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Are programmers overpaid?

Given all the outsourcing these days, do you think U.S. and European programmers are overpaid, or fairly paid?
John
Sunday, February 26, 2006
 
 
I think the good ones are underpaid. If a medical doctor earns 200k to 300k a year, the good programmers should earn that.

The problem is how to pay such salaries and keep the other employees happy with the difference.
Lostacular
Sunday, February 26, 2006
 
 
Let the other employees work by the hour. Nurses don't command Doctor salaries, but I'm sure they aren't illusioned into thinking they could.
Tarkus
Sunday, February 26, 2006
 
 
Definitely. If they had a real passion for their work, they wolud work for the man for free. But these schmucks expect an income. That only proves they are not really committed.
Art Wilkins
Sunday, February 26, 2006
 
 
What people are paid is generally related to demand, but not always. Skill and knowledge is not really a factor. A miner with training (certainly less training than a 3 year degree) can make some pretty good cash, the trade off being the working conditions. Good doctors are more hard to come by than good programmers.
Craig
Sunday, February 26, 2006
 
 
Most people in the United States, regardless industry, are underpaid in relation to how much upper management is getting paid. I expect the same is true of other countries as well.

If in other countries programmers make less than in the United States, its most often a factor of differing cost of living. As globalization continues, the cost of living will equal out amongst all countries in the world.

Companies often derive substantial income from the efforts of a handful of their most talented programmers.

Furthermore, programming requires a substantial investment in learning time, whether in school or independently.

So, programmers definitely aren't overpaid. Only management would think this, usually in an effort to inflate their own salaries.
Jeremy Collake Send private email
Sunday, February 26, 2006
 
 
>As globalization continues, the cost of living will equal
>out amongst all countries in the world.

The theory states that this is what *should* happen, but I doubt very much that it will.
Colm O'Connor Send private email
Sunday, February 26, 2006
 
 
There probably isn't enough difference between what a good programmer gets paid and a not-very-good programmer gets paid. If metrics ever emerge to accurately assess a programmer's effectiveness, then you can bet that salaries will diverge wildly.
Colm O'Connor Send private email
Sunday, February 26, 2006
 
 
They should implement a royalty system, whereby all programmers get a cut of the product's sales. The better they make the product, the better it would sell and the more money they make. Commission in a since.

Would this reward the hard working / good programmers?

The more they sell the more money the workers make, would this make people produce an excellent product?

However this is unrealistic.

Programmers Salary = Base Salary + Commission & Royalties
Chris
Sunday, February 26, 2006
 
 
Isn't that the idea behind offering share options?
Colm O'Connor Send private email
Sunday, February 26, 2006
 
 
"The better they make the product, the better it would sell"

Unfortunately, this isn't true in many other industries as well, and in software especially.
Berislav Lopac Send private email
Sunday, February 26, 2006
 
 
"I think the good ones are underpaid. If a medical doctor earns 200k to 300k a year, the good programmers should earn that."
 
I'd have to disagree with that. Physicians earning $200,000 and above are, by and large, surgeons and specialists. They have to make complex technical decisisions on their feet, and under severe time constraints. Their decisions frequently have life and death consequences, and the doctor is legally liable for those decisions. While programmers sometimes have to think on their feet, those decisions seldom have life or death consequences. There are programmers working in specialty areas that do make life and death decisions, but those decisions are made with plenty of time for reflection and consultation. And of course most programmers hide behind a liability disclaimer that protects them from civil and probably even criminal penalties if they screw up.

As was pointed out in the discussions on what makes a "real" programmer in the Java school threads. Most programmers spend their day scraping data out of databases, pasting it on a screen, providing a UI for updates, and pouring the updated data back in the database. I would place the value of programmers much closer to accountants then to surgeons.

I suppose a real economist would point out that the salaries paid to programmers and doctors are not determinied by your or my assesment of their worth to society, but by the marginal costs of finding replacments for them.
Charles E. Grant Send private email
Sunday, February 26, 2006
 
 
"Physicians earning $200,000 and above are, by and large, surgeons and specialists. They have to make complex technical decisisions on their feet, and under severe time constraints."

Specialist surgeons have to think on their feet under severe time constraints, but the majority of well paid doctors are in specialties like dermatology, radiology, cardiology and the other "ologys" which are very low-pressure. My brother's wife makes $350,000 a year as a dermatologist, and all she does is choose from five different sorts of creams to prescribe.

Programming is like any sort of job where you actually make stuff... you only get paid a bundle if you are the one selling what you are making.
everyone else in my family is a doctor.
Sunday, February 26, 2006
 
 
I don't remember where I saw such numbers, because they are from a US national bureau that keeps track of such numbers. But I remember that it was detailed by specializations, starting at 220k for Pediatric or something like that. Anyway, the important thing is that medical doctors in average make three to four times what average programmers make. So what's the incentive for good programmers to keep working for the man or for the lady? :-)
Lostacular
Sunday, February 26, 2006
 
 
> As globalization continues, the cost of living will
> equal out amongst all countries in the world.

In reality globalisation will have the opposite effect.
Craig
Sunday, February 26, 2006
 
 
" but the majority of well paid doctors are in specialties like dermatology, radiology, cardiology and the other "ologys" which are very low-pressure. My brother's wife makes $350,000 a year as a dermatologist, and all she does is choose from five different sorts of creams to prescribe."

Hmm. You have a point that the 'ologys' are low-pressure compared to say 'neo-natal neurosurgery', but I still think they differ from almost all programming jobs: "You missed that tiny, but clear lesion in the chest x-ray and what was a treatable tumor is now malignant mass and the person is going to die in mind-wrenching pain. Please go inform the family.", or "You didn't withdraw the standing order for baby aspirin when you put the patient on coumadin. The patient died in the ER, bleeding out. The family is suing you for $200,000.", or "You chose the wrong one of the five creams. The patient is now permenantly disfigured and charging you with medical battery.", versus "You wrote 10 ints beyond the end of the buffer which caused the application to crash. The customer lost the business proposal the were working on, and subsequently their job." (to which all too many programmers would respond, "Hey, it's not my fault. They should have made a backup copy. Didn't they read the warranty disclaimer?"
Charles E. Grant Send private email
Sunday, February 26, 2006
 
 
To answer the OP - two things:

1) Programmers are extremely poorly utilized by our industry; queue pages of published reports on shelfware, abandoned projects, mispecified projects, etc. This factor reduces programmers' economic clout and hence makes many appear to be much less valuable than they might be in a more optimally productive situation. (that is, a situation in which what they worked on actually "made a difference", tee hee/snicker snicker...)

2) Formally educated programmers are prone to overly academic mental masturbation - IE - optimizing that which is useless - thought experiments that are nothing but trivia. The theory is fun, and that fun then becomes a trap.

In both cases programmers can have beneficial economic impact much less than that of which they are capable.

In the instance of #1, they can be doomed by circumstance; #2 - they can waste their own capital and opportunity at hand.

It's quite rare to run into a developer that has escaped #1 and #2 both. They either tend to become contractors or they start their own company (ISVs).
Bored Bystander Send private email
Sunday, February 26, 2006
 
 
Oh, yeah - "overpaid?"

Well, that's in the eye of the beholder. Given the synopsis I just posted (which I believe describes how most talent is utilized in the industry), just about any hourly figure over minimum wage will seem excessive to a business person with low technical familiarity.

SW technology looks to most people on the outside of the field like a money rathole, until an absolutely clear need is established for it that transcends the cost.
Bored Bystander Send private email
Sunday, February 26, 2006
 
 
Personally, I think it's neat that I can earn a 6-figure salary without working that hard. While some professions are more lucrative, most Americans significantly less than I do.

When considering physicians, remember that they went through the arduous process of med school, internships, etc. before they finally starting receiving the big bucks. In contrast, most programmers have little formal training in software development.
Julian Send private email
Sunday, February 26, 2006
 
 
I'm sure some programmers make 200K. Not ever New York based programmer works on Bugz reporting software -- someone has to make all those bugs!

Also programmers tend to have the chance to work for stock options at a start-up.  Aside from generic businessperson, which certainly isn't closed to prgramming types, most people don't have the startup option.
Andre
Sunday, February 26, 2006
 
 
As always, it depends.  Your situation, the value you bring to a company and your talent are all variables in this equation.  We aren't overpaid, and here is why: they pay us that much.  In a well functioning capitalist economic system (of which the USA is a reasonable fascimile most of the time) people pay market value.  Market value is determined  by supply and demand. 

If we can make more money for our employers than we cost, then we are a good hire, and we aren't overpaid.  Is Shaq overpaid?  No, because he makes his employer even more money than he costs.

The real question is whether we are underpaid or not when thinking about whether there is some way that we can capture the difference between what the customer pays and what we get in salary.  I think the quick way to find out is to start an ISV.
Joshua Volz Send private email
Sunday, February 26, 2006
 
 
Developers don't kill people, but I've seen people make essentially naive mistakes. The kind which ought to have been avoided if sufficiently skilled people had been employed instead of cheap muppets. The kind that wiped out a business already worth tens of millions of investment.

We don't conduct life or death surgery on people, but we quite often do it to businesses..
Katie Lucas
Monday, February 27, 2006
 
 
"I suppose a real economist would point out that the salaries paid to programmers and doctors are not determinied by your or my assesment of their worth to society, but by the marginal costs of finding replacments for them."

Hello outsourcing!

"Developers don't kill people, but I've seen people make essentially naive mistakes."

What about the time a passenger plane flew into the mountain because of a software mistake? Here is some more software mistakes that caused people to die or at least had serious consequences:

http://www.cs.tau.ac.il/~nachumd/horror.html
CIFChamp
Monday, February 27, 2006
 
 
Lostacular
Monday, February 27, 2006
 
 
>>They should implement a royalty system, whereby all programmers get a cut of the product's sales. The better they make the product, the better it would sell and the more money they make. Commission in a since.

Who is the "they?"  Programmers?  That's what Micro-ISV is all about.  Go for it.  But many programmers find the sales and marketing skill set alien.  So who's going to give up the money to pay programmers royalties otherwise?

Much of the software written in my company isn't "sold" in any form that royalties could be paid, and I suspect that's true for many of of the big houses.  I have no clue what % of the world's programming staff is represented by this market.  We sell a solution to one client.  If there's the possibility of selling a similar solution to another client, that's nice, but it's not in the orginial cost model.

It's not all COTS.
Ideophoric Send private email
Monday, February 27, 2006
 
 
I would like to take this moment to mention that Art Wilkins will no longer be with us.  After a meeting with several labor representatives from the programmer's union he has entered rehabilitation.
Clay Dowling Send private email
Monday, February 27, 2006
 
 
I have never met anyone, from any industry, who thought they were overpaid. In fact, quite the opposite.
A. Nonymous
Monday, February 27, 2006
 
 
There's a long comment thread on Gadgetopia about this in response to a post about Rent-a-Coder:

http://www.gadgetopia.com/post/1017

A lot of Eastern European coders that live on the few hundred they make from RAC came out of the woodwork to jump on some American coders complaining that all the work was going overseas.  It was an interesting conversation.

I chimed in with this, which I still believe:

[snip]

The sad fact (for folks in the U.S. anyway) is that the rise of the Internet and the ease of outsourcing is going to balance out income levels for IT staff around the world.

The downward wage pressure provided by outsourcing is going to cause programmers in the U.S. to make less. The increased opportunity for foreign coders is going to provide upward pressure on their wages. For every U.S. coder that’s out of work or has to take a pay cut, there’s a guy in India or Romania that can fix up his house or buy a new car.

There’s no use complaining about it — the market is what it is. Any attempt to stem the flow will likely fail since the market always finds ways around these things. This is just the new world, and if you’re going to survive in the U.S. you need to find a way to differentiate yourself from your overseas rivals beyond the ability to just crank out rote code.

For a very real example of how this is going to play out, read this:

http://www.gadgetopia.com/2003/12/16/OutsourcingSolutionJustPayProgrammersLess.html

Ask yourself: what can you provide to your employer that someone overseas cannot? In that answer lies job security. (And here’s a hint: the answer — as we’ve seen — is NOT “I can write really good code…”)
Deane Send private email
Monday, February 27, 2006
 
 
"Personally, I think it's neat that I can earn a 6-figure salary without working that hard. While some professions are more lucrative, most Americans significantly less than I do."

I make six figures myself... if you count the dollar sign and decimal points.
newby
Monday, February 27, 2006
 
 
If information (and IT with it) becomes perfectly globalized, then only jobs relying on truly local characteristics are safe. Namely, janitors and barristas and kindergarden teachers. Tell your kids to study for those.
Spinoza Send private email
Monday, February 27, 2006
 
 
> Ask yourself: what can you provide to your employer that someone overseas cannot?

If interaction is required then a local team will be much more productive given to communication efficiencies. Coordinating overseas is really torture. I see projects take 10 times as long as they should simply because of the extra communication noise.

The salaries in india are rising fast. They are getting much closer to US standards.

Salaries aren't really the reason I see going overseas, it's simply to find qualified people anymore.
son of parnas
Monday, February 27, 2006
 
 
Whoever said "all they do is pick from 5 creams" is incredibly disrespectful.  All you programmers do is sit around all day and merely type stuff into a computer for $65k/year.

Doctors have to sacrifice YEARS of their life living on slave wages and basically living in a hospital 24-7.  When they graduate they have essentally a second mortage to pay in student loans and they pay liability insurance premiums that would bankrupt you.

As Dr. Cream how much he sacrificed to get where he is.  To simply dismiss somebody the way you did as "easy money" only highlights your own insecurities.
Cory R. King
Monday, February 27, 2006
 
 
If we all agree that developesrs don't kill people but doctors do, can somebody explain why the result is that it's the doctors who are paid more?
Stephen Jones Send private email
Monday, February 27, 2006
 
 
Developers can kill people - the Therac 25 and one of the recent Medtronic "forgot to label our GUI" Intraveinous system are good examples.
QADude Send private email
Monday, February 27, 2006
 
 
"I think the good ones are underpaid. If a medical doctor earns 200k to 300k a year, the good programmers should earn that."

And they should also have to pay $125,000 per year in personal liability insurance, right? 

"Doctors kill people ..."

The overwhelming majority of doctors do NOT kill people, they help people.  However, a doctor who makes a mistake has a much higher exposure than a typical developer.  Even if the doctor doesn't make a mistake, but a lawyer is able to convince a jury that it s/he did, it can ruin their career.

How many of you have had your career ruined because of a programming error?  Or have even lost your job because of it?  Typically, the end-user response is "bugs are expected."
Karl Perry Send private email
Monday, February 27, 2006
 
 
The problem is that the programmer gets better with the experience. When he is 17 years old, he is the cowboy at anything. When is is 22 years old, he starts to see when it's good to take it easy, instead of just keep producing lots of semi-working code. When he is 28, if he has kept focussed at programming, he will be very good at it already. When ie is 33, he will have family and will be a lot more calm when working, though he will have improved his designing skills. When he is 38, he will be even better. And through all those years, the salary and the jobs will have change very little, despite the costs of living increasing and the developer getting better all the time.

By 30, a good programmer will be as good as a good doctor and probably will have great responsibilities as well, though his salary will be 3 to 4 times lower.
Lostacular
Monday, February 27, 2006
 
 
Lostacular hit the nail on the head. Think about the financial industry, all these traders making tons of money and bonus. All because of the software I wrote!
Patrick from an IBank Send private email
Monday, February 27, 2006
 
 
way over paid.
Lemon Obrien from portable Send private email
Monday, February 27, 2006
 
 
Good lord, I cannot belive some of you people are seriously comparing doctors salaries & job requirements to a that of an average IT worker.  If you really, truly belive you can compare your programming gig to that of a doctor, you are arrogant beyond belief.
Cory R. King
Monday, February 27, 2006
 
 
It's not that ridiculous if you think about it.

All the equipments in hospitals have software in them. Software developers who write them are as important as the doctors.
Rick Tang Send private email
Monday, February 27, 2006
 
 
Are you willing to sacrifice years and years of your youth as a resident living in a hospital eating ramen?  Are you okay knowing that you won't be making big bucks until you are like 35?  Are you okay with talking with families after a loved one dies?  Are you okay with knowing somebodies life is literally in your hands while you operate on their heart?  Are you okay being on call 24 hours a day and okay with dropping everything to run into a hospital to perform life saving operations?

What the hell did you do today?  Make some corporate webapp siphon a new table from a database?  Woopty freakin' doo!  Your job isn't nearly as valuable or requires such personal commitment or sacrifice.  Sorry.
Cory R. King
Monday, February 27, 2006
 
 
Hey, how does what I am doing in my work affect my argument that some developers deserve high salaries?

Do know how much money could be lost if some applications are not available for one minute?
Rick Tang Send private email
Monday, February 27, 2006
 
 
"you are arrogant beyond belief"
this surprises you why???

"All the equipments in hospitals have software in them. Software developers who write them are as important as the doctors"

Really? As one of those developers who writes the software in those "equipments" I would *love* to be paid at the level of an orthopaedic surgeon, but it ain't gonna happen. Why you ask? Whether or not the equipment is working, the Dr. still has to do his job and keep the patient alive, for one. Second, while I may know the internals of my device intimately, its output is a mystery to me. My code may tell the doctor the amount of (insert hormone/drug here) in someone's blood, but I have absolutely no training to interpret that level in relation to the dozens of other things happening with the patient.

Like Cory said, to compare the two is arrogance beyond belief. And yes, it works both ways, but I don't see doctors saying they could engineer software better than I can.
lw Send private email
Monday, February 27, 2006
 
 
Fair enough, we are diverging on our definitions.  That is a typical internet debate for you!

I'll assert that comparing an AVERAGE programmer to that of an AVERAGE doctor is, well, wrong.

A programmer who is programming the global ATM network, or the microcontrollers inside your cars ABS system is a different story as far as pay goes anyway.

But still, I'd say the supply of programers who can program ABS systems are probably much higher then doctors who are licensed and can operate on a human.  See the part of my rant about sacrifice and dedication.
Cory R. King
Monday, February 27, 2006
 
 
No one says software programmers could heal people. At least I won't.

One thing we can agree is CEO are overpaid.
Rick Tang Send private email
Monday, February 27, 2006
 
 
And lw, you haven't met many doctors then have you ;-)  For whatever reason doctors think they can do ANYTHING.
Cory R. King
Monday, February 27, 2006
 
 
Physician jobs are not inherently high pay.  In many other countries, doctors every bit as competent as American ones make much less.

Doctors' high pay has EVERYTHING to do with their control of the educational feeder system.  The AMA strictly controls the number of slots in teaching hospitals to make sure that no more than about ten thousand med students graduate per year.

If there were a free market in medical education, many more teaching hospitals would open, more students would graduate, and doctors' salaries would collapse, and they damn well know it.  Its all about artificial scarcity.

How much do you think programmers would be paid if the ACM controlled the size of undergraduate CS enrollments?
dave
Monday, February 27, 2006
 
 
"One thing we can agree is CEO are overpaid."

I think what you mean is:

"Anyone who makes more than me is overpaid."
Whatever
Monday, February 27, 2006
 
 
"Think about the financial industry, all these traders making tons of money and bonus. All because of the software I wrote!"

Of course the folks mining the coal that powers your computers could then complain: "Think about all those programers making tons of money, all because of the coal that I risk my life to dig." Why do so many programers seem to think they are the apex of technical civilization? Software plays a vital role in the world, but so do thousands of other technologies and trades.
Charles E. Grant Send private email
Monday, February 27, 2006
 
 
>I think what you mean is:

>>"Anyone who makes more than me is overpaid."

No.  CEOs are overpaid (other than those who founded the company and are "paid" mostly from the shares they owned from day 1).  Their compensation is not determined by market forces ... it is determined by cronyism.
T. Norman
Tuesday, February 28, 2006
 
 
Hi,
I thought I should add my thoughts to the discussion.Before I start I should state a few facts. I spend my time in medical school and have a degree in medicine. These days I am pursuing my PhD in information security. I have been working on information security more or less since I left medical school. I am hoping that I might be able to bring out a balanced view.

Firstly training a doctor someone pays, if you are damn good some univeristy would give put up with the bills(read-I didnt pay my bills). Else you pay for it, so doctors see this as an investment and indirectly creates a barrier.

Secondly more training you need you would have to jump through more hoops (read more exams and competition)hence the question of supply vs demand.

Third medical bodies seem to regulate the entry into the spefic fields. This doesnt happen with software engineers.

Fourth outsourcing is only catching up. Outsourcing of radiology by teleradiology (I have two radiologists in my family) is catching up. May be with telemedicine will bring globalisation to doctors :-)

BTW I wont complain that they make more money than I do ...
Anish Mohammed Send private email
Tuesday, February 28, 2006
 
 
"Anyone who makes more than me is overpaid."

No, I think he means CEOs are overpaid.  Of course, that's a broad generalization, but I think the problem of CEO salary inflation is real.

American CEOs make, on average, 500x what the average worker makes.  In the 1960s, that number was around 40x.  They also make 22x more than CEOs in Japan[1].

I don't know what has changed about the role of the CEO, and what makes CEOs in American companies different from those in Japan and Europe, but it seems (based on empirical data) that the trend does exist for paying CEOs much more lucratively to do the same job.

------
[1] Some web sites that discuss CEO pay:

http://www.beggarscanbechoosers.com/2005/04/ceo-pay-soared-in-2004-as-us-economy.html

http://www.businessweek.com/careers/content/apr2001/ca20010419_812.htm
thinker
Tuesday, February 28, 2006
 
 
Re: programmer salaries.

Like most jobs, the salary of a programmer is probably related to the risk associated with the position, in addition to the skills/aptitude required for it.

For example, a programmer generating web pages from database tables for the Accounts Receivable department is neither taking a tremendous risk, nor doing something particularly difficult.

A programmer writing code for the space shuttle, on the other hand, is writing considerably higher risk software.  A programmer blazing trails in neural network research is doing difficult work.  Both will probably be compensated a little more than the Accounts Receivable forms programmer.

However, in all those cases, the programmer doesn't really have to worry about direct liability in catastrophic situations.  Programmers are generally shielded against liability by the corporations they work for.

This also helps explain why a programmer running his own business stands to make more than a programmer in a cushy day job.  The risk is much higher, because the business can fail, and the programmer can lose all his money.  But the potential for reward is also much higher, because the business can be a smashing success and Google will buy it and the programmer will buy a Ferrari and life will be good.

In conclusion (finally!), I can't provide an answer as to whether programmers are overpaid.  Some are, some aren't, but the field is too diverse to make a general statement about salaries.
thinker
Tuesday, February 28, 2006
 
 
The amount programmers make is not related to the risks they take or the talents they have. Their salaries are not even strictly related to how much profit they can generate for their company. It's related to how much someone else would do the same job for.

In NYC, doctors actually get paid less than in comparable locations in the country. Why? A relatively large number of doctors want to live in NYC, and their numbers force the salaries down. A NYC ER doctor makes $100-150K. The same doctor in Texas makes $200-300K.

Why are programmers paid what they are? No one of comparable ability will do it for less. Why are CEOs worth what they are? No one of comparable ability will do it for less. Why do financial traders get so much dosh? No one ...

It's a division of labor economy, people. There is no 'why'.
Hugh Brown Send private email
Saturday, March 04, 2006
 
 

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