Paying Up for Tech Talent in China: Is the Tech Boom Pushing Wages Up to Silicon Valley Levels ?

As an early stage tech investor with limited capital to deploy, I pay close attention to the market for technical talent. Cash burn per technical headcount, especially for young startups that have no or limited revenue, is one of the most important factors in determining how many months or “runway” a company has before it has to raise more capital, or more likely, shutter its doors. For those who can break through the language and cultural barriers, China used to be touted as a place for “cheap talent,” and I wanted to see just how much that remained the case in 2015. As it turns out, while China remains much cheaper than Silicon Valley at the junior levels, it is no longer (and hasn’t been for quite a few years), the low price leader for technical talent overall. In fact, even at the middle levels, compensation in China can now be on par with that in the Valley, at least on a before-tax cash basis.

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