Just ran my numbers and got about 55% of my current salary assuming a lead position (what I have now, which I would probably not get with them) and "a lot of experience" which I'm on the fence about and they would probably disagree with.
Getting rid of the COL deduction by selecting NYC as my location actually makes it reasonable so something tells me not pinning the US salary floor to 1.0 is saving them money and simultaneously getting them lower quality developers.
By offering people medicore, local salaries, they are losing a massive opportunity to clean up on the great talent in remote areas.
Why would someone want to live in a low-end city (assuming they are mobile) - when they could live the same 'quality of life' in a much cooler place?
Assuming a degree of mobility - the whole point of living in a 2cnd tier place is that you can save a lot of money, which makes up for the '2cnd tierendess' of the place.
Montreal is 1/2 Boston. There are a good batch of great devs in Montreal. I could double my salary and move to Boston? I'd probably just do that. And still save more.
If they paid a 20% premium over other Montrealers, they'd be able to attract the best talent - and still save a lot of money over Boston/SF/NYC.
Paying 'regular market wages' for remote localities is not a winning proposition - it doesn't take advantage of the fact they are great startup, reasonably well financed etc..
Even talking about "Boston" as a single thing is tough. There's Boston/Cambridge urban folks and there are people who live an hour west or an hour north. That's an enormous difference in terms of housing prices. And even that is an oversimplification. School districts and other factors make a huge difference within that same one hour radius.
But what neighbourhood you live in Boston is a choice.
Picking up and leaving a city is not a choice for most people.
Also the 'cost of everything except housing' is pretty consistent - everyone pays roughly the same a gallon of gas, and an identical basket of groceries.
Yeah, same here. If I max out the possible compensation by setting lead w/ a lot of experience, it's roughly 60% of what I make now (as a non-lead with a lot of experience).
The kicker is that I'm employed remotely by by a company based in a city whose CoL hit is even larger than the one I currently live in. The NYC range they give is plausible for me as someone who lives in a place that is much cheaper than NYC, but it's not exciting and wouldn't really motivate me to apply.
GitLab's numbers may look right on paper (and they do explain their methodology in the second link, discussing rent indexes, etc), but they're absolutely not comparable to what good people earn in the real world. Good talent commands good wages everywhere. A skilled remote worker is not going to come to GitLab for an average-for-their-area salary.
Even when working locally, talented people make much more than the average for their area. I know this because I've hired many good people and unless they're entry-level (meaning they're good but haven't had a chance to prove it yet), they don't start coming in the door until you're offering at least a 50% price premium over the reported median. In fact, we had a lot of bad candidates come in asking for around that much. The senior people I hired would make more than double the median for their nominal role. The stats on these government reports don't account for seniority, skill, niche demand, etc., and likely include some people that self-report as holding a title when they're really just aspiring to that position.
Once you're a mid-level dev, you should be pulling in a bare minimum of 80-85k, no matter where you live. I say this not as a bubble-dwelling San Franciscan (who surely finds such numbers laughable even for entry-level), but someone who has lived in various parts of "flyover country" his entire life. When local opportunities for at least this compensation are not forthcoming, go contract or remote.
There's no reason for good people to leave money on the table, and GitLab doesn't appear to get that.
My wife is a compensation consultant and we have discussed this phenomenon a few times. She says that for some jobs "there is a national market" and comparisons to local salaries is therefore invalid.
Set it to "lead" and "a lot of experience" (I'd grade myself intermediate-to-senior and above-average experience IRL) and the top of that range is less than I make now, and I'm not big on self-promotion/networking and could probably make quite a bit more if I were. Plus their benefits are worse than what I get at my tiny company. Their comp calculation sucks for my area.
They're paying talentless Wordpress dev prices for their mid-tier devs, by local standards. This is in a mid-sized midwestern US city. LOLWUT? No one decent in my city would accept a job there.
Having that sort of calculator also encourages developers to embellish their competancy level as well, which is not going to help in finding quality developers. I'd much rather a company figure out where I am on their scale (each company I've worked at seems to have different ideas about what makes a junior/mid-level/senior/lead) than taking my word for it.
It's more likely set up based on an untested (and easily falsified) conjecture about the relationship between local residential rent prices and local market wages in the industry.
"In developing the compensation formula above, we looked at the compensation of our team members which had been set in the past (without the formula), and found out that there was a statistically significant correlation between compensation and the factors that are now in the formula. We purposefully chose to look for correlations with metrics that are probably causal and definitely relevant in people's lives (the rent!). This also has the advantage of letting us work with data that is readily available publicly, as opposed to trying to scour the web for market compensation rates for all roles in all locations. Perhaps surprisingly, there was a stronger correlation between compensation and rent index than with the more general cost of living index available through Numbeo (or the cost of living with rent index, for that matter); and so we moved ahead with the Rent Index."
The immediate problem with the method of developing your formula that is described is that it assumed that the pay of your staff before you had a systematic formula already accurately reflected prevailing market wages in the locality of every employee.
And, for US locations, BLS data is readily available publicly. While that may not have been a suitable source for a worldwide formula, it would have at least been a suitable reality check on the validity of the formula you came up with to see if it reasonably approximated the variations in market rates within the US.
You are right that we used compensation from before we had the systematic formula. However, we then repeated the exercise (of finding linear correlations with various COL indices) when we had a larger cohort but before the formula had been implemented systematically, and it still pointed to the use of the Rent Index instead of another index.
You're also right that we need the calculator to work worldwide, and I suspect that that may be part of the reason here that the calculator works well on that scale and then not always as well as it should on more local scales. We'll continue to explore how to get better on both scales; the challenge is always that we want to keep things as simple as possible also.
I've made two issues based on your comment here and the one where you shared specific data for Sacramento (thanks for that!):
BTW, I know I've been kind of hard (fair, I think, but not gentle) on you guys in this thread, and I want you to know that I really appreciate how well you've taken it and how responsive you've been.
I won't quote it because I don't have the source in front of me but there is a quote elsewhere on this thread about Gitlab requiring that you tell them when you move so they can pay you less.
A) What's to stop me from getting hired in a 0.21 COL area and moving to San Francisco or Washington, DC? Are you going to fire me or pay me $20k a year because I moved?
B) My labor is not worth less and my work is not lower quality because I move to SE Asia or Eastern Europe. This is idiotic.
I applied for a position at Gitlab a week ago, and didn't even get a response. Probably because I am too expensive, too old, and live in an area with strong labour laws and staff protection. It's a shame, because it would have been decent to at least get a "sorry, not interested" reply, but no response at all is just not cool. They write on their hiring page: Always leave feedback, this will help everyone to understand what happened and how you came to your decision.
@mdekkers glad we saw your post. I tried searching for you in our ATS, but could not find any application under that name. Can you email me directly on jobs@gitlab.com? I'd really like to see what happened to your application and why we didn't respond.
Getting rid of the COL deduction by selecting NYC as my location actually makes it reasonable so something tells me not pinning the US salary floor to 1.0 is saving them money and simultaneously getting them lower quality developers.