The Phenomenon of "Overpaid" Talent in the Indonesian Technology Startup Ecosystem

It is common knowledge that not a few startups offer a fairly large salary for a number of areas of expertise. Software Engineer for example, is the type of work that is synonymous with high-paying startups.

Not only engineer, some talents in other skills did not escape the lure of big salaries. All of this can not be separated from the combination supply-demand Human resources are still biased and a startup operating culture that emphasizes rapid growth when compared to traditional companies.

Lately there has been a problem that can be seen from the startup's habit of giving exorbitant salaries to its employees. First, when funding sources dry up, layoffs can happen quickly. Second, their high salaries in the past can make it difficult for companies to recruit these talents because they are considered far above the average they can afford.

It wasn't long before the budget hotel startup, OYO, got into this conversation after fired thousands of employees they are in India, China, also in the United States. Similar official announcements have not been heard from their operations in Indonesia. However, rumors about it have been circulating on social media.

We talked to some people from the office headhunter to find out more about whether it is true that startups deserve to be "blamed" for the HR label that is too expensive so that it is considered "damaging the price".

Resource scarcity

David Wongso, who works as Managing Director of Transsearch International, a human resource recruitment company, said the first thing to understand is the availability of human resources has not kept pace with the growing number of startups in Indonesia at least until 2030. Not only startups, the wave of conventional companies digitizing their business also adds to the imbalance in the demand and supply of digital talent.

Another factor that David found is that the lean structure of startups often causes a number of personnel to experience a relatively faster jump from junior management level to senior management. So, according to David, it is not surprising that such a large gap has caused the remuneration of a number of human resources to swell.

"Some of them get leapfrog promotion skip the ladder middle management ke senior management," said David to DailySocial.

Rendi--not his real name--is an alumni Gojek with expertise in marketing. alumni status Gojek managed to pave the way to join other startups. Although it's not exactly what David said, Rendi managed to leapfrog the middle level management when he moved to another startup.

Rendi agrees with startup habits that are willing to spend large amounts of money for the desired HR remuneration. However, it does not apply at all levels and places. According to Rendi, where he previously worked, fantastic remuneration only occurred at the senior management level, but not at the junior and middle levels.

"Example yes entry-level marketing which is still a strategic category, that Offeringit's pretty low. But marketing which for example Head or VP or whatever can be really big because there are too many hijack from big companies," said Rendi.

High demands

Another story comes from Haryotomo Wiryasono who works as a senior consultant at Glints, a recruitment platform. Haryo confessed the term overpaid for talent from startups is still debatable.

According to Harry, the demands and workload of startup personnel are the main causes the pay they receive is very high. Investor pressure to achieve the targeted growth and impact has resulted in the extra work of startup retainers. This is different from the conventional corporate business model which focuses on profit and long-term survival of the company even though the result is slower growth.

"They don't have the privileges of conventional companies. While we know that one of the oldest startups we know, such as Facebook, is still in its teens, but the impact has been huge," he explained.

The three people above acknowledge that startup culture influences the workforce climate. Haryo admitted that he received a story from his client that the price tag for labor from startups was too expensive. Rendi in his new place failed several times to land talent from well-known startups because his salary standards were quite different.

However, David, who has worked in the HR recruitment sector for a long time, said that the high price tag is not always sweet. The high price tag will be a burden for the workers when they are not able to meet the expectations of their price tag. In the end, the exorbitant salaries for digital talents who have worked in startups can be justified if they succeed in bringing their expertise, which is actually increasingly needed by many companies.

"Of course, digital talents who are selected and dropped from startups, when they return to work in large companies, must be able to adapt to the unique culture of the company. If they overpaid and have no ability leadership and managerial, it will be an obstacle for them," concluded David.