[deleted]
The boss who put everyone on 70K
11–20 of 381 posts
Re: The boss who put everyone on 70K
#12Note: I heard this story around 2015-2016. https://news.ycombinator.com/item?id=9371854 I'm not sure which is more applicable: 1. Hurray, decency. 2. Shouldn't getting excited about what would've been middle-class income 70 years ago be a sign how far workers' pay has fallen?
Huh? Inflation calculator says 70k in 1950 is worth 754k today. Edit: I did the calculation backwards. Thanks to everyone who pointed that out.
By the other interpretation of $6500 dollars in 1950 (roughly equivalent to 70k today), it would be much higher than the average family income of 1950 of $3,300 and put you in the top 10-20% of earners, which is probably not as far as 70k gets you today.
Re: The boss who put everyone on 70K
#13This is very nice of the owner, but extremely inefficient economically. Which means most companies can't afford to do something like that. Only if your profit margins are huge.
Like Amazon, Facebook, Google, Apple or Microsoft?
Re: The boss who put everyone on 70K
#14I think it's important to mention some other sides of this story, namely that the raise came right around the time his brother filed a lawsuit for him overpaying himself and domestic abuse allegations. I don't remember the articles exactly but there were some rumors that this change was a PR stunt and shield for him Some articles that talk about the other side: https://www.bloomberg.com/features/2015-gravity-ceo-dan-…
Btw, I think Google could already either pay 70k+ to every employee or is pretty close. They just need to make sure that all the janitors and baristas are employed by subcontractors.
Re: The boss who put everyone on 70K
#15Earlier quoted context omitted.
Huh? Inflation calculator says 70k in 1950 is worth 754k today. Edit: I did the calculation backwards. Thanks to everyone who pointed that out.
By the other interpretation of $6500 dollars in 1950 (roughly equivalent to 70k today), it would be much higher than the average family income of 1950 of $3,300 and put you in the top 10-20% of earners, which is probably not as far as 70k gets you today.
Of course, fewer people were middle class back then..
But yeah, the original comment we are replying to doesn't have much going for it.
Re: The boss who put everyone on 70K
#16This is very nice of the owner, but extremely inefficient economically. Which means most companies can't afford to do something like that. Only if your profit margins are huge.
Ineffficient? It would depend on the total value add of each employee. As stated, the performance of the company increased. The capability of individual employees increased.
Now, without exact numbers, I can't say economically this or that.
But effectively this was not a zero sum game. The company was not paying more for the same outcome, they were paying more for more output.
The output of the company increased. This is how investments are usually supposed to work, you put money in, and reap profits.
What makes this a bit more difficult to gauge that it's likely the increased performance does not come from individual output, but from a better cohesion of the team which generally makes things always easier and efficient.
What people often get wrong is that they think about wages atomically - I pay this guy this much and he delivers this. Whereas when you are having a team of workers (whose job is not to be a mindless drone) and whose output depends on the co-operationnof the individuals, often the second order effects are more important.
For example: rewards. You give a huge reward to the single top performer in your company. What happens? Everybody becomes jealous of him, and some will feel cheated since they contributed heavily to the projects the individual participated in. Future collaboration will likely suffer.
In fields were output is purely of individual performance (some sales jobs, logging, etc) this calculus is of course different. In these situations the atomic cost analysis probably works.
Re: The boss who put everyone on 70K
#17Earlier quoted context omitted.
Huh? Inflation calculator says 70k in 1950 is worth 754k today. Edit: I did the calculation backwards. Thanks to everyone who pointed that out.
I think you'd need to do the opposite: take 70k today, and figure out what the inflation calculator suggests about it's value in 1950 dollars. Just using your numbers, that would be about 6.5k. Now compare with median annual incomes in 1950. Asking Google about '1950 median american income' gives 'Average family income in 1950 was $3,300.' Not quite what I wanted to know, but close enough. (We are looking at per work…
I found this link[0] that tells us that the median income - adjusted for inflation - seems to be rising since 1967.
Re: The boss who put everyone on 70K
#18Note: I heard this story around 2015-2016. https://news.ycombinator.com/item?id=9371854 I'm not sure which is more applicable: 1. Hurray, decency. 2. Shouldn't getting excited about what would've been middle-class income 70 years ago be a sign how far workers' pay has fallen?
Huh? Inflation calculator says 70k in 1950 is worth 754k today. Edit: I did the calculation backwards. Thanks to everyone who pointed that out.
[deleted]
Re: The boss who put everyone on 70K
#19Earlier quoted context omitted.
Huh? Inflation calculator says 70k in 1950 is worth 754k today. Edit: I did the calculation backwards. Thanks to everyone who pointed that out.
By the other interpretation of $6500 dollars in 1950 (roughly equivalent to 70k today), it would be much higher than the average family income of 1950 of $3,300 and put you in the top 10-20% of earners, which is probably not as far as 70k gets you today.
The true inflation rate is probably a lot higher than CPI which is what most calculators use. Somewhere between 7-13% [0] (for example)
[0] https://www.businessinsider.com/if-people-knew-the-actual-in...
Re: The boss who put everyone on 70K
#20Note: I heard this story around 2015-2016. https://news.ycombinator.com/item?id=9371854 I'm not sure which is more applicable: 1. Hurray, decency. 2. Shouldn't getting excited about what would've been middle-class income 70 years ago be a sign how far workers' pay has fallen?
Where do you get that 'middle-class income' from? The standard of living that 70k USD buys today is vastly better than what the median income bought in 1950. (Of course, Seattle is rather expensive. The 70k USD would go much further in a city that didn't restrict residential construction so much.)
You can not even buy a house built on the 1950s on 70k a year. And while most quality claims (which usually lack actual numbers) certainly look subjective, the quality of a dirt lot or vial of insulin has obviously not changed while their adjusted inflation price has sky rocketed.
At any rate, the claim that "stuff" is more expensive because it is better implies that decades of technical improvements have resulted in no efficiency gains. At best, it implies the value per man hour has essentially remained flat. And since the option of buying lower priced versions of items has dispersed, we can never know if the higher quality item is fairly priced.