At the end of the day there’s a pay band in HR and while COL may be 3x in SF than Oklahoma, but either it’s 600k in San Fran or 250k in Oklahoma, which is nearing physician’s pay in many smaller states. Pay will go up in smaller states and pay will come down in SF/SV areas. People in LCOL areas will make top end salaries in their respective geographic areas and will see the best quality of life improvement. $250k in Oklahoma is going to be much better quality of life than $600k in San Jose for some people who have a spouse and 2 kids. And then over time they can hire a lot more people at 200-250k rather than 600k.
And of course all of this assumes a traditional W2 employment agreement.
If the person in Oklahoma pays $1k per month for a 3,000 sq ft home with a 1Gbps fiber connection.... why work full-time at all, or exclusively for one employer?
I just don't see why from a company's perspective you would pay two equally qualified/titled people massively different salaries based on the city they choose to live (which is completely irrelevant to the company). If I were an employer and one person wanted 125k and the other 400k, that seems like a no-brainer to me when they are both remote workers and equally qualified.
If they offer to raise the person getting 125k to 400k if they move to an expensive area, then at least it's fair :shrug:
Companies do not pay based on CoL. The 400k guy is going to be looking at competing offers in that range. If Google decided they would only pay based on Kansas salaries, and Apple only hired local, why would you ever consider a Google offer when Apple pays 3x as much?
That's a great point, although from my experience working with teams on the other side of the world, the language barriers (and even time zones) are enough to make it so the work is not equivalent. Theoretically though it could be. It's more difficult in practice however and may end up costing the company more, so could be cheaper to pay someone more who is local to headquarters and the target market, than less on the other side of the world.
