I’m sitting at a Chase Sapphire Lounge at an international airport. All around me are “business people”. How do I know? For starters, they are starring into their Lenovo Thinkbooks. Who else has a Thinkbook but a “person of business”? These folks smile awkwardly every once and awhile. I believe to signal their engagement with whomever is on the other side of their mind-numbing Zoom meeting. The outliers in this room? The lucky ones starring into a MacBook instead of a Thinkbook. Literally not a single person in my view is not grinding away.
Should I be grinding?
Instead of grinding, I started thinking about how many hours these people must work in a week. Their company sent them to this city, away from their family, and even while sitting in this beautiful lounge, here they are working. If they can’t decline that conference call now, then when?
Like most people, these folks are completely tethered to the albatross that is their VPN.
I think to myself, “Forty hours…”. It’s likely that many of these people work far more than that “standard” forty-hour week.
Brutal. I think I’ll have another glass of wine.
🕥 🕥 🕥
After thinking about the amount of time spent working, I started to think about amount of pay.
These people sitting in the fancy airport lounge are clearly of the salaried laptop class worker type. F.k.a., white collar. Here they are, enjoying that sweet-sweet luxury of not punching the clock as an hourly worker…
…by working from this beautiful lounge. And likely everywhere else with a WiFi signal.
About their pay. They, like me, are salaried workers. We can get to an hourly pay rate by dividing an annual salary by 2080 (which is 52 weeks multiplied by that standard 40 hours per week). I think this will be instructive.
Let’s look at an, of course, very hypothetical example.
This person’s salary, and by extension hourly pay using a 40 hour work week, has increased ~375% from day one of full-time employment to year 15 of their career (yellow line). But using that same pay data, and adjusting for the estimated number of hours actually worked in the particular year, the results can be far different.
This is reflected in the orange line. Again, with the same annual pay data, while the annual salary has continued to increase over a career on an absolute basis (the same 375%), the amount of time worked is, on average, less with each passing year. Annual salary is up (numerator), hours worked are down (denominator).
This means that the adjusted hourly pay line ends up going “up and to the right” in a significant way with both variables moving in the “right” direction. In this example, by year 15 the actual hours worked is 20 hours per week which means an 850% increase in hourly pay since year 1.1 That’s a 4 hour work day. Wouldn’t that be nice?
Working less than 40 hours a week is not sustainable for many, and completely unattainable for most. But this clearly illustrates the power of decreasing the denominator (hours worked) in increasing one’s hourly pay as opposed to only thinking about the numerator (annual salary).
Now look at the purple line below. It’s the opposite scenario. Even if annual salary is increasing meaningfully (in this example, once again 375%), if the hours worked also increases, the effective hourly pay is going to be less than the original orange line, resulting in a 250% increase in actual hourly pay. Far less than the 375% increase in salary.
This is not a complicated concept. But a lack of applying it can lead people to make some less than great career choices. In fact, I think such choices can end with you working from this lounge.
As I contemplate this, I look around and I notice the people working behind the bar at the lounge. They are almost certainly paid hourly. Yet I notice they are smiling more than the representatives from the laptop class. Maybe because they don’t even have a corporate Zoom account. Imagine that?
🩺 🩺 🩺
Time is our most valuable asset. Thinking about your actual hourly pay even as a salaried worker is not a common practice but one I am finding insightful.
It seems so obvious that the job with a $120,000 salary is better than the one with $100,000 salary. How about $200,000 versus $175,000? Higher is better, duh. But what I am arguing is it is not that simple.
What are the tradeoffs? What are the downright negatives? How much of “you” are you trading for that salary? Is working 10 additional hours a week worth $25k? How about 20 hours?
Pay can mask a lot, but not all. There can be real negatives to otherwise good jobs. A high stress job, for example, can have ramifications that ripple throughout one’s life. Stress can even have an actual, deleterious impact on health, it seems. These choices may be an actual matter of life and death.
As I barrel towards middle age, of all the things that may be shortening my life, I don’t want work to be one of them. Inevitably work, like the rest of life, will bring stressors. But it’s important to take a measured, balanced accounting of how we are thinking about work/life, pay/stress, and so on.
The right answer as to whether that $25k salary increase is worth it is going to have something to do with what’s sustainable over the longer-term. That varies by individual.
Taking a more balanced approach to stress and hours worked inevitability means it’s going to be difficult to fully maximize pay. As I ponder if I am okay with that, I sit and watch my fellow laptop class working class stiffs stare into their Thinkbooks with dead eyes. Today, I am. But I must wrap here as I have an arduous 4-hour work day tomorrow and the smiling bartender has brought another glass of Chase’s finest pinot noir.