They shouldn't care how much it costs you to live, they should care if your work is worth paying you X to do it.
And if it was good enough to pay you X in city Y then it should be good enough for them to pay you X in city Z.
How does it hurt them if you have a little more left over at the end of the month? And why is it any of their business? If anything I would think it would be a net positive for everyone including the company.
They shouldn't care how much it costs you to live, they should care if your work is worth paying you X to do it.
And if it was good enough to pay you X in city Y then it should be good enough for them to pay you X in city Z.
How does it hurt them if you have a little more left over at the end of the month? And why is it any of their business? If anything I would think it would be a net positive for everyone including the company.
The reason people get paid higher salaries per location does have to do with cost of living, but it also has to do with the perceived benefit to the company of operating in that location - which they aren't getting if you're somewhere else. It "hurts" them in the sense that, if they (Silicon Valley company) are going to have a programmer living in Houston anyway, they could fire you (average SV programmer) and hire someone there (top-tier local) and save $30k from their bottom line.
Yeah the answer is that employers will pay as little as they possibly can.
If a company opens up a position for $50k as an engineer in San Francisco nobody will take it. They'll have zero resumes submitted worth interviewing.
So they'll up the rate to $100k. A few takers but not the top caliber of employees they're looking for.
So they up the rate to $200k and then they start getting resumes and applications for employees who are A) Good enough to do the work. B) Willing to live in San Francisco. C) Are happy living on $200k a year.
Once you remove the requirement to live in San Francisco suddenly a recent college graduate in Kansas city is thinking to themselves "Hey, $100k a year would buy me a nice 4 bedroom home and a Tesla! That sounds like a good deal!" And she's just as qualified as the applicant who wouldn't even send in their resume until the wages hit $200k a year in San Francisco.
The benefit for the company to pay a cost of living adjustment based on the applicant's location though is that they are truly getting the most qualified applicants. If you don't offer a cost of living bonus then you'll be exclusively limited to people who are willing to live in a low cost of living area. So now you are missing out on potentially the top tier talent who does want to live in San Francisco.
In the UK, it is seriously more expensive to work in London that it is to work in other parts of the country. Only Russian oligarchs, Arabian princes, and other stupidly rich people can afford to buy a house in London. So the workers have to commute. Hours a day. At enormous cost. And then the trains do not run on time. And when I talk about "the workers", I am including highly qualified people, not just labourers.
What I see with the economics is that there are positive feedback effects driving up the cost
"If you don't offer a cost of living bonus then you'll be exclusively limited to people who are willing to live in a low cost of living area. So now you are missing out on potentially the top tier talent who does want to live in San Francisco."
But this wasn't about cost of living increases or pay increases, this was about cutting the pay of someone who moves to a lower-cost area: Should Employers Cut Your Salary If You Change Cities?
I say, no, they shouldn't.
"Now this is a totally brain damaged algorithm. Gag me with a smurfette."
-- P. Buhr, Computer Science 354
No (Score:5, Insightful)
They shouldn't care how much it costs you to live, they should care if your work is worth paying you X to do it.
And if it was good enough to pay you X in city Y then it should be good enough for them to pay you X in city Z.
How does it hurt them if you have a little more left over at the end of the month? And why is it any of their business? If anything I would think it would be a net positive for everyone including the company.
Re: (Score:5, Informative)
They shouldn't care how much it costs you to live, they should care if your work is worth paying you X to do it.
And if it was good enough to pay you X in city Y then it should be good enough for them to pay you X in city Z.
How does it hurt them if you have a little more left over at the end of the month? And why is it any of their business? If anything I would think it would be a net positive for everyone including the company.
The reason people get paid higher salaries per location does have to do with cost of living, but it also has to do with the perceived benefit to the company of operating in that location - which they aren't getting if you're somewhere else. It "hurts" them in the sense that, if they (Silicon Valley company) are going to have a programmer living in Houston anyway, they could fire you (average SV programmer) and hire someone there (top-tier local) and save $30k from their bottom line.
Would we enforce this the
Re:No (Score:3)
Yeah the answer is that employers will pay as little as they possibly can.
If a company opens up a position for $50k as an engineer in San Francisco nobody will take it. They'll have zero resumes submitted worth interviewing.
So they'll up the rate to $100k. A few takers but not the top caliber of employees they're looking for.
So they up the rate to $200k and then they start getting resumes and applications for employees who are
A) Good enough to do the work.
B) Willing to live in San Francisco.
C) Are happy living on $200k a year.
Once you remove the requirement to live in San Francisco suddenly a recent college graduate in Kansas city is thinking to themselves "Hey, $100k a year would buy me a nice 4 bedroom home and a Tesla! That sounds like a good deal!" And she's just as qualified as the applicant who wouldn't even send in their resume until the wages hit $200k a year in San Francisco.
The benefit for the company to pay a cost of living adjustment based on the applicant's location though is that they are truly getting the most qualified applicants. If you don't offer a cost of living bonus then you'll be exclusively limited to people who are willing to live in a low cost of living area. So now you are missing out on potentially the top tier talent who does want to live in San Francisco.
Re: (Score:2)
In the UK, it is seriously more expensive to work in London that it is to work in other parts of the country. Only Russian oligarchs, Arabian princes, and other stupidly rich people can afford to buy a house in London. So the workers have to commute. Hours a day. At enormous cost. And then the trains do not run on time. And when I talk about "the workers", I am including highly qualified people, not just labourers.
What I see with the economics is that there are positive feedback effects driving up the cost
Re: (Score:2)
"If you don't offer a cost of living bonus then you'll be exclusively limited to people who are willing to live in a low cost of living area. So now you are missing out on potentially the top tier talent who does want to live in San Francisco."
But this wasn't about cost of living increases or pay increases, this was about cutting the pay of someone who moves to a lower-cost area: Should Employers Cut Your Salary If You Change Cities?
I say, no, they shouldn't.