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Your salary might be based on your home address…

Average Google salary by title and by location. Based on some leaked information it would seem that salaries will also depend on the location of your home base if you opt for remote working…. Image credit: Quora

That salary levels vary from Country to Country and within a Country is no surprise. The cost of living and availability of skilled resources determines the average salary. If I live in city other than Milan and Rome in Italy the cost of lodging is way lower than the one in London or San Francisco. If a company is hiring me to work in San Francisco I would need a salary that is way higher than the one I need in Turin.

What is emerging in this post pandemic era is that remote working is much more common and once you are set for remote working you can basically work from anywhere. I could stay in Turin and work for a company in San Francisco.  Clearly, if I need to be at the office every few days, say twice a week, than it would be impossible to operate remotely that far away. But I could surely live in Sacramento and commute twice a week to San Francisco. That makes my lodging way cheaper than having an apartment in Menlo Park.

And yes, this is what is happening, to the point that real estate in what used to be high value locations is plummeting as people are opting for remote working.

It is not just real estate that is taking notice of the different way of life – way of working. A few companies are trying to negotiate the convenience of remote working with a salary cut. Rumours have it that Google is considering pay cuts up to 25% for people working away from their office, depending on your home address. If your office is in NY and your home is in NY than working from home will not put a dent on your pay check, but if your home is on the other side of the Hudson, depending on the place you might see a reduction on your salary.

Does it make sense? Yes and No, I guess. Remote working is opening up a can of worm. Once you are (as a company) set to be profitable with remote working your hiring market becomes the whole world. You can get people from India, actually “in India” and have them part of your teams. All of a sudden competition for a job becomes worldwide and this is going to favour those companies that are set (have processes) to use remote working, those market places that today are in developing Countries where offer exceeds demand and at the same time is going to decrease the negotiating power of workers whose main advantage was to live in the area of the companies seeking their skills.

Once this shift will be complete the salary will return to be based mostly on skill, on the value you can bring to the company. Location will be completely irrelevant.

We are going to find some significant changes in the world market in the coming years.

About Roberto Saracco

Roberto Saracco fell in love with technology and its implications long time ago. His background is in math and computer science. Until April 2017 he led the EIT Digital Italian Node and then was head of the Industrial Doctoral School of EIT Digital up to September 2018. Previously, up to December 2011 he was the Director of the Telecom Italia Future Centre in Venice, looking at the interplay of technology evolution, economics and society. At the turn of the century he led a World Bank-Infodev project to stimulate entrepreneurship in Latin America. He is a senior member of IEEE where he leads the New Initiative Committee and co-chairs the Digital Reality Initiative. He is a member of the IEEE in 2050 Ad Hoc Committee. He teaches a Master course on Technology Forecasting and Market impact at the University of Trento. He has published over 100 papers in journals and magazines and 14 books.