Though to try and prevent misunderstandings - I do think inflation is bad for people who are paid wages. Market forces aren't perfect and "market price" is really a band of prices. Inflation pushes all workers to the low end of the band and means if anyone doesn't feel like negotiating they will be pushed in to a bad deal by default.
Inflation doesn't change the actual power balance between different actors, it does make the situation more complex and harder to keep up with. It doesn't create real wealth and it is not responsible for a wealth transfer to wage earners. The idea just lacks a mechanism - for the wealth to come from employers or businesses they have to be ignorant, altruistic and disinterested in money. That seems unlikely. Ditto most other actors. Changing value of money favours people who can continuously adjust to it which isn't a typical wage earner.
If a generation gets something for free, they got it from somewhere else. Who lost out here? Why did it need to be inflation to make that happen? If they didn't get it for free, it is unclear why inflation would be necessary in the story instead of incidental.
Just like millennials love to claim boomers had it easy, it was a small slice of the pie that benefited.
You should unionize for many reasons but I wouldn't trust it as an efficient tool for pay negotiations.
[1]: because no uninon ever manages to not try to meddle in international politics. Gandalf in LOTR had it right: he did not want power because he knew he would be tempted to try to do a lot of good things.
The way it stands the downvotes are deserved.
I'm personally not unionized but this is not something I would accuse the union of ;-)
Edit: Sorry I might have misread your comment. I should say that our average increase was also above 2% several of those years.
[1] https://en.wikipedia.org/wiki/Wassenaar_Agreement [2] https://www.volkskrant.nl/nieuws-achtergrond/koopkrachtrepar... [3] I recently verified it for my own collective bargaining agreement, and on average, the raises were about 1% point higher than the inflation
Unfortunately unions protect the incompetent and punish the successful (by refusing them the ability to negotiate). It's most pronounced in the heavy unionized industries like teaching and auto manufacturing.
There will always be developers who produce the results of 10, 100 or 500 developers single-handedly. Unions kneecap them, like they kneecap outstanding teachers by paying them the same as the teachers phoning it in every day.
Note that this doesn't always even involve taking it.
Go get a job offer that pays better and bring it to your boss. If they want to match it, great. If they don't, bye.
If someone is unhappy enough to start job hunting rather than talking to me then it's a clear sign that they'll leave soon regardless of any pay rise. Psychologically, every pay increase makes someone happy for a short time, and then they get used to it and they start to wonder if they should have asked for more, or they focus on other reasons why they don't like the role they're in and wonder if the other one would have been more fulfilling. If you match an offer, or even beat it, the person is likely to have left in a year anyway.
A new company is willing to risk it on you, while paying more than your current job where you have experience. No surprise they leave in a year anyway.
This is the crux of the problem - people assume that anyone going to their boss asking for a raise is underpaid. That isn't always true.
When someone goes and finds a new role on more money it's almost always at a higher level. People move upwards when they move on. Matching an offer usually means paying someone the salary for the higher level role to do the work of the lower level role.
If someone wants to move up a level to earn more I've always been happy to talk to them about that. That's not what we're talking about here though.
Not all workers are equivalent, and not all roles that seem the same even in the same team, actually are. Let’s say we have a team of 10 people, each with slightly different experience and skills. One of them finds another job with higher pay and asks for it to be matched. What do you do?
It’s quite possible this other role actually matches their skills better than the one with you does. Maybe they are actually worth more to this other company than they are to you. Maybe they had other reasons for looking for a job aside from pay, maybe they’re tired of the job or want a fresh challenge. Maybe it’s a combination of all sorts of factors. Pay is only one.
If you do increase their salary, what about the rest of the team, do you pay them more too? Do they all have the attributes this other company valued in the person they made the offer to? Would they have all got the same offer? Probably not, but now you’ve upped the going rate for a member of your team. They will want the same.
It’s just a really messy situation to get into. If staff retention and recruitment is a problem or you don’t want it to become a problem then sure, of course you should make sure your compensation rates are fair. Of course under paying your team will cause problems. But one person getting one job offer doesn’t necessarily mean anything, except for them.
It's not like everyone performs at the same level or gets the same pay in almost any team I've seen.
If someone gets a job offer, you should consider it a new data point. Some teams don't aim to retain top talent and if that's the case absolutely encourage them to move on. But if you want a high-performing team, you need to pay top of market and a job offer is new signal about the market price.
> Probably not, but now you’ve upped the going rate for a member of your team. They will want the same.
I have never once wanted to be paid the same as everyone on my team. Some people are more experienced than me and should be paid more. Others are less skilled and should be paid less.
It doesn’t matter. Even if they are different, one person getting a raise changes the relative dynamic. Maybe I was being paid more than this team member and now we’re the same, and maybe I still think I’m worth more. It elevates the basis of comparison.
Also, to expand on my post, it creates the impression in the team that the way to get a raise is to get a competing offer. It says that person was being under paid. Maybe that means you are too? It’s just bad all round.
What makes you think people only go job hunting when they're unhappy? I consider it a moral obligation to seek out the best pay (after staying at a job long enough to justify my original hire and for the sake of my own resume) in order to do my small part to increase worker wages.
If someone has a chance to take another step up in their career that's a good thing. If I offer them more money to stay at the same level they'd be silly to accept that.
If you would be a supplier you stance would translate to, I never make a new offer if a customer comes with a better offer from a competitor. I suspect one would loose a lot of customers this way.
I have no opinion on if the negotiating tactic is good or not, only that the comparison of goods and people isn't quite right IMO.
Edit: I also find the argument that employment is not a an economic transaction a really weird argument. Employers don't give raises just so that the employee feels better for example.
The OP talked about people, then your reply was about goods. Unless "contract with a supplier" was about humans as goods, that term obviously means purchasing stuff, not purchasing humans. Who uses "purchasing" when it's about humans/employees?
Goods don't have a brain and no state of mind which was at the center of the OP's comment.
Okay, back to your original reply then:
> If you are responsible for purchasing, will you ask competitors for quotes?
The OP talked about the people themselves. If we follow your line then you don't talk about the employee at all any more. You are talking about something else than the OP.
so you mean if a recruiter contacts your workers and says we can offer you X amount and they check it out they should have talked to you beforehand?
Long time ago when I was employed I liked my job but felt that I am being paid less than what I could get. So I went searching and after a while got a really nice offer. With that offer I came to the company owner and ask him to give me a reason why should not I take the offer. He did give me a reason - matched the offer and put bonus on top. The end result - I stayed. Well until I went on my own and never looked back.
No one, and I do mean no one, is irreplaceable. Maybe you’ll have to throw away an entire IT system because you’ve lost the know how to keep the business case for the system a net positive, but that means a lot less to an organisation (especially enterprise) that we tend to fool ourselves into believing myself included.
When a key contributor asks for a 20% raise (or say $50,000 more per year) and them leaving put millions of dollars of revenue at risk, or more importantly, reflects poorly on a manager and threatens their advancement (why can’t you keep your team happy?) then the math is actually quite simple.
But in a highly siloed and compartmentalized organization where blame for bad decisions never filters down to the ones making them I could see your point.
Every team should fight against this. Writing simple, understandable, documented code that doesn't need some key person to maintain it is a very good thing. For a start, failing to do that locks people in to their job. Not being able to move on, and up, is a very bad thing. Secondly, people leave for reasons other than money. What if someone's husband gets a cool job in another state and they move for that? No amount of money would keep them, so you still lose those millions. Thirdly, there's the bus factor - what if that person is run over by a bus? How do you keep going?
Paying someone more and more to keep them is only patching the underlying problem that your team isn't resilient enough to catastrophic change. Fix that problem.
My experience is on teams of 2-3 working towards a product launch that has to happen in 6 months and sure we can always replace someone if they die. The cost of that if not in revenue, but team efficiency, sacrifice of other work, is way more than a few tens of thousands per year.
And of course, everyone is replaceable. But replacing them may cost more than just paying them more, even if it keeps them around for another 6 months.
If you’re a good manager you’ll want to keep your employees for 5-7 years. This is because you want to help your employees develop their talents and grow their career, and when you do that, they’ll eventually outgrow the role you hired them to do and how far it was possibly to extend it to accommodate their growth. By that point, you kind of want your employees to move on. Maybe to a new position within your own organisation or to a different place. It’s not because you don’t like them or don’t want them to stay, but it’s because good employees tend to outgrow you. A select few people can stay in the same functions their entire lives and never lose enjoyment or motivation, but most of us aren’t like that and you have to keep that in mind when it comes to “pay me more, or I’m leaving” negotiating.
More than that though, you have to see how relying too much on individual employees is actually what is the management mistake in these type of situations. The issue isn’t “why couldn’t you keep x”, it’s “why did you let x become irreplaceable” because any good manager should know better.
Maybe the public sector in Denmark is different than other places, maybe not. I don’t think that it is. What typically happens when you have IT systems that rely too much on an employee is that they leave you and then you end up paying them a lot more money to consult for 6 months until someone else has redesigned the systems to no longer be too dependent on a single person and your former employee finally gets to really move on.
You are comparing throwing away an entire IT system to increasing the salary of _one_ employee.
If you have systems (and that is any function, also cutting onions in the kitchen) that relies so heavily on one employee that you can not continue to operate them without that person then you have a serious issue.
Because you don’t retain employees, and your goal isn’t to keep them forever either. Even if they are happy and stay for 40 years they will eventually retire and then the system tend to break down anyway, and that’s with planned departure. What if your vital employee gets run over by a truck on the way to work?
So from an organisational perspective, it’s not an entire IT system vs one employee. It’s removing a flawed and dangerous system from your organisation.
Some people will argue that employees who design such systems aren’t worth keeping to begin with. I would agree, if the world was perfect, but it’s not.
The irony is that the main reason people get paid more when they change job is because they move up at the same time.
So giving the same purchasing power for more responsibility would probably not look like a good deal for most (unless responsibility is your thing which is the case for some people).
If they fail, they know I cared enough to assist and trust me and are happy for their job. If they succeed they get a raise, but are more likely to stay and work harder knowing they can trust me and can collaborate.
I don’t see the downside in engaging in this manner.
In other words, unless you can contradict me with a straight face, you're basically just saying you underpay as long as you can get away with it and nothing can stop or change that.
What if salary is the only thing they are unhappy about?
It's all game theory, in a minefield of unintended consequences. I take the opposite approach: an unspoken but clear attitude of "you know you won't be able to buy me when I excuse myself with a better offer, so better ask yourself now than later how much you actually want to pay me". And no, that certainly does not make me fabously rich (but there actually was a time when it worked much less bad than I would expect, quite amusing in hindsight)
The first thing my father told me when I started working was "never accept a counter offer. Don't put in your notice unless you're ready to leave - because even if they give you a counter-offer, they'll start looking for your replacement once they know you're looking."
https://allthingsd.com/20110108/twitter-courts-googles-sunda...
I understand mot everybody can move up the ladder or get more money, but if as I line manager you can’t provide incentives or growth opportunities I would look at you first. If you don’t know the aspirations of your people and you match this with the strategy and goal of the company, are really made for your role? Every manager should be more like - I know you can leave anytime lets find the best solution for all…
I’ve tried your approach and it’s usually a token amount or “sorry there isn’t a budget”. When I have an another offer then suddenly they find “flexibility”. But that said, I don’t even ask for more if I’m so unhappy I see myself leaving anyways.
So, you give an inflation matching pay adjustment automatically?
I've gone back to exactly the same job as I started 20 years ago. Pay has doubled, house prices have increased 3-4 times in my small ex-industrial, high-crime, UK city.
They expressed that they wanted me to stay but at the end of the day it was crocodile tears.
He announced he was leaving our company for Amazon (which paid substantially more), and we even had a whole Friday goodbye party with cake and balloons. The next Monday we came into the office, surprised to see him still working for us. It turns out that over the weekend he somehow convinced management to match and exceed Amazon's offer.
His "trick" for getting a raise is that our whole dev-ops setup was unworkable without him. Management hadn't come up with contingencies for his inevitable departure, and thus he held all the leverage in salary negotiations.
It is true, but i am not sure it is a good long term strategy, i suspect that too much job hopping doesn't look good on the resume.
Also changing jobs becomes harder with age, i am fifty one years old, and last time around, when forced to look for a new job, I found that it was quite a bit of a challenge (being said that, i need to feed my family, so that i really need a raise :-( )