I was recently flipping through an interesting email list. It’s focused for tech leaders, managers & startup entrepreneurs. An HR team lead posted asking about “promotion paths” for engineers.
While I have an intuitive grasp of what engineers at those different levels look like, I’m having trouble making those concrete.
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It struck me how antiquated the whole “career ladder” concept is. Work one job for 20-30 years. It feels like the fairytale of dating that leads safely to marriage. It all seems like a wonderful plan until it fizzles out, employees get jaded, they start seeing the real money being paid elsewhere, and begin looking around.
1. Talent in short supply
I’m not a CTO. I should preface with that bit. I’m a consultant. That said I’ve worked in the tech industry for 20 years, so I have a bit of an opinion here.
Going to meetups, startup industry & pitch events. They’re all like a feeding frenzy. There are more companies hiring now than I remember back in 1998 & 1999. It’s just crazy.
Angel List says 18,000 companies are hiring right now. What about Made In NYC? That shows 735 jobs. And of course there’s Ycombinator who is hiring April 2016, which posts every other month. It has 720 comments as of this writing.
2. Are salary jumps always larger through external promotion?
I’ve seen a pattern repeated over & over. An outside firm offers more money & grabs the talent, or the talent gets restless, starts looking & finds they get a bigger bump in salary by leaving, than by internal promotions.
I don’t know why this is, but it seems almost universal that salary jumps are larger from outside firms, than internally through promotion.
3. Building a better ladder
All the titles & internal shuffling in the world aren’t going to hide industry pay for long. When an employee gets wise to their career & the skills marketplace, they’ll eventually learn that title does not equal compensation.
4. Building a better culture
In a pricey city like New York, the only thing that seems a counterweight to this is phenomenal culture, chance to build something cool & be surrounded by coworkers you love. To be sure bouncing around you get less of this. Companies like Etsy comes to mind. According to glassdoor companies like Airbnb, Hubspot & facebook also fit the bill.
5. Surge pricing for engineers?
Alternatively to better ladders & promotions, perhaps what Uber did for taxi driving would make sense for hiring engineers too. Let the freelancing phenomenon grow even bigger!
Perhaps we need surge pricing for engineers. That way the very best really do get rewarded the most. Let the marketplace work it’s magic.