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(Slate)   A discussion on annual salary increases - from someone who clearly doesn't understand inflation or the consumer price index   (slate.com) divider line 155
    More: Asinine, inflation  
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3071 clicks; posted to Business » on 20 Mar 2014 at 12:30 PM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2014-03-21 10:07:39 AM  

Fark_Guy_Rob: Still, the simple truth is, I ONLY ever hear employees yelling that they deserve more. I've never heard an employee say, 'Well, the company didn't sell enough widgets this quarter, they should cut my pay 10%'.


No, you wouldn't hear that. That wouldn't make sense. People, as a general rule, don't advocate against their own interests. What you do hear about is companies telling their employees that they didn't hit their target so they have to take a pay cut.
 
2014-03-21 11:33:46 AM  

thurstonxhowell: Fark_Guy_Rob: Still, the simple truth is, I ONLY ever hear employees yelling that they deserve more. I've never heard an employee say, 'Well, the company didn't sell enough widgets this quarter, they should cut my pay 10%'.

No, you wouldn't hear that. That wouldn't make sense. People, as a general rule, don't advocate against their own interests. What you do hear about is companies telling their employees that they didn't hit their target so they have to take a pay cut.


OR following this example the crappy salespeople that didn't bring in more business than/as much business as previous years didn't get their upper-tier bonus or higher commissions that year, so that economic pain was indeed felt in an employee's wallet.
 
2014-03-21 11:44:11 AM  

EngineerAU: MBA types of course will counter with "why would you pay anyone more than they're willing to accept"


Which is another way of saying why shouldn't I exploit people to the maximum of my ability. Kinda sums up everything wrong with capitalism, and why something as amoral as a free market is bad for nearly everyone. It's government's job to step in and provide those ethics, too bad they've been bought and paid for.
 
2014-03-21 12:30:16 PM  

dumbobruni: Communist_Manifesto: Wages must be based only on productivity.


Wages are so far disconnected from anything based on something concrete like productivity that it's not even funny. Wages are overall set at the market level. How does one determine what the market is paying? You buy salary surveys from consulting companies (Towers Watson, Aon Hewitt, Mercer etc.) Then your name and job title/job code are taken from your companies HR database and matched to the market based on vague factors like job descriptions. Comp people are lazy, so they're more than likely just matching the job by title. Then they aggregate the data, and set "market appropriate" pay ranges for the jobs. Doesn't matter if the place would farking sink without you, you're probably not going to get above market value. Sure you might get a decent raise, but it will still be within the pay range set by the surveys.


I'm not sure how true that is.

according to surveys like Robert Half, average pay of a Financial Analyst with 3-5 years experience is about $75k, with a 25-40% adjustment for the NYC metro area (25% for NJ suburbs, and 40% for Manhattan).

in my last job search here (thankfully over) I was struggling to find one of these roles that topped $80k, even in Manhattan. I found salaries in Chicago & Detroit to be the same or slightly lower, despite the immensely stupid cost of living here.


The surveys can be broken out by city, or really any other way, by industry, revenue size, number of employees etc. The compensation industry is basically a shadow industry, I find that when I describe it to people they have no clue that any of this stuff is even a thing. Salary surveys/HRIS systems are a multibillion dollar a year industry that provide. Granted this usually only applies to large companies as each of these surveys can cost thousands of dollars per report. These huge companies use this data to set their overall pay ranges in accordance with their pay philosophy.

Also, average pay is NOT what you want to be looking at, especially in the financial sector. I would use the median, most companies market price jobs at the median level as well. Averages tend to be skewed towards the higher end.
 
2014-03-21 01:24:34 PM  

EngineerAU: Every single company I've worked for has offered my a raise when I resigned. Maybe if they offered more than an one or two percent during my annual review I wouldn't have had a wandering eye to find a better job. MBA types of course will counter with "why would you pay anyone more than they're willing to accept" not understanding things like the costs involved in finding someone new and the loss of institutional knowledge. If you keep paying people the bare minimum, you'll keep getting the bare minimum effort and get the people from the bottom of the labor barrel. Most people chose a career in something other than salary negotiations and aren't interested in spending lots of time and effort on it. All too often changing jobs is simply an easier way of getting a raise than staying in place, even if your current company has a greater economic reason for paying you more than a new company would.

Reminds me of how Wal-Mart has been so successful at cutting labor costs that they can't even stock the shelves with merchandise. They made reducing labor costs more important than selling goods to the public, which is pretty stupid.


As an MBA (in IT) I want to smack a lot of these traditional business types, they forget Henry Ford's lesson of "your employees are also your customers" and "re-hiring is expensive". Link:  http://www.forbes.com/sites/timworstall/2012/03/04/the-story-of-henry - fords-5-a-day-wages-its-not-what-you-think/

Now the article I linked argues that for a company like Boeing the whole "your employees are also your customers" doesn't make sense. He forgets that the economy is an interwoven system, if Boenig's employees have extra money after basic living expenses, they'll be more likely to, say, travel to exotic locals (on Boeing planes) or spend more in the income which would trickle it's way up to the executive's of other companies and they then might want to purchase private Boeing planes.

Wages for EVERYONE but the top 1% have been stagnant for about 20 to 30 years (depending on whose numbers you cite), cheap easy credit was able to hide and alleviate this for a long time but now it's catching up to us and everyone is suffering.

You need a healthy consumer base for a healthy modern economy.
 
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