I’m an engineer and I’m in demand — so pay me more!

If you’ve been keeping up with technology news, you’ve likely come across one or two articles recently about developer salary. There are some strong opinions out there.

There are those that believe we should go public with how much we’re all paid. Others say this will cause the closest of colleagues to never speak again. Some companies, like Gravity Payments, have famously implemented radical pay policies with mixed results.

It leaves many employees asking, how do I know if my salary is fair, and who can I ask? Should I be negotiating for more pay?

The problem is, there are so many factors to take into account – where you’re based, seniority, company size, bonuses and benefits. All of which make it incredibly difficult to figure out if you’re paid fairly, or if you should be negotiating for more.

I’ve personally hired hundreds of technologists and engineers over the last few years at a Series A level startup and a Fortune 500 company. I’ve experienced salary negotiations both as a coder and as a manager many times over.

My general advice would be, it shouldn’t be all about the cash. There are more important factors, such as whether you’re happy at work.

But putting that to one side, let’s talk about the money.

The formula for salary

Of course, there isn’t a magical formula. But there is a typical process that most companies follow to determine your salary when you first join. They usually look at four inputs:

  1. Salary ranges for people with your skill set and years of experience (and yes, I’ll show you those ranges below)
  2. Salaries for others on the team who would be your peers, to ensure it’s fair and consistent
  3. Your personal pay history
  4. Whether you have other offers on the table that need to be matched.

The first two inputs are the most important. The others are used to validate and confirm.

At an early stage startup like untapt, where cash flow and funding are big considerations in general, there’s a fifth input: how much money is in the bank!

Ongoing performance and salary review

At most companies, large and small, there’s a regular pay review process that goes hand-in-hand with your performance review. Your manager will look at your personal results, ​then compare your salary with your peers and the industry benchmarks.

Then they may decide to award you a pay increase. Again, budget will play a role. At this point, they could also discuss cash bonuses, equity and options (but that’s a whole different topic that we’ll leave for a future blog post!)

 

The counter-offer

If you get an offer to work somewhere else, your company may scramble to keep you. Your manager will follow a similar process to the initial offer, but with a little more urgency.

“So should I always get some additional offers from other places, just to make sure I’m getting paid fairly?” you might ask.

Getting competitive offers can help boost your pay in the short term, and it’s always good to keep your interview skills fresh. But longer term, your employer is likely to go by your performance and whatever’s fair and consistent with your team. (Of course, this all assumes you stay in your current job and don’t actually take one of the competing bids!).

So what are these salary ranges?

Here’s a rough guide to salary for engineers based on my experience with the market, and the roles we have on the untapt platform.

Salary range for a developer in a major US city:

Junior Level (up to 3 years): $60-90K
Intermediate (3-7 years): $90-115K
Senior (7+ years): $115-140K
Lead / architect: $140K+

Some of the factors which affect this:

  • For other regions outside a major US city, adjust to account for market differences and varying cost of living. (PS For San Francisco, adjust up!)
  • Early stage startups will pay lower and should make up the difference in equity
  • There’s also variation depending on how specialized your tech skills are – for example, roles requiring Python knowledge with scientific computing might pay higher, while HTML5/CSS web development roles will generally start at a lower level.
  • Finally, industry verticals pay differently. At untapt we specialize in FinTech, which tends to have higher levels of pay, particularly for those with deep domain expertise.

Final advice

It’s most important to focus on the things that really matter – whether you’re happy in your role and positioned for success. Here are some final thoughts:

  1. Don’t worry too much about your salary today compared with others. If you like what you’re doing, you’re good at it, and your company does well – you will get rewarded.
  2. Make sure you work well with your manager and you have their support. If not, it’s time to change.
  3. Keep up a healthy, regular conversation with your manager on how you’re getting on. If you have concerns about your salary level, be sure to raise it with your manager. Every six months or so, ask about pay review timing and whether you’re on the right track.

 

 

 

Ed is co-founder and CEO of untapt. A FinTech veteran and an Oxford alum, Ed was previously MD at JPMorgan and has held technology positions at IBM and various startups. Coder by day, Ed leads a double life as DJ after work. And if you happen to run into him, ask him how much he loves Seamless (hint: a lot).

Ed is co-founder and CEO of untapt. A FinTech veteran and an Oxford alum, Ed was previously MD at JPMorgan and has held technology positions at IBM and various startups. Coder by day, Ed leads a double life as DJ after work. And if you happen to run into him, ask him how much he loves Seamless (hint: a lot).