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The Almighty Buck IT

Are Skimpy Raises the New Normal? 736

Posted by ScuttleMonkey
from the something-is-better-than-nothing dept.
Lam1969 writes "Computerworld just released their latest salary survey, and it finds that IT worker bees have once again only received small raises. The article notes, "IT raises still lagged slightly behind the average of about 3.2% for all U.S. workers as reported by the Bureau of Labor Statistics. While the majority of respondents (69%) said their 2004 base salary increased from one year ago, 31% experienced either no change in salary or had their pay cut." It goes on to quote LAN specialist Stephen Noisseau as saying, "I guess that's the way the cookie crumbles ... I'll take 4% over nothing. We're getting basically cost-of-living raises.""
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Are Skimpy Raises the New Normal?

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  • by Duncan3 (10537) on Monday October 24, 2005 @07:43PM (#13867681) Homepage
    We're getting basically cost-of-living raises.

    Welcome to the way the rest of the universe works. Be glad you even got that. Most poeple have to find new jobs to get a raise at all.

    Don't worry, I'm sure another bubble will be along to get you a 100% raise every 6 months like the good ol days.
    • by jellomizer (103300) * on Monday October 24, 2005 @07:51PM (#13867764)
      Exactly the only way for us to get raises is to find a better paying job. If enough tech workers do this then companies may give higher raises to keep their workforce. Or they (Like my company) will replace these people with people will less skills for less pay and train them with experience.
      • by SeaFox (739806) on Monday October 24, 2005 @08:45PM (#13868128)
        If enough tech workers do this then companies may give higher raises to keep their workforce. Or they (Like my company) will replace these people with people will less skills for less pay and train them with experience.

        In other words, fire the experienced employees who want a decent wage and hire unskilled workers who don't have the guts to ask for more pay and let the customers suffer with bad support while the new class learns what the hell they're doing..

        At my employer (we do contracted support) The client pays for training classes for new employees (these training classes are not as long as they should be but anyway) what happens if the company can't retain the new hires? They have to hire some more and the client has to pay for their training. At some point, the client gets tired of paying for new groups to be trained, and simply don't allow new classes. The result is a hiring freeze for that department. The employees on the project get overworked, irritable, ect. trying to cover the workload of a larger group. We may have oppertunities to earn more from overtime when this happens, sometimes these "oppertunities" are not our choice. In any case, the remaining employees don't get any additional compensation per hours for the extra workload. This situation continues until the company that hired us starts to lose money from their customers leaving from bad support or the employee numbers drop to a point where it is not possible to fulfill staffing hours. The only people who really suffer in the end is the employees who don't quit and the customers (end users) who deal with poor support.
        • by uncqual (836337) on Monday October 24, 2005 @10:18PM (#13868594)
          We may have oppertunities to earn more from overtime...

          Please explain this concept of "earning more" by working overtime. I'm very confused. :)

          • by SeaFox (739806)
            Please explain this concept of "earning more" by working overtime. I'm very confused.

            Well there's the first way:

            Working overtime is generally not allowed, so by working all scheduled hours I am making the most money possible at my pay rate (without raising ire with the higher ups). I'm scheduled for 40 hrs a week, so base wage x 40 = maximum weekly gross. But when overtime is allowed I can work over 40, so the weekly gross will be more than what my normal maximum weekly gross is.

            Then I also get time-and-a-h
      • by timmarhy (659436) on Monday October 24, 2005 @08:49PM (#13868157)
        way to have shit staff. i've been in that position and you end up with a constant stream of sub par staff who leave you at the drop of a hat. retraining costs money, you'd better of hanging on to staff with a clue if you can. it doesn't take huge pay rises to keep people, just a sense they are being paid well for a job well done.
      • by quarkscat (697644)
        "Or they (Like my company) will replace these people..."

        Meager wage increases (if you get them at all) are now the norm rather than the exception. The change to labor laws under George W. Bush were not an anomally -- your employer now expects you to work longer hours for less pay and benefits. Consider yourself lucky if your job hasn't already been offshore outsourced, or not in the planning stages. Your 401K overseas investments are growing fastest because you are helping to finance your company's globa
      • by Bill Dog (726542) on Tuesday October 25, 2005 @02:32AM (#13869726) Journal
        If your company could replace people with less-skilled counterparts, then they probably should've done so long ago.

        Here's what it is with most companies: After a while they take you for granted, and are no longer interested in paying you what you're worth. But to another company you're all new and shiny and irresistably mysterious, so they'll offer you more to lure you away. So your old company now has to pay market value+ to replace you, so they're now paying *more* for someone 1) they don't know, and 2) who's not familiar with the code base and procedures for getting reimbursed for travel etc. Each company would be better off working to retain the competent that are already up-to-speed on that company's stuff, but instead they in effect force musical chairs amongst all but the dead wood.
    • by Alex P Keaton in da (882660) on Monday October 24, 2005 @07:53PM (#13867780) Homepage
      Exactly... Around here (Ohio) the job market is so bad, for both degreed and non degreed workers, that people seem happy just to keep their jobs, raise or not. Sometimes it seems that employers create an atmosphere where everyone thinks that they are an inch from unemployment, so they don't have to give raises...
    • by Anonymous Coward on Monday October 24, 2005 @07:57PM (#13867804)
      After 2 years of unhappiness and general lack of hope in my current job, my group has a 30% turnover.

      I remember hearing over and over that raises where only 2% for the last couple years. In fact, due to cost cutting they stopped collecting the trash cans on a daily basis. Now, instead of individual trash cans in our cubes, we have communal trash cans in the hallways, which are emptied once a week. BTW, we keep having record quarters.

      So, when my boss's boss threatened to give me a bad review and no raise, I shrugged my shoulders and informed him that "My annual 2% raise is close enough to 0% that it didn't matter." I then proceeded to tell him that he had a structural problem. The lack of raises provided him with no "stick" and the lack of advancement opportunities provided him with no "carrot."

      I have already decided to leave as soon as the first of the year comes around (and I quality for the End-of-Year bonus).

      The funny thing. I honestly believe I got a 2% raise last year. That is what everyone says the raises were. I was doing some record keeping this weekend and noticed that I actually got a 8.25% raise last year.

      Sometimes perception and reality don't match.
      I am still leaving though.
    • by forand (530402) on Monday October 24, 2005 @08:02PM (#13867847) Homepage
      I think I have heard this type of argument before. . . OH YEAH that was it when slave owners told their slaves that they were better off being slaves in the US than being godless in Africa. My point is that one should not have to be "glad" that they are getting a cost of living increase in pay. Convincing people that they should be happy in a bad situation isn't doing anyone any good. In the long run you are correct that people will have to look for different jobs to get the money they need just to maintain their standard of living which will hurt the employer. Similarly switching jobs like this plays havic with many retirment plans which will hurt the employee in the long run. Just because it is the way it is doesn't mean anyone should be happy about it.
      • by heinousjay (683506) on Monday October 24, 2005 @08:08PM (#13867883) Journal
        Here's something I've noticed - take it as you will.

        People that have the attitude of entitlement, that someone must take care of them, that they deserve increases, tend to do worse in the long run over people who believe they are owed nothing and must earn every penny.

        All my evidence is strictly anecdotal, so I won't bother detailing it. Feel free to discount this.
        • by IdleTime (561841) on Monday October 24, 2005 @09:27PM (#13868367) Journal
          If I and the rest of my cowrkers do such a good job that the company makes a few billion dollars in profit each year and the company raise the price of our prodcts each year, but have problem giving the employees the slightest wage increase. THAT is the real problem, the company I work for and many, many others are having record years, the owners fortunes increases drastically each year because we do such a good job, WE, not THEY, because without us, they would not be rich, but without them, we couls still produce and sell the same product.

          Nobody is talking about entitlements here, that is a typical right wing talking point without foothold in reality.

          Over the past 6 years, we haven't even gotten cost of living raises, basically resulting in making LESS and LESS money each year.
          • I think what the grandparent is saying is that instead of complaining that you don't feel you're getting paid enough, you probably should go out and start a company/find a new job. If enough people are getting screwed over by their employers (in the way you say they are), then you should have no problem assembling a good workforce and making a decent profit, both for yourself and for your workforce.

            If you do that, you'll not only better yourself, but the world as well.

            Of course, 90%+ of people don't do tha
      • by elgatozorbas (783538) on Monday October 24, 2005 @08:15PM (#13867923)
        Actually a raise equal to the cost of living sounds rather fair to me. If everybody would get a raise significantly higher than the cost of living, things (produced by those employees) would become more expensive too, making the cost of living follow the increase. It is like saying 'everybody should be above average', no?
        • by StillAnonymous (595680) on Monday October 24, 2005 @08:21PM (#13867975)
          But that discounts your increasing experience and (hopefully) better performance at your job that occurs each year.

          If there's no raise, there's no incentive to work harder. Unless of course you're easy to replace and your experience doesn't matter to the company...
        • You've left one thing out of your math. Workers get older and gain experience. More experienced workers are worth more than fresh college grads (in some industries, at least). If experience matters in your industry, you should expect raises somewhat higher than the cost of living increases as you get older. The reason this doesn't cause runaway cost of living increases is that people eventually retire and are replaced by new college grads.
    • by liquidpele (663430) on Monday October 24, 2005 @08:06PM (#13867873) Journal
      Everyone at my job told me as soon as I got there, "work here for a couple years, then go to another company. You'll get a much bigger raise, then work there for a couple years, then apply back here again. You'll end up making 10x what you would if you just stuck around trying to get raises."

      Point is, you've gotta know how much you're worth, and if you're not getting that, find someone who will pay that (this of course ignores the happiness factor).
    • by HermanAB (661181) on Monday October 24, 2005 @08:16PM (#13867932)
      What? Some people have jobs?
    • by zerocool^ (112121) on Monday October 24, 2005 @09:13PM (#13868299) Homepage Journal

      Way to be callous, man. A 2% raise... adjusted for cost of living, that's actually a pay cut.

      Health care costs are up, gas costs twice as much as it did a year ago, houses are unaffordable - up 85% in the past year - in any location where there are jobs, but you can't live far away because you can't afford to commute, and yet you can't work for some small town company with no health benefits...

      I didn't get a piece of the Dot-Com bubble, and now that we're on the downside of it, there are no jobs that pay a living wage, and lots of us are looking for other ways to make a living. It'll come back around, and salaries will become more consistant with cost of living... but in the mean time, I wonder about whether or not I should take my 1 year old to the hospital or if his cough is going to get better on its own with time and generic robitussin, because the emergency room doctors here don't participate with my independant keycare health plan and I really can't afford it.

      Save your harsh words for the realtors, man. All I'm trying to do is scrape by and take care of my family.

      ~Will
  • Hard Times (Score:5, Informative)

    by ackthpt (218170) * on Monday October 24, 2005 @07:43PM (#13867687) Homepage Journal
    LAN specialist Stephen Noisseau as saying, "I guess that's the way the cookie crumbles ... I'll take 4% over nothing. We're getting basically cost-of-living raises."

    Took a 30% pay cut two years ago, as nothing was available but a job 40 miles from home. Only one pay increase in two years, 1.15% which has more than been eaten by the rise in petrol cost.

    It's simple Supply-Demand (Keynesian economic theory), when workers with a particular skill set are not in demand or supply excedes demand, there's not much rationale to give workers higher pay. Of course some increase is a sign of goodwill and encourages workers, but tell the beancounters.

    Oh, and the execs got about 6% pay increase this year. Can't have that lot starving, can we?

    • Re:Hard Times (Score:2, Informative)

      by ichin4 (878990)
      Deriving an equilibrium wage using supply and demand curves has nothing to do with Keynesian economic theory [wikipedia.org]. Economists (and mere mortals) understood the effects of supply and demand on wages long before the mid-20th century.
      • by ackthpt (218170) *
        Deriving an equilibrium wage using supply and demand curves has nothing to do with Keynesian economic theory. Economists (and mere mortals) understood the effects of supply and demand on wages long before the mid-20th century.

        Do tell me, now that Web Design is a commodity skill, who still makes six figures designing web pages?

        The last person I knew who was doing that is now living in his parent's house.

    • Re:Hard Times (Score:5, Informative)

      by keraneuology (760918) on Monday October 24, 2005 @08:15PM (#13867925) Journal
      Oh, and the execs got about 6% pay increase this year.

      Only 6%? That's not much... 2003 saw the average Fortune 500 CEO's salary up 22.18% [cnn.com].

      In 1992 the average CEO made 82x the average employee's salary. By 2004 this ratio has climbed to 400x [stanford.edu].

      Don't forget Gary Smith [msn.com] who was awarded $41.2 million for overseeing the elimination of 93% of Ciena's value in just 4 years.

    • Re:Hard Times (Score:5, Interesting)

      by Audacious (611811) on Monday October 24, 2005 @08:31PM (#13868043) Homepage
      I've gone both ways in pay scale. When I worked for a university once there was a stretch of three years when we never got a pay raise. Usually we only got a 1% or less pay raise. When I became an assistant manager I found out what was going on - the higher-ups were taking all of the money even when the state congress expressly stated that no managerial personnel was supposed to take a pay raise for that year. Pay raises of 3-5% were the norm.

      On another front, a friend of mine was also working at the university. After three or four years of never getting a pay raise he decided to find out what was going on. In his case, he wanted to look at the accounting books. It turned out that the accounting books were on the top floor of the library accesible only by stairs and no photography equipment was allowed on the top floor. Also, no pens, no paper, no pencils, nothing - except yourself. (Althought you could ask for a pencil and paper as you will see here in a sec.) It took several hours (and several days) of making requests for various accounting books, being told they were not available, being denied access to records, and the like to finally get hold of the books he wanted to look at. Turns out they were all done in pencil and several of them had areas that had been erased. Lucky for him, the sections he was looking for were still in good condition. After looking at the pages he asked for some paper and a pencil. The person would only give him one sheet of paper, one pencil, and stood over him while he copied the information from the book to ensure he didn't modify the books. Only one sheet of paper was allowed per person per visit. So it took him a while to get all of the facts. It turned out one person who had hired on with the department had funneled almost all of the funds to themselves. Something like a 30% pay increase each year for the past few years thereby doubling their salary in a very short amount of time. Since the "librarian" had stood over him and watched him copy everything he had the foresight to get the person's name as a witness to what he'd done so there could be no mistake about what he'd found out. He threatened to expose the whole affair if the offending person wasn't fired. They were and the money got distributed like it was supposed to be distributed to everyone. No charges were ever filed against the other person.

      This is why I hate the "let's hide what everyone makes" mentality of most companies. As the saying goes "Evil can not stand the light of day but loves the darkness of the night." Which is to say that you can not do covert things unless you hide, misdirect, or mislead others in what you are doing. So remember that the next time raises are (or are not) handed out. Those people above you didn't take a "0%" pay raise. They took their cut out first and then went "Oops! There's nothing left for the rank and file. Oh well! Maybe next year!"

      One last thing: Any time your boss gives you little or nothing as a raise; just remember this one thing - Every company has to file their income tax returns and those returns are open to public scrutiny. But more importantly, there is a company that already does this for you. They are Standards and Poor. Any major library in any major city will have the S&P books on hand for each year. All you have to do is to go to the library and look up the year you are told you are not going to get a raise (or even if they cut your pay). You can look up your company's information, see what the head of your company had to say about that year's profit and loss, see what dividends were paid to the stockholders, and even see how much money the company's owner made for that year (and you can compare it to the year before's amount to see what kind of a raise they got). Go and look at it. See how much of a pay decrease they took. I think you will be very surprised to find that even in the worse years they didn't take a pay cut or no raise at all but instead usually take about a 7-10% increase every year. Not to mention bonuses they may have taken on top of their pay increases.

      Something to think about.
  • I often wonder about these surveys... who is an "average"? Who is an "average" slashdot poster? A bot?!
  • by heinousjay (683506) on Monday October 24, 2005 @07:45PM (#13867707) Journal
    Is it really a valid expectation to automatically get a salary increase? What happened to earning it? I feel pretty confident in saying that 69% of all workers didn't perform above average, so why should they be expecting a reward?
    • by MoonBuggy (611105) on Monday October 24, 2005 @07:53PM (#13867779) Journal
      The first thing that springs to mind is inflation. No raise is the equivalent of a pay cut, taking into account the fact that your salary buys less as time goes on.
    • Many of us have got lazy. During the Mid-Late 90s you could make millions for saying HTML on your resume. Now they expect more, now they want such odd things like "People Skills", "Experience", "Work Ethics", and "Competence". Now the tech workers who are doing above average are those people who started working in the early 90's and Late 80's who knows what real tech working is about, and you should also watch out for those who started working post bubble, who are trying to get a food hold in the market
      • by King_TJ (85913) on Monday October 24, 2005 @08:30PM (#13868039) Journal
        Every time I hear the "in the 90's, people stumbled all over themselves to pay you I.T. guys to do practically nothing" line, it makes me cringe. See, like a lot of people I knew, we stayed here in the midwest during the .com explosion, figuring "Hey, all those modern-era gold-rush people will come back soon enough with their tails between their legs anyway." Instead, we worked hard for our below-average salaries, confident that our commitment to the job and dedication would win out in the long run. Then, many of us got laid off while the scammers and cons came back with millions from stock options, or hundreds of thousands for providing practically useless services to failing businesses. Some thanks we got for "doing the right thing", huh?

        Best job I could find after that was a couple years of working in a guy's unheated garage scrapping together used computers for resale cheap to daycare centers and preschools - for less than half of my former, below-average salary. I'm *still* trying to find something that might at least pay close to what I made in '99-2000!

        I agree that smart businesses are clued in more to things like "people skills" and "work ethics" nowdays, but from what I've been running into around here - the single most impotant thing you can have is an inside connection. Almost everyone I know in this market who has a good-paying job in I.T. got there because they had a friend in management. They need a decent resume too - but you're just another piece of paper in H.R.'s resume pile unless you have connections who get someone to "pull your resume" and seriously consider it....
    • It's based on the assumption that the more experience a worker has, the more valuable he is to the company.

      Salaries aren't about "earning it". The company figures out how much they value your labor, and then figure out how much less than that you will accept. If the later is lower than the former, they offer it to you, otherwise, they fire you.

      Salaries are low because most people don't seem to understand that a company will generally attempt to pay you as little as it can without losing you.

  • by AnswerIs42 (622520) on Monday October 24, 2005 @07:46PM (#13867713) Homepage
    I have never heard that word before.. I have never experienced it. Paycut I know, I have had three of them :\

    The only way I can see increasing my pay is to leave this job for another. And this is NOT a good market now to do that.

    Would LOVE a 2% or 3% raise once a year or so...

    • In SK, a supposedly labour friendly environment, the government proclaimed that its employees would get 0,1,1% over three years for raises and no more. Since then most departments have cut deals above that, but still barely the rate of inflation is given. People whine and whine about teachers getting 2%/year when that doesn't even cover the cost of inflation which is more like 2.4% last I heard. The average raise was closer to 3% in the private sector.

      I think that not giving employees a raise better than
  • by Anonymous Coward on Monday October 24, 2005 @07:46PM (#13867717)
    And keep in mind that a 0% raise is actually a pay cut, due to inflation. If you're not averaging about a 2% raise every year, your income in terms of buying power is declining.
  • by jkind (922585) on Monday October 24, 2005 @07:47PM (#13867718) Homepage
    I'd like to see how the raises compare in North America versus countries where a lot of the outsourcing jobs are popping up...
    But I guess 10% increase in those countries would still be a steal for the labour they are receiving in return.
  • IT=cost center (Score:2, Insightful)

    by Kaphin (834914)
    IT does not generate revenue for a company, unless that company is of course an outsourcing firm. Get into a revenue generating line of work and then you'll make some bucks.
    • Re:IT=cost center (Score:3, Insightful)

      by mister_llah (891540)
      Yeah! Amen!

      You don't need IT to run a company, just like you don't need oil to run a car!

      Just don't expect it to run very well or for very long.
    • Re:IT=cost center (Score:3, Insightful)

      by Soko (17987)
      I once worked under a very intelligent person. One of his pearls of wisdom was this:

      "A companies IT infrastructure is like a highway. No one really notices it when everything is smooth. However, just add one pothole..."

      As I said, he was a very intelligent man.

      Soko
      • If you run the IT department, you need to market the IT department. Things like What We've Done For You Lately; Ways We're Making The Company More Profitable; etc... If you come from the frame of mind that IT should be invisible until there's a crisis, then when things get tough, the Finance guys are going to look at that big department that spends a ton of money and say, "Just what exactly do these guys do?"

        If you market the IT department and prove its value to the company, raises are much easier to come
  • by jellomizer (103300) * on Monday October 24, 2005 @07:48PM (#13867731)
    Well it is a situation where we are recouping from a huge bubble. We had the end of Y2k in 2000, then 9/11 that scared the chicken investors, Out Sourcing in 2002, By Late 2003 we became so disenfranchised that we were willing to work a large fraction of our pay, 2004 got a little better when they started to see the outsourcing isn't as much a value as they thought. So now most companies are still careful on their IT spending, and with a good supply of IT workers they are willing to save on their budgets as long as possible. So Raises will be COLAs for a while until we get more scares or there is a large business need for some new technology (Like the Web in the late 90s) But right now we are humbled back to the average income job. As it probably should be.
  • by UpLateDrinkingCoffee (605179) on Monday October 24, 2005 @07:49PM (#13867741)
    How many of your employers use a good bonus year as an excuse to skimp on raises? Sure, bonuses are great and all, but they come and they go... I personally think it's ill advised. When base salaries fall behind the market as soon as the bonuses dry up, it seems like a mass exodous is likely. What do I know, I just need the extra money to pay for gas (most of which is used for my commute)
  • by SupahVee (146778) <superv@NosPam.mischievousgeeks.net> on Monday October 24, 2005 @07:50PM (#13867743) Journal
    And while I may whine about the fact that most of the time I have to jump jobs to get a raise, if I hung around those places, i'd probably be likely to get the 3-4% every year or so, and I don't really have a problem with that.

    What I do have a problem with is when I only get a 3-4% raise, yet, executives can give themselves 50% raises, 4 million dollar bonuses, etc. There is nothing a CEO can produce that warrants that level of compensation. PERIOD.

    I say we find somebody crazy enough in congress to propose a salary cap for CEO's bill. Then tell everyone in the public about it, and see how many people really support something like that. Especially when the workers outnumber the C-level's probably 100 to 1.
    • by guyjr (180613)
      Good theory, one I'd like to believe in, but remember - in the U.S., it's not who votes for you, but how much money those people put into your campaign coffer. Can't exactly run a national campaign in this day and age without a multi-million dollar advertising budget.

      Jeez... W raised over _100_ million dollars in the last campaign if memory serves right. Mayor Bloomberg is a _billionaire_. The _last_ people these politicians listen to are the working class. Sad as it may be.
    • by NekoXP (67564) on Monday October 24, 2005 @08:03PM (#13867857) Homepage
      Most CEO's get their pay raises voted on through the board of directors of the company, and any majority shareholders that aren't on the board.

      Of course they can all also vote themselves the same outrageous pay raises..

      A salary increase cap I doubt you could push through - you'd have to rule out the fringe cases where a guy DID earn $4m bonus a year (for instance, turning a company around from bankruptcy - I imagine a couple of airline bosses are hoping they can swing this)

      What I suppose could happen is that salary raises and bonuses are capped based on percentages of profit margins and difference between previous years (if it's profits up, add a percent or two, if profits are down, reduce a percent or two), and written into company charters.

      How much could Bill Gates grant himself per year if he had a 3% pay raise and a further 2% bonus on a good year? How about Steve Jobs?
      It's probably no better than the current "corruption" :(
      • by Ziest (143204) on Monday October 24, 2005 @08:13PM (#13867912) Homepage
        How much could Bill Gates grant himself per year if he had a 3% pay raise and a further 2% bonus on a good year? How about Steve Jobs?


        If I am not mistaken, Steve Jobs has an annual salary of $1.00. Considering how much stock he owns and how much money he made in the past I don't think he thinks very much about how much he is getting paid. I think the CEO of Cisco has the same deal.

        Z.

  • by Canberra Bob (763479) on Monday October 24, 2005 @07:50PM (#13867745) Journal
    Thats why I always aim for a decent base package before I sign up. I take the approach that I will only work for an amount I am happy with for that position, any raises, bonuses etc are then just icing on the cake as I dont really need them and dont really care. Also stops me from overworking and chasing the pay rise / promotion that never comes (hint: if you want career progression and better pay you have a far greater chance getting it faster by changing jobs than just sitting back and waiting your turn)
  • Disorganized Labor (Score:5, Interesting)

    by Safe Sex Goddess (910415) on Monday October 24, 2005 @07:54PM (#13867788) Homepage Journal
    I was already modded down as a troll in an earlier posting last week for being pro-union. But no one tells me to shut-up:-)

    I'll say once again:

    Blue Collar = Organized Labor
    White Collar = Disorganized Labor

    Democracy is about working together to be treated fairly. Why should corporate profits leap by huge percentages while employee salaries do not?

    • by Kombat (93720)
      Why should corporate profits leap by huge percentages while employee salaries do not?

      Because during the years when revenues drop, those same employees will fight like hell against taking a corresponding pay cut. Are you really sure you want to tie salaries directly to revenues?
    • by Usquebaugh (230216) on Monday October 24, 2005 @08:21PM (#13867968)
      Organized Labour = Paying for tyrant who tells you to stop work.

      I lived through the 70s & 80s in the UK. Unions help nobdy but those elected to an office within the union.

      I'd rather join the bloody masons than a union and I consider the masons scum.

    • by patio11 (857072) on Monday October 24, 2005 @08:22PM (#13867982)
      Democracy is about working together to be treated fairly.

      However, I don't want to be treated *fairly*. I want to be treated *well*. Maybe its the ./ Conceit, but I think I'm better/more employable than the guy in the next cubicle (figuratively speaking, considering the next cubicle is a printer) and don't want to have my ability to bargain *for me* compromised just so he gains immunity to firing. I also don't want to get X% of my pay jacked in an additional tax to support a bunch of layabout "leaders" who will spend the majority of their time spending my union dues on lavish offices and political causes which I don't support anyway.

  • by nurb432 (527695) on Monday October 24, 2005 @07:55PM (#13867790) Homepage Journal
    Too many people are out of work these days due to plant closings and businesses outsorcing everyting, including the kitchen sink.

    Be glad you get a paycheck. After having to live thru 2 bankrupt companies, I am..
  • Hopefully (Score:5, Funny)

    by t_allardyce (48447) on Monday October 24, 2005 @07:57PM (#13867809) Journal
    I give my Chinese sweatshop kids a raise now and again, usually about a cent a month extra, sometimes a dollar bonus if they've been churning out consistently good shoes. It keeps moral up and gives them the belief that they might one day make enough money to break free of their shackles. I would warn bosses against so called 'perk raises' for example taking the number of tardiness lashings down might seem like a good idea but I've had problems when the workers start boasting about it and eventually UNICEF or someone finds out that we actually _are_ lashing them. That was a pretty costly lawsuit. In all I would say treat em mean and keep em keen. Its far better to threaten a wage reduction for poor work than to offer a raise for good work, instead just tell them that you're only paying the Pakistani kids half the price and that will get them feeling pretty good.
  • Outsourcing... (Score:3, Insightful)

    by HockeyPuck (141947) on Monday October 24, 2005 @07:58PM (#13867819)
    "Senior management says, 'If you don't like the work, we'll get somebody in India to do it.' The computer people are seen more as part of the technology rather than part of the human resource,"

    Translation:

    Beggers can't be choosers.
  • Until the econ gets rolling, we have a new paradigm shift, or all compitition stops, we will recieve small raises. Once there is a new way to reduce business costs via IT, and it starts to get implemented, then and only then will we go back to large raises.

    Compitition is a good thing.
  • And in other news.. (Score:5, Interesting)

    by siliconeyes (154170) on Monday October 24, 2005 @08:01PM (#13867835)
    Salaries in India to go up by 11.4 percent [finfacts.com], possibly the highest in the whole world.

    As a small mobile software developer in India currently looking for fresh business and perhaps adding employees other than myself to the business, this news makes me have second thoughts!

  • The paradox (Score:5, Insightful)

    by Y-Crate (540566) on Monday October 24, 2005 @08:02PM (#13867852)
    What always gets me every time we have a discussion about raises is that any call for pay increases to the rank and file is met with fierce opposition by those who claim it will obliterate the economy via inflation and will rob shareholders of their rightful gains while sending corporations reeling into bankruptcy.

    So, I must pose the question, why is it perfectly fine for managers (especially those in the upper echelons) hand out massive raises to themselves and their cronies that are often the equivalent of several times the average salary of their subordinates? The typical CEO makes 450 times as much as the average person they employ. Even when business is bad, layoffs are rampant and wages stagnant, the raises for the managers continue - because according to them, poor performance is always the fault of the lower rungs, while good quarters are always thanks to their expert stewardship.

    The auto parts company Delphi is asking for their non-management staff to accept 50-69% pay cuts, (these workers were described as being basically worthless in a speech the CEO gave two weeks ago) while the managers that have presided over the company sliding into bankruptcy are going to get massive raises.

    Please explain who spending tons of money to compensate workers who are being asked to produce more per hour, work more hours and accept fewer fringe benefits like comprehensive healthcare coverage is some evil, evil thing that shall destroy every company and drive them into bankruptcy, while distributing the same amount of money to the higher ups is no problem whatsoever?
    • Loyalty is Stupid (Score:5, Interesting)

      by mosb1000 (710161) <mosb1000@mac.com> on Monday October 24, 2005 @09:19PM (#13868328)
      This is what I don't understand. If you feel that a pay-cut is unfair, why do you stay with the company? I mean, if you think your time is worth more, why are you pissing it away working for less than you are worth? The fact of the matter is that companies can't be loyal to their employees and remain competitive. If your employer is not going to be loyal to you, you should not be loyal to him.

      The whole principle of a free-market economy is fair exchange where both parties feel that they are getting back an equal or greater amount of value than what they put in. If you're not getting that out of an exchange, you shouldn't be participating in it.

      Managers can do whatever the hell they want, a company run by morons is going to go bankrupt in short order, and it's the shareholders who will pay for their stupidity. That's one of the risks of investment, and it is also why many shareholders keep a close eye on what is happening with their investment. If you feel like your boss/the leadership of a company you've invested in is making stupid decisions, for god sake get out now or they'll take you down with them.
      • Re:Loyalty is Stupid (Score:5, Interesting)

        by Jah-Wren Ryel (80510) on Monday October 24, 2005 @10:22PM (#13868612)
        This is what I don't understand. If you feel that a pay-cut is unfair, why do you stay with the company?

        Health insurance. It isn't the only reason, but it is decent sized. In particular pre-existing ailments. A lot of health insurance plans will not cover pre-existing conditions until you've paid 12 months worth of fees.

        For anyone with a kid or spouse with a pre-existing condition, the thought of no coverage, especially if the condition could dramatically worsen, is enough to keep them from even considering switching employers.

        Which, is why I believe employeer-provided health insurance is evil. I don't believe in state-provided insurance either for all the inefficiences that come with socialism. I do advocate for personal health insurance, where you are personally responsible for each dollar spent for fees and it has no ties to your employer or any other group that would use it to coerce you into acting against your own best interests.
        • Re:Loyalty is Stupid (Score:3, Informative)

          by pete6677 (681676)
          A lot of health insurance plans will not cover pre-existing conditions until you've paid 12 months worth of fees.
           
          I believe this is only if you have had a lapse in coverage of more than 3 months. If you transfer from one insurance plan directly to another, they should cover everything. I could be wrong, but this is the way the plans have been at every place I've worked. The idea is to prevent people from not signing up for insurance until after they come down with a major condition.
  • by Surt (22457) on Monday October 24, 2005 @08:02PM (#13867853) Homepage Journal
    Ask your prospective employer if they offer superior raises to overperforming employees, and what kind of range such a raise might be in.

    I always ask this question, and as a result, i've never had a raise less than 9%.
  • by TheNarrator (200498) on Monday October 24, 2005 @08:33PM (#13868058)
    I was curious as to how rich a programmer would feel in India vs the U.S. That is a comparison of wages programmers receive in the Us vs India divided by the average wage for those countries which dictates the cost of living in general. Perhaps somebody could put together a global index for various professions?

    The International Herald Tribune says that the average wage for an experienced programmer in India is $11,423 a year. The average wage for an experienced programmer in the U.S is $83,000 a year. However the average per capita income in India is $3,100 and in the U.S it is $40,100. Per capita income is a good indicator of the relative cost level for people living in a particular country.

    So the programmer vs average salary ratio in India is 3.684 while in the U.S it is 2.069. To feel as rich as an experienced Indian programmer an American Programmer would have to make $147,728.

    Origional article + links to references, etc over at my blog [blogspot.com]
  • Cry me a river (Score:3, Interesting)

    by ccmay (116316) on Monday October 24, 2005 @08:44PM (#13868125)
    If folks find this unacceptable, let them start their own companies. The fact is, any increase in salaries must be matched by an increase in productivity in order to be sustainable. I dare say that IT has added precious little to most companies' bottom lines in recent years. We have crossed into the realm of counterproductivity, when systems that should be used for work-related functions are used instead for running office football pools, surfing for porn, checking one's auctions on eBay, or reading Slashdot. Moreover, the task of ferreting out wasted time on computers, and punishing it in a HR-approved manner, is more than the company can hope to save in increased productivity. There are many jobs that could be made more productive by returning to pencil-and-paper, or at least mainframe computing.

    -ccm

    • Re:Cry me a river (Score:3, Insightful)

      by aeoo (568706)
      We have crossed into the realm of counterproductivity

      Are you saying that the productivity of the CEO's is continuing to skyrocket, despite all this? This would explain why CEO's salaries rise like crazy and the gap between the rich and the poor keeps increasing. I didn't realize it was all the poor people's fault.

      It's kinda like copyright infringement is on the increase, but the media industry is having another record breaking year, while laying off employees at the bottom level. A bit like that?
    • So it's only the amount added to the bottom line in recent years that matters, in terms of valuing an employee? In that case, what has the CEO done add to the bottom line? What about the CFO? Where has their direct contribution been?

      Oh, wait, they don't add to the bottom line at all.

      See, businesses function as an entire unit, and not every component of that unit is going to directly add to the 'bottom line'. It is important to recognize that, although many departments don't directly generate revenue, th
  • by RobinH (124750) on Monday October 24, 2005 @09:00PM (#13868222) Homepage
    4% is more than the consumer price index, even including energy, rose in 2004. A 4% raise is more than a cost-of-living raise. It's not much more, especially this year with gas prices skyrocketing, but inflation has been very low recently. That translates into smaller raises. Compare it with the real numbers.
    • Keep in mind that the core CPI [wikipedia.org] excludes gas and food prices, which are more volatile than other basket goods. The Fed prefers the Core CPI to the overall CPI as an inflation guage. Because gas prices have risen so much lately though, and because unleaded gasoline futures are expecting the price to remain about the same over the next 2 years [nymex.com], it is reasonable to expect that the overall CPI will increase moderately as well in the same time period.

      This image [wikipedia.org] shows the CPI over the last century. Note how the
  • by ucblockhead (63650) on Monday October 24, 2005 @09:16PM (#13868312) Homepage Journal
    Many places flat out lie. Be prepared to quit. It's often the only way to get a real raise. There was one place that, after I had worked there nearly a year, gave me a 2.25% raise, claiming that it was "all they could do". So I went and got another job. When I have notice, they offered me an immediate 10% raise if I'd stay. I laughed at them, and suggested that if they would give decent raises, they wouldn't have such a problem keeping good people.

    Unfortunately, there's too many saps out there who complain about shit raises, but won't go out and do something about it. Don't like your raise? Get a new job, and then when you leave, tell them exactly why. If more people did that, raises would be higher for everyone.

    • Laughing was dumb (Score:3, Insightful)

      by Srin Tuar (147269)
      I would never laugh in their face, or do something so short sighted.

      Be reasonable: Tell them exactly how much it wil cost them to keep you.
      If they are willing to pay it, then tell the new company you were going to go to
      about it, and tell them how much it would cost to still hire you.

      There is no point in throwing away perfectly good leverage.
  • by Adeptus_Luminati (634274) on Monday October 24, 2005 @10:46PM (#13868729)
    I came in as a contractor, because I had unique skills very hard to find in the mark place. Having worked for over a 1/2 dozen companies in my past (as an employee), I know very well that if you want to get paid well it's all about your initial negotiations. Once you've signed on the dotted line as an employee, that's it amigos: game over - You've got little else to leverage with after that and you have to be treated like the other employees.

    So after 6 months they wanted to keep me as I had done a good job and they valued my work, at which point I bypassed my boss all together and negotiated with the VP of IT for 2 days for a total of 5 hours, explaining why I was worth way more than what he was offering and debunking every reason he had to pay me like the other employees. And yes, I did plan a lot before that meeting - many hours! I did get the spcheal about how the company paid fairly and according to market research I was worth X amount of dollars, but I played it cool, mentioned that I had other prospects on the side (which was true) willing to offer me close to 60% more than what he offered me, I mentioned I had worked internationally and one of the jobs even offered me partial company ownership, but most importantly I said, hey, look I don't consider myself an average employee, so if you are interested in hiring average employees I understand that but if you read my resume (which I knew he didn't read it as I had been hired by another manager), you will know very well that I'm hardly an average employee and I take on work that very few people have the skills to take on.

    Even though I didn't get the huge $ I was asking for (which was a 6 figure close to what he was making), I did get the highest tier of pay he was allowed to give me (he even got out all the pay charts and showed me what all the other employees made). 2 years later, I still make about 5% higher than my boss who has been working there for like 7 years!

    So, hey... It was mental stress-hell for a week there getting ready to prepare to negotiate and getting through the negotiation itself, but 2 years later I could care less that I haven't been given even 1% raise as I am very happy with what I am earning and have no intentions of stressing myself over any raises for at least another 2 or 3 years.

    Do your research, prepare like hell, know his negotiation abilities, strengthen yours and be VERY creative in your game. During negotiations, as he was saying no to my request, I said stuff like:
    1)
    well fine then how about you re-hire me as a contractor, or
    2)
    let me look at your Hierarchy and pay-scale to find me a job description I am capable of doing that meets my salary expectations (which he did show me),
    3)
    I brought into the negotiations print outs from monster.com and other places that showed that people with my job title made way more than what he was offering (what I showed, was of course the extremes),
    4)
    I suggested that the company was growing in a new direction and fast and that perhaps it was time to create a new job title that did not fit into the existing pay scales & descriptions,
    5)
    I explained that in my last job I made 50% more than what he was paying me as a contractor, and that I took the job because I liked the company and the technology was very leading edge at the time (VoIP) but that now (2003) my skills are high in demand (and he knew that),
    6)
    next I said, ok well what about stock options to make up the difference?
    7)
    Or what about training commitments worth $X per year,
    8)
    or forget the salary and if you are not convinced, let me work for you for free and you pay me 10% of what I save the company money on (I could have trippled my salary easily if he had said yes).
    9)
    I threw the question/problem back into his lap saying... Ok so listen, you know that I am not your average employee and am worth more than your regular pay scales, so how do you sugge

  • by macsox (236590) on Monday October 24, 2005 @10:53PM (#13868773) Journal

    it is precisely circumstances like these that led to the development of labor unions (well, plus a few deaths-by-locked-door-in-a-fire)


    it's alarming how many modern workers buy the company line about unions and how they're only in it for the dues. why is it ingrained in modern companies that teamwork is the solution to problems, but then teamwork is lambasted as a strategy to improve conditions?


    i had a discussion with my sister once in which she railed against the organized workers at her job because they didn't have to work as much and got paid more. ? why is that bad? it's in the power of every worker! (except those working for the tsa, thanks to mr. bush.)


    the communications workers [cwa-union.org] is the first place to look if you're looking to get started. you have nothing to lose but your lousy schedule and crappy raise percentages. and your chains, but that's more metaphorical.

    • i had a discussion with my sister once in which she railed against the organized workers at her job because they didn't have to work as much and got paid more. ? why is that bad? it's in the power of every worker! (except those working for the tsa, thanks to mr. bush.)

      Labor unions are an example of too much of a good thing. Unions started out to level the playing field between labor and management. Now, many unions are out to do no less than screw the company. It is no long about fair treatment. It is about

  • by Tablizer (95088) on Tuesday October 25, 2005 @12:13AM (#13869161) Homepage Journal
    Cheap-labor lobbyists bribed Congress to increase the H-1B tech visa limit recently. Lobbyists keep saying there is a "shortage" of techies, but there is no objective evidence to back them. Tech unemployment is still high by historical and population relative standards, and salaries have been flat. Why don't they pick on lawyers for a change? Why, because lawyers have (or use) power, we don't.

    If we don't collectively apply political pressure, they will do to our field what they have done to agricultural workers.
           
  • by bleckywelcky (518520) on Tuesday October 25, 2005 @02:35AM (#13869737)
    Um, I think 4% is pretty standard for anyone across any industry that is considered a worker that gets their work done in a timely fashion and in good order. If you want that 10% raise, you better be implementing procedures to save the company millions of dollars and make sure your management knows about it. The only justification you could make for a higher raise while "just doing your job" would be for a smaller company where the earnings are more transparent to the workers. If there's only 30 people at the company and profits rise 30% over the year due to everyone "just doing their job", then yeah, a higher raise is arguable. But all that fancy stuff you do as a server admin for a large company, managing server space, making backups, handling software licensing schemes, that's all your job. You're expected to do it and do it reasonably well, that's why you were hired. And in return, you can expect a cost-of-living raise plus a small service incentive increase. The average raise at my company this year will be about 3.5% and I'll be content with that. Mainly because I'm still learning some of the processes and I don't know how everyone else will review my performance thus far. While I think I've done a great job on everything I've worked on, I figure that's what is expected of me. But if I end up patenting some new technologies in the coming year that I believe will help the company, I may feel different. If you can backup your claim for a higher raise, then by all means go for it. But don't sit there and whine that you only get 4% for just doing your job.

    Besides, hasn't anyone ever told you? You don't get rich working for someone else.
  • by gelfling (6534) on Tuesday October 25, 2005 @07:37AM (#13870536) Homepage Journal
    4% would be considered a clear signal that not only you indepensible but you are probably being groomed for bigger and better things. My whole department, for the last 3 years has given out ZERO increases ZERO bonuses to all but the 'top' 15% of the staff based on ratings but more realistically, based on who actually works in physical proximity to the boss, given we're a spread out, 'virtual' organization.

    And if the noises we hear about the strategizing the paradigm and upselling the modality to shape the customer solutionality are any indication our reviews for 2006 will come out the same.

    And this is a MAJOR IT corporation you see commercials for, every day on television.

    And this is in one of the areas commonly touted as a hot area; commercial security.

    So in real terms as our compensation FALLS at least 3%/year for 3-4 years I have to say your complaints of only getting 2.8% - 4% fall on deaf ears.
  • by Chanc_Gorkon (94133) <gorkon@@@gmail...com> on Tuesday October 25, 2005 @08:14AM (#13870643)
    3-4 % is not even a cost of living raise when:

    We see gas prices spiking periodically (200-300% increase in last 10 years..anyone remember 98 cent gas? How about 78-87 cent gas?)

    Health insurance rates have been increasing for most(in US) at double digit increments....anywhere from 15-35 percent!

    They only thing that has suprisingly stayed low has been food costs.

    3-4% is CRAP when you have these kinds of increases. Copst of licing in my book should have given me a 10-15% raise.
  • Another reason.... (Score:3, Insightful)

    by dentar (6540) on Tuesday October 25, 2005 @09:11AM (#13870943) Homepage Journal
    to not work for other people. Start your own company and make your own W2. It's one of the best things I've ever done!
  • by sallgeud (12337) on Tuesday October 25, 2005 @11:51AM (#13872308)
    The vast majority of my family owns their own business or works for one of the members who does. As someone with experience on both ends of the spectrum... company ownership and working for "The Man"(tm)... I can say for certain that the primary reason most people are offered 2% (or whatever) raises, is because the boss or bosses are fairly certain they can get away with it. Sometimes this backfires. In a company with highly skilled and specialized folks, this can often mean you lose some of your best employees. Either way it's all a calculated risk. Questions that are asked:

    Is the cost of the additional salary more or less than the cost of replacing the potential loss of personel?

    What percentage of those who find other jobs can be lured back in with an offer for a bit more?

    Is the product produced by the employee worth the money being paid?

    Can an employee that costs less create the same quality of product in the same amount of time?

    In the end, if you truely believe you're worth more than you make, and the company you work for seems unwilling to compensate you in this manner, everyone is better off if you find that job. In reality, your true market value is only what the highest bidder will pay. And, in our current job market, there are typically at least a dozen people willing to do what you do for the same or less... supply and demand at its best.

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