don't.
Companies say they're building a product for a market, but look behind the curtain and you'll see the product is irrelevant. At least at first.
The company is the product, investors are the customer.
What do investors want? A big company.
How do you get a big company? Headcount.
Companies want to hire fast, fire slow, and accumulate lots of cruft. Get 5 junior engineers, let them loose, and wow your valuation looks great.
You added 5 whole engineers! Awesome 😍
How much they get done, how many wheels they invent because they don't know wheels exist, how much your code looks like duct tape and chewing gum 👉 irrelevant.
As long as you have 1 or 2 senior engineers for every 5 to 6 juniors, you'll be fine.
New incentives in tech
With the uncertain future, free money is slowing down. [^1]
Companies realized winter is coming and it's time to start making money. Like, you have to build a business.
Wtf that's not what we signed up for ~ every "entrepreneur" with a rich mommy and daddy
First thing that happened were rounds of layoffs at big companies. Even engineers got fired.
Everyone who wasn't directly involved with bringing home the bacon, gone.
Who do companies hire when engineers need to bring home the bacon?
They hire seniors. Because seniors get shit done.
And they avoid juniors. Because they don't have the time to train them.
It's unfortunate and juniors aren't making it any easier. To a hiring committee or an HR person they all look the same.
Friend of mine recently said: Yeah I was part of hiring at my old job and one day I went through 200 resumes and couldn't find one single thing to tell them apart
Everyone looks the same!
Yay graduated from X with GPA, did extracurricular Y, part of frat Z, went to bootcamp Q, super duper know tech A, B, C.
That shit matters if you have nothing better to show.
Do something.
PS: this is an area I'm figuring out how to help with. Hit reply if you're interested.
What if you were paid like an athlete?
Say you're a senior or have a way to stand out from the crowd.
This gives you leverage.
Companies want you. Not any schmuck who can type code into an editor, you. Your experience, your expertise, you.
Not saying it's easy to get there, saying it's realistically doable ✌️
Past a certain level companies stop seeing you as a code monkey. They don't care about your hours, lines of code, or tickets closed.
Companies care about the systems and tools you put in place to make the whole engineering team run better, do more, and make bank.
You're paid for value, not work.
Now what? Cash, baby.
How to become a millionaire if you can code
— Swizec Teller (@Swizec) July 29, 2020
1. Get coding job
2. Quit and new job every 2 years – 30% raise
3. Put 20% in index funds
4. Wait 16 years
Start wealth: $0, start salary: $100k
End with $1,238,883
Start at 25, retire by 41. But ain't nobody talk about *that* 🤔 pic.twitter.com/Lud3FxhbvM
This is a simplistic model of what you could achieve with a pretty basic "The Tech" career ladder for a software engineer. Here's a more realistic version from @ArvindVermani.
You start with a salary and no wealth. 6-figures is common.
Then you switch jobs regularly. About 2 years is the median tenure in tech. 4.7 years across all industries.
Don't worry about looking like a job hopper. Everyone does it.
Reid Hoffman calls this the Tour of Duty model.
Avoid saying it out loud and you'll be fine 😛
A 30% raise is common when switching jobs. Lots of advice on salary negotiation and how to make this happen.
I recommend Josh Doody's Fearless Salary Negotiation. He's helped me in the past.
And lest you worry that a few 30% jumps lead to unrealistic numbers, check out levels.fyi for SFBA. $500k+ for 10 years of experience is normal.
Yes that means you'll have to bring the bacon. The game is not "sit around and wait", it's "get aggressively better and work".
What about the athlete thing?
Athletes are paid for value.
Sponsorship money. Notoriety. Daniel Ricciardo is the 4th highest paid F1 driver despite bad race results.
But he looks good on camera and has a fanbase. Value.
Your value is the expertise, the experience, the not gonna make avoidable mistakes that cost us 3 years to fix.
Tech contracts come with a 4 year vesting cycle. You're incentivized (but not required) to stay 4 years.
Here's how to shift your mindset 👇
tired: I got a new tech job with 30% raise
— Swizec Teller (@Swizec) July 31, 2020
wired: I signed a 4-year deal with $company for $785,000
What if engineers were paid like athletes 👇https://t.co/Wr64DI1Rmo
cash and bonuses included, equity is the unpredictable icing on top
Happy Friday,
~Swizec
PS: my model above includes 7% investment returns because that's the standard rate everyone uses when talking about "the economy as a whole long term". Individual results vary and years like 2020 are bad.
[^1] free money has weird effects right now because investors want their average returns and have nowhere to put the money
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