As a full-stack web engineer who's ended up being competent with Yocto, I think a major factor is which companies need embedded Linux or proper microcontroller embedded work.

They're not you VC, SASS, zero marginal cost software first company. They're hardware manufacturers with physical product margins. The embedded project I work on only ships on a few thousand units/year, and it's only a small component of the overall system.

I think within that group of companies, the comp for embedded vs "software" isn't significantly different. "Software" just has FANG/VC backed salary inflation making the averages look crazy.

The FAANGs have definitely inflated prices, but in those companies the average revenue per employee is just orders of magnitude larger than anything a physical product company can produce. Giving a software engineer 2x or 5x salary compared to embedded is literally noise on the balance sheet.

Because you're a line item in a product's bill of materials and nothing more.

I work on Yocto-based products and am responsible for the platform, but working on recipes and kernel mods is only 10% of my work, and by the end you're not touching it at all. If you're making kernel and rootfs changes in validation you have a serious problem.

I'm not sure what projects need someone that is hacking recipes 40 hours a week.