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Employees who stay in companies longer than two years get paid 50% less (2014)

forbes.com

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Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#71

Post by HEmanZ »

This seems very generally true to a point, so on average it works out. But I think there is a big caveat. My thoughts are centered around software development, but I know there are many analogous career paths.

I really believe if your career goal is to peak a lot higher than just middle-management or senior software engineer, and earn the pay that comes with those higher positions, you need to stay on the same company and even same project for much longer periods of time (I would say 5 year absolute minimums). If I look around at the careers of Distinguished Engineers and senior principal engineers, or VPs of Engineering at FAANGs, etc., these people always have massive chunks of time at the same company, often many years on the same product even. If they have changed companies a few times in their careers, it’s after a string of promotions and delivering big things. It is really hard to build a portfolio of high-level impact with 2 year stints.

Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#72

Post by PeterCorless »

crooked-v wrote: post #48
PeterCorless wrote: post #27

This is a hideous truth: loyalty is punished under modern corporate feudalism.

I don't think calling it "feudalism" is quite right, because feudalism as a system depends extensively on personal loyalties at each step of the chain of authority. The death of feudalism came from monarchs developing enough administrative power that they no longer had to depend on the loyalty of their vassals to control areas outside their personal domains.

Late-stage capitalism is definitely different than late-stage feudalism.

For example, we still have the equivalent of early Medieval English right of "socn" ("soke") — the right to withdraw our loyalty from one lord and grant it to another. We're not "tied" to our corporate overlords the same way that serfs were through strict infeudation.

A recent court case threw out most of the nonsense non-compete clauses also helped beat away or forestall the rising threat of "you can't leave with what you know... I'll make you unemployable." But that was a threat to modern day "sokesmen."

One can even establish themselves as their own freeholder by incorporating, say as an LLC, or remaining a "freelancer" like the errant knights of old.

In other terms of what I consider "corporate feudalism:"

• Do you wear any "corporate heraldry" (logo'd gear like t-shirts, hoodies, polos, backpacks, laptop stickers, etc.)

• Do you participate in any "corporate jousting?" (benchmarks, competitive bakeoffs, panel talks or meetups)

• Do you have or retain any intellectual property you've created during your employment, or was it all work-for-hire and assigned away in perpetuity?

And don't get me wrong. I am somewhat of a big fan of the medieval period and feudalism. In a way there were more freedoms under feudalism than we realize.

Certainly we had far more free time.

I just find it an interesting mental exercise to spot the commonalities and the differences of then and now.

Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#73

Post by tsunamifury »

ryandrake wrote: post #45
whateveracct wrote: post #7

Earlier quoted context omitted.

I've run into this. I work at a place that claims they pay top market rate. I've poked around other options and it seems like they're right about that! Back in 2014 when this article was posted, it was probably more true. Lots of money frothing around and salaries were growing and growing faster than employers were willing to keep up with for existing employees (although even then, I had a job that gave me a substant…

I've run into this too, hopping from one FAANG to another. In fact, the second company's comp offer was so close to my current comp (about 0.1% over), it's hard to imagine there wasn't some covert information sharing going on. The "job hop for a salary bump" conversations always seem to assume you are early in your career, where this works. My first job hop was for about +50%. My second one was for around +20%. 20 ye…

You don't think they also did mass layoffs together to not suppress wages?

Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#74

Post by iends »

francisofascii wrote: post #57
ApolloFortyNine wrote: post #14

Odd to see skepticism here, I thought this was well known. I've seen it first hand just a couple years ago where a large company was offering new hires a 20% bump, and yet when I told them I was leaving the counter offer was only a 3~% bump.

I think people are skeptical of the 50% figure. New employees joining a firm might make more than the current employees at the same level, but do they make 50% more?

The article is talking in aggregate over a workers lifetime.

Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#75

Post by laweijfmvo »

prakhar897 wrote: post #41

Do employees suffer from having too many jumps in their Resume? After some time, companies would be less inclined to hire these people right?

I think big companies (with recruiters) no, they just want to hire people and keep their jobs. At smaller companies, where non-recruiters are screening resumes, I think yes, but only if it's extreme (like 2+ jobs per year for several years).

Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#76

Post by AlotOfReading »

s0kr8s wrote: post #53

Caution: you might get paid 50% more to work at a company that is 500% worse managed, and therefore is hemorrhaging employees so fast that the only way they can maintain staffing levels is to offer a hefty premium above normal market wages to get new suckers to take a chance on them. If you're nihilistic and believe all employers are rotten, then jumping ship every 2 years might be a decent game strategy, but I tend…

Perhaps this is just personal experience, but the worst jobs I've ever had also paid the worst. The places that are badly managed either don't know or can't afford market rates, so they try and hire cheap labor. Think body shops, game dev, government positions, etc.

By contrast, a place that has expensive employees is going to see their time as more valuable, so there's a direct monetary incentive not to waste it and the cash flow exists to do things. Doesn't always work, but it dramatically improves the odds.

Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#77

Post by s1artibartfast »

JumpCrisscross wrote: post #55
ukoki wrote: post #54

Employers don't reward long-term employees because they don't need to. Even though everyone knows you make more by job-hopping, companies are following a rational strategy because too few people "walk the walk" despite wanting more salary. Arguably unethical, but rational. At the cost of losing a minority of job-hoppers they retain the cheap majority that: - finds job interviews exhausting, or is anxious about being…

In a sense, it’s trading convenience and stability for compensation.

Employees are also giving up compensation for lower risk and fewer unknowns.

A risk adverse person, or even rational one, may avoid still avoid positive EV gambles.

Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#78

Post by LunaSea »

ukoki wrote: post #54

Employers don't reward long-term employees because they don't need to. Even though everyone knows you make more by job-hopping, companies are following a rational strategy because too few people "walk the walk" despite wanting more salary. Arguably unethical, but rational. At the cost of losing a minority of job-hoppers they retain the cheap majority that: - finds job interviews exhausting, or is anxious about being…

This does not match my experience where the average retention duration for employees across all the companies I've worked for or have known has bee around 2.5 to 3 years.

Re: Employees who stay in companies longer than two years get paid 50% less (2014)

#80

Post by laweijfmvo »

I've experienced this to varying degrees over my 15 year career, but can safely say that my current job at a FAANG probably pays more than any job I could get today (including another FAANG). Stock appreciation and more importantly, extra stock awards, are difficult to match.

Or I could be a sucker and 100% wrong.

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