Tech workers are increasingly looking to leave Silicon Valley (real estate, tech jobs)

[HockeyMac18]

This thread could go in the SJ subforum, but this subforum is more active so am posting here.

Article: Tech workers are increasingly looking to leave Silicon Valley

Some interesting quotes:

Indeed.com found that the share of searches from within the Bay Area for tech jobs outside of it is on the rise. As of Feb. 1, 35% of tech job searches on Indeed.com from the region were for jobs elsewhere, data from the company shows. That share, which is based on 30-day averages and adjusted for seasonal factors, was up about 30% year-over-year.

The portion of searches for work outside of the Bay Area—which has the most expensive rents in the US—was also highest among people ages 31 to 40, suggesting that people are leaving to find better opportunities elsewhere or to settle down in more affordable areas where they can improve their quality of life.

While only a limited snapshot, I do think this is an interesting trend (even if still somewhat small). COL issues have been squeezing people in the area for a bit now (even those paid highly in tech) and we're starting to see the impact of that as people are either leaving or seeking to leave the area.

I don't think the number of people leaving will make much of an impact overall since people are still coming here (I would wager in higher quantities than people that are leaving) - but it's interesting to see data that confirms much of what we hear here and in real life (particularly a popular sentiment among people with families).

[Ultrarunner]

People come here to make their mark...

Once established it can be quite attractive to ask the what if I could make about the same money somewhere else?

[jonlovet]

i agree with ultrarunner..
People will leave and come. almost daily we see threads on sj/sf citydata from someone who is relocating to silicon valley. lot of people don't post on public forums and some others don't know much about city data. I think unless companies relocate or move jobs elsewhere, people will always be attracted to sv. And i don't see companies doing it soon. we do not have startup scene as big as sf in any other city.
most importantly, companies elsewhere do not offer stock options to the extent companies (google, fb, apple, startups etc.) here offer. so there is a compensation to COL but ofcourse it is not as much as it should have been eg. company in austin offering 100k to an enginner would not offer 200k to employee in sv (incl stock and other compensation) .. this is considering real estate value at austin is half of bay area.
in spite of all this people relocating here see bay area is a good bargain (if they get into above companies). and people who don't get into those, aspire of getting in them or going for startup or planning to do something in those lines.

[neutrino78x]

Eh, the only other place I would want to live would be Seattle, and that's a stretch. I love the Bay Area, it is home, I grew up here, and it is where I want to stay.

[NYMTman]

Lots of people go to SV to build a resume then leave. For one, it's a lot easier to tolerate the CoL issues when young and single vs. middle aged with a family of four...

[plot]

Originally Posted by jonlovet

i agree with ultrarunner..
People will leave and come. almost daily we see threads on sj/sf citydata from someone who is relocating to silicon valley. lot of people don't post on public forums and some others don't know much about city data. I think unless companies relocate or move jobs elsewhere, people will always be attracted to sv. And i don't see companies doing it soon. we do not have startup scene as big as sf in any other city.
most importantly, companies elsewhere do not offer stock options to the extent companies (google, fb, apple, startups etc.) here offer. so there is a compensation to COL but ofcourse it is not as much as it should have been eg. company in austin offering 100k to an enginner would not offer 200k to employee in sv (incl stock and other compensation) .. this is considering real estate value at austin is half of bay area.
in spite of all this people relocating here see bay area is a good bargain (if they get into above companies). and people who don't get into those, aspire of getting in them or going for startup or planning to do something in those lines.

What... You do realize that google, facebook, apple, hp, cisco, intel are all multibillion dollar and multinational companies that have thousands and thousands of offices all over the world other then the bay area right? Google, facebook, apple have corporate buildings in austin (they hire people for marketing, sales, engineering etc).

Also I have no idea were you are pulling those salary offers from but austin is not as low as you think and certainly paying more then half what sv is offering for employees. A entry level base salary in a good tech company in sv will offer 90k-110k while in Texas it will be from 75k-95k. Also keep in mind there are other industries other then tech.

Also correct me if I am wrong, I thought employees have the choice to purchase stock options from the company at a "discounted" rate. They do not just give you 50k worth of shares for free, I thought they deduct that from your pay unless you have an executive position or happen to be one of the first few employees of a private company. And if you are an average employee and the company decides to give you free stocks you are not allowed to sell them for a certain number of years? Also you get taxed on those stocks. I always thought that the stock options average employees got from established public companies had almost no significant financial impact on the long run unless the stock shot up. People make it sound like all these average employees at those popular company you have listed are rolling in money. I have bumped into someone that rejected an offer from Facebook to work at a less hyped tech company. So it sounds like not everyone aspires to work at those top hyped companies or going for a startup.

[rca215]

Originally Posted by plot

Also correct me if I am wrong, I thought employees have the choice to purchase stock options from the company at a "discounted" rate. They do not just give you 50k worth of shares for free, I thought they deduct that from your pay unless you have an executive position or happen to be one of the first few employees of a private company. And if you are an average employee and the company decides to give you free stocks you are not allowed to sell them for a certain number of years? Also you get taxed on those stocks. I always thought that the stock options average employees got from established public companies had almost no significant financial impact on the long run unless the stock shot up. People make it sound like all these average employees at those popular company you have listed are rolling in money. I have bumped into someone that rejected an offer from Facebook to work at a less hyped tech company. So it sounds like not everyone aspires to work at those top hyped companies or going for a startup.

Most companies will give a grant of options when you join and on an annual basis. They are priced at the then market price, so yes it only has value if the stock increases. The grants are typically higher and the strike price lower if it's a private company, so there can be more upside with that.

Some companies also give restricted shares (RSUs) as well, which are just straight-up shares. Those of course have value even if the stock doesn't necessarily climb.

Option and RSU grants typically have 2-4 year vesting periods, meaning you have to stay there that long for them to become 100% available to you. But once they do vest, which typically starts after 1 year and then happens monthly, they are yours to sell as you wish.

I think what you're referring to is an employee stock purchase plan (ESPP) in which you can buy shares at typically a 15% discount. So that by definition provides some upside but not the type to really change your overall compensation.

[jbunniii]

Originally Posted by plot

Also correct me if I am wrong, I thought employees have the choice to purchase stock options from the company at a "discounted" rate. They do not just give you 50k worth of shares for free, I thought they deduct that from your pay unless you have an executive position or happen to be one of the first few employees of a private company. And if you are an average employee and the company decides to give you free stocks you are not allowed to sell them for a certain number of years? Also you get taxed on those stocks. I always thought that the stock options average employees got from established public companies had almost no significant financial impact on the long run unless the stock shot up.

In fact, many major tech companies these days have stopped giving stock options (the option to buy stock at some specific price) in favor of restricted stock (free shares). So, in fact, they do just give you $50k (or more) worth of shares for free, not just once but every year. They typically vest quarterly over a period of four years, starting in the quarter after you receive them, not after a "certain number of years." Of course you are taxed on this income, like any other income. Unlike stock options, you make money selling these shares as long as the stock price doesn't go to zero. (Obviously you make more if the stock price increases.) This part of your compensation can be significant. In some years nearly half of my income has been from restricted stock.

[plot]

Originally Posted by jbunniii

In fact, many major tech companies these days have stopped giving stock options (the option to buy stock at some specific price) in favor of restricted stock (free shares). So, in fact, they do just give you $50k (or more) worth of shares for free, not just once but every year. They typically vest quarterly over a period of four years, starting in the quarter after you receive them, not after a "certain number of years." Of course you are taxed on this income, like any other income. Unlike stock options, you make money selling these shares as long as the stock price doesn't go to zero. (Obviously you make more if the stock price increases.) This part of your compensation can be significant. In some years nearly half of my income has been from restricted stock.

Okay so if the company offers 50k stock compensation vesting over 4 years that means you will receive 12k worth of shares for those 4 years correct (assuming stock price does not change)?

[BicoastalAnn]

Originally Posted by plot

Okay so if the company offers 50k stock compensation vesting over 4 years that means you will receive 12k worth of shares for those 4 years correct (assuming stock price does not change)?

if you mean $12kish each year for 4 years, yeah. this can be pretty sweet but i got the impression that the average joe (below director level) doesn't get much in stock at the big tech companies anymore... and it's more in the smaller companies that you tend to get 6 figure RSUs.