U.S. Programmers at Overseas Salaries
Business Week Online reports a Boston-area company that was looking at sending work to India. They were quoted $40,000 per year per programmer. They decided to try to hire U.S. programmers for $45,000 per year and the labor market is so bad that they found takers. This is the inevitable consequence of offshore competition for programmers. Gone are the days when a newly-minted CS major with 2 years experience could expect to make $80,000 per year and get a signing bonus and a Senior Developer title. We should eventually expect the price of real estate and cars to drop as well as standards of living take a hit.
If U.S. programmers want to maintain their standards of living, they need to figure out a way to become a lot more productive than someone overseas. Coding and testing are hugely labor-intensive and easily sent offshore. One way of reducing the labor required is to invest in test automation and high-level design practices like Model-Driven Architecture. A small US-based software firm using these capital-intensive techniques ought to be able to outcompete offshore firms with more labor-intensive models, at least in the US market.
March 6th, 2004 at 7:15 am
So, invest in the latest buzzword and I’m ok? Great advice.
March 6th, 2004 at 10:56 am
Well 45,000 a year is much better than 5,000 a year. Not what it used to be, but not impossible to live off of .
March 6th, 2004 at 11:25 pm
$45K a year is barely enough to afford a 1 bedroom apartment, nominal car payment and normal life in Silicon Valley. When the average home price for a small 2-bedroom, 1 bath goes for about $375K, a 3-bed/2bath about $480K and 4-bed 1800sqft home in the $600K’s, you can forget about the dream of owning a home in this area unless you run out infront of a truck and sue, or land a great check from your dead auntie’s will. It is a joke. The average rent cost for a 2-bedroom apartment is $1300 a month. At $45K, your take home if you claim 0 is about $1800 a month, so you have $500 left over to feed yourself, pay car, insurance, pg&e, garbage, and so forth. Better hope your company provides healthcare or you’ll be working the weekend at Safeway.
It’s really sad to see that developers are accpeting such crap salary for high-demand, high-tech talented work. I can understand if it’s to do simple HTML, or tech support. But writing enterprise level applications takes skill, years of experience and should demand high salary. Throw in the usual “we’ll need you to work long hours and be available at all times..” crap, and the more common “Do you know oracle, db2, mssql, how to setup multiple networks across domains and remote locations, make sure the web app you are writing is fully scalable and you need to set up the cluster and make sure it works..” stuff, and you’ve got yourself caving in.
Frankly, I would much rather see all these companies outsource and come back a year or so from now going “Shit, that was more expensive, we could barely understand the people in meetings, we spent shit loads on flights, meetings, etc, oh, but we saved a bundle on the talent.”
Frankly, what is going to happen, and it’s been doing so for a couple years now, is the US is going to lose a large percentage of it’s college kids wanting to learn computers. Sure, the geeks, nerds and hackers will always be among us, but they may not be interested in “giving” their skills away when they could make the same money bagging groceries (well, after about 5 years on the job). More kids are saying “There wont be a job, why bother with computer science”. That in turn starts the ball rolling with a lot less creativity and originality coming out of the US colleges in the fields of science, computers, etc. Pretty soon, we may as well sell the country as all the programming will be done by those that don’t even speak our language, and somehow I dont even think that will be good enough. Next they’ll find ethiopians, cubans and others to do the programming for $2.50 an hour.
It’s really sad. I have some friends finding great salaries, even better than before. But others are still laid off, unwilling to drop more than 1/2 their salary and be expected to do 2x as much.
So I say, go ahead, outsource. Good luck. When you add things up, it will take many many years before the ROI is worth it, and by then, your company may be owned by the country you outsourced to in the first place. It’s the American business way. “Hey, thank you guys, you rocked for a number of years, you made us all rich, now we are going to screw you and the economy and any hope for future kids to be intelligent and make something in this field, so that we can save a buck or two and do it in another country”.
Hey, when the irish and italians came here, America was the cheap labor market, the Brits and the likes were losing jobs. I guess it was due to us at some point. Just sucks that the most innovative country in the world is starting to send all their innovative ideas and work to other countries. We won’t be the land of opportunity for much longer, that is for sure. And the two countries getting all the work, India and China, hell they don’t have room to become the land of opportunity either, so forget about moving there.
Hopefully these dumbshit execs will wake up and realize they are barely saving, if not losing money, time, and business to outsourcing. I love those nimrods that outsource thier tech support and help support to countries that can barely speak the language.
Sad thing is, I have a lot of chinese and indian friends, and in no part blame them. They are just trying to make a living like the rest of us. At least in their countries you have the butt poor, and the rich. Here, you have the middle class getting screwed out of everything, salaries, jobs, health benefits. Meanwhile, Bush and the right/left morons want to allow the 16 million plus illegal immigrants that are sucking our economy and health care system dry, to go on and enjoy life. I have to pay $600 a month for my family to be seen by shitty doctors 6 weeks after we get sick because God forbid there is one appointment within a few weeks. These immigrants get to come in illegally, and their kids get sick and get free medical care, free social benefits. Yeah, sure sounds like the land of opportunity to me. The past 15 years has seen this country change a LOT. I am considering being a hermit these days. I think I’d live a longer life shitting in the woods with the bears in a small shack with no worries than trying to make it in this piss-on-your-mothers-grave business that we are seeing now.
March 7th, 2004 at 3:03 pm
So don’t live in Silicon Valley. There are plenty of places in the US where $45,000 is a living wage, although not a generous one.
The long-run effect of $45,000 wages, though, will be to drive most smart younger people out of programming in the U.S.