56 Percent of Tech Employees at Amazon, Microsoft and Apple Think They’re Underpaid
Anonymous survey of 10,500 tech employees shows most believe they should be getting more.
PHOTO CREDIT: Getty Images
A typical annual entry level salary for a software engineer is about $86,000. From there, depending on experience and skills, salaries can keep going up. They can reach $177,000 at Amazon, $191,000 at LinkedIn, and $203,000 at Apple. These jobs come with paid time off and a host of attractive perks.
You might think these tech employees, many of whom are already out-earning their parents while in their 20s, would be pleased with their compensation. You'd be wrong. A new and disheartening survey by Blind, an anonymous social network for tech employees. More than 10,500 Blind users were asked whether the following statement was true or false: "I am paid far less than the value I create." About 56 percent said the statement was true. Thousands of these respondents work for Microsoft, Google, Amazon, Apple, Facebook, and other household-name high-tech employers.
And yet. More than 60 percent of tech employees at Uber and LinkedIn said they were underpaid. So did more than 55 percent of Lyft employees--even though the survey was conducted March 14-22, when those employees knew their employer was about to launch a high-profile IPO that stood a good chance of making many of them very wealthy. (Some Lyft drivers are protesting their exclusion from this bonanza, but the company considers them contractors rather than employees.) By one estimate, current and former Lyft employees now collectively own $1.5 billion in stock. Yet more than half still think they're worth more. The same is true at Apple, Amazon, and Tesla. At Google, SAP, PayPal, and eBay, just under half of the anonymous respondents say they should be earning more.
What the heck is going on here? Basically, human nature. In a fascinating experiment, UC Berkeley social psychologist Paul Piff had people play Monopoly and secretly recorded them on video. But, these weren't fair Monopoly games. One player--chosen by coin toss--would receive twice as much money for passing Go as the other player, and was also allowed to roll two dice instead of one, allowing that player (the "rich player") to move around the board faster and accumulate more wealth. These extra advantages were, of course, obvious to everyone involved. Still, when interviewed afterward, the rich players tended to ascribe their success at the game to their skill and the smart moves they made. They seemed to forget all about the doubled payments and doubled dice that so obviously allowed them to win, not to mention the coin toss that gave them those advantages in the first place.
Piff and his colleagues spent years studying economic inequality like that created by their rigged Monopoly game, he says in his TEDx Talk. "What we've been finding across dozens of studies and thousands of participants across this country is that as a person's level of wealth increases...their feelings of entitlement, of deservingness, and their ideology of self-interest increase." In other words, the more money you're being paid, the more valuable you think you are, even if your high compensation came about through some accident of chance.
Which is how today's tech employees came by their stratospheric salaries. Yes, they were very smart in their choice of profession. But the shortage of needed tech talent and the resultant feeding frenzy in which employers try to outbid each other for every hire came about because of this odd moment in history when "every company is a software company." If the economy changes, and big tech employers start laying off employees and reducing compensation for the ones they keep, will that mean these employees will see themselves as less valuable than they are today? I don't think so.
If you're an employer, the fact that these generously compensated tech employees still feel underpaid has to rankle. "What do they want--blood?" you might be thinking. There's a clue in the one big tech company that's an exception to the survey norm--Facebook. In contrast to the other large high-tech employers, 69 percent Facebook's employees answered "false" to the proposition that they were paid far less than they were worth.
Does Facebook pay its tech employees more than other high-tech employers do? Not according to Glassdoor. On that site, the average salary for a Facebook software engineer is about $121,000 a year, which is slightly lower than Google and Apple, even though those companies' employees are a lot more likely to call themselves underpaid. And it's quite a bit lower than the $130,000 average for that job at LinkedIn--where more than 60 percent of respondents said they were underpaid. If you want employees to feel they're being fairly compensated, simply paying them more may not help.
There could be a different reason Facebook is an outlier: The company and its CEO Mark Zuckerberg have traditionally enjoyed extremely high levels of employee loyalty and even the scandals that have rocked Facebook for the past two years don't seem to have changed that fact. Facebook does offer some nice perks such as long paid leave for new parents, money for baby-sitting, and on-site dental care. But in the employee-centric world of Silicon Valley, none of that is all that unusual. Zuckerberg's weekly Q&As with the whole company and willingness to answer their questions even on sensitive topics seems to be the secret of the company's success.
In January, some former Facebook employees made news when they publicly accused the company of having a cult-like atmosphere and requiring people to say they loved working there whether or not it was true. Because Blind's survey is anonymous, though, its findings suggest that techies who work at Facebook really do love the company. So did a Facebook-specific Blind survey earlier this year. That seems to point the way to an answer to the techie compensation conundrum. Trust employees and be open with them, and they'll feel highly valued, even if their colleagues at other companies are making more.