No matter how serious the monthly salary is 40,000 yuan, it will not become 120,000 yuan. From the business model, explain why the salary difference in each industry is so large?

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I know many designer friends who complain that the salary of an engineer is so high that they will never be able to get it in this life. An entrepreneur also said: “A person with a monthly salary of 40,000 can earn 50,000 if he is serious, and a person with a monthly salary of 100,000 can earn 120,000 if he is serious, but no matter how serious the monthly salary is 40,000, it will not become 120,000 .Their difference is not in seriousness, but in the industry.”

Many people like to say that the difference in salary is due to differences in educational qualifications, schools, and entry thresholds, but in fact, this cannot explain the reality at all. It is also a technology company. Those who often go to private universities of science and technology also become big managers. Even Wang Yongqing only went to elementary school. Compared with a bunch of doctors who are unemployed, how could it be education or the school that determines the salary?

Likewise, the barriers to entry are wrong. In 2014, many people went to the United States to study for a master’s degree in AI. It took only two years to go from being almost ignorant of programming to becoming a technology upstart in Silicon Valley. In comparison, a sushi chef has to train rigorously for 10 years, is the salary higher?

Here is another perspective for everyone to explain, using a business perspective to explain why salaries in different industries vary so much:

  1. different business models
  2. Can the value be proven

Salary explained in terms of business model

Here I would like to talk to you about two very important points in the business model – “reproducibility” and “value of the product itself”.

 

  • Reproducibility

Let’s take a look at the examples of AI engineers and sushi chefs respectively.

Today, a software technology company, let’s take Google as an example. In order to create a recommendation function on YouTube, they hired a group of AI engineers to handle it. At this time, if a group of AI engineers need to spend 1 million US dollars a year to build, an excellent video recommendation function may make Google earn 10 million US dollars a year in the United States, and it may earn 100 million US dollars in the world. But the same is the video recommendation function, which will not be changed because it is used in the United States or the world.

In contrast, a sushi chef has worked hard for 10 years to become a chef who can be his own, so he can make a turnover of 10 million Taiwan dollars a year. But when this restaurant wants to open a branch in order to earn more money, hey, sorry to hire another sushi chef.

The output of a sushi chef is limited, and the programs written by the AI ​​engineer software have no upper limit for use. Therefore, the sushi master is a marginal cost for this sushi restaurant, while the AI ​​engineer is a fixed cost.

Marginal cost means that the more you sell, the more you spend, but the fixed cost is the same no matter how much you sell, so as long as the company has a large turnover, it doesn’t matter if the fixed cost is higher, because it will be diluted anyway. And if the marginal cost is high, no matter how much you earn, you will not earn much. That’s why.

 

  • The value of the product itself

This time, I will take the case of a doctor and a sushi chef as an example.

Physicians can only see one patient at a time, and sushi chefs can only make one sushi at a time, and their reproducibility is almost zero. However, if you want to eat good food today, how much are you willing to spend on sushi? Conversely, if you seem to have a heart problem today, how much would you like to spend to see a doctor?

This is what needs/pain points the product itself hits. The greater the demand and the more painful the pain points, the greater the value of the product/service itself, and the more profitable people in this industry will naturally be.

 

Can Value Be Proven to Explain Salary?

This time take graphic designers and engineers as an example.

For a software company, it is assumed that a product has no wrong development direction (that is, someone wants to use it). At this time, people buy you or other products because the product is not well done, and this depends entirely on the customer. engineer.

In contrast, does a product sell well because of a good graphic design? In fact, we have no way of knowing for sure, or at least, we can attribute some of it to graphic designers. But it’s still because the product itself is easy to use, the market is right, the marketing is right, etc. A lot of people are doing well, but no one knows.

If the person hired is not a key person, if you are the boss, you would not want to spend a lot of money on him, right?

This is why many designers receive a salary similar to that of an artist, because an artist can see and touch it, but it is difficult to prove a good design. At this time, how can the boss be willing to spend several times the salary of an artist to hire a designer?

It’s not that the boss is stingy, let’s come back and look at our daily consumption logic.

Many people spend 30,000 yuan to buy an iPhone, but you have never heard of someone spending 30,000 yuan to buy a poster with a super beautiful design, right? Because the value is different. Switching from Xiaomi to iPhone may make life happier, and a super beautiful poster hanging in the room can also make life happier every day, but the difference is the difference, right?.

 

summary

Going back to the original sentence, no matter how serious the monthly salary of 40,000 is, it will not become 120,000. This is a difference in the industry.

Different industries mean that you use different business models and create different business values, so the value of your work is also different.

In addition, it is also important to choose a position among your peers. The salary of a research and development engineer is often higher than that of a quality assurance engineer. After all, whether the quality is good or not, the difference is 80% or 100%, but whether the research and development is in charge of 0% or 100%. This influence is self-evident.

This is also the application of the product/service value mentioned earlier. Looking at it from these two perspectives, you should know why some jobs are very profitable, while others are difficult.

 

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