Wouldn't the neutral solution be to pick a target standard of living (roughly approximated by something like a 75th percentile market rate salary, or whatever metric you chose) and pay that for any given location?
I'm aware of several teams that have done this with success in the past. Everybody, no matter their region of choice, gets compensation enough to enable an appropriately comfortable standard of living desired based on the actual costs of living where they choose. This is what we're talking about when we advocate for adjusting salaries for COL. It creates incentive for your employees to live where they actually want to live, work, and be happy - rather than wherever they feel like they can extract the most cash value from the company.
To be clear, I'm not opposed at all to remote work - but it feels weird to me to ignore cost of living where your people are when setting their compensation if you aren't deliberately trying to incentivize people from (or relocating to) low-COL areas.
I totally agree, and am trying to balance my desire to preserve my career and standard of living with what - logically - makes so much sense.
I previously worked for an all-remote team that, over time, shifted from mostly within the US to HQ'd within the US on paper, but with just a few employees left in the country. When I left to take a local job, the guy who replaced me in Latin America was every bit as talented an engineer and tech leader, but for less than a third of the cost to the company compared to what I was making in NYC.
I get the feeling a lot of people are looking at this as their first step towards more tech jobs in cheap parts of the US, but the reality will probably end up as more tech jobs offered to people from much cheaper parts of the developing world - also a great thing... but with potential impact to those of us in the country if wages move faster than COL does.
My justification for finding my walkable community in one of the only places it exists in the US was always high wages, but if that changes, there's little reason to not pursue parts of western europe with a much better social climate and lower wages - but also lower wages. Who knows what will happen post-pandemic though, and how much of this will stick outside of a few SV companies.
I'm basically operating with the assumption that with the expansion of programs like this, enough tech workers would be willing to leave high-COL tech labor markets to reduce the average tech worker pay nationally as NYC/SF are no longer hyper-competitive, but not so many as to meaningfully reduce the cost of living in those areas, especially in NY where the COL is driven by many other industries.
The end result (as I'm imagining it) would be that these new national-average tech salaries can still provide a very comfortable living in low-COL areas, but are no longer comfortable in high-COL areas.
Posting from a throwaway since I use my real name (and reference my employer) on my primary account...
Is nobody else worried that policies like this are going to end up penalizing workers who genuinely prefer living in an urban, high-COL area? I'm not sitting here in Brooklyn eagerly awaiting a chance to move to a cheap giant home in the suburbs - I genuinely like walkable communities, and moved to one, and found a job there which paid me enough to justify the high COL.
This feels like a regression-to-the-mean sort of move, where the net effect over time will be all tech salaries becoming reduced as the labor pool spreads to cheaper areas and the national average market rates become depressed. It'll be great for those who genuinely like living in small towns in the midwest, they'll probably still be doing well relative to the local average. It'll be horrible for those who genuinely like living in expensive coastal areas - the pressure to move to a cheaper place will be enormous.
(And thats not to say anything about my belief that a lot of low-COL areas afford to be cheap by providing poor social services, which feels like we're diminishing the ability of high-COL areas to apply social pressure to elevate the standard of living of other states and regions...)
Am I thinking about this the wrong way, or are high-COL urban workers going to take a hit here?
I'm aware of several teams that have done this with success in the past. Everybody, no matter their region of choice, gets compensation enough to enable an appropriately comfortable standard of living desired based on the actual costs of living where they choose. This is what we're talking about when we advocate for adjusting salaries for COL. It creates incentive for your employees to live where they actually want to live, work, and be happy - rather than wherever they feel like they can extract the most cash value from the company.