Ask HN: Is your company considering inflation in this year's comp review cycle?

I'll be looking for a new job this year for sure.

I assume from the day I start that I will be gone in less than 18 months.

Eventually I got bored, stopped trying, and still walked out of reviews with average or above-average marks and same pay bump. This is after getting talks from my manager about upping my game and narrowly avoiding a PIP.

If an employer wants me to bust my ass for them they need to make it worthwhile. If my work unlocks significant value (verifiable 6 or more figures) for the company then I expect more than a token amount of that to be sent my way.

SWE pay may be high but they use that as a cudgel to keep you from claiming value proportional to your contributions, and don't even get me started on the trap that is equity compensation

The two tech incapable ones are pretty annoying, or at least would be if I gave a damn about my performance there.

Also never met such mean people. Tech is so nice in comparison.

son: "dad, why can't we go to vacation this year?"

dad: "sorry son, don't have enough money. still got bills to pay and dad's company don't give enough raise."

son: "why can't you just find another job?"

dad: "that's treason son, we don't do that here. think of the team morale son."

son: "okay dad. i love you."

I’m the kind of person who has eaten the same breakfast since I was 13. I have 5 of the same shoe as I don’t want to have to find another new kind of pair. I like rules and consistency and knowing a system well.

But if I don’t, I will end my career millions of dollars poorer.

Essentially as soon as I am comfortable in an org, I have to leave unless I want to forsake a big chunk of money.

> I've job hopped too

Nice double standard, lucky that your current employer didn’t apply your heuristics to you, so you could close the door behind you.

Changing jobs is such a hassle, I suspect most people wouldn’t do it as often if companies were nice places to work with raises to match the market. But that’s harder to do than blame candidates and only hire those that appear to settle for less.

P.S. It is especially amusing considering lots of "only if I were to leetcode I could increase by X" coexist with many posts that diss on leetcode and whine that it filtered them out and it is not "relevant to the work they are doing". Perhaps the system is working then?

You hit the nail on the head.

Everything related to compensation becomes much less confusing once you accept that hiring is a market. Like any market, supply and demand drives the prices. Nothing else matters much.

Big companies have entire teams dedicated to compensation which are separate from HR and hiring managers. They carefully track these details and will fine tune their rates up and down depending on how often their offers are accepted or rejected. If every candidate is accepting the offers, they're probably too high and can be adjusted downward. If the company can't close any good candidates because they're going to other companies, it's time to raise the rates.

Of course, not every company plays this game correctly or intelligently. If the OP's company has guessed wrong and gave too low of a raise, they risk losing too many people. On the other hand, if most of the employees shrug it off then maybe they made the right call for the business.

If $X needs to increase because they can hire/retain the people they want, then $X needs to increase.

The government publishing a single inflation numbers is kind of irrelevant to the equation. If they can keep hiring/retaining the people they want, in spite of inflation going up, then nothing has to change.

I can't imagine it being that hard to imagine :) considering this is the second paragraph of wikipedia[1]:

Prices will not all increase at the same rates. Attaching a representative value to a set of prices is an instance of the index number problem. The consumer price index is often used for this purpose; the employment cost index is used for wages in the United States. Differential movement between consumer prices and wages constitutes a change in the standard of living.

[1]: https://en.wikipedia.org/wiki/Inflation

Now that I see it from the manager perspective, I pledge to stay sharp and become a job hopper ... as soon as I find the time to start interviewing. :^)

There are a few reasons I encourage other employers to peg annual raises to the same number:

- It’s usually a very fair number; never egregious for increasing costs. - Someone else gets to do the math, and you have a very easy number to tell prospects in interviews for what to expect. - It helps keep social security solvent.

We also use this number as a guideline for increasing our billable rate during contract negotiations. It has most of the same benefits.

Even in the same role YoY, don't they become more knowledgable, experienced, capable? Take on new responsibilities? Don't they deserve to share in that added value to the company?

The value is very much based on what a person does, where they do it, who they do it for, and when they do it.

All those other factors will usually outweigh modest personal growth.

Lame example: being a better typewriter repair person today, working in a barbershop. No matter how well that person does their job, they may not add more value this year than last.

Companies were giving equity grants based on inflated, sloshy market values. Why stay at a company where your $1MM (hypothetical) stock grant is now worth $400k when you can go to a new company and get a new $1MM grant at the current cheap market value?

not as relevant IMO. Overcorrections might be better than current performance. Example, now is the best time to join Robinhood, get an $800k stock grant at $12/share. If it goes back up to $50/share like is was last year then that $800k would be worth $3.3 million.

well put.

I accepted an offer at a high-growth, public tech company in January. I talked with my hiring manager after the stock got hammered and we agreed to push my start date to April to take advantage.

Jesus, that's a tone-deaf official line. Are they also not updating their prices? What are company's annual statements and financial figures looking like?

> New hires are getting 50% more equity than the total value of my unvested equity

Request an increase in equity to the equivalent that a new hire is getting by default. If not, you may have to decrease your rate of productivity (or working hours) in line with the difference between the raise percentage and the inflation percentage.

Could literally double my total comp if I spent some time doing leetcode. Probably 20% raise without leetcode.

Have some silver (bronze?) handcuffs or would probably be gone already.

Please just don't. You're better than that. Here's a list of companies who don't participate in this bullshit: https://github.com/poteto/hiring-without-whiteboards

At my current gig I was hired at staff level in Nov. 190k (please, let's normalize sharing salaries) . I could do better, but I am passionate about my job for the first time in 10 years. How much do you value happiness?

You're not an imposter. Especially as an HN reader (you're actually interested in your job).

That’s over a 100% increase from your current rate.

I’d personally recommend practicing leet code, if that’s the thing holding you back… maybe 1 problem a day. By the time you actually decide to change companies, you wont be interview prepping just before an interview.

Oh yes, I know, and I am envious. My soul and mental health is worth more. Solving problems makes me feel alive. Parroting answers does not.

I was somewhat headhunted by UiPath. Huge money. Crazy salary. First round I had whiteboard problems with the most awesome engineer that there is. Absolutely aced that, the engineer missed a meeting over shooting shit about algorithms. Second and third leetcodes were engineers that were clearly running off known solutions, and couldn't rapport over best or alternative solutions. I absolutely made a fool of myself, and I'm really good at that stuff.

Leetcode encourages parrots, and I need to believe that I'm better than that. Arriving at the thesis of a doctorate of a tenured scholar in the heat of a 1.5hr interview is hardly a representation of how valuable an engineer is.

I am so glad I failed. I was kicking myself at the time for tolerating the bullshit (I had a gun/green card issues at my back), I knew that I should have walked away.

Leave. They either only want you at a discount or you will get a counter offer to consider.

I knew that going in. I helped to secure 10 million in business in 2021. They disbanded our team. To “grow” it. I applied for the “new” role.

They offered less and said it would include 2022 annual raise.

Told by my managers manager they would make me right at the end of 2022 through a bonus. Asked for it in writing, never heard back.

This decrease in total comp plus inflation has seen my real world earned drop by 20% for 2022.

Good shit. Make that threat real ASAP.

The other piece is equity, and the detail you’ve given here is insufficient. Total new hire grants are irrelevant, the question is how much are you vesting annually and where is the stock trending compared to other companies you could work for.

Of course there are other factors like how you much you enjoy the environment and work, but the important thing is to consider the holistic situation and not get hung up on a narrative about inflation which is at best an excuse papering over broader feelings you are experiencing.

Personally, I'm running a tiny IT-consultant company together with six close friends. Because the market is so volatile for us, everyone is paid based on the company's result, with a definite minimum of $120,000/year (2021. This is then adjusted for inflation every year. Everything else is bonus, except a lot goes into running expenses (of course) and a "war chest" for worse times.

[0] https://en.wikipedia.org/wiki/Category:Employers%27_organisa...

[1] https://en.wikipedia.org/wiki/Category:Norwegian_Confederati...

Throwaway for obvious reasons.

(FWIW this means that my salary, teaching undergrad-level math classes to high schoolers, is going from $74K to $81K.)

It's already been well established by many even in non inflationary times that dev salary is maximized by switching job every 2-5 years or so, subspecialty dependent.

Then what is?

Engineer comp has exploded the last few years, well past inflation. So if they're not matching inflation, and they're not matching the market (which would be even higher) then it sounds like they just pay you whatever they feel like and hope you stick around.

Exceeded expectations on both 2 years.

Raise for inflation doesn't even take into adjustments knowledge and experience gained.

Looking at TeamBlind astronomical TCs, I feel I'm not valued enough. Especially not when my peers are making $70k more than me.

The company: we sell terminal.

I am interviewing hard these days. Leetcoding again. It sucks to interview again, because I like my teammates, my manager. And instead of working with my best effort for my employer, now I have to juggle interviews and Leetcode/system design/behavioral preparation.

And I will not stop interviewing until I get a better job, even if it takes me 365 days or more.

I don't even need to earn $250k like them. If they were giving me $240k I would've been okay. But $180k, come on...

I have family to feed. I am an immigrant with no help from parents. I gotta do what I gotta do.

If you are earning 180k vs. 250k earners who you have nothing to learn from, move on, even if you move to another 180k but with smarter folks.

Doubt this is relevant, seems like a red herring. What do you want? Just get paid more and call it a day, right? What level of collaboration do you really want? Just join another company, and if there are leadership expectations that cannot be met, then just get the normal level of performance review so that when you do become effective you can get the higher evaluation later, compared only to your moderate performance earlier. No need to overachieve.

The reason (relating to my other comment) can literally be ‘it is 2022 and these are the new rates.’

Often that’s enough reason.

is there a more lightweight model where for say 10-20% they'll handle searching, billing, rate negotiations, late payments and disputes?

i'm not sure if i'd go into contracting again without something like that. it takes far too much energy to be the asshole that is necessary to not get screwed in business (for yourself) and it detracts from the actual work and life satisfaction in general.

Be matter of fact about new prices, and try to explain as little as possible.

(But always give some reason. Any reason beats no reason, but a simple even vague reason beats too many reasons.)

Baffled me for years until I started to understand that I needed only to offer fewer and simpler reasons to get my ideas implemented.

This round I expect the usual 3% base plus a small discretionary bonus pool and have been setting that expectation with my staff accordingly. Depending on how this year pans out I expect the 2023 raise pool will factor in persistent inflation.

You might not personally agree with it but that was the prevailing wisdom amongst economists until fairly recently. The US Fed in particular didn't start discussing rate increases until early this year, well after FY 2021 was over and 2022 budgets were set.

The transitory inflation parade was so ridiculous that it turned into an internet meme. It’s just like the Fed was saying inflation was 2% when housing was skyrocketing across the country. They’ve literally redefined their measures to the point that their measures have become useless and a meme.

Amazon is increasing pay for many technical jobs, although specifics haven’t been communicated. They’re selling it as a large bump for everyone, although I already understand it’s mainly to retain talent or at least match inflation. We’ve underpaid our talent in the past compared to competitor companies.

With the 5.5% increase, is your compensation competitive with similar roles at other companies? Are you making enough salary to live a comfortable, satisfying lifestyle? Is the equity you have increasing in value over time better than, say, a mutual fund or ETF? Are you concerned you're not being paid your worth, or are you experiencing FOMO and anxiety because it feels like the economy is failing?

Internally it’s nothing but complaints about comp and attrition, but to me it’s the best I’ve ever been paid. My idea was to stay here long term and learn a ton before thinking about leaving, but does anyone do that anymore? Maybe I’m being naive.

Not to single them out or anything. Previous companies have never taken into account inflation for perf review.

The only salary bumps I've gotten that are worth mentioning are from changing companies and negotiating a better offer.

[0] https://www.youtube.com/watch?v=ADobcQEhrzQ

Biggest effective raise I have gotten without leaving for another company, and I considered myself obscenely compensated to start with. Pretty content.

The first step is some event triggers a reduction in supplies for some commonly needed good. In Zimbabwe they chose to expel white farmers and replaced them with black farmers, many of whom who had little to no experience in farming. Food production rapidly plummeted and many farms simply ended up being completely abandoned.

The second step is rising prices as a result of the first. Wheat isn't inherently worth 5 coppers. It's worth however many coppers people are willing to pay for it. If there's half as much wheat to go around as before, people are going to be willing to pay more to ensure they are the ones who get their wheat.

The third step is an entity, usually a government, trying to solve the problem by attacking the effect rather than the cause. The government of Zimbabwe saw many people were quickly becoming unable to comfortably afford food. And so they responded by giving people more money aiming to bring them closer to their previous buying power.

The fourth step is a new increase in prices. This time the supply of wheat has stayed the same, but people suddenly have more money to bid on it. So again people are willing to pay more to ensure they get their wheat.

The fifth and final step is: goto the third step.

The end result is Zimbabwean's becoming quite capable at big figure math alongside the complete collapse of their economy. For instance we saw the introduction of the world's first $100 trillion bill. In a nutshell, giving people more money to combat inflation is like trying to put out a fire by dousing it with the only liquid you have - gas.

[1] - https://en.wikipedia.org/wiki/Hyperinflation_in_Zimbabwe

Lets call a properly measured inflation I. Let I_z, I_usa be inflation of Zimbabwe and USA respectively. The first derivative of I increases faster in third world countries than in those countries with world reserve currency status. That's why the US likes to project military power, that's why the super wealthy class in the West support wars to project the power in order to control the first derivative of I.

https://www.nytimes.com/2022/02/27/business/economy/price-in...

Combine that psychological effect with our current post-truth world of disinformation campaigns, and it seems to me that people can create inflation, or create more of it.

"Inflation" is shorthand for 'price inflation' - every single price and dollar amount goes up, and, when it happens too fast, can tear an economy apart (e.g. 1942 Berliners packing cash into wheelbarrows to go and buy bread).

EDIT: grammar

  * higher utility and Internet bills
  * increased wear-and-tear on the house
  * purchasing equipment and home office furniture out of pocket or using your existing tech equipment
  * increased vehicle maintenance cost (decreased usage lead to more rust, damaged batteries in the cold weather and selling is ultimately not worth it, at least in my case)

There's usually only two choices once you get top seniority in your position: move to a different role with a higher salary cap, or find another employer. Personally, if I was happy in my role, I wouldn't leave just for money. It's hard to find an actually enjoyable place to work. You might be really lucky and just have GIG syndrome.

If the intention of an flat company-wide increase is fairness it should be a fixed dollar amount that's the same for everyone. I've never seen a company do that though.

if you have to rebuild your network to be effective at a new firm, anyone they bring in (at a higher rate) will have to do the same