Third decade in a row, Silicon Valley remains the Mecca of the tech industry that allures the best software developers either to work in IBM, PayPal, Apple, Facebook, Google, Oracle, and Logitec or to try their luck developing cutting-edge products for innovative startups like Uniphore, Weee!, and Slintel.
The legend says that the mere residence in Silicon Valley quadruples chances of success but this privilege comes at a high price.
The average engineer salary in Silicon Valley ranges between $85,948 and $174,459, the office rental, taxes, shares, and non-financial benefits add up to the already sky-high price of doing business.
In this article, we’ll explore whether the hustle’s worth the price and learn where to hire top specialists for a reasonable salary outside Silicon Valley.
- Average Engineer Salary in Silicon Valley
- Who Pays the Highest Average Engineer Salary in Silicon Valley
- Supplementary Costs of Hiring Engineers in Silicon Valley
- Look Outside Silicon Valley: Hire Top Talents for Reasonable Price
Offshore Developer Rates Guide
Get outsourcing rates in Eastern Europe, Asia, Latin America, Africa as well as tips on how to choose the country for offshore development.
What Is the Average Engineer Salary in Silicon Valley?
The average engineer salary income in Silicon Valley ranges between $88,000 and $152,000 (according to PayScale).
The average engineer salary in Silicon Valley by years of experience:
- Less than 1 year — $109,622
- 1-2 years — $112,626
- 6-9 years — $128,821
- More than 10 years — $147,585
The Average Salary for People in the San Francisco Bay Area, California, United States (PayScale)
According to SalaryExpert, an entry-level software engineer salary in Silicon Valley starts with $87,896 and can be as high as $155,990 for a senior specialist.
The Average Software Engineer Salary in Silicon Valley (SalaryExpert)
To compare, the average engineer salary in the US is $110,638 (SalaryExpert) with a junior engineer earning around $77,437 and a senior engineer getting around $137,429 per year. The average engineer rate in Silicon Valley is around $60 per hour.
The Average Engineer Salary in Silicon Valley vs Average Engineer Salary in the US (SalaryExpert)
[USA] Calculate Offshore Software Development Costs
Everything you need to know about offshore software development cost structure: direct costs, ad-hoc costs, offshore developer rates, and more.
What’s Average Programmer Salary in Silicon Valley by City?
The average engineer salary in Silicon Valley ranges between $122,797 and $174,459 per year (SalaryExpert).
| Silicon Valley Salary Comparison by City | |||
| City in Silicon Valley | Average Engineer Salary | Average Junior Engineer Salary | Average Senior Engineer Salary |
| Mountain View, Palo Alto, Santa Clara, Cupertino | $140,449 | $98,303 | $174,459 |
| San Francisco, San Mateo, Sunnyvale, Redwood City, Menlo Park, Belmont | $137,792 | $96,443 | $171,159 |
| Alameda | $132,533 | $92,762 | $164,625 |
| Solana Beach | $122,797 | $85,948 | $152,533 |
The highest average engineer salary in Silicon Valley is seen in Mountain View, Palo Alto, Santa Clara, and Cupertino ($98,303-$174,459) and the lowest has been found in Solana Beach ($85,948-$152,533) and Alameda ($92,762-$164,625).
How much does a Software Engineer make in Solana, California? |
How much does a Software Engineer make in Cupertino, California? |
According to Indeed, San Jose ($146,071), Sunnyvale ($145,510), and Mountain View ($139,786) are the highest-paying cities offering the highest average engineer salary in Silicon Valley.
Software engineer salary in San Francisco is one of the most competitive in the world. On average, an engineer gets around $145,851 each year. The average Silicon Valley engineer rate in San Francisco is $60 per hour.
What Are the Cities with the Highest Average Engineer Salary in Silicon Valley (Indeed)?
- San Jose, California — $146,071
- San Francisco, California — $145,851
- Sunnyvale, California — $145,510
- Mountain View, California — $139,786
- Palo Alto, California — $137,662
- Redwood City, California — $127,551
- Los Angeles, California — $112,976
- San Diego, California — $111,819
Cities with Highest Average Engineer Salary in Silicon Valley
What Companies Pay the Highest Average Engineer Salary in Silicon Valley?
Microsoft, Google, Apple, Uber, Facebook, Netflix, eBay, Cisco Systems, PayPal, Yahoo, LinkedIn, SalesForce, and many other world-known tech companies reside in Silicon Valley.
The tech giants fuel the competition and empty the local tech talent market by offering sky-high engineer salaries and significantly increasing the overall price of leading business.
For instance, Netflix pays a senior software engineer an average annual salary of $357,213 that exceeds the national average by 186%.
Meanwhile, in the Apple office in California, software engineer salary can get as high as $176,268 which is 72% higher than the national average.
| Average Engineer Salary in Silicon Valley by Company (Indeed) | |
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eBay 42% Above national average |
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32% Above national average |
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Apple 72% Above national average |
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Uber 54% Above national average |
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56% Above national average |
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Netflix 186% Above national average |
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PayPal Meets national average |
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77% Above national average |
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Amazon 77% Above national average |
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That’s why those hiring engineers in Silicon Valley should be ready to put extra effort to battle the competition by offering competitive salaries and offering compelling non-financial incentives and bonuses.
What Are the Major Extra Costs of Employing Software Developers in San Francisco?
High as the average engineer salary in Silicon Valley can get, the base salary is just the tip of the iceberg.
All of the average engineer salaries in Silicon Valley listed above don’t include bonuses that only on the entry-level positions can generate $8,800-$26,340 of additional income.
Total compensation is comprised of five components:
- Silicon Valley programmer base salary paid on monthly basis and quoted each year.
- Taxes
- Non-financial benefits such as healthcare insurance, car rental, commuter assistance, paid education.
- Cash bonuses get higher with each new level and can generate from 50% to 200% additional revenue of the base salary.
- Stock units and stock options that can be cashed out over time.
What other Benefits Employers Cover in Silicon Valley (Indeed)?
- Stock options
- Commuter assistance
- Visa sponsorship
- Health insurance
- Gym membership
- Food provided
- 401 (K) and 401 (K) matching
- Referral program
- Relocation assistance
- Health savings account
- Vision insurance
If you want to have an office for your team, expect to spend around $80/square foot and 150 square feet per person in San Francisco. The cost of renting an office space amounts to $12,000 per year per person.
Facebook, Google, and LinkedIn have devoured a lot of real estate in Silicon Valley thus driving the prices up and pushing small tech companies to emerging neighborhoods.
To make an empty premise a comfortable office, you have to furnish it with hardware, computers, and other necessary items.
And don’t forget about setting up HR, recruitment, accounting departments, and hiring legal staff.
Consider Hiring Engineers for Reasonable Cost Outside Silicon Valley
In the midst of Covid-19, many companies have proven the efficiency of remote work and telecommuting has blurred the lines between working from one city and different continents.
Many tech startups and SMEs have benefited
from working with remote teams.
So it appears that many companies with headquarters in Silicon Valley like SizeUp Inc. have extended their teams by hiring programmers from growing outsourcing destinations such as Eastern European countries — Ukraine, Hungary, Belarus, and Croatia.
Why did they choose CEE? First of all, because the region
has 1.3 million tech specialists with strong educational backgrounds.
In Ukraine only, there are about 200,000 tech specialists and 450 higher educational institutions that generate 30,000 prospect entry-level specialists.
For
an average engineer salary in Silicon Valley, you can build an entirely dedicated team of vetted programmers, BAs, QAs, PMs, and designers or extend your existing team with tech specialists who already have experience of developing
tech products for foreign clients and will work directly for you.
There are innumerate cases that prove successful experiences of building remote teams and here’s just one of Clutch reviews left by a CTO at a large cybersecurity product company:
“All of the work that they deliver for us is well built and functions very smoothly, so we have been able to entrust them with just as much of our portfolio as our in-house team. Technically, they are the best remote team I have ever worked with in 20 years of experience.”
| Comparison of the Average Engineer Salary in Silicon Valley and Ukraine | ||
| Silicon Valley | Ukraine | |
| Entry-level Engineer | $85,948 - $98,303 | $15,600 - $22,800 |
| Middle Level Engineer | $122,797 - $140,449 | $23,000 - $43,200 |
| Senior Engineer | $152,533 - $174,459 | $44,000 - $60,000 |
The average engineer salary in Ukraine is around $1300 and $4600 per month that amounts to $15,600 and $60,000 which is three times less than the average engineer salary in Silicon Valley for a senior specialist.
The Average Engineer Salary in Ukraine vs Average Engineer Salary in San Francisco
Why Build Remote Teams in Ukraine?
- Moderate developer rates $25 - $46/hour
- Large pool of engineers who use trending technologies (JavaScript, Python, PHP, Java, etc.)
- IT outsourcing companies offer flexible cooperation model
- 68% of Ukrainian engineers have an intermediate and higher level of English
- 47% of developers in Ukraine speak fluent English
Build a Remote Team of Engineers with Daxx
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Daxx provides free of charge recruitment
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Conclusion
Having a presence in Silicon Valley is a privilege that comes with a high price: to keep win over experienced engineers companies have to compete with the tech giants such as LinkedIn, Google, IBM, spend fortunes on renting expensive offices, and offer great social packages.
The main value to the product’s success lies in the people who develop the product which leads us to a conclusion that not every company benefits from having an office and a development team in Silicon Valley.
As practice shows, many tech companies try to optimize development cost by hiring experienced engineers overseas. And it’s only logical that they do so because tech startups and SMEs can hire three high-class engineers in Eastern Europe for a price of one average engineer salary in Silicon Valley.
