The Mystery/Myth of the $3 Million Google Engineer 173
jfruh writes "Recently Business Insider caused a minor stir among developers with dreams of riches with a story about a nameless Google engineer who's making $3 million a year. Who is this person, and how unusual are pay scales like this inside the Googleplex? Phil Johnson uses public information to try to figure out the answer. His conclusion: the $3 million engineer may exist, but is a rare bird indeed if so."
Bogus Math, click farming. (Score:3, Insightful)
His math is bogus, double counting compensation. His source is weak, a self-reporting site with no indicators of how well it actually represents googlers.
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His math is bogus, double counting compensation.....
Not to mention this sentence:
"According to the U.S. Bureau of Labor Statistics, in 2012, the average salary for an application software developer was $93,000, with only 90% of such developers making more than $139,000 in salary."
If 90% of such developers make more than $139,000 in salary, it is mathematically impossible for the average salary to be less than $125,000.
(well, on the assumption that salary is non-negative number, it is mathematically impossible).
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Re:Bogus Math, click farming. (Score:5, Funny)
The whole things smells fishy (Score:5, Interesting)
What startup could even offer 500k salary in the first place?
Re:The whole things smells fishy (Score:4, Informative)
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You'd be surprised. I worked for a perpetual startup once, and they seemed to be able to pay above-average engineering salaries with no real sales (or products!) for years. It's a bit baffling, but I'm in Quebec, everything is baffling here.
Are they hiring ? I need a new job.
Re:The whole things smells fishy (Score:4, Insightful)
One backed by VCs who see "Google Engineer" and think it's probably worth it?
Google gave 3.5M to keep an engineer from Facebook (Score:5, Informative)
I believe the article is accurate. Back in 2010, a senior staff engineer received a pre-IPO offer from Facebook, but Google gave him $3.5M to keep him [techcrunch.com]. I strongly suspect that person from 2010 and this person from this current article are the same, and it's probably Jeff Dean, one of the engineers who created Map-Reduce (which led to Hadoop and all that jazz) and other engineering feats.
In Silicon Valley the salary for principal engineers is well in excess of $170k, and if you're at a company with a healthy stock price, an additional $100K in vesting RSUs per year is definitely not out of the question.
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And here I was thinking it was the guy who messes with the YouTube comments user-interface every now and then.
http://images1.wikia.nocookie.net/halo/images/3/3d/Give_that_man_a_cookie.jpg [nocookie.net] (appropriate?)
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The funniest URL I've seen in a long time. ;-)
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I believe the article is accurate. Back in 2010, a senior staff engineer received a pre-IPO offer from Facebook, but Google gave him $3.5M to keep him [techcrunch.com]. I strongly suspect that person from 2010 and this person from this current article are the same, and it's probably Jeff Dean, one of the engineers who created Map-Reduce (which led to Hadoop and all that jazz) and other engineering feats.
Chances are, Jeff Dean makes several grades above that.
My Jeff Dean story (Score:5, Interesting)
I was friends with Jeff Dean in high school and he was my roommate in college for a year. We don't keep in touch much but he was in Minneapolis last fall and we got together for breakfast.
If Jeff Dean is making $3M a year, you wouldn't know it. He's one of the least materialistic people I've ever known and I'd guess that between salary and stock options he could if he wanted to live a pretty high-end lifestyle. But he doesn't.
When we were planning our breakfast, he was staying St. Paul because a charity his wife is involved with was having a board meeting. He wanted to pick a place he could WALK to, which is kind of challenge if you're in downtown St. Paul. I was thinking "Walk? You don't have a town car? A rental? Or a self-driving car?"
Anyone else making a $3M a year wouldn't be walking or would want to have some kind of fancy brunch at the St. Paul Hotel (which I don't think he was staying in, either).
I even asked him as gently as I could -- "How much do you still work? I mean, you don't need to, do you?" His answer was "only about 50 hours a week." "Why?" "There's still a lot of interesting problems."
I don't think Jeff works for the money or even cares that much.
I also asked him about the NSA revelations and he said that they were "really pissed" and "making internal changes to make it a lot harder to get any useful information."
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Even if you're not very materialistic, few people like being significantly underpaid for their services particularly at a large, for-profit company. It smells of being taken advantage of and played for a sucker, even if you don't need it for your lifestyle. And the whole story adds up, the most difficult employee to keep is one that doesn't care much about the money but see a lot of "interesting problems" to work on at a competitor. Still even the selfless tend to like money they can spend on their charitie
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I found your information about Mr Dean to be very interesting but the following is suspect to say the least:
I've worked with a lot of people with money (I'm in the legal field), and some of (definitely not all of) the most understated people I know are either old money and have some maturity, or are self-made, and have come from the lower e
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7.5 million is rich as fsck (Score:2)
Uh, yes it is, if you're living on this planet. Your own math shows that! $125k annually is in the richest 0.07% of the world's population. It's more than 76 times the median income for Earth humans, according to Branko Milanovic [repec.org].
Honestly, even in the USA, just 4 million in assets is rich. Affluenza rich. You'd pretty much have to be both insane and incompetent to fail to increase your wealth once you had 4 million in pocket. Hell, hire one honest accountant with an above average
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Most of the other self-made people I know with high incomes live much more affluently -- lake homes, country club memberships, Mercedes in the driveway. They're not living faux glam lifestyles, but they're not nearly as non-materialistic as Jeff is. None of them grew up in affluent households, all were squarely middle class with the exception of one, who was the daughter of an Italian immigrant who worked as a maintenance person on the NYC subway.
Jeff didn't really grow up poor or at the low end of the s
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Most of the other self-made people I know with high incomes live much more affluently -- lake homes, country club memberships, Mercedes in the driveway. They're not living faux glam lifestyles, but they're not nearly as non-materialistic as Jeff is. None of them grew up in affluent households, all were squarely middle class with the exception of one, who was the daughter of an Italian immigrant who worked as a maintenance person on the NYC subway.
Jeff didn't really grow up poor or at the low end of the spectrum. Both his parents were PhDs with good jobs and the house he lived in was in a neighborhood considered affluent, although I wouldn't call his family's lifestyle affluent; I think he was just raised by parents who had better than average means but did not really live a lifestyle focused on material consumption.
In Jeff's case, I think he's just one of those technology people with an intense focus. It helps he's extremely intelligent and capable.
I don't consider myself self made, but I did break the 6 figure mark. I'm divorced (no more alimony), I have one child (no child support, I have her), I live in a 1300/month rental condo in a nice location where I can walk to work (one of two concessions to spending "more") I have a car I paid 1400 dollars for, I keep fixing it up (costs me around 500-1000/year in maintenance plus some elbow grease) it is ripped up, some of the body panels have been crowbarred off it (someone really wanted them I guess), t
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You're making some dange
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Some ~$500,000 jobs for an experienced person: (Score:5, Interesting)
What startup could even offer 500k salary in the first place?
Some ~$500,000 jobs for an experienced person:
Assuming you have experience and/or the degrees to back it up, Futures Group IT, LLC in NY is offering a starting salary of $250,000-$300,000 for Java/Python developers capable of doing systems architecture for a Quant Trading System.
A similar job for a C#/WPF developer for Westbourne Partners in Chicago, IL is offering $300,000-$350,000 to start.
The Hagan-Ricci Group is offering $300,000-$400,000 to start for a Senior Equities C++ Developer in Chicago with SQL, Java, and Linux experience bumping the number up to the higher number. They are also offering $250,000-$450,000 for a Low Latency Equities C++ Developer, with your choice of NY or Chicago.
There's a UK company offering 250,000 GBP - ~$410,000 at current exchange rates - for trading systems work in London.
A lot for the willingness of the finance industry to part with this level of cash might have something to do with what happened to Sergey Aleynikov, but probably not. It's just the kind of numbers they tend to throw around.
Note that all of the above salaries are starting, and come with discretionary performance bonuses, and for the startups, can include stock options and signing bonuses.
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And those are all startups?
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And those are all startups?
The first 2 and the 4th one are.
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$300k is meh in NYC. My rate is a bit less than that but I live in the midwest and I would bet I have a lot more disposable income than the $300k guy in NYC.
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They are as common as unicorns (Score:5, Insightful)
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Even here they don't seem to be claiming it was $3m in W2 income. Most likely scenario is that it's an early-ish Google employee who effectively makes $3m/yr as his old stock/option grants vest.
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Sales pay structure is different. They are paid by the sale, not by the year. Therefore, their pay is dependent on how much work they do. Best deal you can hope for in IT is by-the-hour -- because by-the-issue would raise all kinds of new problems.
As a software developer, your only hope for such astronomical pay is either by stock-options, or by selling a product on your own.
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Undoing moderation to ask a question: It sounds like he brought in 178.2 million GBP of revenue after his commission, and they fired him for it. And it sounds like they may not have even paid him his commission. I can't imagine how that can be legal, especially in a country that isn't the USA. I've heard rumors that employees/contractors actually have some rights and recourse when their employer fucks them over over there.
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What? On what planet is that a good idea? That guy has paid for himself many times over, why would you punish that?
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Firing salesmen who earn too much is a common failure mode for small businesses.
A wise friend once told me, "You can never overpay a salesman on commission."
Apparently it's very easy to look at a high-performing salesman and think they're overpaid, forgetting the large buckets of money they brought in to lead to their commissions...
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Well, as an anecdote from the USA:
Apparently there was an engineer with sales skills back in the 80s who made the jump from 'run of the mill' engineer to sales superstar. He was given a two percent commission on all of his sales (industrial robotics), and was on track to make about 450k a year in commission in 1984!
Of course, his employer thought this was too much, reigned him in, and the goose that laid the golden egg walked right into another company and did the same thing for a competitor and then retire
Minor error (Score:1)
According to the U.S. Bureau of Labor Statistics, in 2012, the average salary for an application software developer was $93,000, with only 90% of such developers making more than $139,000 in salary.
That should be 10%, from the BLS data he quotes [bls.gov].
Working men top out around $120k (Score:1, Insightful)
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Honestly speaking, you must already be born into a "wage" higher than $120k, or be incredibly lucky or blessed with talent and join one of the few circles where wages aren't locked into sane figures, like sports or the stock exchange.
The reason $120k seems to be a limit is because that's about as high as people genuinely would be willing to pay others for "work". Anything higher than that isn't payment for work, but a cabal of people paying each other more than their "work" is worth, because they can.
And ye
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Re:Working men top out around $120k (Score:4, Insightful)
You are either ignorant, unintelligent, or a factor of the two
I've got a "jump to conclusions" mat for you to buy. You can afford it.
I recently left a job that paid $155k in salary plus around %30 bonus for one that *only* offered $145k in salary.
...Which puts you in the top 1% of American wage earners, pretty much demonstrating that AC's point is more or less correct.
why? because of quality of life.
A luxury that must be wonderful for you to enjoy. You stepped down from the 99th percentile to the 97th. Oh, the sacrifices you've made!
And, I was not "born" into this wage; it came out of years of studying when others would call me a "nerd"
We can tell that based on your first sentence. What percentage of people do you estimate are able to pull that off, realistically? You live in a bubble world surrounded by the success stories, and thinking that because there are a few hundred thousand of you, that the tens of millions who have not enjoyed that success simply did something wrong. The fact is that you won one of the lottery seats on the magic carpet. Hard work made you eligible, but it didn't get you there on its own.
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I'm not far off the magic $120 and a friend of mine is significantly over it.
Both of us lived our younger years on counsel estates. Both of us spent time homeless as children.
> Hard work made you eligible, but it didn't get you there on its own.
Yes it did.
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We can tell that based on your first sentence. What percentage of people do you estimate are able to pull that off, realistically? You live in a bubble world surrounded by the success stories, and thinking that because there are a few hundred thousand of you, that the tens of millions who have not enjoyed that success simply did something wrong. The fact is that you won one of the lottery seats on the magic carpet. Hard work made you eligible, but it didn't get you there on its own.
Making $150k+ by your 50s is not some incredibly rare thing for those who actually work for it. They may be the top 2% or so of wage earners, but in my opinion that is only because so few people actually put in that kind of effort into career paths that make that kind of money. I don't know any high quality developers (with people skills) over the age of 50 that don't make at least low six figure salaries. (this is an estimate based on their spending and savings habits since I don't know the actual salaries
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I know MANY people who have worked very hard to become great at their field, and are actually amazingly competent. The difference between them and the ones who are making $150k is that somebody is willing to pay $150k for the other person's work.
I did say "because so few people actually put in that kind of effort into career paths that make that kind of money." Just working harder isn't enough, you have to make sure you are working smart as well. If high salary is important to you, instead of other rewards like loving your job, then you need to be smart when managing your career. I have made some decisions because of money, and I have made many more because I don't like the career paths that lead to more money. I have certainly left money on the ta
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I've got a "jump to conclusions" mat for you to buy. You can afford it.
I don't need it. I can jump to the conclusion that you're a bitter, downtrodden troll that has probably made a mess of your life and are looking for anyone else to take it out on.
How you got marked insightful is beyond me. First of all, earning $155k does not put you into the top 1% of wage earners in the US. It might get you into the top 5%. Last I looked, you had to make close to $400k a year to be in the 1% of earners. But, I know, it's popular to use the whole 1% vs 99% vitriolic spewage.
What percentage of people do you estimate are able to pull that off, realistically? You live in a bubble world surrounded by the success stories, and thinking that because there are a few hundred thousand of you, that the tens of millions who have not enjoyed that success simply did something wrong.
That I have su
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I am a Software Engineering Manager at a Silicon Valley Top 5 Company. College grad start at 105k plus liquid stock of 20k per year for a total w2 compensation of 125k per year. Your 120k number is BS. With stock grants that are increasing (google is up a lot recently), engineers can easily clear 200-300k per year in compensation. How do you expect people to afford the 1 million dollar houses in Silicon Valley? When I was in the mid-west I probably saw your 120-150k ceiling, however in Silicon Vall
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Stories like this really do nothing to disprove his point. Top 5 Silicon Valley Companies hire the cream of the crop, most of whom went to the right schools and/or know the right people and (not to dismiss their work/intellect) were "born into it". Sure your Top 5 Silicon Valley Company has a couple guys with unconventional backgrounds, maybe they went to state U or you found them working at a small midwestern industrial manufacturer, but certainly they are the exceptions to the rule.
Re: Working men top out around $120k (Score:3, Interesting)
In software:
60k is wage to do work
120k is wage to do meaningful work
200k is wage to be lead on important work
300k+ is wage for work that is high risk and critical path to business success
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I think the point about $120k being this sort of psychological limit is that if you do the math, you basically have the amount of money someone makes if they get paid $60/hr and work 40 hour weeks -- a very typical labor rate for many trades across all industries.
Wanna make $120k / year? Go start your own business and log 40 billable hours a week at $60 / hour. If you're busy enough, charge $100 / hour.
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Keep telling yourself that, so you won't ever feel the need to excel.
Re:Working men top out around $120k (Score:5, Informative)
The working people, including Engineers and Attorneys top out around $120k/yr.
That's one of the most ridiculous numbers I've ever seen pulled out of any asshole. Maybe where you live it's true, but at least in NYC (and I'd bet in a few other cities as well), there's plenty of regular job-type-jobs when people can, and do, make well above that - yes, on their W-2. You just have to be really good at what you do and be worth that much to the company that hired you away from the previous company that was paying you less. Mobility is part of the key here.
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Senior-level graphic designers make WAY more than this, and not just at Google/Apple/Yahoo/Microsoft.
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More to the point, you'd need more in NYC to make up for the cost of living. According to the calculator I checked, the equivalent salary in NYC to $120K where I live would be about $215K.
It also says NYC employers only pay about 23% more than where I live, which means a $120K job here is likely to be about a $150K job there.
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Exactly.
Not to mention, there's lots of "stuff" that costs the same no matter where you live. A new TV, or anything on Amazon, costs about the same (maybe you save some pennies on state sales tax). Cars cost about the same. Vacation stays, wherever you go, cost the same, and all this is bought with my discretionary income - which I have more of, because I live here.
In fact, in the NY area, you've got 3 major airports (and lots of carriers) to choose from, so airfare is often cheaper. This, of course, goe
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Cars cost about the same
Not in any sense of the word "cost" I'm acquainted with. If I purchase an automobile in NYC, I'll pay an extra 5% just in sales tax (delta) alone. Car insurance rates are far higher in New York, there are all kinds of parking costs and "operating fees" that are a foreign concept here. Gasoline costs 20% more there (I filled up yesterday at a name-brand place for less than $3 a gallon). Frankly, I wonder why New Yorkers even bother with cars. My family here has three of them. May become four soon when my dau
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I live in BFE because I make much more here than I would in a big city, as well as enjoying a lower cost of living. But it's not for everyone.
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If you can avoid some sort of gouging middleman the huge chargeout rates are supposed to cover expenses and all the time you can't get work.
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Oh...and he works remotely, from his home in Toronto, so he's not in NYC or SF.
You realize that after SF and NYC, Toronto and Los Angeles are the next most expensive cities in North America, right? So the idea that he's making great money and living somewhere substantially cheaper is pretty dumb.
Heh...true just about anywhere these days.
If by "just about anywhere" you mean for the top 4% of wage earners, then yes. Not saying your engineers don't deserve it, but you have a badly warped sense of reality if you think it's typical of what people are making for actual labor. Professional jobs occupy a fairly small, high-end nich
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Re:Working men top out around $120k (Score:4, Informative)
That's a really low number. $120K (base) is in the neighborhood of what most tier 1 tech companies pay good engineers with about 5-8 years experience. Add in stock/bonus/fringe, and total compensation is usually somewhat higher than that.
The eventual top-out for most folks is likely much closer to $220K (total compensation) than it is to $120K. Outside of silicon valley, YMMV, though.
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The working people, including Engineers and Attorneys top out around $120k/yr
That's not true, I can tell you several companies around the bay area where the pay scale for a senior developer tops out in the mid $130k. That's before stock grants or options. And that's not talking about Architects, Staff Engineers, etc.
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No, no they really don't. Here's a source for Software Engineers: http://www.businessinsider.com/the-worlds-highest-paid-software-engineers-work-for-these-25-companies-2013-4?op=1 [businessinsider.com]
Note that these are *averages*, not maximums. And maximums will be a multiple of the average.
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I would add that those numbers are from glassdoor.com, whose userbase almost certainly skews young
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including Engineers and Attorneys top out around $120k/yr
lol, here in Sweden even a politician earn more than that!
I thought skilled labour was well paid in the US.
Uneducated, random opinion, no responsibility and not really interested in taking a regular job now or later (they used to receive lots of money for long even after they had stopped, they limited that now but only for new people)? Then politician is for you!
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I know fresh-out-of-undergrad kids who got that as their first year's salary at Google (plus another $30k or so in bonuses). You have no idea what you're talking about.
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That's bullshit. I know well over a dozen working software engineers making above $150k. Get better at your job.
Re:Working men top out around $120k (Score:5, Interesting)
uhm, as a silicon valley engineer (20+ yrs in the bay area), I can confirm that number is WAY wrong. even in this economy, $120k in the bay area is actually kind of low for anyone with experience and 4 yrs is enough to be at the 120k level.
engineering in the bay area stays to top out (right now) at the 160-170 level. if you are at that level, you are damned near the top in terms of being a 'working engineer' (vs a manager).
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Accounting Fraud (Score:1)
It's more likely he uncovered accounting fraud going on than an engineer being paid $3 mil.
Probably BS.... (Score:3)
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Yah, sure, youbetcha! (Score:1)
But we're happy to pay CEOs to party and entertain, and others who stuff balls through hoops millions, so why not? In terms of their impact on people's lives the pay scales would be reversed if, as a society, we valued that sort of thing. But we value entertainment more, so F the engineers.
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Science wasn't really valued until after WWII. It was during this time with the invention of radar, sonar, computers, atomic bomb, and so on that science shone through. It's in the last 30 years or so where other study-intensive professions such as lawyer and doctor started earning substantially more than a comparable scientist. A top doctor or lawyer makes at least $1M topping out at ~$10M (see Kardashian Sr.). A Nobel prize scientist would top around $500K (with the exception of Economics).
A cast member i
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But we're happy to pay CEOs to party and entertain, and others who stuff balls through hoops millions, so why not? In terms of their impact on people's lives the pay scales would be reversed if, as a society, we valued that sort of thing. But we value entertainment more, so F the engineers.
It is also a question of scale. A professional top athlete that makes a difference is "worth" ridiculous sums because the fan base that is really paying for it, through tickets, merchandise and being influenced by sponsors, is so large. When David Beckham went to Real Madrid for a 50 mill USD contract, it was at the time widely ridiculed as "no one is worth that", especially not someone just kicking around on a ball. Then it was reported that before he even played his first match, Real Madrid had recouped t
Sadly... (Score:2)
Wally from Dilbert is who first came to mind.
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Half Pennies (Score:2)
He figured out that each AdWord purchase came to a fractional number of cents, so instead of just rounding he took the floor of the value and credited the fractional remainder to his payroll account. This only ends when Ray's AI turns somebody into a robot.
Some people deserve that (Score:5, Interesting)
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One algorithm at google could save or make the company millions of dollars. Never underestimate the power of intelligence.
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What is a guy with this talent doing at an advertisement company in the first place?
Shouldn't he be working on more gratifying things than office software? Like medicine, or high-energy physics?
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Editing failure? (Score:1)
"According to the U.S. Bureau of Labor Statistics, in 2012, the average salary for an application software developer was $93,000, with only 90% of such developers making more than $139,000 in salary."
Err, "only" 90%? WAT?
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That's not the only failure. As the second (anonymous) poster said, the author seems not to understand the difference between "total compensation" and "salary". He quotes figures from Glassdoor showing the range of salary, bonus, stock, and total compensation, with the total-compensation figures clearly corresponding to salary + bonus + stock. Then, in the very next paragraph, he adds stock and bonus figures to total compensation, counting them twice.
Looks like our buddy Phil isn't a good fit for one of tho
Hope (Score:5, Funny)
I bet it's their UI designer. He's worth every penny!
And all this money (Score:2)
To architect boring office software not more ingenious than the paperclip was in its time.
cookie monster (Score:2)
That page at Business Insider really hit the bell on my NoScript. I counted roughly twenty-five cookies in the pop-up menu.
Kinda makes me miss dial-up.
Really (Score:2)
In other words, given that anyone who has any understanding of the business at all could have said the same thing without doing any research at all, he actually found out nothing.
lord the hate.. (Score:2)
so what if someone at Google is making $10bagillon dollars????
more power to him...and everyone in this world who makes $1 more then you and I do.
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He's on Google+ [google.com],
That's not him; he doesn't work for Google.
heard he has heart trouble too.
Had heart trouble. They fixed that.