More job satisfaction, more pay!

“Life is not fair – get used to it” – so said Bill Gates

Many bosses might agree with him, if they were honest – they’re good examples after all

As people climb ladders at work, so their job satisfaction also tends to rise – more status, responsibility and power – bigger decisions to make, more interesting problems to solve, more ‘pride in workmanship’ as Dr Edwards Deming, the management guru, called it

But their pay and other employment benefits also rise significantly

How is that fair?

Most people have to work in order to earn money, first to support themselves and their families and then to do other things they enjoy with any surplus, their ‘discretionary income

Sadly, surveys show most would ‘pack in’ their current jobs if they won the lottery

Cash is certainly needed to encourage people to take on jobs which they would not do otherwise – cleaners to sweep floors, nurses to wipe bottoms, firemen to risk terrible burns whilst trying to save lives and buildings – jobs which are dirty or dangerous – and the worse they are, the more pay they might expect up to a level where management feel compelled to seek ways of automating their work

But most jobs are neither dirty nor dangerous – they’re either unskilled, semi-skilled or clerical – most job holders find them dull and can’t wait to get home to do things they enjoy – and most people can do such lowly paid jobs with little training needed so there’s little need to pay them well to attract the numbers needed

That leaves one last broad category of jobs – difficult  jobs – where there’s usually a scarcity of competent people to do the work

According to author Malcolm Gladwell: “Nobody becomes very good at anything without talent and putting in some 10,000 hours of practice” – hence the labour pools to fill highly paid jobs are relatively small, the competition high, and the pay higher – hence one finds Peter’s Principle rife throughout all rungs on the management ladder

To keep pay levels high, some organisations have distorted the market for difficult jobs by restricting supply even further viz:

  • The trade unions once insisted on ‘closed shops’ where, for example, only skilled electricians were able to do electrical work – ditto welders, joiners, plumbers – which greatly reduced productivity, increased unit costs and reduced competitiveness – hence the UK shipbuilding industry is now a pale shadow of what it was only 50 years ago
  • The legal profession continues to bar many qualified barristers from being ‘called to the bar’ and practising in court to keep their numbers down and pay levels up, thus feathering their own nests but depriving most of the population from affordable access to justice when offended against

But such supply restrictions do not explain how some bosses can be paid small fortunes

Average FTSE 100 CEOs’ pay is now said to be over 150 times the average salary paid to their troops, some five times more than most would consider to be fair – and for doing what most of them would probably elect to do anyway because they enjoy the status, power and/ or problems encountered:

  • None seem to recognise that much of their success, if any, has been beyond their control – either as a direct result of the efforts of others within and without the firm or due to a stroke of luck such as a change in legislation
  • Nevertheless, if things go right on their watch, their employment contracts ensure that massive rewards fill their pockets
  • And, if things go wrong, similar rewards still pour in or golden goodbyes and enormous pension pots are paid out?

Heads they win – tails they don’t lose

So how can they do this?

“Because they can” according to President Obama

They appoint their chums – their ‘inner circle’ of top school/ university/ consultancy ties – to become non-exec directors who hop on a carousel of pay review committees – all then see what others earn so vote for each other getting at least the same (transparency levels pay up, not down) – shareholders are kept quiet by short-term actions taken to keep share prices and dividends rising – employee discontent mounts, morale dips, productivity stalls, but few notice or seem to care

It’s a system in disrepute – another ‘ugly face of capitalism’

By all means pay vast amounts to the entrepreneur or inventor who took huge risks, who re-mortgaged his house in order to set up and fund a company which turned out to be successful, employ thousands and pay lots of taxes to help fund good public services e.g. Bill Gates, Larry Ellison, James Dyson

But the great majority of the current crop of CEOs are mere watch-keepers who take few big risks and only order‘steady as you go’

To pay them 150 times the average is obscene, contemptuous of employees, an affront to shareholders and offers ‘two-fingers’ to the nation which provides them with vital support

Such practices must surely be stopped somehow and soon

And ignore any pleas that premier league footballers are paid more outrageous amounts, thousands of times more than their doting fans, and for doing something they’d probably do anyway, most Saturday afternoons, for nothing

Such footballers earn such rewards for the intense pressure to perform well that they endure every time they appear on the park – they have no hiding place – many thousands judge their individual performances every week – if they don’t cut the mustard, they’re dropped, and fast – if the team wins silver, and they played well, they win big-time – otherwise, they’re out – it’s brutal

But surely such criteria also applied in the days of Manchester United’s ‘Busby Babes’, say, some 60 years ago yet they were paid relative peanuts

So why the difference?

Scaleability

No longer do top football teams play in front of a few thousand stood in a small cold stadium – now top teams are watched live by 20,000 to 60,000 in the crowd at each game plus millions more at home and abroad on TV live, plus even more millions later on via recordings or replays

TV companies pay many millions for the rights to televise them depending on their success levels – advertisers then pay the TV companies many millions more to access their viewers

Most viewers want to watch winners, which means ‘top players’, so top players rightly expect to get a fair share of those millions, even though they’ve been organised by the efforts of marketing professionals, global communication systems and corporate advertisers, not them – ultimately, it’s their performance levels that determine their earnings – if they’re talented and successful, the public will want to watch them – if not, they will soon join the rest of us

Such scaleability also applies to the pop music business

But it certainly does not apply to the top FTSE 100 CEO business

 

 

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.