[thechat] P.o.Ws - Thought this was interesting...

Martin martin at members.evolt.org
Tue Jan 29 17:00:59 CST 2002


On Tuesday, January 29, 2002, at 07:40  pm, deke wrote:

> On 28 Jan 2002 at 23:15, Judah McAuley posted a message which said:
>
>> I formulated a theory awhile ago that I really haven't seen disproved
>> yet.  It seems to me that the amount of money that a job pays is
>> inversely proportional to the amount of contact/service that they
>> provide to other humans.
>
> I formulated a theory back in the 1960s that is similar in results. You
> don't get paid for what you do. You get paid for what you put up with.
> And it's not what you *actually* put up with, but what you are
> *perceived* to put up with.
>
> A tax preparer and a travel agent, for instance, have very similar
> jobs. They interview their clients, look up arcane data, and fill out
> forms. But a great independent tax preparer in a small town can make
> three times as much as the corresponding self-employed travel agent.

True, but screw up your taxes and you're (usually) in a *lot* more
trouble than screwing up your holiday.

Also, if your accountant screws up your taxes on your behalf, you're
a *lot* more likely to sue than if your travel agent puts you in the
wrong hotel.

Finally, there are fewer accountants than travel agents (because it's
harder to get into)

So pay is increased by:
1) Cost of error for not using them (ie value to you)
2) Their liability in the event of error
3) Scarcity (ie supply and demand)

> When I employed people, I didn't pay them what they were worth. I
> certainly didn't pay them *more* than what they were worth, but I only
> paid as much as was necessary to attract and retain the employees.

The other way of looking at it is that you pay them less than the
value they add by their services. So if an accountant saves you $10k
on your taxes, it's worth $5k for their services, even if they only took
10 minutes to do it. It's the old "$1 for correcting the error, $4999 for
the experience and ability to spot it in the first place"

> As a general rule, people in this society change jobs (not necessarily
> employers) every four years. Depending on how expensive it is to hire
> and train a new employee, you may want to adjust your pay scale
> accordingly.

Which is related in part to scarcity and market conditions. If you have
a city where public service workers on standard pay rates can't afford
to live, they won't live there. So you need to pay more to attract them.

We were visiting a rather rich coastal town over the weekend, where
we talked to a few people. The consensus about the school is that
1) Yes, it's a 'nice' [sic] school - well behaved, polite kids where
learning
      is easily accomplished
2) There aren't enough teachers because they can't afford to live there
3) They can't attract cleaners for the same reason.

So you have what *should* be a good school, but with 30 kids to a
primary class, and smelly toilets.

> If you compare new teachers with other recent liberal arts graduates,
> you find comparable annual salaries, despite the fact that school
> teachers work 36 weeks a year.

Having a teacher as a parent, I can tell you categorically that this is
a gross simplification. The kids may only be there 36 weeks, but it
doesn't mean that the rest of the time is loafing.

> If you compare teachers with 20 years
> experience with other liberal arts graduates of 20 years experience,
> you find *higher* annual salaries.

Source?

> You hire someone to do something you *can't* do, or you don't *want* to
> do.
...
> That's why the outside salesman
> makes 50% more than a retail store clerk.

Also because outside sales staff tend to be more closely commissioned.
So a *good* salesperson will make more than a retail store clerk. A bad
one will do much worse.

Cheers
Martin
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