What is the salary range of Software Engineers in London?

By Abdul Muhit | Oxford Knight

 

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Short answer:

This question is the wrong question to ask if you want to know as an individual what you might be able to earn in London.

Form what I’ve seen London salaries varies dramatically depending on what sector you work, who you work for, your ability, and the nature of your employment contract (perm or consultancy).

Therefore, in order to gauge what you might be able to earn as an individual the question here should be sliced into many sub-questions such as what can I earn at a series A start-up as a ful-stack engineer in London vs SFO? What can I earn as a x10 engineer in London vs SFO? etc.

Nevertheless, my short answer is London pays very well and sometimes more than SFO for a good software engineer (what I mean by “good’ someone who can pass the interview process at Google, Facebook) and a x10 Software Engineer (someone who can pass the interview at companies with a super high bar MemSQL, Palantir, Dropbox, Quora).

Long answer:

Industry:
London (similar to NY) has multiple industry offering in a sense that you have the choice of working for big tech firm Google, Facebook, Twitter etc, some really cool start-ups, or tech-driven funds most of whom are based in and around a 3 mile (5 kilometre) radius. However, the compensation structure for these three environments differs significantly and comparing salary between these different industries is hard let alone against another geographical area such as SFO with a different job market make-up; nevertheless, I shall try.

Cash plus Bonus terms:
Vladimir Novakovski does a great job of outlining how salary structure differ in finance vs tech companies – Career Advice: I just turned 23 and make around $300k working on Wall Street. Could I make this in Silicon Valley if I was looking to make the switch?

In finance it is very normal to be paid a healthy base salary but also gun for a strong bonus based on your performance that can be a multiples of your base cash salary.

Over the past 10 years I’ve seen some jaw dropping bonus earnings by x10 Software Engineers at tech-driven funds that have a hiring bar as high as Jane Street. A few guys I know of have earned north of $1.5m in the HFT space back in 2010. These days those number are not being banished around too often, but it’s still not unheard of to hear a x10 software engineer earning circa £110,000 ($180,000) as a base and £100,000-£200,000 ($165,000 – $330,000) as a bonus. I must stress, these are not bankers I am talking about. These are pure software engineer who code and learnt about finance on the job. They remain hands on and are not necessarily doing anything too quantitative.

Overall it is here in capital markets that I believe a software engineer in London can can earn more than an engineer in  SFO.

From a cash plus stock perspective: 

I am lucky enough to work with a some amazing start-ups working on hard problems that I hope we will disrupt a few sectors in the future. I am also hopeful one day that london we will have its own Facebook equivalent IPO.

However, (I feel like a national traitor saying this) if your looking to make it big on stocks the Bay Area’s past history/recent history, it’s fertile grounds for entrepreneurialism, great VC’s, and baring another Armageddon makes the upside of your stocks a safer bet in SFO than London.

Overall, it is here on the stock option side that I feel that an engineer in SFO is likely to earn more than an engineer in London.

From a pure cash perspective:

For those concerned with pure cash earning (what actually lands in your bank after tax on a month to month basis) I feel that London is on par with SFO if not better placed for a Good or x10 engineer.

Here in London a good — x10 software engineer can expect to earn £100,000 – £130,000 ($165,000 – $215,000) as a software engineer on a perm employee basis working for bank or a tech company.  This does not have to involve being a middle manager, but you may have some technical leadership at the top-end of the salary bracket I’ve outlined.

However, one area that I have to cover that I am not familiar with when it comes to SFO is the consultancy space.

Consultant Software Engineer (those that have 6 – 24 month term) in London (JavaScript, Scala, Java developers) can earn a lot.

I’ve recently dealt with a Java high performance software engineer earning a rate of £1600 ($2600) a day. No domain experience, just an optimization expert. I’ve also seen solid Scala Developer at a rate of £800 ($1300) a day. What makes these London contract rates for the right person so astonishing is that it’s all taxed at a much lower rate of only circa 20%.

So to sum up, for good software engineer (someone who can pass the interview process at Google, Facebook etc.) and a x10 Software Engineer (someone who can pass the interview at companies with super high bar MemSQL/Palantir/Dropbox/Quora) London salaries is higher in cash+bonus terms, maybe pure Cash terms….but may not be in cash/stock terms.

By Abdul Muhit
Linked In: Abdul Muhit – United Kingdom
Email: abdul.muhit@oxfordknight.co.uk
Website: www.oxfordknight.co.uk

 

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