alt Hacker News> That means each employee's AI spending cap is ~11% of that median compensation package.
Probably better to use the fully-loaded cost of the engineer, which is much higher than their compensation package. The fully-loaded cost is the total cost paid for the labor power of the engineer, and it includes big ticket items such as office space, food, equipment, insurance, payroll tax, fringe benefits, recruiting costs.
If the median compensation package is $330k/year then the median fully loaded cost is probably around $450-500k.
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Both metrics are valuable.
If one uses AI minimally and is able to out perform peers who are maxing out AI spend, one might want to use that in salary negotiations.
I’ve even heard the rule “twice the salary” being used here in EU, but the tax and insurance burden may be higher. All kinds of those are based primarily on total payroll amount.
"$330k/year" Lol. I thought I clicked on hacker news 2022.
It’s also worth noting that’s the peak benefit. Expect most engineers to not hit those limits on the regular (if at all, since limiting this puts skills in focus again), and that limit to come down over time as the easy processes are automated and humans are re-tasked with harder problems relative to their TC.
This is not a good bellwether for the AI industry, including its adherents. Their growth assumed a level of indispensability that’s not being reflected in hard numbers and real costs, which lends credence to the notion that these IPOs being fast-tracked are meant to try and cash out before the bubble really pops in earnest. There’s no way consuming enterprises are going to pay such insane costs for such minimal uplift in the long run, and the AI companies can’t keep offering subsidized tokens via subscription plans at their current pricing.
My usual rule of thumb for the US is north of double the received compensation but something in that range sounds reasonable with such high compensation. It's actually really interesting and underappreciated how that fully-loaded cost varies from country to country. Canada (for most salary ranges) is about half again instead of double owing to the insurance portion coming out of income tax rather than being a hidden expense so Vancouver ends up being attractive for trading 160k USD for like 120k CAD in compensation and then also lowering overhead from 100k USD down to like 60k CAD. The savings can be extremely dramatic.