The Wage Gap 2

A recent post on Hacker News prompted me to revisit What Does a Wage Gap Look Like?

What has changed in the past 5 years? Unfortunately not much. The point today is the same as it was 5 years ago. Location based pay is still the norm and is still hugely unfair. That last point is not shared by everyone of course. People exploiting the current status quo for profits, and employees who are afraid paying fair salaries to everyone would negatively affect their total compensation obviously have very little interest in acknowledging the situation. Let’s look at some other excuses.

1. Discriminating salaries based on location is not an equal employment problem because one can change locations

If we look at some equal employment opportunity directives they cover traits like race, color, religion, sex, national origin, sexual orientation, veteran status, disabilities etc. Indeed, some of those are set in stone, but others are not so much. If someone was asked to e.g. change their religion or renounce their nationality for a better salary that would be ridiculous. Yet asking people to severe cultural and social ties and uproot their whole families to move thousands of miles away is still perfectly normal. Obviously this only applies when an opportunity for relocation is presented at all.

2. People are paid what a replacement would cost

Let’s suppose for a moment that employees are interchangeable resources without discernible differences and companies are profit maximizing entities. How is it possible under such assumptions that 2-5-10x salaries exist when 1x replacements are readily available elsewhere? To argue that people are only paid what their replacement would cost also requires an explanation why a garden variety remote employee (or a team of four experienced veterans) is not a replacement for locally grown organic talent? So far there is no convincing explanation to back that up.

3. You get what you negotiate

Negotiation can move the needle in a narrow salary band, but it does not change the fundamentals. There is no way to negotiate against a glass ceiling. It is simply impossible to negotiate a salary that is not on the table. Unless we want to pretend whole countries are good/bad at negotiating, arguing getting paid a fraction of your coworkers is a failure in negotiation is insincere.

+1. Location based pay protects local economies and thus GOOD for employees

Yes, you read that right. Some folks indeed suggest wages should be suppressed out of kindness, bless their hearts. The poor should stay poor for their own sake (not for their sake). Frankly this is an insult to injury.

5 years. Remember 2017? Trump has just entered office, market was booming, the start of the covid pandemic is still 3 years away, no war in Ukraine. Now consider since 2017 people having the same title, working the same job within the same company still have not earned the same money their colleagues made just in 2017 alone, just because they live somewhere else. Let that sink in for a moment.

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