Are Software Engineers Going to Get Paid Less?

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Matt: All right, everybody. This is yet another edition of The Web News, and this is gonna be, a conversation on a controversial couple of posts that were posted on X. And no, this isn't a big political thing, and yada, yada. This is about a couple of job postings, and so I wrote a little blurb here to organize my thoughts.

Just to kick things off, just gonna read that to you. I have a small paragraph here. So two recent job postings in Toronto, Canada, have sparked debate online over software engineers and their salaries. One of the jobs in question is from Canadian Tire, posting for a... and this is the name of the posting, a Senior Applied AI Scientist, Advanced Analytics and Modeling, Customer Intelligence. And this has a salary, range of 64,000 to 106,000 Canadian dollars, which is approximately 30% less than USD or United States dollars. And then the second job is from OpenTable, and they're looking for an AI Applied Engineer, Business [00:01:00] Solutions, and they have a max pay of 110,000 Canadian dollars, which according to this X post, 'cause both of these posts are on X, is approximately 78K or 78,000 U S dollars.

And so if you're watching us, I have, the two posts l- like lined up here. I have them, just on the screen here. just to show you, I'll link to these as well if you want to weigh in on the conversation. And I wanna be clear here, this is not a post, this is not a video that's, you know, dogpiling on Canadian Tire or dogpiling on OpenTable or what's a fair wage or w- Toronto is so expensive, how are we supposed to live, or Canada is so expensive.

Like, there's so many angles that you can tackle stuff like this with. The thing is, ultimately, is I worried that this is validating a theory I had and a theory that I conversed with a friend over, a few weeks ago. And my theory is that coding is becoming like a factory, and we've heard that. We've heard code [00:02:00] factory, right?

Where we're just trying to pump out code as quickly as possible. Effectively, you're manufacturing software as quickly as possible, and because we're manufacturing software as quickly as possible, we are likely to start seeing wages come down and down and down because not only are we using AI to quickly pump it out, but also the barrier to entry into this field is also, lower than ever.

So the thing is, is I wanna unpack this because I also have a second part of my theory, and my theory is kinda scary, and I actually commented this. I kinda think that this will unfortunately inevitably become like the manufacturing industry, which is why I was talking about CodeFactory and manufacturing software earlier. I actually think that this may result in all manufacturing, quote-unquote, of software being shipped overseas the way that much of the manufacturing in North America is not done [00:03:00] here any longer. And that is largely because the dollars in the various countries, the currency in various countries is obviously worth different amounts. And so the Canadian dollar or the United States dollar will potentially go further in another country. And so of course, that attracts people to say, "Oh, I'll manufacture there and I'll ship the goods," physical goods right now, but I mean, ship the software internationally. Why would I not just have it manufactured in a cheaper place?

And I kinda am worried that this is gonna become the mentality moving forward. And that's why we're seeing these sort of low wages, I'm gonna say, because Canadian or what have you, especially in Toronto, not the greatest. So Mike, why don't you, give us your thoughts 'cause I've been kinda gabbin' on

Mikhail: I, I think there's a couple things happening here, and part of it is exactly what you're saying. [00:04:00] So There is a, a good chunk of the industry that's driving the wages lower based on offshoring, so that's happening, I think, more now than it was before, and part of the reason why companies like Microsoft and, Google, and all those, like, there, there's massive, I wouldn't call them layoffs, but they're like, they're telling people that they can retire essentially and get packages, like a voluntary layoff,

A lot of these comp- large companies are doing that. One of those reasons, buyouts. One of those reasons that people are speculating is that there's, there is gonna be a significant amount of offshoring. The other reason is going to be obviously something to do with AI, whether, AI's too expensive, whether AI is gonna be used more.

I don't know. Like, I- there's not really much evidence saying that AI is actually replacing jobs yet, but something to do with AI.

Matt: I'm still personally leaning into my theory

Mikhail: Yeah

Matt: is potentially a sign of the times. Now, I, I do wanna be clear, I have not done en masse research on [00:05:00] wages across Canada, on wages in this type of position in Toronto.

I do know that this is a very low wage for Toronto for having PhDs and stuff. I've also been told by a friend, and, and this person is not in ML, but I've been told by a friend that PhDs are a dollar a dozen. Again, just a, just one friend. I haven't done a study on this or anything like that. Uh, but this

Mikhail: The, the

Matt: problem, though.

Mikhail: Like

Matt: is, this is an example of they should... Like, they're not paying enough to live sustainably in one of the most expensive places in Canada

Mikhail: Oh, yeah. That, that's a whole other thing. Like, this, this requires someone to move an hour and a half away from the city and commute every day three or four hours a day.

Matt: 'cause

Mikhail: That's, that's

Matt: uh, I, I believe this is the role that's hybrid. It might be the other one that's hybrid

Mikhail: Yeah

Matt: four days... Yeah, here it is. tr- location Toronto, uh, Ontario, hybrid in office four days per week, and that's for the Canadian Tire ad there

Mikhail: Yeah. Then, and that's what a l- a lot of people here do. They will, they will commute two, [00:06:00] anywhere between two to four hours a day. That's a standard commute for Canadians because people cannot afford Toronto pricing, so they have to live far away, and our housing prices are very high. They're lowering right now, but not enough.

Anyway, that is a thing that's happening. I do wanna point out that, like, PhD- just saying PhD, I agree with you, doesn't n- necessarily mean they should have, be paid a high salary. The reason that I do believe that this is a ludicrous proposal is specifically because a PhD relating to the highest demand field in the world right now, essentially

Matt: That, that is a little crazy. And, and

Mikhail: Ja

Matt: if PhDs, you know, if they make a bunch of money. I don't have an opinion. I was just quite

Mikhail: Yeah

Matt: by a friend that PhDs are a dime a dozen. 'Cause I actually assumed, the reason why I was having this conversation with him is he had a friend going to become a, a PhD, doing his PhD, and I said, "Oh, that's gotta be a great pay boost."

And he's like, "What are you talking about? PhDs are a dime a dozen." And it's ... I was just sort of taken [00:07:00] aback. I always just sort of figured that you would naturally make a whole bunch of money if you were in a PhD that had jobs around. Obviously, if you're taking a PhD in a, in a field that's com- that's gone completely kaput, that's one thing. But I was just I never really even thought of it, but I always just assumed that a PhD would naturally make you a good living

Mikhail: I, I think one other thing I do wanna mention is this, we're in a different market right now in terms of competitiveness from a hiring perspective. So that is a, that's a big portion. Like, if you go, if you go back to the OpenTable listing, this one to me is more about the market just being more competitive.

It's definitely a lower salary, but in my opinion, they're just doing this because they can, in a sense of there's a lot of applicants. And people will ... The app- applicants right now are desperate

Matt: Well, it even says over 100 people clicked apply

Mikhail: Absolutely. And I believe that, and I believe [00:08:00] that a lot of people are gonna apply for a job that pays $110,000 Canadian today, even though it is underserved, but there's a lot of layoffs happening, and people need to pay bills, and OpenTable is taking advantage of that. And I'm not It sucks, let me be clear, but we live in a capitalist world, which also isn't perfect.

Matt: Supply and

Mikhail: is, this is the inevitability of supply and demand, correct. So regardless of your thoughts on this process and like, "Oh, you should be making more money," if there was less of us applying, we would be making more money. That's at the end of the day how this is working. So for me, this one is just them being like, "This is a supply and demand issue.

We can, we can get someone good for this amount of money for this specific role."

Matt: Sure

Mikhail: they probably, they're probably right

Matt: And the thing I, that I'm saying too with, with my theory is that I'm not singling out OpenTable or Canadian Tire. I honestly think that this is probably to [00:09:00] start happening in the field in general.

Mikhail: Ja

Matt: my, my joke with my, with my friend when I was having a conversation with him is I said, "We're gonna be, I'm gonna be working for $16 an hour, is what's gonna end up happening to me." And in, and in the same field. it's like tech workers are a dime a dozen Because there are so many that have been laid off, there are so many looking for work, and so unfortunately, tech workers are a dime a dozen. And then, we've always contended with questions like, "Well, why would I hire you to be my web developer?" From our web dev agency side, we've, we've contended with that for a time. Why would I hire you to be my web developer? Because I could go to any other place. Like, I could go to India, I could go to the Philippines, I could go to here, there, the other where, and I could just get a quick website made for really cheap. A- and that's very possible. you know, they, they could have found some great engineers over there and gotten a great website, and it is very cheap because our dollar goes further there, granted. But it [00:10:00] wasn't an en masse issue, and I kind of feel like it's going to start becoming an en masse issue.

'Cause we've heard it in our web dev agency side, where people have asked us that question or brought that, that argument as to, "Why would I go with you? Why wouldn't I just go with these other guys that constantly email me that they can make me a website for $250?" And, know, it's hard, it's hard to argue with them because I don't know the quality of that person's work.

Now, it is only $250, so even 250 Canadian dollars isn't gonna go that far, overseas. It's not that much money, so you're kinda getting what you pay for in that regard. It's not... I could see you kinda arguing and saying, let's say it costs 3,000 Canadian dollars for a Canadian to make a website.

Maybe it's 2,000 overseas or 1,500 overseas, depending on wherever it is you get it. I could see that. But the $250 is very, going to be very, very difficult, to live on. Like, clearly the, the agencies doing that are absolutely churning through websites, hundreds and hundreds of websites. So it's a different, it's a different [00:11:00] experience for sure.

Meanwhile, Mike and, Mike and I, if you come to us with, with website business, like, we'll talk to you. We'll have several meetings if we need to. We'll work through problems. We'll have conversations. you can call or text us, et cetera, et cetera. It's gonna be a different experience because we don't...

I, I don't have 50 people calling me the time, and I'd imagine that those turnover rate agencies will naturally have a massive amount of people calling and texting and emailing and, and they have to get the work done so quick that you're not really gonna get many tailored solutions or, well thought out because they just don't have the time.

You're not gonna get many well-thought-out solutions 'cause people are like, "Hey, you know, get that slider up. Next. Get this, get this little bit of content box done. Next. Get these two blog posts done. Next." But I don't know. I, I think at this point, like I, I think I, I, or I did comment on, on the one post and I was mentioning that, uh, I, I mentioned, I, I mean, I could just read it.

It's, I, I wrote, "Inevitable. We're already starting to use the [00:12:00] words like code factory. Wouldn't be surprised if we see coding outsourced overseas for a fraction of the cost. AI will be the liaison between North America and wherever the work is being done 'cause AI doesn't sleep and people have different time zones." and AI also can be the person that, like AI can, fill any sort of language barriers. AI can figure out the conversion rate to figure out fair price on things, and AI can also verify work and it's, it's very powerful at the end of the day. And so why wouldn't you go with the cheaper option? It's a, it's a difficult, it's a difficult sell

Mikhail: I think at the end of the day it is a sell, and it's always been a sell. in our industry, ever since we started 10 years ago, we had this thing. we had offshoring. There's no- nothing... In my opinion, uh, the offshoring conversation hasn't changed pretty much at all since the beginning.

The AI conversation does put a caveat on there, because you're right, maybe the [00:13:00] intermediary being AI does change things to a certain degree

Matt: even just in time zone alone.

Mikhail: Yeah

Matt: zone alone. it can act up on your behalf. If it knows how you would answer stuff, it can act on your behalf to some extent. It can verify some work, and then you don't have that delay of five to six hours between responses and answers and back and forth

Mikhail: I still think that that setting up that process is not a trivial, is not a trivial task and would require an onshore, at least a smaller, a small team in the company to handle that

Matt: But it's still the en-shrinkening of the

Mikhail: It is

Matt: of

Mikhail: possible.

Matt: like, tech workers here.

Mikhail: Yeah. I, and

Matt: mean, we still do manufacturing here. We still manufacture food, which sounds like a weird thing to say, but there's industrial bakeries and industrial processed food plants, and there's also cars that get made here

Mikhail: Yeah. I, I think naturally what's happening, what's gonna be happening is the teams will shrink

Matt: Yeah, I would, I would estimate that's true

Mikhail: Teams will [00:14:00] shrink and, and it's not necessarily due to offshoring. I think teams will shrink because they'll figure out how to use AI more efficiently, and they will offshore to AI. So like there will be instead of a team of five developers working on a product, there will be a team of two developers and agents, right?

It's, it's in a transitionary phase right now, so there's a lot of data to say that that isn't necessarily the case. But the reason that that data is there, in my opinion, is that the, the AI really hasn't caught up to the capabilities of an offshore team or of a, of a team of junior developer or a team of developers until 2026, and we just don't have that data yet.

So I think we're gonna start seeing 20-- like 2027, Q-Q1, Q2 2027, we're gonna start seeing data that, hey, two developers doing the same task as five developers with a- without agents. We're gonna start seeing that productivity conversation come into play. just from my own experience, this is my own anecdotal experience using it.

But the shift is happening regardless [00:15:00] of whatever we're s- we're talking about. There's going to be less supply of jobs, more demand for jobs. That will drive costs down. it's inevitable at this point. There's still going to be these specific jobs like AI/ML engineering, at least for the next short while, that will be demanding a lot of money because there's a very small amount of people currently that have the expertise to train a model.

but en masse for web developers, for example, yeah, you're gonna start seeing much, like, lower salaries across the board, especially when you're not talking about FAANG. And even in FAANG, I think the salaries will start to fall slowly, or MAANG, whatever you wanna call it now,

Matt: But why, why would you ever have something developed here for more money? Justify, justify paying more

Mikhail: Well, justify paying more is someone that you can trust. That's it. Someone that's been referred to you, someone that's, someone that's gone to a college that...

Matt: hopping on a plane is

Mikhail: Yeah, yeah, g- that you can go to, yeah, yeah, that's [00:16:00] gone to a college that you recognize that's, uh, you know, done X, Y, and Z on- for companies that you know

Matt: that's coming into the office every day

Mikhail: Sure, yeah.

Exactly. Just some, yeah, there, there, there is going to be a demand for that, there's no doubt. Like, that's always been the case, right? that's not going away, in my opinion. Like, you're not ... People aren't just gonna all of a sudden wholeheartedly just trust offshoring 100%. some offshoring works great, some doesn't.

And that's the same thing with onshoring. Like, you know, you hire an employee, they could be bad too. But, like, there is th- there is this bias towards employees that are part of your area. Like, that's still, that's still, there's still a positive bias for, like, local employees. And it's the reality

Matt: that almost enters the conversation of whether you should work from home. 'Cause effectively if you can work from home, then you may as well... There's an argument there, and th- this isn't my argument, but the argument there is that if you can work from home, I may as well get someone cheaper that is [00:17:00] working from their home wherever it is in the world

Mikhail: Correct. That's true. And, and, and everyone that I've talked to that's looking for a job is saying that the work from home jobs are far and few between.

Matt: Yeah, they're gone

Mikhail: Yeah, they're pretty much the... Not, not gone, gone, but like they're very, very hard to find. Most startups,

Matt: existed or they've existed

Mikhail: yeah.

Matt: even before the whole

Mikhail: Yeah

Matt: uh, like, I don't know, what, what do you call it? The work from home rush, I

Mikhail: Yeah

Matt: say. The COVID rush. I- of course, like, that brought the conversation

Mikhail: Mm-hmm.

Matt: big time. But before that, five, five years before COVID, 10 years before COVID, there were people working from home.

Mikhail: Yeah. And I, I still think there's way more people working from home now and way more opportunities to work from home now than before COVID. But

Matt: Yeah, I

Mikhail: the, if you, if you look at, like, the, the chart, like if you see a chart, it's probably, like, well below the peak, but somewhere, you know, still above the, the, the, the point of COVID, similar to how jobs are.

Matt: hybrid, but that hybrid

Mikhail: Correct.

Matt: away. You know, three in

Mikhail: Yeah

Matt: then it goes four in office, [00:18:00] two at home

Mikhail: Mm-hmm. So regardless, like yeah, yes, to your que- to your question there, yes, that, that is the case. So if you're, if you're hiring someone remotely, you're probably gonna hire, try to hire someone cheaper.

Matt: Yeah.

Mikhail: Mm-hmm.

Matt: And, but that's a whole other conversation.

Mikhail: Correct

Matt: point of this, the whole, the whole point, I guess, in almost in, in conclusion, is that you can talk in circles around this stuff. I have a theory.

Mikhail: Yep

Matt: evidence to support both. There's evidence to support this.

There's evidence

Mikhail: Угу

Matt: that. It's all, circumstantial evidence, right?

Mikhail: Yes

Matt: do I think that these wages are good for the area and for the country?

No. I'll say that, for sure. That's not, it's, not enough. Maybe if you, if you said you could live anywhere in Canada,

Mikhail: Ja.

Matt: you don't have to go to the office,

Mikhail: Mm-hmm

Matt: uh, but, uh, getting to Toronto is, uh, a hellscape. It's a difficult drive or a very crowded train.

Mikhail: Hit

Matt: it's a metropolitan [00:19:00] area. Obviously, it's gonna be very, very busy.

But it's, uh, a big ask the wages aren't there

Mikhail: I would say it's one of the worst, if not the worst commute in North America. And I've been to LA, so I've been to LA traffic. I've been to New York, and I've been in New York traffic. The things with LA and New York, or especially New York I should say, is their public transit is a little bit more spread out, and you can get to downtown New York a little bit easier than in Toronto.

So our internal public transit in Toronto is actually pretty good. the subway works well. the trams work well. But getting to downtown Toronto from the suburbs is a nightmare of epic proportions. I'm t- like, yeah, if you look, if you look online, you will find evidence of what I'm saying.

Lately has been even worse. People ... [00:20:00] The, the people driving are just insane because I, I think it breaks people. I'll be honest. I've done a year of driving to downtown Toronto at 6:00 AM in the morning every single day, and I became a worse person as I did that. And I think it's gotten worse and worse over the years, so people are becoming worse and worse, and they just start losing their, regard for other human life while they're driving.

They start doing really crazy shit, and it just ... There's no consequences for it because During rush hour, the police can't do anything 'cause there's no room on, even on the shoulders to, to monitor the traffic. So it's just the worst thing in the world. Like so yes.

Matt: great.

Mikhail: Yeah. There is really noth-

Matt: to downtown Toronto, but I drove to Mississauga, which

Mikhail: Yeah

Matt: a, a city that's directly attached to Toronto. It's

Mikhail: Угу

Matt: you know, a hop, skip, and a jump from Toronto, and I mean, it wasn't great, and

Mikhail: Not good

Matt: in the morning. It wasn't... Thankfully it wasn't 6:00 in the morning or whatever.

I was allowed to come in later, but

Mikhail: Mm-hmm.

Matt: it was still... [00:21:00] It was a dangerous drive. I saw many accidents and almost got hit many times, we have bad winters here in Canada, so not great. But I get it. I know there's gonna be a subset of people out there that are gonna say, "Suck it up. You just commute." And I mean, that's what, that's what we do.

That's what I did, you know? I, I did it.

Mikhail: Mm-hmm.

Matt: So I don't know. That's the web news I think though. let us know your thoughts. I think this is gonna be a charged episode. Again, no dogpiling on Canadian Tire, no dogpiling on OpenTable. This is a, a conversation about, the really the, the careers and the path of this whole industry, of the tech industry just in general really. And, I want your... I wanna know your thoughts about this, and if you, are familiar with, Canada, if you're m- familiar with this area, let us know your thoughts as well, especially 'cause you'll probably have some local insights into Toronto and the cost of living and etc., etc. Please let [00:22:00] us know in the comment section on Spotify.

Uh, I believe there's actually a comment section on Apple. I don't know if that's true. I know Apple had changed the Creator Center recently, but, um, I'm uninformed in that. I haven't, I haven't logged into that much. But anyway, no more off-topic stuff. the web news. Let us know your thoughts. We're signing out

Mikhail: Goodbye