If you are a software engineer, software developer, or coding engineer looking at a career in software development, you’re probably interested in what the top tech companies are paying. Today we’ll explore the compensation software developers receive at one of the most renowned FAANG companies in the world – Amazon.
Growing from an online bookstore to an “everything” store that puts its customers first, Amazon is constantly evolving and innovating through its teams of software engineers. Additionally, the tech roles at Amazon are also constantly progressing to match new markets and skill requirements.
In this article, we’ll look at the various software developer roles in Amazon and their respective pay averages. These are the topics we’ve covered:
Every role in the corporate framework of Amazon is associated with a level. This level is determined based on two parameters:
After taking into consideration both the parameters mentioned above, a level from L4-L7 is allotted to the designation of the candidate. Here are the main job titles in the compensation hierarchy when it comes to software development engineers:
Associate Software Development Engineer 1 (SDE I, Level 4)
An SDE-I is a new hire with around 1-3 years of experience. Most corporate positions at Amazon begin at Level 4.
Software Development Engineer 2 (SDE-II, Level 5)
SDE-II is an individual with 3-10 years of experience; this includes experience with large codebases.
Software Development Engineer 3 (SDE-III, Level 6)
This level is achieved after completing at least 8-10 years of experience in the field of Software Development. The individual at this level should have led at least one important project.
Principle Software Development Engineer (Level 7)
An individual who begins a career at Level 4 at Amazon rarely reaches this position. This level is reserved for people with 10-15 years of experience.
The salary structure of a software development engineer at Amazon can be divided into three components:
The estimated salaries for each level have been taken from Levels.fyi.
At Amazon, the compensation of an employee is based on their level. For example, a senior software development engineer at Amazon would be at Level 6 and would earn an estimated salary of around e $300K per year.
As a software development engineer at Amazon, you’re entitled to earn Restricted Stock Units (RSUs). Every FAANG company has its own way of compensating its employees through stocks and shares. This is a part of the total compensation that an individual receives.
At Amazon, the RSUs are subject to a four-year vesting schedule, so you’ll have to work at the company for a number of years before you can cash in your stock,
With every passing year, the vest will increase. In the first year, 5% of the stock will vest, whereas, in the second year, 15% will vest. In the third and fourth years, 40% of the stock will vest, respectively.
In addition to the senior software development Amazon salary, employees are also eligible for various added benefits that Amazon has to offer. Amazon provides its employees with benefits worth approximately $5,400. These benefits can be broadly classified into three categories:
Amazon has company shuttles, regional transits, and in case the mode of transport provided by the company isn’t sufficient, then Amazon even provides transport allowances to its employees.
Some of the insurance policies provided by Amazon include:
Onsite wellness benefits:
Employee leave policy:
Amazon also contributes $500 to the employee savings count.
Amazon offers a relocation bonus of $700
A thing unique to Amazon is, they offer a Mega Backdoor Roth IRA. The company allows the employee to contribute 10% of their pay towards the after-tax portion of the 401K plan. Employees also get:
The total compensation earned by a software development engineer varies according to the location and years of experience in the technological field.
This is not an all-inclusive list; Amazon has many more locations all across the United States.
As compared to the average salary earned by a level 6 senior software development engineer in other locations, the annual income of an employee working in the headquarters is substantially higher.
A great way to decide if the compensation offered by Amazon is the best in the field is by comparing the salary offered by Amazon with two other leading tech companies — Microsoft and Google.
Entry-level Compensation Comparison
The compensation offered by Amazon to an entry-level Software Development Engineer is $151K, whereas, for the same position, Microsoft offers $162K, and Google offers $180K.
Second-level Compensation Comparison
The compensation offered to a Level 2 Amazon Software Development Engineer is $206K, whereas Google offers $256K and Microsoft offers $176K.
Third-level Compensation Comparison
The compensation offered to a Level three Amazon Software Development Engineer is $305K, whereas Google offers $343K and Microsoft offers $221K.
So, if you are looking to join a company for a good pay scale, Google should be your target. However, if growth is what you wish to achieve, Amazon will be a perfect fit for you.
Whether you are starting a new position or are expecting a promotion, or are relocating, salary negotiation is going to be a crucial aspect of the process. There are few points to keep in mind while politely negotiating for a salary you deserve:
Signing bonuses offered by Amazon are extremely luring, so if you really think you deserve much more than what is offered, you can politely negotiate.
Feel free to check out our blog on Salary Negotiation Tips to learn about some of the common mistakes made during the process of salary negotiation and how to avoid them. Also, check out Highest Salary earned by a Software Development Engineer at FAANG companies.
The only way to ace any of the FAANG company interviews, be it for the post of software engineer, software developer, or tech lead, is by adopting a smart strategy. The strategy can be devised only after understanding the technical interview process. After that, the following points can be considered:
The only way to successfully follow the mentioned points is to have a well-planned course.
If you are preparing for a tech interview, check out our technical interview checklist, interview questions page, and salary negotiation ebook to get interview-ready! Also, read How hard it is to get a job at Amazon, How to get software engineering Jobs at Amazon, and How to prepare for Amazon On-site Interview for specific insights and guidance on Amazon tech Interviews.
Having trained over 6,000 software engineers, we know what it takes to crack the toughest tech interviews. Since 2014, Interview Kickstart alums have been landing lucrative offers from FAANG and Tier-1 tech companies, with an average salary hike of 49%. The highest ever offer received by an IK alum is a whopping $933,000!
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