- 1.Staff/Principal ICs often out-earn equivalent-level managers at Big Tech ($210K-$400K+ vs $200K-$350K) (Levels.fyi 2024)
- 2.Management provides faster career progression but lower ceiling; IC track is slower but extends higher
- 3.At Director+ level, management compensation catches up and can exceed IC through larger equity grants
- 4.The 'manager tax'—lower TC for management responsibility—exists at L5-L6 levels at most companies
- 5.Both tracks lead to $300K-$500K+ TC; the right choice depends on interests, not money
Manager vs IC Salary Overview
The relationship between management and IC compensation defies intuition. At most Big Tech companies, Staff Engineers out-earn Engineering Managers—the 'manager tax' is real. The compensation picture only equalizes at Director level and above, where managers gain access to larger equity grants.
Staff Engineer vs Engineering Manager
Equivalent-level comparison at Big Tech
Staff Engineer (L6)
Median Annual Salary
Engineering Manager (M1)
Median Annual Salary
The Manager Tax Explained
The 'manager tax' refers to the phenomenon where first-line engineering managers earn less than Staff-level ICs despite having more organizational responsibility. This exists because: 1) Technical ICs at Staff+ level are rare and command premium, 2) Management has more candidates (many people want to manage), 3) IC tracks compensate for limited career advancement options.
Source: Levels.fyi
Compensation by Level
Here's how compensation compares across the two tracks at Big Tech companies.
IC vs Manager Compensation (Big Tech)
| IC Level | IC TC | Manager Level | Manager TC | Gap |
|---|---|---|---|---|
| Senior (L5) | $280K-$380K | — | — | IC only at this level |
| Staff (L6) | $350K-$500K | EM (M1) | $300K-$400K | IC +10-15% |
| Senior Staff (L7) | $450K-$650K | Sr. EM / Manager of Mgrs | $380K-$500K | IC +15-20% |
| Principal (L8) | $550K-$800K | Director (D1) | $450K-$650K | IC +15-20% |
| Distinguished (L9+) | $700K-$1M+ | Sr. Director / VP | $600K-$1M+ | Converging |
Source: Levels.fyi 2024
Career Ceilings: IC vs Management
Both tracks can reach very high compensation, but through different paths. IC track has higher ceiling for pure technical contribution; management track has larger scope and eventually higher ceiling at executive level.
Career Ceiling by Track
| Track | Top IC Title | Top IC TC | Top Mgmt Title | Top Mgmt TC |
|---|---|---|---|---|
Distinguished (L10) | $1.5M+ | VP | $2M+ | |
| Meta | E9 | $1.2M+ | VP | $1.5M+ |
| Amazon | Distinguished (L10) | $1M+ | VP | $1.5M+ |
| Microsoft | Technical Fellow (70) | $1M+ | CVP | $1.5M+ |
Source: Levels.fyi, public company data
Staff+ Engineers at Big Tech
The percentage of engineers at Staff+ level has nearly doubled as companies formalized IC career ladders. This expansion increases opportunities to stay technical while earning $300K-$700K+ TC.
Day-to-Day Differences
Beyond compensation, the roles involve fundamentally different work.
Solves the hardest technical problems. Leads through influence, not authority. Sets technical direction and mentors other engineers. Can spend significant time in deep work and coding. Impact through technical artifacts.
Key Skills
Common Jobs
- • Staff Engineer
- • Principal Engineer
- • Distinguished Engineer
- • Fellow
Responsible for team health, delivery, and people development. Conducts 1:1s, handles performance reviews, does hiring. Shields team from organizational chaos. Less coding, more meetings. Impact through people.
Key Skills
Common Jobs
- • Engineering Manager
- • Senior EM
- • Director
- • VP Engineering
Lifestyle Comparison
| Factor | Staff+ IC | Engineering Manager |
|---|---|---|
| Meetings per week | 15-25 hours | 25-40 hours |
| Coding time | 20-50% | 0-20% |
| 1:1s responsibility | Mentees (optional) | Direct reports (required) |
| On-call for people issues | No | Yes (always) |
| Hiring responsibility | Interview, don't own | Own end-to-end |
| Promotion criteria | Technical impact | Team/business impact |
Source: Industry analysis
Switching Between Tracks
Modern tech companies support bidirectional movement between IC and management tracks. Switching is common and often encouraged.
Track Switching Considerations
IC → Manager transition
Common path. Many companies offer 'tech lead manager' roles as bridge. Expect temporary pay cut relative to Staff IC peers. Build people skills gradually before committing.
Manager → IC transition
More difficult but possible. Technical skills may have atrophied. Usually involves a level adjustment (Director → Staff, not Principal). Best done within same company where your reputation carries.
Pendulum approach
Some senior engineers alternate: IC → Manager → IC → Manager. Builds broad skills. Each switch has cost, but diverse experience is valuable. Works best at companies with strong dual-track culture.
Try before committing
Most companies let senior ICs 'try' management: lead a small team temporarily. If it doesn't fit, return to IC without stigma. Take advantage of this to test interest.
Which Track is Right for You?
The right track depends on your interests and energy sources, not compensation (which is similar at high levels).
Decision Framework
| If You... | Choose IC | Choose Management |
|---|---|---|
| Get energy from solving hard technical problems | ✓ | — |
| Get energy from growing people | — | ✓ |
| Hate meetings | ✓ | ⚠ |
| Want to code regularly | ✓ | ⚠ |
| Want broader organizational impact | Possible but harder | ✓ |
| Prioritize highest possible TC | ✓ (at L6-L8) | Higher ceiling at VP+ |
Source: Career analysis
Compensation data from crowdsourced databases filtered by level and role type.
Frequently Asked Questions
Related Articles
Data Sources
Crowdsourced tech compensation by level
Executive compensation disclosures
Taylor Rupe
Full-Stack Developer (B.S. Computer Science, B.A. Psychology)
Taylor combines formal training in computer science with a background in human behavior to evaluate complex search, AI, and data-driven topics. His technical review ensures each article reflects current best practices in semantic search, AI systems, and web technology.