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A series of scandals and missteps has damaged Facebook's reputation so much that the company is being forced to pay ever larger compensation to hire and retain workers, according to industry recruiters, former employees, and data reviewed by Insider.

The company has always competed aggressively for talent, and the tech job market in general is on fire. But a deteriorating public image means the social-media giant now has to outbid other major tech companies, such as Google.

"One thing Facebook can still do is pay a lot more," said Jose Guardado, an experienced tech recruiter and the founder of Build Talent. "They can easily throw more compensation at people they currently have, and cover any brand tax and pay a little more to get people to come on."

Silicon Valley companies thrive or whither based on their ability to recruit the smartest employees. Without a steady influx of engineers and other technical experts, new products and important updates take longer to release, and rivals can quickly get ahead. Then there's the financial cost: In 2022, Facebook projected, expenses could jump as high as $97 billion from $70 billion this year, in large part because of "investments in technical and product talent." A company spokesperson did not respond to a request for comment.

Other companies, and even whole industries, have had to increase compensation to overcome hiring and retention problems caused by scandal and shifting public perceptions, said Alan Johnson, a managing director at the compensation consulting firm Johnson Associates. "If you're an oil company, if you make cigarettes, if you're in cattle or Wells Fargo, sure," he said.

How well this is working for Facebook is debatable as the company has more than 4,300 open jobs and has seen decreasing rates of acceptance on job offers, according to internal documents reported by Protocol. It's also seen dozens of high-level executives leave this year, and recruiters say employees are now more open to considering jobs elsewhere. Facebook used to be a place that people rarely left, given its reach, pay, and perks.

A former Oculus engineer who left last year said Facebook could now be seen as a "black mark" on someone's career. A hardware engineer who exited in 2020 shared similar sentiments: They said they quit because of concerns about misinformation on the platform and the effect of that on children. Another employee said their department was dissolved in late 2019 by Facebook and, although the company offered another position that paid more, they left last year anyway for a different industry. The workers, and many other people who spoke with Insider for this story, asked not to be identified because of the sensitive nature of the topic.

For those who stick around and people who take new jobs at Facebook, base pay and stock grants have gone up a "sizable" amount in the past year, said Zuhayeer Musa, cofounder of Levels.fyi, a platform that collects pay data based on verified offers and compensation disclosures.

During the second quarter of 2021, the median compensation for an upper-mid-level engineer, an E5, was $400,000, up from $380,000 a year earlier. For an E4, the median pay jumped to $276,000 from $256,000 in the same period. For both groups, the increases were double the gains between 2018 and 2019, Levels.fyi data showed.

Musa, who's firm also offers pay-negotiation coaching, said previously that the total compensation ceiling for an E5 engineer at Facebook was $450,000. "We recently had a client get up to $510,000 for E5," he added.

Equity awards at the company are getting more generous, too. At the group-director and VP levels, Facebook staff are getting $3 million to $6 million in restricted stock units each year, another tech recruiter said. Directors and managers are getting on average $1 million a year. In engineering, a high-level engineer is getting $600,000 in stock and a $75,000 bonus, while even an entry-level engineer is getting $50,000 to $100,000 in stock and a $20,000 to $50,000 bonus, Levels.fyi data indicated.

Even compared to Google, Facebook's stock awards are generous and increasing, Levels.fyi data shows. While base pay is about the same, Facebook offers more in stock grants, significantly increasing total compensation. At Google, entry-level equity awards range from $20,000 to $38,000, while Facebook grants are worth $40,000 to $60,000. Sign-on bonuses at Facebook are often about $50,000, while Google gives about $20,000, according to the data.

"It's not normal, but it's consistent with the craziness that's happening in the market right now," said Aalap Shah, a managing director focused on the tech industry at the consulting firm Pearl Meyer.

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