"Industry Standard" Paycuts in IT? 1144
noGarnishMe! asks: "I was just reading about a Chicago-based company that has told all its employees earning over $60K/year that they will have to accept a 50% percent paycut for the month of May. This cut might be necessary in these times but keep in mind that the bozos in senior management just finished buying up several failing companies and paying some large bonuses to themselves. The memo announcing the cut is here. This cut, coming in such large chunk and in May, seems like a draconian shot to boost the 2d quarter financials. True, the annual paycut of 3.8% is modest but it ignores that fact that many folks won't be able to pay their May bills with only half their salary. I know that many of us have been through rough times these past 18 months and so I ask, what has been the approach at your company?" There are graceful and non-graceful ways for a company to handle a lack of cash flow. In the scramble for survival, especially in an economic downturn, many companies are caught off-guard and have to show their shareholders that they are doing something to get the company back on the road to profitability (which seems to be the issue, here). In many of these cases, the group most affected by such changes are the employees. It would be interesting to note how many of you have gone through this before and what you had to do to survive the shortfall.
that kind of crap would not happen...... (Score:2, Insightful)
I suggest getting out of a company that does this more than one time EVER, if it is feasable for you to do.
bad managment leads to lost jobs.
that is only MHO though so take it as you like
Don't accept the cut (Score:3, Insightful)
Managers too? (Score:2, Insightful)
I work for a company that put a 3% cap on raises at the end of last year for us normal people, claiming that's all it could afford (I know, a lot of people didn't get anything...), but more than doubled the salary of a VP one month earlier.
As i remember... (Score:3, Insightful)
industry standard?? (Score:3, Insightful)
DVIN [yahoo.com] is not an industry standard at anything, except how to go out of business.
Cash vs profitability (Score:5, Insightful)
The real problem is that cashflow problems can be extremely hard to get over... and now they've probably alienated most of their remaining staff. I would hope that this comany tried their hardest to liquidate furniture, benefits, executive cars, office space etc before they did this, otherwise they'll have a mass exodus on their hands (which may of course be what they want).
In Europe, where I work, it's much harder to do something like this, for better or for worse; most countries don't allow unilateral cuts.
Alex.
Not good (Score:5, Insightful)
Better, actually, to acknowledge that the staffing is too high, and cut some staff outright. Better for the company, and, really, better for the staff that do not have to live in a constant state of anxiety and insecurity while trying to do their job. I mean, what do you prefer: get cut outright, with a couple of months salary in your pocket and free tolook for something better; or losing half your pay for a month, maybe for the next month as well, then maybe get cut anyway (or see the company collapse) and never see that money again - and all the while expected to do your job instead of having time and energy to search for a better one?
/Janne
MISMANAGMENT ......period..... (Score:5, Insightful)
I have in the last week been offered a job at a significantly higher sum than their cutoff number, and as a counteroffer I have been offered by my current employer a 24% share in a spinoff of ourselves dedicated to the sales and development in my area of expertise.
The coffers of companies marketing and purchasing budgets are ovrflowing since the 911 hold on most big dollar activities. Companies are gearing up to spend.
If you have a product/service that sucks, or if managment of that company is so blind to have had too much belief in an idea and over employed based on those misconceptions of the product or its marketplace youre screwed.
Big money is moving, you just need to be in the right place to catch it. If youre not its managments fault. PERIOD. Now with that said, managment will find any excuse they can to mask their involvment in your current situation, the first is to blame the economy, but even that one is wearing thin with most.
Overexpansion, Overmanagment, Underselling, Overpaid salaries (although 60k isnt much for even a howler monkey)
I looked at the company in this article, I still cannot see what tangible product or service the sell clearly, THAT is a problem in my opinion and probably has something to do with their current situation.
I wonder how much of a Pay-Cut managment is taking ?
Cut all you want, they'll steal the rest... (Score:3, Insightful)
They also seem to have forgotten that the vast majority of the employees have NO stake in the company. They're probably not going to be thrilled to take a kick in the groin to shore up someone else's stock options.
Finally, in the memo, it says if you don't accept it, notify the company and they "may" terminate your employment. Guess that's one way to find out whether you're really irreplaceable!
Re:Working for Uncle (Score:5, Insightful)
Summary (Score:5, Insightful)
Um. The company wants to become profiable by November, so they have 6 months, and they think cutting 1 months worth of IT salary is going to do it? 60/12=5 So Instead of paying out 5k per IT staff, they'll cut that to 2500. If they have 100 people, that's 250k. Anything less than that, I wouldn't consider worth the risk..
Besides, why would they need 100 IT people at over 60k?
Doesn't sound healthy to me..
My suggestion: GET OUT NOW
Keep the Employees` Faith (Score:3, Insightful)
-Always keep your employees informed about the state of things: finances, workload, potential customers, potential problem areas. Big surprises are bad, dramatic changes are bad.
-Let everybody know that their loyalty and willingness to stay through rough times will be rewarded in the good times. But, complementing that, don't expect them to take their loyalty too far (i.e. to the point where they can't live their lives, pay bills, etc) - let them know that you'll support them in whatever adjustments they need to make, including leaving if necessary.
-Use the experience, skills, and wisdom of your collective staff to find new ways to bring in income, reduce expenses, and streamline operations without sacrificing quality. Having 1 or 2 people at the "top" trying to make all the right decisions is too much - include the people who will be affected by them in the process, especially when times get rough.
-Don't do anything stupid that will put you in court, jail, congressional hearings, or on the front page of the paper. Business ethics are business ethics, through good times and bad - whatever yours are, don't sacrifice them just to save this particular ship, even if it is cutting those icebergs a little close.
How's that for a dose of idealism? But really - honesty, trust, integrity and creativity will get you through a lot more crap than a 50% paycut for your employees will. It's worked for us.
Paying tthe Piper for going public (Score:2, Insightful)
This is the price you pay for agreeing to work for them. Not me, and not anymore. I've had it up to here with the greed of publicly traded companies, and I'm never working for one ever again if I have anything to say about it. They're more trouble than they're worth.
Re:industry standard?? (Score:2, Insightful)
You stupid bastard.
Re:hmmmm (Score:5, Insightful)
BTW, anyone who is earning that kind of wage and still living from paycheck to paycheck is, well, a fscking idiot. There are families that earn $30k/year on a single salary with children and still save money. More to the point, if you're working in a high tech job right now and don't have an appreciable amount of cash in an "oh shit" fund, you're going to find out the hard way what a bad idea that is.
Having 3-6 months of living money (rent/mortgage, utilities, food, etc) in liquid savings (CDs are ok if done wisely, money market, savings acct, etc. but NOT stocks or mutual funds) is really something people should do. You can scoff, but when you suddenly find yourself unemployed, it's the people with these funds that are going to be fine and able to focus on finding a new job. The people without them will be visiting bankruptcy court.
Yeah, right! (Score:5, Insightful)
I'm glad I work for the government now....
Wow, Chicago memories.... (Score:2, Insightful)
This is just another reflection of how the net economy is finding its usefullness. When I moved up there getting a job was a cinch, but then at the end they were just, well, gone.
Also, the point regarding management might be sharp but it is appropriate. Is there anyone out there with a great manager in the technology field that doesn't feel both lucky and a bit like a rarity? Tech people might hate the idea of being a suit, but I'm begging anyone that knows what their doing and can speak well to think about getting into the ranks of the damned, because technology needs people that know technology to manage.
Amen!
Re:At least people are still working... (Score:3, Insightful)
However I'f I had to take a 50% paycut or get fired I'd be screwed both ways, as there is no way I could live on half my salary for a month and the insurance Co. would be able to show that I caused my own redundancy by not accepting the pay cut.
I'd start looking through my contract at this point and see if there is any thing about time limits before announcing a pay cut.
That or by a shair or two in the Co. and turn up at the AGM and start asking embarrancing (sp?) questions about directors pay.
Pity you are not in the UK. Hear any shair holder is allowed to spend 2 hours a day at the Companies HQ looking over the directors renumaration package, take any notes they want, and leave the building with them.
This would give you lots of amo. for the AGM
suggestions (Score:2, Insightful)
2) Don't work for M$ solution providers. It's a shrinking market.
3) Don't work for companies so obviously full of crap.
4) Try to anticipate employer layoffs and get out before they happen.
5) If 1-4 fail, tell employer to go to hell, move to Hawaii and live on the beach. If you're going to be homeless I'd rather be there than Chicago!
Re:hmmmm (Score:5, Insightful)
BTW, anyone who is earning that kind of wage and still living from paycheck to paycheck is, well, a fscking idiot.
I resent that. Yes, I was an idiot (back in college), racking up a lot of credit card debt. I now find myself paying off all of that, plus a hefty student loan to boot. I do quite well for myself (not $60K, to be sure), but quite frankly, the minimum monthly payments on my outstanding debts swallow just about every penny I take home (well, that which isn't taken by rent, utilities, etc.).
Your advice is definitely sound, and I'm working on building up my rainy-day fund, but it's going to take a while, and meantime, I'm vulnerable.
All I'm trying to say is, some of us are no longer idiots, but still manage to find ourselves in this position.
Re:Not even 2 week salary liquidity? (Score:2, Insightful)
economic engine because we save money!
We spend. We go in debt to spend more.
We are good americans!
Re:Its simple, QUIT! (Score:2, Insightful)
There is no reason for you to put up with this sort of behavior from management. QUIT! Taking the pay cut and grumbling under your breath will get you nothing in life and will tell management you can be easily rode for future abuse.
While I certainly agree in principle, it isn't always that easy when you have a family to support and things such as that. The other thing to consider is that quitting is what these guys want you to do. If you quit they don't have to pay the state the unemployment tax for you, among other things.
I consider this a hostile move by companies to force you to quit. To force you to make a move out of anger that you haven't fully thought out. The worst thing about it, is that from what little I've looked into it, there isn't any legal recourse you can take.
The number one reason not to quit is that you won't get unemployment. While unemployment isn't anything you're going to live a grand life off of, it helps keep you afloat while you're looking for a new job. (It kept me going for 4 months last year.) In the same way, 50% salary isn't great, and you should start looking for a new job immediately, but don't quit if you need that money to survive.
Re:hmmmm (Score:5, Insightful)
I think that the point he was making is that people need to live within their means - not that they don't have expenses. Heck, we all have expenses; the point is to live within them.
Re:What a 50% Pay Cut Really Means (Score:4, Insightful)
Accordingly, we are requiring each employee at or above a certain level ($60,000 annual salary) within the Company to take an immediate 3.85% reduction in your annual salary. This reduction will be reflected in the compensation paid to you on the May 31, 2002 and the June 14, 2002 paydays.
If your position falls within the affected levels, we are informing you with this communication that your gross bi-weekly salary to be paid to you on the regular May 31, 2002 and June 14, 2002 paydays, will be reduced by 50%.
Continuing in your employment on or after May 20, 2002, will be deemed acceptance of the above-described pay reduction terms. In the event you do not wish to accept the reduction, you must advise the Human Resources Department immediately. The Company will then take the appropriate action, which may include the elimination of your position or the termination of your employment."
Which reads, pretty much "we are screwing you out of your pay. If you don't like it, then leave."
Now, if their goal was to keep employees despite this unfortunate needs for pay cuts, the second half of the memo would read something like this:
"We sincerely regret the need to have to take this action. As you are well aware, our company is going through a very difficult time financially. We are initiating this action in order to spread the financial burden out across our employees rather than take the more drastic measure of having to eliminate some positions altogether.
Our goal in this action is to increase the profitability of the company and maintain employment for each and every one of our employees. It's going to be a difficult road, but we are confident that with the support of all members of our team, we can get through this difficult time. Once we are in a better financial position, we plan to return everyone's salary to the previous level. Again, thank you for your understanding and support."
This says "we're screwing you out of your pay but we'd really rather not. We know it's a crummy thing to do but it's better than the alternative, and we hope to be able to make it up to you someday."
If I worked here, even if I wasn't being affected by the pay cut, I'd be outraged by the very thinly veiled message being given, namely that they don't care about their employees at all. it would serve them right if they lost most of their employees and then couldn't recruit new ones because people were so outraged at the way people were treated.
Hm, OK, next company on my list of places I would never want to work is now Divine.
Let me get this straight. (Score:4, Insightful)
Yet in spite of all that, those making over $60K a year somehow are unable to save enough to pay HALF the bills for one month? What would happen if they got fired? Is cost of living so horribly expensive in Chicago that 60K might as well be minimum wage?
-Restil
Another Approach (Score:3, Insightful)
Because if your DBA suddenly loses her husband, and you aren't sympathetic, you lose a DBA.
If your NOC monkey's car goes poof, and he's 10-15 minutes late - then you either have to bitch at him, or fire him, and you lose a NOC Monkey.
No, its not a manager's duty to make sure that an employee's home life is peachy keen, but it IS part of his or her job to remember that serious homelife problems can affect an employee's performance drastically - and cutting them, just to preserve your bottom line will likely result in other employee's jumping ship just because they percieve an unsympathetic management staff.
Yeah, fire the slackers. But giving shit to hard workers who have something happen that isn't their fault is -really- poor management practice.
(Not assuming that's what you do, just commenting that you cannot just look at the bottom line - you have to look at the bigger long-term picture as well as the immediate short term goals)
Re:hmmmm (Score:3, Insightful)
~C
Re:hmmmm (Score:2, Insightful)
I think the main issue is, if you realize you aren't in the financial position you should be, you should adjust your saving and spending habits until you are. If you have big high-interest rate loans, then yes, you need to pay those off ASAP. If rooming with Mom'n'Dad is an option if you get laid off, then you can focus even more on debt repaying and less on establishing savings. But once the debt is gone, don't start cranking up the spending until you do have a good cash reserve.
You may have been foolish before. Whether or not you are an idiot now should be judged based on what you are doing now. The true idiots are those who don't learn from their mistakes.
Same boat, captain. (Score:3, Insightful)
All I'm trying to say is, some of us are no longer idiots, but still manage to find ourselves in this position.
Wow. I could not have said that better myself. There are many of us under 30 yrs old that have old credit card debt with student loans that are trying to get that stuff paid off whilst working on a rainy day fund...
I too am doing well, I too was way too stupid with credit cards when I was 18. I am working on getting that debt taken care of so I can save for the future but it freaks me out to think of how vulnerable I am.
Oh, and as for how companies are dealing with the poor economy... my company has not paid us on-time since December. You see, we are on a monthly pay schedule (one big check on the 1st of every month) which requires good budgeting to get through the month okay. Missing that by a few days can be rough, but manageable. However, this does not work too well when you are paid 15 days late, and really sucks when you are paid 30+ days late. I have not been paid for March, and I should be paid for April this week but that is not happening anytime soon. (Ramen noodles ROCK!)
So, I guess I have to start calling lawyers to see if there is any legal action that I can take... anyone happen to have had a similar experience and have advise??
Re:Let me get this straight. (Score:5, Insightful)
Take my parents for example, combined they make well over $100,000. They certianly doin't live paycheck to paycheck and they invest quite a bit. However it would be a hardship if 50% of their pay evaporated for a month. There are bills to be paid and I'm betting they do total half or more of their total income. So if half of it dissappeared, they'd need to tap into savings.
Well contrary to what you might think smart people do NOT save money by hiding it under a matress or even leaving it in a bank. A good deal of it is in non-liquid assets like land, their house, etc. This cannot just be easily liquidated. Even at a large loss it would be problematic to liquidate it in a couple weeks. The most luquid asset they really invest in is stocks. However even those aren't something you want to liquidate unless it's absolutly necessary. In addition to paying captial gains (on those that are up) you then loose the potential growth.
Long term investments aren't something you just want to gte rid of, it costs you far more than just the actual money you get from it. As for getting fired, generally when you have a job of that level you have a contract that gaurentees you a severence pay of at least a monet, often more. Gives you time to get a new job, and so on.
Basically ti's jsut a really dick move on the part of their company. A paycut is one thing, people don't like them but in a slow economy a 4% paycut is probably something employees making that much wouldn't really get all that mad about. The problem here is that first, it's being applied retroactive to the beginning of the year. They aren't just cutting your pay, they are cutting what they already paid you for the first 6 months by 4%. Second, it's the huge hit that the employees ahve to take over the short term. Like I said, it really causes problems, even if you have saved up.
Also this is something that will make people additonally angry because there's no reason for it. If the problem truly was jsut a slower economy and profits going down, a standard pay cut would do the trick just fine. The onyl reason for a quickm drastic cut like this is to attempt to artificially inflate earnigs this quarter. And then there is the fact that the management is NOT taking a paycut and, indeed giving themselves large bonuses.
It makes people rather angry when they are forced to endure hardship because the morons up top refuse to take any responsibliity. SOmething tells me that had the management just not given themselves bonuses, it would have more than made up the total amount the company will gain in this pay cut.
Give them time to fix the problem, no more (Score:3, Insightful)
There's a HUGE difference between giving a suddenly widowed employee six months to process the death of her husband, or an employee a few hours to deal with a mechanical failure of their car, and letting stuff slide indefinitely.
I'm not saying that a single mother has 6 months to find a husband and get married, but she needs to find a workable solution. Fast. Management can cut her some slack if her usual daycare provider is sick and can't take care of her kids, but can't let her constantly go home early while her coworkers all work late several times a week because her current daycare provider requires her to pick up the kid early. She needs to either find another daycare provider or another job, or some other solution (e.g., *always* being the first person in the office because she puts in her extra hours in the morning).
The best example I've ever seen of this was a blind sysadmin. He was regularly asked how he would get to work during interviews, and he told the interviewer that that was his concern, not theirs. He asked for no accomodation on that, only modest accomodations (in one-time purchases for things like text-to-speech synthesizers) required to do his actual work.
My Opinion ... (Score:5, Insightful)
Tell everyone in the IT to stick together, and you may be able to "convince" the upper management, that going through with this pay cut, at ANY time, would be a "Bad Thing"
PS ... Start getting that resume polished up right now ...
Re:Corporate bastards! (Score:3, Insightful)
Then again it could be my particular neck of the woods so to say.
I do live in Ohio.....
I am certain that the Devil has a hold here of some sort(tounge in cheek, In the movie "Needfull Things" when Ed Harris asked Max Van Sydow(Satan) where he was from ? , Akron...Ohio....(I live here) But when you look at the number of politicians, presidents, actors, sports legends, etc that come from Ohio it seems a little odd.....
Libertarianism is a WONDERFULL thing Imho, I just wish they would change the name, it seems to people who are not familiar with it to alighn your political beliefs to Jimmy Carter or worse Bill Clinton. If in europe say they came up with a new political party , completley pure of intent and benevolent in function and called it say...Nazipuffism, I doubt it would garner much of a following.
I see the same with Libertarianism, my boss jokes he would be a Libertarian if he actually thought they could win anything.....
Re:hmmmm (Score:3, Insightful)
Oh GAWD! Take some responsibility? "More money than they were capable of managing?" Give me a break. You were perfectly capable of managing your money. If you are smart enough to hold down a job, you are smart enough to do the addition and subtraction necessary to save more than you spend.
You didn't WANT to manage your money. You were perfectly capable.
That doesn't mean we^H^H^H they're idiots. Just that they're still figuring this whole "money" thing out. In a situation like that, it's harder than you'd think to save for a rainy day.
Sorry, it does mean you are an idiot. It is not hard to figure out the "money" thing. If you are ignorant of specifics (different types of investments and so on) there are plenty of books on the subject, and you can even hire people to help you manage your money. You were perfectly capable, and it wasn't that hard. You just didn't WANT to.
Re:Look in a mirror (Score:3, Insightful)
Three years later and I had a cash buffer nearly 2x what it was when I bought the house. And yes, I'm paying extra toward my principal. Now, a good bit of that poofed when I got married, and I'll admit that my job at the time had rather high raises, but the key was that I kept my spending down. Getting a bonus or a tax refund or a raise didn't mean I figured out how to blow it immediately. Sure, I spent some of it, and Uncle Sam took some of it, but I still kept a portion for savings.
The point of all of this is to live below your means and pay yourself first. If you don't do both of those you're going to regret it. If you say it's not possible, then I suggest that you re-evaluate just how you're spending money. Go read some good financial planning books, sites, or even go to a financial planner if you simply can't control yourself. You may be surprised just how much you can save.
Or, hey, ignore it and work until you die. Me, I plan to retire well before age 65.
Re:Union now! (Score:5, Insightful)
Yes, if the company were shut down, it would be very bad both for the company and the employees. But the threat of shutting the company down could prevent things like what this company did in the first place.
hmmm... beware signs of trouble ... alert warning (Score:3, Insightful)
IMHO, if they are not paying you at all in late May/ early June, then the reason is that they are doing so is in fear of not making payroll. Some management wonk probably figured it was better to make up this 5% dealey than to actually miss payroll.
Their is a slippery slope that a company gets into once financial misery sets in.
Do:
Good people leave,
customers get skittish,
lendors freak.
Loop.
My advice: start looking now. The company is flashing big orange DANGER warning signals, and passsing out a memo saying to ignore them, they're just for some silly regulation.
good luck
--Pete
Re:Not good (Score:3, Insightful)
I've been there and did take the pay cut. But that was a very small company where everyone left owned a significant share. If I was just an employee, my resume would have been with agencies the day after the cuts were decided.
With hindsight, it was a mistake, and we should have given up sooner. But at the time, we still thought there was a real chance to turn the company round and end up with more money in the end, and no-one wanted to be the one who made it impossible for the others to continue.
Re:Let me get this straight. (Score:2, Insightful)
Re:hmmmm (Score:2, Insightful)
I bought a house back in '96. Since then, the powers that be have redone their assessments. My property taxes have more than doubled, are currently running about 3x the local income taxe rates, and are growing at 3x the rate of inflation.
I'm now paying more in city, state, and property than I am in federal taxes... The property taxes, per month, exceed what I used to pay in rent. And I'm actively looking to flee this area of the country (PA).
Don't even get me started on the costs of repairs: The furnace blowing up. The roof leaking, and falling off. The basement flooding.
Re:hmmmm (Score:2, Insightful)
My first job after college was as a new officer in the Navy. Talk about horribly low pay (~$30K after including tax benefit) for an engineer. I also paid for ALL of my education at Boston University (a private school), racking up college loans to the tune of $65K. By being reasonable and frugal, I paid all of my monthly payments and saved. My social life wasn't anything to dream about; but it has all paid off. I'm now debt free.
Was it worth it? Heck yes! I can go where I want (with my wife and two kids) any time I want. And we have a 3 month (5 months, if we're frugal) rainy day fund built up.
It all comes down to what you think is important. Hopefully most of us have grown out of that teenager "Shop til you drop" mentality.
Re:Look in a mirror (Score:2, Insightful)
Using your numbers, the first person (after rent and taxes) is left with 42K. Assuming the second pays no taxes, she's left with 21K. If both cut their spending down to the absolute minimum, the guy bringing home 75K should still be able to save four or five times as much as the first.
The problem with people is that they believe that, if they're pulling in 60 to 100K, then they should live like it. You know, buying the $30,000 Lexus instead of the slightly used Accord that still has 50,000 miles left on its warranty. Shelling out $30-100/month for satellite TV. Eating three or four times a week. Buying a new computer every time Intel ratchets up the clock speed another
The point is, some people have trouble making distinctions between the things they absolutely need and the things that are just nice to have. Your "You're an idiot" jab would indicate that you took the parent post's comments personally, and that you see a bit of yourself in them. But try and keep a thick skin. Sure, there are some expenses that you just can't get rid of or reduce. But which ones? I'd divide them into three categories: "needs", "investments", and "wants".
"Needs" are the ones you cannot reduce without risking life, limb, or imprisonment. Rent, food, taxes, child support, etc. Investments are those that will increase your skills and your capacity to earn. For computer geeks, technical books, courses, and software might fall under this heading. A course in auto mechanics might also fit, since it allows you to save money on repairs. Finally, there are wants: Things that are nice to have, but simply don't rise to the level of need.
When you think about it, there's an amazing amount in the average person's budget that falls into the last category. Food is a need. Dropping sixty bucks at a local sushi bar is a want. A computer may be a need in some professions. But a dual 1.8 GHz Athlon with a gig of RAM, a 140 Gig HDD, and a DVD burner is most definitely a want.*
It's tough to move into a cheaper apartment, or trade in the nice car for something whose only virtue lies in reliably getting you from point A to point B, or take a weekend off to go backpacking instead of a two week vacation to Disneyworld, or make your 600 MHz machine last you another year or two. But if the paychecks ever stop coming in, these are exactly the sort of sacrifices you'll wish you'd made. For me, the security of having that buffer is the most valuable thing I could ever buy with that money.
It's possible that I'm wrong, and absolute expenses like child support, old credit card debts, and student loan repayments burn up most of your paycheck. In which case, I'm sorry. My advice here is completely misguided, and I don't think that the parent post had situations like yours in mind. I think he was addressing the average situation, where people just spend a hell of a lot more on living than they really ought to.
I agree that buying real estate is about the best thing you can (legally) do to improve your financial situation, especially while mortgage rates are so low. The tax breaks alone make it worthwhile. Just remember to get a ten or fifteen year mortgage instead of a thirty. The monthly payments aren't much higher, and the amount you save over the term of the loan is beyond vast.
* And I do want. Oh, god, do I want.
Globalization hits home (Score:2, Insightful)
Based on some reasearch I did, I suspect the savings is something between five- and ten-to-one.
USA India
------ ------
Development Programmer 41,000 8,000
Test Engineer 47,000 8,000
QA Specialist 50,000 14,000
Annual salaries, in US dollars. Figures from 1995.
ref: http://idpm.man.ac.uk/idpm/isicost.htm#compar
This is a huge growth industry for India:
In 2001, India exported $5.1 billion worth of software labor. The average annual growth from 1990 to 2000 is 42%. Looked at another way, in eleven years this business became 39 times as large.
ref: http://idpm.man.ac.uk/idpm/isiexpt.htm
Sixty-five percent of software exports goes to the US. Then next closest is the UK, which comes in at 10%.
I don't think this is necessarily bad, but I think it does indicate that the production of software, like the production of autos, is becoming more standardized. Or at the very least, this is the direction companies would like it to go.
Seems like a good time to move towards providing services and support for companies that want to use more Free Software.
Re:Union now! (Score:1, Insightful)
No, the idea is that because the workers WILL
make this move with unity, the employer will be
loath to make such a decision.
Unions don't want to stop industry or put their members out of work, but they do want a powerful weapon for when things take this sort of turn.
If there were a union, this company would look elsewhere for cost cutting measures, and they would have done it IN TIME to prevent this disaster.
From their home page (Score:4, Insightful)
"divine helps companies maximize profits through better collaboration, interaction, and knowledge sharing across their entire value chain."
OK, let me guess...
- The top management are all book-trained MBAs. They built the business on venture capital with handshake deals where who you know is much more important than what you can do.
- They are regularly written up in glowing articles in all the local business PR rags.
- They are in technology, but they have a VP of communications and/or marketing who previously did not work in technology, and who mocks it openly.
- Middle management is encouraged to think about their political standing within the company, and routinely value that over actually getting actual productive work done.
- The sales force dresses in Armani or similar, and drives late-model cars more expensive than $40K because it is supposed to give them an advantage.
- People who don't show up for happy hour are considered ineligible for promotion, despite the fact that behind their backs everyone hates everyone else and doesn't want to drink with them.
- No management has ever showed up at a goodbye luncheon, or if they did, they spent five minutes there and didn't speak to the outgoing employee.
- HR is the second-most powerful unit in the company (behind marketing) and establishes policies with the help of corporate lawyers.
- Golf is considered essential to one's career.
divine employees or ex-employees, how'd I do?Salary Deferment (Score:2, Insightful)
It was optional for other employees to participate. I did, donating 10% of my paychecks for 6 months. That was 5 months ago, so I can expect a nice chunk of my money back in about a month. To further motivate us, any non-management who particpated volountarily get a decent chunk of stock. So it's win-win, I help my CEO cut his costs for two quarters, and I get a little equity in the company (which will further motivate me to work hard and keep us from going under).
The only thing that bugs me is it's been almost 2 years and I haven't had a wage increase. If I get to my 2 year anniversary date, they'd better give me at least some sort of wage increase, or I'm walking. Or they can pay for my grad school, that would work too!
- Kengineer
I was laid off -- along with 20% of the IS dept. (Score:2, Insightful)
Frankly, I'd have preferred a pay cut...
Re:Union now! (Score:4, Insightful)
No, you're the one who's trolling.
Unions do not serve to protect weaker workers at the expense of the hotshots. Read your fscking Adam Smith (you know, the father of the Free Market) to see what his opinion on unions is.
Frankly, the imbalance in bargaining power between employer and employee is such that the only way the workers can get a reasonable wage and decent working conditions is by collective bargaining. This is historical proven fact, and the reason unions exist in the first place.
If an employer can't pay union scale without going out of business, that means that he is not profitable enough to pay his employees a decent wage. According to the Free Market doctrine, he shouldn't be in business, but he should go broke. Nobody's obliged to support a bad business model, and especially not by taking lower wages and worse conditions.
Remember, the Free Market cuts both ways. Read up on some history and economics before you make a fool of yourself in public again.
MartRe:Yeah, right! (Score:2, Insightful)
Granted, I've encountered SOME IT groups in government that work hard. For the most part, many don't (it takes folks in government roughly six times the amount of time to do ANYTHING involving systems administration.) However, I have never seen a stranger combination of feeling "entitled to job" combined with an overall professional malaise. Last time I checked, if you really, truly didn't add value to an organization, you weren't helping it survive.
The "job security" provided by government work is a misnomer. In the event that your division gets axed (which does happen--granted, every five to ten years), you end up holding the bag with skills that are way outdated, along with the remnants of bad cultural habits...
Sorry for the rant, but really, it's frustrating when you're trying to do something quite good for the organization you're working for...
Ignore trolls from bosses (Score:3, Insightful)
I'd like to take a moment... (Score:2, Insightful)
Welcome to the harsh realities of supply and demand folks. Don't say I didn't warn you anyways...
Re:hmmmm (Score:3, Insightful)
Nope, not quite true. If you are having money trouble, the *last* thing to pay off is the credit card company. Credit cards are unsecured loans, which means the most they can do is call and harass you and mark your credit. First thing you do is eat. Second thing you do is pay your house ( a secured loan --you don't pay, they take your house ), third thing is pay your car loan ( how else are you going to get to work ). Then, and only then, pay your credit cards. Call the credit card company and tell them you are having a hard time, and please stop calling. They will stop calling, and may lower your rates if you make minimum payments.
This is not the situation I'd encourage anyone to get into, but if you are desperate, this is what you can do to protect yourself and your livelyhood.
On the next technology boom, don't put yourself in this horrible, stressful, humiliating position of needing to choose "Who should I pay next?" when the bubble breaks.
Don't come off saying "the 18% credit card interest will cost you more in the long run". Paying the credit card company last is for people who would go hungry and homeless before they miss a credit card bill. Put your priorities into perspective.
Re:hmmmm (Score:3, Insightful)
Exactly. While the above is certainly not a good excuse, it's probably by far the most common reason people get into trouble financially. I'm definitely in that group.
The one thing I really wish I'd done differently was to learn more about personal finance, and more importantly, the consequences of poor financial management. I can't blame my parents - they always bugged me to save, don't spend so much, be smart, etc. I didn't listen when I was growing up, and because I had no real responsibility then, I saw no negative consequences. I spent my allowance like there was no tomorrow and enjoyed my youth.
I got out of college 6 years ago and landed a good job making nearly $40k. All of a sudden I had a hefty, steady income with lots to spare after splitting living expenses with a couple of roommates. I bought an expensive vehicle, a few nice guitars and music studio equipment, computer toys, went out to eat a lot, etc. My mentality at the time was basically that I was young, it was early in my life, and I'd have plenty of time to save later on. Plus, in 5 or 6 years I'd be making a lot more money and would have no trouble paying everything off. I never thought about saving for retirement, to buy a house, having a cushion for hard times, etc.
I suppose I've been lucky. I haven't gotten laid off or anything, so I've got it pretty good compared to many. But 6 years later my salary is almost exactly double what I started with, and I'm just now climbing out of credit card debt. I live in a small one bedroom apartment with two other people, drive the same vehicle and have no cushion. About 8 months ago I moved in here to save money and aggressively pay off my debt. I've managed to knock off about $12k, with another $4k to go. I'd be done by now if I didn't have a wedding in another month, but it'll be a couple months after that before I'm down to $0. Then we start saving for a cushion and a down payment on a house. We'll probably buy our first house in mid to late '03 depending on how things go.
About a year ago, I realized that if I had been just a little smarter with my money, I could already own that house. Not only that, but I could probably still own all the toys and gadgets I've bought, I just would have had to wait until I could afford them instead of buying them when I couldn't. A $3000 guitar is a much bigger deal when you make $40k than it is when you make $80k.
Back to the point... I really wish my high school or college had had a good course on personal finance. If I had really learned that being irresponsible early would have me paying for it years later, maybe I would have acted differently. Instead I just "winged it," as you say, and assumed everything would work out automatically. I figured I was ok as long as I always made at least the minimum payments on all my debts.
Stupid, but after reading this thread I'm glad to see I'm not alone. ;-)
Management's first responsibility is ... (Score:2, Insightful)
If they hack the salaries of the company's best and brightest, at least some of these people will leave, perhaps many of them, but the dead wood remains. Morale spirals. Product quality declines.
If a company is in such deep schmutz that they must enhance their revenues by scalping their own employees, it is time to leave.
Many people have trouble leaving bad jobs because they have stock options in the company which they very much hope will someday be worth something. Waiting for the next wave before jumping ship. This is a terrible pressure, a monkey trap, a pyramid scheme where the senior management swindle their own employees. This actually gives management an incentive to keep stock prices low, for fear of suddenly hemoraging their best.
All of which does very little to inspire the stock market or potential customers.
I am more impressed with what Steve Jobs did: waved his salary for a year, all of it. That adds up to quite a few employees who didn't take a cut. And sets a good example. He won't be jumping ship.
=brian
Re:Working for Uncle (Score:2, Insightful)
What is the trade-off? Stability often leads to stagnation. Govt work is often extremely high stress. (Always a good turnout for national "take a gun to work" day.) Paperwork, bureaucracy, red tape, carrerrism, human speed bumps, etc. The frustration levels can be very high, getting little things done is a nightmare; big things are simply impossible. Sure, you get a job for life, but so does Wally, the human water-cooler, who retired at his desk 10 years ago. Perhaps he's your boss. Random drugs tests. Bizarro politics. Absurd regulations. "Snow Crash" paints a pretty close picture. And after a few years of getting your ass handed to you, you learn to keep your head down and just cover your ass. Like Wally. 10 more (irreplacable) years of your life and you too can retire.
Yes, there are definitely very real pluses, but these don't detract from the minuses. They are real too.
=brian
Re:hmmmm (Score:3, Insightful)