The Tech Industry’s Darkest Secret: It’s All About Age

Tech Industry loves youth

They don’t prepare you for this in college or admit it in job interviews. The harsh reality is that if you are middle-aged, write computer code for a living, and earn a six-figure salary, you’re headed for the unemployment lines. Your market value declines as you age and it becomes harder and harder to get a job.

I know this post will provoke anger, outrage, and denial. But, sadly, this is the way things are in the tech world. It’s an “up or out” profession — like the military. And it’s as competitive as professional sports. Engineers need to be prepared.

This is not openly discussed, because employers could be accused of age discrimination. But research, such as that completed by University of California, Berkeley, professors Clair Brown and Greg Linden shows that even those with masters degrees and Ph.Ds have reason to worry.

Brown and Linden’s analysis of Bureau of Labor Statistics and Census data for the semiconductor industry revealed that although salaries increased dramatically for engineers in their 30s, these increases slowed after the age of 40. After 50, the mean salary fell by 17% for those with bachelors degrees and by 14% for those with masters degrees and Ph.Ds. And salary increases for holders of postgraduate degrees were always lower than for those with bachelor’s degrees (in other words, even Ph.D degrees didn’t provide long-term job protection).

It’s the same in the software industry. Prominent Silicon Valley investors often talk about youth being an advantage in entrepreneurship. If you look at their investment portfolios, all you see are engineers who are hardly old enough to shave. They rarely invest in people who are old.

It may be wrong, but look at this from the point of view of the employer. Why would any company pay a computer programmer with out-of-date skills a salary of say $150,000, when it can hire a fresh graduate — who has no skills — for around $60,000? Even if it spends a month training the younger worker, the company is still far ahead. The young understand new technologies better than the old do, and are like a clean slate: They will rapidly learn the latest coding methods and techniques, and they don’t carry any “technology baggage.” The older worker likely has a family and needs to leave the office by 6 p.m. The young can easily pull all-nighters.

What the tech industry often forgets is that with age comes wisdom. Older workers are usually better at following direction, mentoring, and leading. They tend to be more pragmatic and loyal, and to know the importance of being team players. And ego and arrogance usually fade with age.

During my tech days, I hired several programmers who were over 50. They were the steadiest performers and stayed with me through the most difficult times.

It can be difficult for some companies to justify paying the age premium. For tech startups in particular, it always boils down to cost: Most can’t even afford to pay $60,000 salaries, so they look for motivated, young software developers who will accept minimum wage in return for equity ownership and the opportunity to build their careers.

We can blame the employer, but in a free economy you can’t really force any company to hire workers who have the wrong skills or to pay higher salaries. Larger companies develop products for global markets and have global workforces. They will hire where they can get the best skill for the best price.

So, whether we like it or not, it’s a tough industry, and the onus is on employees to keep themselves marketable. I know that many people will take offense at what I have to say, but here is my advice to those whose hair is beginning to grey.

  • Move up the ladder into management, architecture, or design, and diversify your experience. Work with business executives in your company, in areas such as sales, finance, marketing/product management, legal, and operations. Develop a broader set of skills that make you more valuable to your employer and that differentiate you from others with just coding skills.
  • Become an entrepreneur. Despite what some investors say, older age is an advantage in the startup world. You know more about industries and markets, and have ideas for products that the world actually needs and a better ability to motivate and manage than a kid out of school does.
  • Keep your skills current. This means keeping up to date with the latest trends in computing, programming techniques, and languages, and adapting to change. To be writing code for a living when you’re 50, you will need to be a rock-star developer and be able to out-code the new kids on the block. Top developers are always in demand and companies will readily pay top dollars for them.
  • If you’re going to stay in programming, realize that the deck is stacked against you. Even though you may be highly experienced and wise, employers aren’t willing or able to pay an experienced worker twice or thrice what an entry-level worker earns. Save as much as you can when you’re in your 30s and 40s, and be prepared to earn less as you gain experience.

Finally, I don’t know of any university, including the ones I teach at, that tells its engineering students what to expect in the long term or how to manage their technical careers. Perhaps it is time to let students know what lies ahead and prepare them for their difficult careers.