> It is a means of lowering wage rates among engineers and software developers
You might think Mark Zuckerberg is in this to bring in international developers and pay them peanuts, but the reality is that most people Google, Facebook, and the like are bringing in on H-1B visas are extremely well compensated, on a par with their US counterparts. Once you account for relocations packages and visa/legal fees (which alone can top $10k) it's often more expensive.
Yes, some companies take advantage of international workers. I don't dispute that. But many people who want to enter the US are losing out - they have great job offers, and end up being slaves to an arbitrary lottery with a fairly meaningless cap in the grand scale of total US immigration.
Econ 101: importing labor reduces "scarcity" driving down prices, regardless of paying going rate. It simply keeps rates from going up which would bring more Americans into the "silicon valley" tech labor pool.
If Zuckerberg's is trying to satisfy a labor shortage then he should go to where the labor wants to live, as Google has done which is to establish a major technical presence in Manhattan, where the kind of people he wishes to hire want to live.
If Zuckerberg's is trying to satisfy a labor shortage then he should go to where the labor wants to live, as Google has done which is to establish a major technical presence in Manhattan...
Google, by owning the second largest office building in Manhattan has a major technical presence. I'm not aware of any tech (Apple, Amazon, Oracle, Microsoft, Facebook, Intel) firm that comes close to having close to this kind of engineering/software presence in Manhattan.
Facebook has a substantial (and expanding) presence in NYC. As does Amazon and various other "tier 1" tech companies. Tech presence in NYC is exploding in no small part due to Californian (and abroad) companies trying to tap into the local talent pool.
While you're condescendingly lecturing others on basic economics, I'd suggest you brush up on what's going on in the tech scene in your own back yard.
Your understanding of economics is also overly simplistic and fails to account for the utility of the good or service being sold. Reduction in supply only raises prices if the utility of what's being traded is infinite and there are no substitutes.
While there are notable outliers in the tech industry in terms of profit per employee, most software businesses are firmly in the $200-300K range when it comes to revenue per head. This represents the upper bound of how much someone can get paid and still make sense - and both NYC and SF/Bay salaries are already a substantial portion of this figure.
A reduction in supply will only result in a rise in salaries until you hit this revenue cap. A continued reduction in supply past this point will result in companies going under as they cannot fulfill labor needs at a price they can afford. This becomes a net negative for the tech industry as the only businesses continuing to employ engineers will be the extreme outliers who can generate highly abnormal revenue numbers per employee. Startup costs will also blow through the roof as the amount of capital required to get a business off the ground explodes. The entire industry suffers as overall employment drops.
It's frustrating how many people in our field live in a fantasy land where squeezing hard on the supply side will mean they get rich.
> "where the kind of people he wishes to hire want to live."
This statement requires more elaboration. I'm in Manhattan, but I also understand that not everyone is like me. To claim that the type of software talent companies are looking for are inevitably urban is entirely misguided. There is no shortage of talented techies who would love nothing more than a house, a lawn, a car, and surfing on weekends.
NYC contains a certain demographic of talent that absolutely refuses to live anywhere else - and anyone has the capability would be well-advised to try to tap into it, but it is not the only demographic worth courting.
This may seem obvious to outsiders but bears repeating sometimes in the city: New York City, and the "type" of people who live there, is not the center of the universe.
When you quote $200 to $300K revenue per head, you are quoting averages, whereas the firms I quoted (and also say, Qualcomm) earn have greater revenues per head and Facebook is about $1 million per employee.
Google has a 3 million square foot building in Manhattan which they purchased for $2 billion. I'm sorry but I don't see Microsoft, Oracle, Apple, Amazon, or any other tech firm making anywhere near that commitment.
Of course, not everyone wants to live in Manhattan and I never said that, but as Google has demonstrated, it should be the second place after SV that you want to have a major presence. There are a lot of extremely intelligent high value employees and networks there. It is also a best place for employees to be that want to improve their careers esp if it overlaps with media, finance, health care delivery, pharma, ...
BTW, I don't make my money as a software or hardware engineer but once worked in both fields. I do believe, with the exception of Google, that Goldman and other top tier finance firms have been brighter than many of the SV firms that have only made a small presence in NYC.
You might think Mark Zuckerberg is in this to bring in international developers and pay them peanuts, but the reality is that most people Google, Facebook, and the like are bringing in on H-1B visas are extremely well compensated, on a par with their US counterparts. Once you account for relocations packages and visa/legal fees (which alone can top $10k) it's often more expensive.
Yes, some companies take advantage of international workers. I don't dispute that. But many people who want to enter the US are losing out - they have great job offers, and end up being slaves to an arbitrary lottery with a fairly meaningless cap in the grand scale of total US immigration.