This Is What Software Engineers Are Paid Around The Globe
A marketplace for jobs – Hired – recently revealed details of its findings from its data science team. The core focus of this study, was to analyse why San Francisco is becoming harder and harder to afford for software engineers even though they are paid more than their peers in other major cities. San Francisco has grown into the main global hub for software development and therefore the destination of many an aspiring software engineer of our time.
From around 280,000 interview requests and job offers provided by more than 5,000 companies to 45,000 job seekers on Hired’s platform, the study has computed the average pay for a software engineer in the San Francisco Bay Area to be in the proximity of $134,000. That takes it to the top spot in cities with Seattle a close second at $126,000. Other major tech hubs – Boston, Austin, L.A., New York, and Washington, D.C – clock in the range of $110,000 – 120,000.
A higher pay equals richer people, or so the old belief goes. On the contrary, the much higher rent and general expenses in the city, go hand in hand with the higher pay packages. According to Hired’s lead data scientist, Jessica Kirkpatrick, once you factor in the cost of living, San Francisco becomes one of the lowest paying cities for software engineers. Based on her analysis, she says that a $110,000 that an Austin engineer makes is the rough equivalent of being paid $198,000 in the Bay Area.The differentiate coming down to the living expenses. The same holds true for other cities, $107,000 – the average in Melbourne, translates to the equivalent of $150,000 in San Francisco.
In fact, Hired says it’s seeing a “huge percentage of our candidates” in other markets that are attracting and hiring relocation candidates. In Austin, says Kirkpatrick, 60 percent of job offers are being extended to and filled by people outside of Texas.
On a side note, it should be noted that most candidates who are willing to move into a different city for a job usually get paid higher, irrespective of the location.
The study explores a range of data including the pay of data scientists and product managers across 16 cities & the changes in the pay scales over the years. One area of interest however, is the section of the study focusing on the potential impact of biases on pay scales & hiring practices. For this part of the study, Hired has been collecting data for about a year from willing candidates. They gathered demographic data to understand how one’s identity might impact the compensation they receive from their respective organizations.
Bias – sadly – is not a new concept. In a survey by another job site, 1 in 4 respondents working in the technology sector admitted to having been at the receiving end of discrimination owing to their race, gender, age, religion or sexual orientation. Roughly 29 percent of female respondents said they experienced discrimination, compared with 21 percent of men. Meanwhile, 32 percent of Asian and nonwhite employees said they were discriminated against, compared with 22 percent of white employees.
Hired’s research has shown that discrimination has been extended beyond day-to-day working into the pay scales as well. As an example, as per their data, a black software engineer with certain level of experience might earn $115,000 while a white software developer with the same qualifications and experience might get around $125,000 in the same role. It further shows a discrimination against Latino and Asian engineers too with them respectively earning $120,000 and $122,500 on average.
This also applies with respect to age. Younger candidates often tend to get paid lesser compared to older candidates with a software engineer’s highest salary coming in at around age 45, after which it tends to head down hill.
Specifically, on Hired’s platform, job candidates aged 25 to 30 years make $102,000 on average, whereas 45-year-olds make $140,000. But candidates between the ages 50 and 60 see their salary knocked down to $130,000 per year.
“Part of that could be that [older employees] were trained and specialize in older technologies,” says Kirkpatrick. “But even looking at candidates going out for similar job titles, we’re still seeing these same trends” of tech workers beyond the age of 45 paying a price for, well, aging.
There might be a silver lining however. With companies waking up to the power of diversity, black candidates appear to be in a greater demand than white candidates at the moment, even though the salaries still tend to be lower. Unfortunately, that doesn’t seem to apply to Latinos & Asians.