I mean, the raise structure at most companies blows even when they don’t do these. The difference between a year of slacking off and a year of overtime for a salary employee is likely a single percent on their review. And then internal promotions usually come with a capped pay increase when they finally get a new position. As long as companies pay more for outside talent than they do for internal loyalty and performance they will never retain their top performers.
Sadly this has been the case for a long long time. I left a company only to later return at the same pay grade but still earned more than friends who had advanced to higher pay grades in the interim.
I left a company, returned 3 years later at a much higher salary. If they had paid me to start, I wouldn’t have left. They called me, BTW, to come back.
Definitely not a new phenomenon. My first boss told me that the way to get a 20% raise was to leave for 10% and come back for 10%, and that was going on 20 years ago.
She’s a lifer and still there. Wonder what she makes vs. where I am now.
It does depend a bit. For most people you’re better off switching companies occasionally for big jumps. But for certain people who companies consider are their “rising stars,” that they want to push up the ladder quickly, they can actually get big raises very fast at one company. Sometimes deserved, often not. But it’s only a very small percentage of people that get that treatment, so for most, you need to switch companies every few years or so.
That’s fair - admittedly I am GenX and “back in the day” it was more frowned upon. As such I may represent an out of date notion about how short “too short” is
Yeah. I've actually never applied for a job and I probably wouldn't even call myself a high performer. Just an average software engineer in an age bracket that there was a serious shortage of at the time I graduated. Recruiters have always contacted me.
Even with tech how it is, I'm still regularly getting cold called by recruiters in specific industries since I'm a US citizen with a clean record, good credit and would be able to easily get a top secret clearance. I'm not interested but if I wanted a job at a defense contractor, they are actively trying to hire people...
While I agree but top performers are like maybe a very small % that actually get direct offers.
Vast majority of workers, as in the pareto principle probably applies, don't get that.
The overall picture is that most workers are not getting pay raises to keep up with COL. We're falling further and further behind, especially a Millennials age into the work force.
Covid really affected people's work behavior. Why move up when the system isn't working? This is where the 'grind mentality' folks really came into gear post Covid aka Gary Vee or Alex Harmozi.
Some Millennials have families now, some don't. Some have homes, some don't. Some still have college debt, some don't.
Millennials and Gen Zers have learned this. Ask them about loyalty to a company and they will laugh at you. They know they are just cogs in the machine and most change jobs after 5ish years to get a raise
Yep, about 3 years in role is the sweet spot, especially early career. You don’t want to job hop too much as it becomes a resume liability but staying much longer than that your pay becomes well below market. If you want to move up the ladder to management you have to stay a bit longer and lateral moves to other companies becomes harder as there are just fewer available positions the further up you go.
Yeah when the article talked about how the drawback was top performers wouldn’t be getting big raises I thought when did they ever? Maybe start by introducing those and see how that goes?
I'm GenX and just in case you weren't sure, it's ALWAYS been this way.
When you choose to settle into a position, you're surrendering money for another reason. Maybe it's work/life balance, or a great work environment.
It's the same with products/services too, think of how hard your cable providers (the one that didn't have you) offer you much better deals than your existing provider.
There's still the odd company that rewards loyalty and hard work. The company I work for pays 5-7%/year to top performers. It's outpaced my local market for the job I do, which has actually seen salaries decrease a bit.
Yeah, last time I got laid off I ended up with a 20% raise. After a long career of 3%. It’s a system designed by people who consider employees to be lazy suckers.
It's true. My wife has been at the same hospital since 2019 and her last raise (for which she just signed the agreement) brings her up to a 35% raise over the last 7 years. The only reason they did this, by the way, was because they wanted to attract new doctors and needed a higher salary so they raised all doctors in the department to that base.
Since 2019, I've been at 5 different law firms (because I kept getting poached) and my base compensation has gone up 230%. Granted, I grew my book by like 10x so I could justify the compensation but I would absolutely not be anywhere close to where I am now if I had just stayed at a single firm.
Taking that reality one step further - your long term career strategy should plan for jumps between companies for every level up. Raises are trash or non existent and promotion opportunities are too infrequent.
I tell my kids this, I have been in the workforce since 2000, in that time I've had about 5 raises internally. Even when my performance is 200% above the expected. You just get blocked by a supervisor or manager who doesn't want to lose your numbers. They don't pay you more and they block you from leaving the department. Move to a different company 4 years later and get a 20,000 pay raise.
One year I increased the total production capacity of the factory I worked at by 30% we're talking like 16m lbs of additional production capacity. And I made sure everyone knew it was me that found the issue and fixed it.
I got $1/hr more then i did the previous year as a raise. It was like 7% or something instead of like 4%
Left that company like 6 years ago. Couldn't get that cat back in the bag anyhow more or less id changed the whole production process and trained everyone on the new process. So Id have had to get like 40 people to forget what id taught them.
How tech companies overcome this is with the vesting + refresher stock grants until year 5 or so, by which time the top performers should've gotten a new higher leveled role or be capped out on their careers.
As long as share price goes up people even in same role will have more money every year.
And if share price goes up too much, you can always fire people en masse and then start the new batch once again at a more reasonable expected value of total comp.
Yup. Many companies have 401k vesting periods but the company match is usually so small that you aren’t really leaving much on the table by leaving. Now if 30% of your pay is stock bonuses that vest…now that’s a true carrot.
This is much less common than it was in the dot-com era when everyone was doing it. It's now a small number of mature companies, or tiny startups.
Working for a startup is definitely not for everyone, and there's a lot more tech workers than can be employed by those behemoths.
So now you job hop every 2-5 years until you get around 20 years experience and are already bumping up against non-management salary caps (which are stupid, but "how dare he get paid more than me!" is a common problem)
Sure, there’s a lot of upside - but also a lot of risk in effectively having a bunch of my salary tied up in my employer
If the employer goes bust I lose my job AND effectively lose a bunch of my salary from the last 5 years. Right at the moment I can least afford to lose it
This. First thing most people realize (usually the hard way) is that it's easier to adjust your work to the pay then it is to work harder for more pay. And my managers always wonder why kids don't want to work hard anymore e
My job has done this by specializing each roll very heavily. Used to be 1 employee did virtually 100% of one thing, but they slowly spread it out to allow for faster growth. You can bring in someone for actual entry level and then have them do that work. Pay folks more for more complex stuff. Also gives a lot of carrots to encourage hard work.
We need to go back to unions everywhere the best period economically in our history was when unions were strong enough to argue for fair pay and benefits for their workers. At minimum maybe poorer performing workers should be given a raise close to the rise in inflation, at max good workers should be given raises above what the economy grew at, there’s no reason people should be making less per year because of inflation or economic growth.
Unions do like the opposite of what you say. Unions are all about stopping high performers from getting rewarded and bringing up the poorer performers.
Yes but high performers aren’t being rewarded, they’re raises are still under what economic and in some cases inflation growth is, so unions are the best option since corporations are not giving the bare minimum they should be unions should force them too
High performers don't want the bare minimum and will leave if that's what they're getting. Unions make this problem worse since they push everyone's increases towards the bare minimum.
>We need to go back to unions everywhere the best period economically in our history was when unions were strong enough to argue for fair pay and benefits for their workers.
Real wages have never been higher than they are now so I'm not sure your arugment makes much sense.
This right here sounds spot on to me. This is true at my company that internal promotions are capped, and it's ridiculous. It really screwed me over in my last position change, leaving me below the expected median salary, and currently looking for an exit after about 20 years there.
It’s imperative for the loyal employee to validate themselves both internally and externally. Loyalty is a virtue that should be presented to their existing employer alongside an outside job offer.
“I’m a loyal employee and I am giving you an opportunity to beat (not just meet) this validated external evaluation of my value. “
Work extra hard and maybe get 4% increase but you're likely to get a 3% increase yearly if you do your job well enough.
Want to get a promotion? Okay, you can apply for other jobs within the company but your unit likely won't have any available positions. Oh, you meant an actual promotion. We don't do those unless you prove that you are doing work (not exceptionally well) but outside of the confines of your current job. Those duties have to like up with the next level job almost exactly or else we won't give you a raise. Also, if you go that route you can only get 15% increase. But yeah, you can either likely not get a promotion or go to an entirely different area and leave all your friends and coworkers behind!
And then you get a reviewer who won’t give you a 5/5 after acknowledging that you earned it, but that it’s “not fair” to the others who didn’t score that well… and the score is directly tied to your pay.
Edit: yes I raised 10 kinds of hell, though it didn’t get me anywhere immediately. I got a 50% increase the next year tho from it, long story.
I had to be the bearer of bad news to one of my coworkers informing them I get paid the same as them (they’ve been there for five years, I’ve been there for six months). They have certificates and whatnot that I don’t have, they were training me and were super cool and we bonded. At one point they asked what I was getting paid and said they understood if I didn’t tell them. I told them, but also thought they were paid much more than I, to find out that wasn’t the case. I thought that’s fucked, and if they want to try to get a raise or something, feel free to use my name as, at this point, I realized I gotta start looking elsewhere for more money and quickly saw the writing on the wall.
Management sat me down a few days later to talk about it, one of the managers mentioned they are paid less than other managers in the same position, and that’s just the way it is expecting me to understand. To which I replied along the lines of, well that’s horrible and unfair for you. I also mentioned that I thought my coworker was paid more than me, so I was just as shocked as them to find out I was paid the same as them even though they have certifications that I don’t have, and have been there for five years compared to my six months.
Just had my first round of interviews at a different business this week lol. Fuck corpo.
Counter point:
Labor costs can be one of the largest expenses. It’s difficult to give large pay raises and then have the rest of your work force expect similar pay increases. Then suddenly your costs over run and you’re holding loyal employees but the company is on the verge of profitability. For a publicly traded company, this problem is exponentially worse.
I’m playing devils advocate here, but it is a bit more of a juggling act.
I am part of the on-boarding and training process at my job, and it is so much more expensive to bring someone in from the outside to fill a role. We try to fill higher positions with current employees when possible, and that is a big reason. Another reason is hiring from the current employee pool can do wonders for improving the culture at a workplace.
>~~So it works.~~ Gradually grinds your company down
FTFY.
There's a reason you get some amazing company completely changing the world, and then 10 years later it's a terrible workplace enshitifying all of its products.
They thought everyone was complacent and "family".
I don’t disagree but there has to be a reason that this is the prevalent method for balancing labor costs and employee retention. If it were as easy as “just pay everyone more” then it would be more common. It isn’t.
I’ll be honest, then there is something I’m not understudying in the dynamic. Maybe it’s taboo to try to request budget increases and management doesn’t want to come off to the higher ups that they can’t control costs.
Basically, there isn't an objective way to measure "good people". As soon as you think you've found one, it'll destroy your company.
For example, let's say you tried to use "widgets built per hour" because you sell widgets. But it turns out the guy on the production line who is really good at making part of the widgets was helping 10 other people, which brought his overall production down to average.
Since he's now penalized for helping, he just makes widgets and makes more than any other individual. And the output of those 10 others drops a lot. You now reward the guy for being the top performer, but the company overall is in a much worse state because his output doesn't compensate for the 10 others.
Or let's say you pay a giant bonus to the top salesperson. The top salesperson is going to be the person who most effectively sabotages the other salespeople.
So you need management that actually understands what the workers are doing and can recognize who is really a "top performer" without formal metrics that can be gamed.
But then you have the problem of a whole lot of management can't do that. They just don't understand the work, or they just reward their friends because it's easy and they're friends.
I'm not saying it's an easy problem to solve. I'm saying that management regularly messes up, and "everyone gets 3%" requires less effort by management.
> there isn't an objective way to measure "good people". As soon as you think you've found one, it'll destroy your company
as soon as you choose an “objective” metric that approximates actual value, everyone is incentivized to game the metric instead of producing value. c thi ngyuen wrote ‘the score’ about this very idea.
Depending upon your MBA program, some of them literally teach that McDonald's is the 'ideal' way to make profit- high turnover, nickel-and-diming, etc. Good MBA programs will tell you there are a number of strategies and this model is only useful for cheap, fast commodities... but not everyone with an MBA got a good education.
All it takes is one dumbass being in a position to make these kinds of decisions to cause long-term damage to the company.
American corporations only prioritize the next quarterly profit instead of looking for long term growth. That's why. They only care about the next few months.
At my EMT job, one of my managers bragged about finally reaching a million a month profit. A year later at the union contract negotiations they offered senior workers a pay cut.
Is there another way to do things? Because ever increasing labor costs will mean more layoffs when there is a slow quarter. There’s a lot of short term thinking but it’s part of the balance that makes things work. If a company increases pay costs and then the economy dips for a few quarters, who’s going to be the first to be laid off? Most likely, the people whose compensation has had the biggest impact on those quarterly numbers. Employees can be liquid in that sense. They are often some of the easiest causalities to fixing balance sheets.
If you keep 90% of your workforce year over year and lowball them on raises, then you're getting a discount on the majority of your employee paychecks. If this discount surpasses the cost of hiring 10% of your workforce at market rate, then it saves money overall.
Most people, especially older and more expensive workers, don't want to hop jobs frequently, that's just something ambitious young people do because they're have to. Older workers often have kids and a mortgage, and value stability over a higher paycheck, so they'll stick around even though they know it's a bad deal.
Executive compensation is the largest labor expense because for some reason we have to run a big company completely differently than how we run a small company. We put groups of people around tables to talk about vision and direction so they can make 6 figures with 7+ figure bonuses. When they make poor decisions people below them lose their jobs or benefits or no raises all to answer to share holders who chose to take an investment risk.
They leverage the fact that leaving your job is a pain and applying is just a slog.
The problem for them is that top performers are sought after and so they run the risk of losing them. But most employees are replaceable to one degree or another and I suppose some companies feel comfortable with that risk. Just dont feel offended when people decide to leave for more money, its just business.
They told me I was replaceable at my company. I can directly trace how my contributions transformed the company from a struggling, disorganized garage operation to the fastest growing company in the sector, to one of the main entities in our industry, led mostly by products I created and systems I built or implemented.
We got bought out, mostly due to the success of a deal that I initiated as well as our ability to rapidly scale the production of custom products without a lengthy certification process, something I worked for two years with the regulatory bodies to get for us.
During Covid, they laid everyone off. When people were coming back, they decided they just needed me as a contractor, as now they’re bringing in a “real” product design specialist (at multiples of my rate). After almost two years and a huge budget, he releases what is essentially an empty metal rack which is supposed to be compatible with the rest of the gear the company made.
Yes, like, of course everyone is replaceable on a long enough time scale, but companies who say this never account for the cost of replacement against their bottom line. Stronger retention policies will save them so much more money.
The vast majority of employees are not that smart or that bright. Most places will be fine if they move on.
The folks who they don't want to lose - they compensate them on the higher end of the bell curve since they know they won't be able to leave for higher comp easily.
100%. I've seen companies spend 10s of thousands recruiting for replacement employees only to have those replacements leave in less than 6 months. Each time they could've just given the existing employee a fraction of that cost as a salary bump and would've prevented brain drain, but naaah better to burn money than promote people.
I had a boss once tell me that everyone is replaceable. Sometimes the replacement is better sometimes the replacement is worse. For whatever reason it has stuck in my mind rent free for years.
It comes to mind immediately only because I directly watched my company literally replace their crankshafts with cardboard, thinking they could sell the cardboard and bail before anyone noticed.
At most companies that follow merit based increases there isn’t a lot spread between the average raise (3-3.5%) and the top (4.5 to maybe 6%) so most folks are better off changing every 2-3 years if they can.
> They leverage the fact that leaving your job is a pain and applying is just a slog.
No they don't. "Never attribute to malice that which is adequately explained by stupidity."
There are people in HR whose sole job it is (in a large enough company) to determine what the pay range of some position should be and to ensure that internal equity is balanced. This formula takes into consideration years of experience, title, and some related experience using the minimum requirements of the position. Experience inside of the company, gaining subject matter experience, is not worth any more than experience gained outside of the company. That is all.
It's a huge failing of the system but has held true for several different organizations my wife worked for.
Eh, "ensure internal equity is balanced" is putting an obscenely kind spin on it.
The reality is that they're trying to maximize profit by charging as much as possible and spending as little as possible (including on payroll). They are paying people as little as they can get away with, not trying to keep things "balanced".
Outside of public administration, institutional knowledge isn't really measured so it isn't valued: all the cogs in the machine are in the same class of liability.
I agree but I often think of this info I read in a Seth Godin book. Every employee should be thinking about how they can become a constraint because then you have the company by the balls. Simultaneously every manager should be identifying the resources who are becoming a constraint to ensure no one can have the company by the balls.
It really is a game and as an employee you have to know how to play it.
The managerial class needs to keep track of the constraints to use them as bargaining chips. At the end of the day, the managerial class should have some solidarity with traditional rank and file Labor to stand against Capital.
The problem is that no company I've ever heard of ever actually negotiates with this sort of constraint in mind; essentially, they will see it as blackmail, and in the best-case scenario they will give you your raise, tell you to offload your knowledge to your replacement, and fire you. More often than not they'll let you go immediately out of we-don't-give-in-to-blackmail spite.
The only exceptions might be high-ranking sales managers, but the idea that your intimate and exclusive knowledge of some obscure backend system will give you leverage at a salary negotiation is, unfortunately, bunk. They'll let you go, regret it a bit later, and suffer the consequences, but they won't change their tune.
I hear you, but that is the game, if you as the constraint hold all the knowledge then you have to be smart enough to not give away that knowledge. Call the bluff either fire me, or shower me with rewards.
I worked at a major bank a few years ago and there was this guy in technology who knew everything about the legacy mainframe, specifically in the context of mutual funds. He and everyone else knew only he had the knowledge of how it all worked and when they tried to do knowledge transfers he would play dumb. During covid when we all went remote I remember this guy openly smoking cigars and drinking whiskey on his deck during conference calls. Everyone knew it was wrong but management couldn’t do anything because only this guy knew how it all worked. It was beautiful.
It’s weird to me that some professions (things like cops/detectives) have formal tests that must be passed in order to make it to a promotion, but that’s so rare elsewhere.
There are MANY professions that would benefit from a formal test structure to prove you at least have an understanding of the book smarts kind of knowledge of the work. Some put that responsibility on certifications which is OK, but sometimes a bit too generic. Think things like health care administrators, for example, it’s kind of important they know the details of the work. Interviews alone aren’t sufficient screeners for that.
I’m a developer. Imagine giving me a test that adequately reflects what I do. You currently have as much knowledge and understanding as the execs above me.
There are many professions like this. This is also why execs tend to make really stupid decisions based on irrelevant metrics.
This is teenage-redditor^TM nonsense. There are millions of private companies that greatly value institutional knowledge and will offer competitive pay to employees that have that knowledge.
You'll be tossed by the wayside for someone cheaper at the first chance of missing the quarterly earnings: competitive pay is how an immediate problem's solution is out sourced, and then you're canned because you're liability exceeds your value.
CSB/ I work with C suite executives across several industries, and on more than one occasion those execs privately mocked their own employees. In one instance I put together a very detailed analysis on what a company could do to increase retention. When the #1 thing was increase wages, and the second thing was "PTO policy that employees can use for days off". They laughed in my face, and did a PR push on two trap benefits instead.
They see their businesses as existing to only enrich themselves and their buddies.
Restricted Stock Units (RSUs) are an example of a trap benefit. Free stocks at the company that vest quarterly over a two year period, but are lost if you leave before they vest. Had this at a prior job that was great but not fulfilling, ended up keeping me stuck there far longer than I really should have been.
Education benefit where the company paid for classes but required employees to work for years after it pay back the full cost if the wire or were terminated. Managers were encouraged to change schedules so they were working during classes during the employees last semester so that the employee would either drop out of school or be terminated.
They also offered employees additional comp for selling plasma, the equivalent of 8 hours OT. But if you quit or were terminated, you got banned for life.
Even if you have happy employees who want to stay forever, relying on key people too much is a risk because shit happens. They may literally be hit by a bus. In a healthy organization you have documented processes, thorough training for new hires, succession plans where every role has a backup and a backup to the backup, etc.
I think people forget companies aren’t people, and these decisions are typically being made by people who do not necessarily [probably don’t] have the best interests of the company in mind. For most public companies, leadership is incentivized to generate profits in the short term over long term, and they are also typically paid such an inflated amount, that it contributes to this [unhinged] mentality of looking at people’s value as corespondent with their pay (“if my workers are making a 1/10th of what I do they are probably pretty replaceable”)
My first job thrived on hiring fresh grads and then telling them they were all worthless and could never go anywhere else so why even try.
They also paid about a third of what other companies did.
Long story short everyone that started and spent about ten years there got fed up and left in the same 3 year span and last I saw they still haven't replaced us.
They could've just paid us what we were worth and instead they lost half their employees that had been there for almost half the lifetime of the company.
I guess the owner got rich as fuck off us though so that must've been nice.
I used to travel for a company and I got a .50 cent raise at my last job on my second year after doing the work of a lead without the title, pay, or really anything. I didn't have a certificate I needed for advancement and was told the company would help me get it. They never did and gave me a bunch of runaround.
I had a job offer that was for $5 more and accepted. When I told my boss he said it put him in a really bad spot because he really needed me and was hoping I would stick around. I told him that I can't pass on the money.
Before I walked the quarter mile back to my work site I had a plane ticket back for two days later.
I let my boss know I suddenly wasn't feeling well and was going to use my sick time to head back. I got back to the hotel and started packing up my stuff.
The new company told me to buy the certificate myself and gave me paid time to get it finished. I haven't even been with them a year and am about to get my second promotion.
Don't count on raises, just change jobs when you start to see toxic behaviour. Loyalty works both ways.
More companies are adopting or considering “peanut butter” pay raises which are even and thinly spread increases for all employees instead of performance based raises, according to Payscale’s Pay Increase Preview Report. While 48% of organizations still plan to reward performance, a growing share either already use across the board raises or are planning or considering them.
Companies cite tight budgets, fairness concerns over biased performance ratings, and administrative simplicity as reasons for the shift. However, experts warn that equal raises can demotivate high performers, hurt morale, and lead to retention problems once the job market improves.
In today’s weaker job market, many employees may stay put despite disappointment. Still, experts caution that underpaying top talent is short sighted, as they may leave when opportunities improve. Employees unhappy with raises can explore benefits, update their resumes, and monitor job opportunities but should think carefully before making major career moves solely over one pay decision.
We did peanut butter style. Then they claimed they were going to performance based. Then my manager just completed my review without me and I got the same 3% I always get for COLA instead of the possible 4% we can get up to.
Which, big whoop, 1%..
"fairness concerns" fairness is what they use to keep us all down. They destroy efficiency for fairness when being more efficient would mean more downtime for all employees.
There's nothing less fair than treating everyone the same. If one neighbor is an asshole and another is nice, nobody would fault you for occasionally shoveling the nice neighbor's walk and leaving the asshole to fend for themselves.
Same with employees. If you want to be "just business" about it, it doesn't make sense to reward the person who slacks off and is unhelpful the same as the person who always comes in clutch, doesn't need constant supervision, whatever.
Yeah, it's a tough conversation, that's part of management.
>Yeah, it's a tough conversation, that's part of management.
We don't have management anymore. We have Accountability and Liability Reduction. They cannot really even have conversation. Mine cannot even look me in the eye anymore. The problem with reducing liability through poor communication is that you begin to really lose sense of what goes on in your workplace. And then you can no longer be a competent manager. And then something goes wrong and the higher ups will let you take the fall.
That is what I cannot understand about the manager/directors. They are not immune from the effect of what they do on behalf of their bosses and when lawsuits start flying, the company stops standing behind them.
Even better is across the board pay cuts. Try that at your company and wait a year. Look around at all your employees that have not left. Congratulations, you now have a list of underperforming employees that you should have fired.
I don't think it is only underperforming employees who will stay.
Some employees will be considered too old by the job market, and so cannot leave. It is not easy for a 55 year old to job hop to a new firm. They will stay, but they will quiet quit.
One of my old managers retired from a fortune 50 a couple years ago. Dude had quiet quit like a decade prior. He still definitely did some parts of his job but he was ready for requirement.
That's true, but the same can be said of any bigotry. Women, African-Americans, LGBT people, and others often find themselves loyal to companies that pay less but accept them.
Not really, top performers often want the pay and recognition. Giving someone a 2% raise who brings in tons of revenue is just gonna drive your best performers to your competitors who will pay them.
The people you're left with are those who don't care and/or don't perform at that same level.
Or they’re tied to vesting or they value their commute or they are allowed a certain level of WFH or they have a sense of loyalty or they owe time on a certification the employer paid for. Again, it’s not absolute.
There’s more to life than work. Your top performer could easily have family, elderly parents, or some other circumstance. The time table it would take to truly see top performers leave can’t be measured in a year or two.
This is me. My work commute is 5 minutes and it’s an easy job. I am a high performer but also don’t work nights or weekends at all.
Got a 3% raise this year. Fuck it. If I keep doing what I’m doing right now for 5 more years I won’t have to worry about saving for retirement anymore at 42 years old. After that as long as I cover my expenses I can do whatever job I want and or worry less about my current career.
Yea ik that... which furthers my point, a top performer who has dependants is definitely not going to stay. And yes it absolutely can lmao. If you've ever worked front office/sales it's clear as day. It may not be clear in traditional white collar roles but for those that actively generate revenues, it's no question.
A top salesman leaving, immediately affects the companies earnings, both in the short and long term.
Talent never stays put in bad markets. What ends up happening is top guys move and you're left with the useless idiot's that cant find anything anywhere else.
Iv watched this happening in real time and the very real impact its having this generation of execs are so bad im so confused whats led to entire generation school just being so bad at business. And it's uniquely this particular generation because I've met very savy younger execs or the remaining old guard who know the importance of talent
The overwhelming majority of MBAs now will cut off their nose to spite their face. They think by squeezing the expenses they're going to showcase their ability to increase profits when they really just break a system that was already profitable to juice the numbers so they can bounce at the first opportunity and the next guy has to fix what they broke.
It never fails to amaze me when they are put into any kind of authoritative position they make things immediately worse because they think they're God's gift to the shareholders because nobody else was smart enough to consider spending less on the people doing the work at a company. They are all so short-sighted, self-centered, and dumb.
This is horrible, but not nearly as machiavellian as the proposed military warrant officer's bonus plan. Army warrant officers will ‘bid’ against each other for their next bonus.
Eh this is kind of short sighted. They just need to establish an effective organizational culture and through the ASA model will fill their ranks with employees who agree with their principles.
For reference I had a position in which our bonuses were all or nothing, either the whole company got it or nobody got it. And it worked very well, high performers will put in the work to get past the goal. Except everyone worked together instead of focusing on issues specific only to their jobs.
Except when there's one department that misses goals 2 years in a row, due to shit completely outside their control, and now I'm barely working at all because it doesn't matter how hard I work, I'm just going to get screwed anyway.
The real lesson here is that wage increases should not be tied to bonuses and they should not be tied to performance but rather to rising costs of living.
And then your competitor grabs all your top performers by giving them bonuses based on their performance and now they took your market share. What do you do then?
Easy to have that work when everything is clicking but a bad string of luck quickly kills companies that operate like that iv witnessed it first hand in at least two orgs who promptly adjusted to department based performance rather than company
I've worked for companies with performance based plans. More people left because of that than anything else. It's impossible to determine actual performance in most large organizations. My experience was these systems were at best bad, usually they were detrimental.
My experience is leading groups of several hundred people, I have never seen any performance based system work well. In the end it allows for even more subjective outcomes where you cannot explain why person A got a 125% merit and bonus award and person B gets 50% and 25%. You can tell person B why, but it's always some subjective nonsense that does nothing but deflate them and they eventually quite quit until they find a new role somewhere else. Obviously, not everyone but those who can do.
Yeah, it tends to be great for people that have explicit measurable job-goals, or the ego to be able to bullshit-waffle whatever they've done into being 'fuck you I'm awesome pay me more'. For others, it's mostly a hassle to try and justify a boost, which management will shut down or not for their own effectively inscrutable reasons
The organization I work for does merit or these peanut butter style raises depending on department structure. My department is performance based. Everyone hates it except a handful of people buddy-buddy with the executive teams. It's a whole bunch of work that turns out to be meaningless.
We pretty much all get the same pay raise anyway since they lump everyone but a dozen or so into the "meeting expectations" category. We may get 3% while those falling below expectations gets maybe 1% while those handful exceeding expectations somehow get 7 or 8% since the scale isn't linear at all and is totally subjective with no transparency. Everyone tries hard for the first couples years until they realize the goals sheet is pointless, so they start half-assing it like the rest of us since it doesn't matter.
I worked for company that had a performance based raises. Then they had the smart idea to show how everyone was graded based on position. Surprise, surprise all the senior management got the top performance and therefore highest raises. All the new, junior level got the lowest and the lowest raises. And then senior management was shocked all of the junior staff quit, myself included, within 6 months of that meeting.
Buybacks cost real cash. The company writes a check, that money is gone. That's not neutral, that's spending.
And your SBC point is literally proving the opposite of what you think. If buybacks were free, why would companies need to "use" them to cover anything? You're describing two expenses canceling out, not no expenses.
Jokes on you. I haven’t had a raise in four years. So I been raising office supplies and snacks like it IS my raise. Every time I went in, walked off with five reams of paper and dropped it off at a public library. One of the libraries legit asked me if my ‘company’ can drop off legal also because they thought i worked for whoever supplied them…..
The US military is doing this with the Warrant Officers Corps. It’s an auction for CW3 and CW4 to price their worth. They bid too high they get no raise and no bonus. They bid too low and they are awarded what the winning bid gets. Let’s say they all want 1,000,000. That’s blows the budget and no one gets rewarded.
This is such an awful idea. I consistently have top performance metrics. Thats because I want a sizeable raise. If im treated the same as everyone else, Im going to perform the same as everyone else. I dont work hard out of the kindness of my heart. I work hard because I like money. Why would you intentionally drive out top performers?
Our parent company is doing this along with the Jack Welch bell curve performance evaluation method. We manager were informed (at the last possible minute before evaluations were due, in true HR fashion) that our performance evaluations had to fill a bell curve this year and that we all had to have at least one person “below expectations.” Never mind that, even if all of your people are meeting the published job requirements and achieved all of their annual goals, we were all told that we had to find a reason to give somebody a “below expectations.” And that went for everybody, even functional-area managers and directors. One of my fellow functional area managers is the one who drew the short straw this year, and the only thing our director could find to ding him on was his email communications being difficult to read sometimes due to run-on sentences and punctuation. I’ve worked with this guy for 12 years, so we’re pretty close outside of work. He was around when our highly customized SAP was implemented, and retains a ton of esoteric knowledge of production transactions, issues, and how to resolve them. The same-day we got our reviews he started searching. We’re fucked if this guy leaves and we have one of those rare, obscure breakdowns in our production confirmation system. Willing to bring our production system to a screeching halt until TCS can fix the problem just to save 0.5% on an annual raise.
I heard Peanut Butter for the first time in a meeting about 4 months ago. We do the bell curve as well for ranking performance, but generally do not put anyone in the bottom tier unless they are really underperforming. I think this year they went with the PB method. It cannot be coincidence that I heard it in October which is when bonuses typically get decided. My company made millions and hit their targets. It’s exhausting
A company I worked for years ago decided to change their performance rating system. Anyone rated a 3 (an average performer and most ended up here) were deemed "meets expectations although sometimes misses expectations". It had previously been "meets and sometimes exceeds expectations". This was a backdoor way of putting people on a PIP and getting rid of them without paying severance.
The expectation was that average performers would head for the exits. Instead, the top performers headed for the exits and it blew up in management's face. I had left the company by that point but apparently the change caused huge problems and was a disaster.
These peanut butter raises will suffer the same fate.
Why would you give your top performers bare minimum raises?
If someone’s role is only getting a “raise” that matches inflation, it has already been decided that you would be somewhat easily replaceable. The new budget wasn’t invested in you.
Top performers know their worth- and it’s usually rooted in stock value/bonuses, not as much their hourly wage. That’s the difference.
I've gotten high enough up in my organization to understand that the people making the decisions about the raise pool and the people who are identifying top performers are different people.
If the strategy is to spread the peanut butter as thin as possible, there's no room to reward anyone. Sure, I could probably give my top performers a decent raise, but then everyone else would get nothing. There's no good solution.
The scope I’m referring to doesn’t have “top performers” on every team…part of the reality is how churn rates are factored into the decisions.
A capex/opex budget is passed, and then it’s up to strategic managers to decide where that goes via approved proposals.
The inflation raises aren’t a “we want to keep you” signal- it’s a “you’re not fired” signal (until the next budget cycle).
The more senior manager usually isn’t going to burden themselves with the personnel decisions that aren’t theirs to make- it’s just business, so the role beneath them makes the call.
The article argues that companies lose value by opting to dole out broad, inflation-based wage increases YoY vs. weighted performance increases. It argues the former causes the unintended consequence of its best hires opting to leave/lower their effort.
It’s a mischaracterization of what’s going on- the companies are not “losing value” if these people decide to leave. It’s all factored into the decisions- and increasingly it’s a means to manage churn in the short-term (i.e. get people to voluntarily leave without the negative PR).
People often like to believe their professional value should be worth more than what they’re actually paid, what the market rate is for the role, and/or how their contributions are perceived by decision makers.
That'd depend on your current salary. If you're a top performer already making $120k in a role that typically makes $90k, an inflationary raise reflects that you're already paid like a top performer.
Yeah it’s all relative, subjective value. I’ve been paid more at a company contributing less, and vice versa.
The argument of the article is only accurate if the strategy involves keeping the same people for as long as possible…but that’s just not how the market has moved as of late.
Most large companies do have their sights set on the next 3-5 years, so they optimize strategy, hiring, and resources for that timeframe- not the longer term.
If you're getting paid 33% more than average for your position, it's typically going to be because you're worth more, because you're more productive than average.
Sales jobs often do this automagically with commissions, but the principle can apply in other positions
I get that but the post is about giving raises to everyone evenly with at least my assumption, salaries matching what the market is paying. Anyone who acknowledges they are paid more than fairly for their work doesn't really apply in this situation. In fewer words, I didn't think your original comment was relevant because it's so obvious.
Right, the article is trying to argue people that got a paltry raise can be a “top performer” and has leverage…but that’s nonsensical.
I was expanding to essentially say: companies with high growth targets will definitely pay particular people more to help reach those goals.
In the example, I’m sure there are people working at Starbucks corporate who were granted more than 2% gross increase YoY…but they’re probably referring to rank & file roles and claiming there are “top performers” in the bunch.
Performance based raises in my experience can have negative side effects too. I worked for a biotech company that was all about that and the company atmosphere was a complete CYA shitshow where collaboration and problem solving was slowed to a crawl because if anything went wrong it was a total blame game. Instead of just solving the problem it was finding who to blame and finger pointing. Different departments didn’t work well together because “you might screw up and make me look bad.” Hated working there.
That's the system we live in, though. Shortsighted is literally the corporate way of life. There will be a whole new set of eager and broke college students ready to slave away due to crippling debt and high costs of living that we can take advantage of, anyway. Q2Q profits, kick the can down the road until after I jump out of the wreck I made and land safely thanks to my golden parachute.
Everybody should get a raise to cover inflation and higher cost of living. Top performers should get an additional raise on top of that. Employers will chose one or the other, based on which costs them less, and that's why they will struggle to retain employees. Same as it always been. This article doesn't say anything new.
Came here to say this. My company pushes a pay for performance philosophy. So if you do well you will be rewarded, but that reward means other, capable and still valuable employees, get nothing.
Eventually those ‘average’ employees move on. This forces the high performers to take on more work or at a minimum spend time training replacements from the start which leads the over performers to burnout.
This could easily be avoided if they decided to provide those in charge of the pay cycle a modest increase in budget. However we don’t because that would come out of our profit margin and shareholder value.
> Top performers should get an additional raise on top of that
they should be compensated for high performance, but that could come in the form of bonuses, which don’t stick around if for some reason next year they decide to check out.
Add in the fact that the pay range for new hires shifts higher due to market competitiveness and inflation, but existing workers are basically held in place. It doesn't take long to realize they have no intention of paying you what you're worth and won't bother to update your pay until you make less than they would pay a new hire while having the experience that makes you a better employee. The system is broken.
I have performance based pay, I hit top tier and while my bonus was amazing, my pay raise hit 3%. Not that I expected 10, but someone not hitting top tier probably got 1.5-2% is crazy to me
I have similar thoughts. I got a rating for 2025 that is considered top performer. Was the hard work worth the extra 2% I’ll get in my annual raise? Even the extra 5% I’ll get on my bonus?
It does long term for next bonuses and raises, also, at my company you don’t see people hit top tier back to back years. I hit it in 2022 and now 2025. It’s subjective, and I get that but also frustrating
Hire me for the job. Pay me. Why do I need to perform or do extra, you hired me for something I do. I either do it or don't. I ain't gonna kill myself over it.
That's fine promotions, raises, and bonuses typically go to people who over perform their responsibilities. You probably already have the job you want. You were hired at a salary you agreed to when onboarded and I assume you've been paid for your time.
People always say this... so, I assume it is or was true somewhere. I've never experienced it or known anyone personally who experienced it and told me about it. Instead, those things go to outsiders and insiders only. Extra work gets you everything except extra pay.
Well we've never met in real life but. I started over in my mid thirties as a maintenance tech for an apartment community. I had some handyman skills, rose up pretty quick and was a supervisor within a year. I spent four years doing that and was promoted to regional maintenance supervisor.
During this time I was working a lot and missed out
on some things in life I regret. Kids birthdays and the like. I'm nearing fifty now and in asset management for a construction firm and it's not too bad. I'm grateful younger me crawled through the crawlspaces and unclogged the shitty toilets.
Honest question: does this article read as propaganda? How in the world could they know what the hundred of thousands of people in a position to give raises are planning.
I’m a high performer at my company and recently got a 15% raise. Standard this year for people was 3%. However, I was also below market rate for my position to begin with.
The amount of hoops my managers had to get this done was insane. I’m talking like up to multiple VPs at minimum to get approval. It may have gone higher, but those are people I know had to sign off.
I’m grateful for my raise of course but the fact it takes people of that level to sign off on an above standard raise is pretty absurd.
I'm in consulting and see this a lot. It drives me bonkers. Amazing young talent who are fully billable, easy to work with and are emerging rock stars, generating many multiples of their salaries in billable work get denied a reasonable raise so they quit. Just had an amazing girl quit on me because the firm offered her a $15k raise bringing her to $85k, she wanted $20k. They wouldn't budge so she quit and just like that $370k in revenue stalled plus a few pissed off clients.
Of course, the firm defends it by saying if we give her a raise, everyone will demand one and our margins will suffer. It's so stupid.
Performance based data is very hard to acquire for many jobs, and metrics are hard to define. This means it ends up being how well you network and how well you socialize. My own company has very few job families that have good metrics at all and all of the ones outside of management are extremely loose, having nothing to do with their jobs.
You will always be hamstrung by the fact that the HR department is benchmarking roles and after you max out, what then? You can’t get a promotion because there isn’t a higher position.
“More companies are leaning into “peanut butter” pay increases this year, according to Payscale’s Pay Increase Preview Report.
The term refers to across-the board raises “that are even and spread thinly, like peanut butter would be on a sandwich,” according to career coach Colleen Paulson.”
I think on a case by case basis, this might not be a bad thing. I’ve worked in companies where the biggest ass kissers got the biggest raises and promotions, despite being the biggest slugs and a liability. It would be nice if everything was merit based… But that’s just not reality.
There are multiple examples, but one glaring example for me was Kmart. Not exactly a mom and pop operation… But trust me… Cream did not rise to the top.
So, companies are basically saying they cannot afford to have employees that do the work that needs to be done.
It's a legitimate point that the workers have been dealing with inflation for a long time, and have generally not gotten the raises needed to cope with that inflation. So, they are falling behind. Because of that, they're looking for better jobs.
Which is more expensive, because recruiting, hiring, and training is a LOT more expensive than retention.
But, for the workers, the issue remains the same. Prices are going up faster than wages. So, they're still falling farther and farther behind.
Companies are going to have to deal with the fact that the top performers are going to leave. They're going to have to deal with the fact that retention is NOT a concern. They have to deal with the fact that the workforce marketplace is about competition, not retention.
Workers have been underpaid for a long time, and the dam is cracking.
just wait, the trend today is eliminating annual merit increases. You negotiate a salary and that is what you get paid unless you take another role or leave company. You'll wish for PB raise.
Short sighted and business decisions go hand in hand. Everyone assumes they will sell or bail before the consequences of their actions or decisions arise. Literally every business decision is made without forethought into future issues it may cause.
Layoff highly skilled employees because they’re expensive
Offshore jobs to low quality workers because you can get more of them for cheap
AI replacing entry level jobs meaning there’s no upcoming workers to get skills
Failing to take care of employees so that good ones leave and only shit ones who can’t find work elsewhere stay
Raising the price of subscriptions and adding advertising, because where else are you gonna go? Everyone is doing it now and mega mergers are eliminating competition every year.
The quality of products sliding. Changing ingredients at the cost of taste. Shrinkflation. Shoddy code going out in software. Global outages of services.
How long before things start having safety issues because of cutting corners?
CEOs don’t care because they are paid in stock options and want the price to go up at all costs. They know they’ll get a golden parachute if they can push the numbers high enough.
The board doesn’t care because they can resign and walk away after selling high.
The only time decisions are made without forethought into consideration for the future is when it comes to cutting costs. Massive imports before tariffs hit, planning the next massive layoff wave and how many roles in a 3rd world country are required. How can OpEx be increased versus CapEx to reduce the tax burden.
My company on average gives about 2.5% raises. Top performers and people in the lower end of their pay and might get that bumped up to 3% - 3.5%. wow!
Whenever someone asks in a leadership Q&A we are told inflation doesn't matter, we structure compensation adjustments to be "market competitive". It's just soft collusion between companies to all do this and say they're competitive with each other...
Most companies retaining employee policy is the same as phone companies retaining customers. If youre a new customer you get a good rate but since you've been with us for 20 years we charge you up the ass.
Having just gone through a round of performance reviews where everyone in the department was rated 3 because real raises are not in the budget, I’d rather get peanuts than pretend that performance will be rewarded, then pull the rug at review time.
My company gave 2% across the board last year, promising performance based raises this year. They lied. 2% again this year. I gave my two month notice. No one at the company even tried talked to me about staying. My last day is this Friday.
I swear people who write these articles have never run any sizable business. Brass tax- performance based increases bring a litany of internal risks; morale issues, liability issues, FAPE allegations. Bad employees cause these issues and it also impacts the high performers. You know what work; peanut butter increases and high performance standards that drive revenue. Then you can make the increases size able more years than not.
When I was in college, I worked for a big box dept store (that is still around). I was reliable, frequently covered others' shifts, and would work in a different dept as necessary.
The performance evaluations were exclusively determined by how many credit cards we opened. Nothing else. One could call out every other shift and tell off customers and they would get a better raise than the reliable employee if they opened more credit cards.
The credit cards were easy to open when the store first opened but quickly became a saturated market. This was an affluent area, so there weren't a lot of people who opened store cards to build credit (there were more Amex platinum cards). Within a year of the store's opening, everyone who wanted a card (and could get one) had one.
Something similar happened the last time the minimum wage was raised. I was about 3 years in, promoted and making significantly more than when I started obviously. The kicker was all current employees would receive a $1 raise on top of their performance review raise. All new employees would start at $2 above base wage.
Well, that system, put my current wage almost equal to a new employees that I was part of the training and management. Not cool. Eventually, I decided I didn't want to be in that position anymore and go back to being a general worker. The supervisors were humming and hawing that I was going to take a $0.50 pay cut. I was like "yeah, no problem."
After busting my butt to get to that point and get a raise and then have the rug pulled from me, and probably the majority of the staff, for significantly more work for an extra $0.50.
I was young, but it really disenfranchised me as worker from that point forward. While the "peanut butter spread" isn't exactly the same comparable scenario; it triggered a memory of how some of these people might be feeling.
I work in local government and they have always done peanut butter raises. They also have annual performance reviews but you only need to “meet standards” to give the peanut butter raise. There really is no incentive to be a top performer and do just enough to meet standards.
Not much changed here. 2-3% is the typical “merit” baseline. Refusing to give high performers more would be new and will just cause them to leave provided someone else will pay the desired amount which is not new.
Personally, I’m a high performer and earn well above my peers. I asked for a large raise and if they don’t give it I have other options.
That’s the market for me right now. In 2 years it might not be. Always be willing to make the move while the irons hot.
Labour cost increases can squeeze margins for firms that compete on price, which is why many economists note employers may adjust headcounts or pricing rather than simply absorb higher wages. In competitive markets, the pass-through from wages to consumer prices depends on productivity and market structure.
Hindsight is 50/50, especially for public traded companies since they offer refresher/stocks that vest annually the longer ur there the more rewards. I have so many colleagues regreted jumping ship a 20/30% raise and forfeit their unvested stocks that couldve been a lot more. Especially past 10 years
Without "peanut butter" raises, the people that work closer to the money always end up getting better raises, because they can more easily tie their work to company revenue.
As an RN in America the only way to get paid even half of what you are worth is to move every year. These bloodsucking companies that run health care in America do not care about you and will throw you to the wolves for their institutional decisions. The real perpetrators will never take the hit. So move and do not care what these blood suckers say. I went from $36 hr as a new grad to $45 in 2 years by moving jobs. Now I move again and I can get $48 or more. This is without even moving speciaties.
Even tho some orgs do “performance” based raises, you end up having to normalize your team due to “budgetary” concerns. So then everyone still gets nearly identical raises. All such a sham.
I was given 2% per person to work with. It doesn’t even matter at that point. Performance is good from all, what am I gonna do, give someone only 1 percent? 1.5 percent? So that I can give someone else 2.5 percent? It doesn’t matter at that point. Unless you have really bad performers who actually don’t deserve much or anything, you’re going to piss someone off.
It’s easier to get an interview while working. Than if your hired tell them you can start the day after your resign and state when you’ll be leaving. 2 to 4 weeks or Evan till they food a replacement or you’ll be part time tot help train. so you’ll be working the only thing to acct for is the small gape in income. Be about two to three weeks depending on company before your first paycheck.
The harsh reality is, if most companies are giving peanut butter raises, finding another company that pays steak raises is going to be hard. Companies know this unfortunately.
Unfortunately, this is pretty feasible in today's market. I would love to leave my job, but there are so few and they are hard to find/get. It is also far easier for companies to discriminate in today's job market. A lot of people will take a peanut butter pay raise and accept that insult just to keep a job that is needed.
Big corporate would love a reason to be able to stop increasing people’s salaries in line with inflation. Putting down the long-term practice of COLA increases in favor of throwing all the rewards to the preferred people is an obvious way to further create a caste system of workers
This article is so dumb. No mention of cost of living increases. Really, "peanut butter" pay raise sounds like a way to brand cost of living increases (which should simply be applied automatically based on CPI) as a raise. Which is the way people talk about it in the US, and it's a deliberately dishonest strategy by management. Management explicitly bends the truth in negotiations and this article doesn't even address that.
Nobody wants to see the office slacker get the same pay raise as one of those that try to maintain self-discipline, and determination to succeed and advance.
You don't just lose top talent, you inevitably end up with only slackers. Then you say "Nobody wants to work anymore!" after your "desirability to work here score" gets torpedoed.
It’s really interesting to read about the differences between countries. In Canada, I’ve been a working professional for 10+ years and these are the only raises any of my organizations have ever had. 1.5-2.5% annual increase, applied evenly.
It's kind of amusing to see people worry about how the "top performers" are getting the same percentage raises as people "doing the bare minimum".
Meanwhile, for the ordinary folks "doing the bare minimum" (/eyeroll), that "peanut butter" raise probably ends up being more like "too little butter scraped over too much bread". It probably becomes yet another excuse not to actually pay employees living wages.
Nothing better than being a manager with a rockstar employee carrying the department and also being straddled with one of the laziest employees who outright knows they're checking a diversity box as their only contribution. This way they can both know that hard work isn't rewarded!
Playingwithmyrod | 6 hours ago
I mean, the raise structure at most companies blows even when they don’t do these. The difference between a year of slacking off and a year of overtime for a salary employee is likely a single percent on their review. And then internal promotions usually come with a capped pay increase when they finally get a new position. As long as companies pay more for outside talent than they do for internal loyalty and performance they will never retain their top performers.
Seandrunkpolarbear | 5 hours ago
The only way to get a decent raise is to switch companies nowadays
TheChewyWaffles | 5 hours ago
Sadly this has been the case for a long long time. I left a company only to later return at the same pay grade but still earned more than friends who had advanced to higher pay grades in the interim.
Dgp68824402 | 4 hours ago
I left a company, returned 3 years later at a much higher salary. If they had paid me to start, I wouldn’t have left. They called me, BTW, to come back.
Shadowcat205 | 4 hours ago
Definitely not a new phenomenon. My first boss told me that the way to get a 20% raise was to leave for 10% and come back for 10%, and that was going on 20 years ago.
She’s a lifer and still there. Wonder what she makes vs. where I am now.
Nickeless | 2 hours ago
It does depend a bit. For most people you’re better off switching companies occasionally for big jumps. But for certain people who companies consider are their “rising stars,” that they want to push up the ladder quickly, they can actually get big raises very fast at one company. Sometimes deserved, often not. But it’s only a very small percentage of people that get that treatment, so for most, you need to switch companies every few years or so.
Giraff3 | 3 hours ago
How long should you put in at the first company before leaving?
TheChewyWaffles | 2 hours ago
Long enough to not look bad on your resume and/or look like a red flag on your job hunt - min 2-3 years imo
You need to be able to tell a story about why you’re leaving.
unknownpoltroon | 2 hours ago
These days from what I understand it doesn't matter much as long as you're in the same industry/job. There is so much job hopping no one cares
TheChewyWaffles | an hour ago
That’s fair - admittedly I am GenX and “back in the day” it was more frowned upon. As such I may represent an out of date notion about how short “too short” is
JitteryJoes1986 | 5 hours ago
Job market is so bad these days that even top performers are stuck.
Why leave when nobody is hiring and the benefits of the current company (outside of pay) are pretty good?
People can't afford to move right now. The job market, like the housing market, is frozen solid right now.
dcuhoo | 5 hours ago
Worst job market in decades... At least since 2008 to 2009. Before that, during stagflation in the 70s maybe?
And all totally self-inflicted due to bad policy, tariffs, etc.
absurdamerica | 4 hours ago
Top performers get direct offers they don’t even really need to apply for. People hunt down talent with a track record.
zeezle | 3 hours ago
Yeah. I've actually never applied for a job and I probably wouldn't even call myself a high performer. Just an average software engineer in an age bracket that there was a serious shortage of at the time I graduated. Recruiters have always contacted me.
Even with tech how it is, I'm still regularly getting cold called by recruiters in specific industries since I'm a US citizen with a clean record, good credit and would be able to easily get a top secret clearance. I'm not interested but if I wanted a job at a defense contractor, they are actively trying to hire people...
JitteryJoes1986 | 2 hours ago
While I agree but top performers are like maybe a very small % that actually get direct offers.
Vast majority of workers, as in the pareto principle probably applies, don't get that.
The overall picture is that most workers are not getting pay raises to keep up with COL. We're falling further and further behind, especially a Millennials age into the work force.
Covid really affected people's work behavior. Why move up when the system isn't working? This is where the 'grind mentality' folks really came into gear post Covid aka Gary Vee or Alex Harmozi.
Some Millennials have families now, some don't. Some have homes, some don't. Some still have college debt, some don't.
Point is, this affects everyone.
tivooo | 4 minutes ago
The youngest Millenials have been in the workforce for like 10 years.
tiebreaker- | 5 hours ago
That has been the truth for a very long time.
akapusin3 | 5 hours ago
Millennials and Gen Zers have learned this. Ask them about loyalty to a company and they will laugh at you. They know they are just cogs in the machine and most change jobs after 5ish years to get a raise
ReturnOfBigChungus | 5 hours ago
Yep, about 3 years in role is the sweet spot, especially early career. You don’t want to job hop too much as it becomes a resume liability but staying much longer than that your pay becomes well below market. If you want to move up the ladder to management you have to stay a bit longer and lateral moves to other companies becomes harder as there are just fewer available positions the further up you go.
ShadowTacoTuesday | 4 hours ago
Yeah when the article talked about how the drawback was top performers wouldn’t be getting big raises I thought when did they ever? Maybe start by introducing those and see how that goes?
Quirky_Spend_9648 | an hour ago
I'm GenX and just in case you weren't sure, it's ALWAYS been this way.
When you choose to settle into a position, you're surrendering money for another reason. Maybe it's work/life balance, or a great work environment.
It's the same with products/services too, think of how hard your cable providers (the one that didn't have you) offer you much better deals than your existing provider.
FuturePrimitiv3 | 5 hours ago
That was true when I entered the workforce 30 years ago and was "old news" then.
Sorge74 | 2 hours ago
Basically about the time pensions went away, so did the incentive to not job hop.
joe_canadian | 4 hours ago
There's still the odd company that rewards loyalty and hard work. The company I work for pays 5-7%/year to top performers. It's outpaced my local market for the job I do, which has actually seen salaries decrease a bit.
thegooddoktorjones | 2 hours ago
Yeah, last time I got laid off I ended up with a 20% raise. After a long career of 3%. It’s a system designed by people who consider employees to be lazy suckers.
ConLawHero | 3 hours ago
It's true. My wife has been at the same hospital since 2019 and her last raise (for which she just signed the agreement) brings her up to a 35% raise over the last 7 years. The only reason they did this, by the way, was because they wanted to attract new doctors and needed a higher salary so they raised all doctors in the department to that base.
Since 2019, I've been at 5 different law firms (because I kept getting poached) and my base compensation has gone up 230%. Granted, I grew my book by like 10x so I could justify the compensation but I would absolutely not be anywhere close to where I am now if I had just stayed at a single firm.
coke_and_coffee | 2 hours ago
This was true during the pandemic but is no longer the case.
Lumberlicious | 2 hours ago
Always has been
voytek707 | 2 hours ago
Taking that reality one step further - your long term career strategy should plan for jumps between companies for every level up. Raises are trash or non existent and promotion opportunities are too infrequent.
bashomania | an hour ago
Nearly 35 years says that was always the way.
VoidOmatic | an hour ago
I tell my kids this, I have been in the workforce since 2000, in that time I've had about 5 raises internally. Even when my performance is 200% above the expected. You just get blocked by a supervisor or manager who doesn't want to lose your numbers. They don't pay you more and they block you from leaving the department. Move to a different company 4 years later and get a 20,000 pay raise.
JoJackthewonderskunk | 5 hours ago
One year I increased the total production capacity of the factory I worked at by 30% we're talking like 16m lbs of additional production capacity. And I made sure everyone knew it was me that found the issue and fixed it.
I got $1/hr more then i did the previous year as a raise. It was like 7% or something instead of like 4%
ballmermurland | 4 hours ago
Sounds like you need to go back and unfix that issue then.
JoJackthewonderskunk | 4 hours ago
Left that company like 6 years ago. Couldn't get that cat back in the bag anyhow more or less id changed the whole production process and trained everyone on the new process. So Id have had to get like 40 people to forget what id taught them.
mianbai | 5 hours ago
How tech companies overcome this is with the vesting + refresher stock grants until year 5 or so, by which time the top performers should've gotten a new higher leveled role or be capped out on their careers.
As long as share price goes up people even in same role will have more money every year.
And if share price goes up too much, you can always fire people en masse and then start the new batch once again at a more reasonable expected value of total comp.
Playingwithmyrod | 5 hours ago
Yup. Many companies have 401k vesting periods but the company match is usually so small that you aren’t really leaving much on the table by leaving. Now if 30% of your pay is stock bonuses that vest…now that’s a true carrot.
6a6566663437 | 5 hours ago
This is much less common than it was in the dot-com era when everyone was doing it. It's now a small number of mature companies, or tiny startups.
Working for a startup is definitely not for everyone, and there's a lot more tech workers than can be employed by those behemoths.
So now you job hop every 2-5 years until you get around 20 years experience and are already bumping up against non-management salary caps (which are stupid, but "how dare he get paid more than me!" is a common problem)
audigex | 5 hours ago
Stock grands don’t interest me at all
Sure, there’s a lot of upside - but also a lot of risk in effectively having a bunch of my salary tied up in my employer
If the employer goes bust I lose my job AND effectively lose a bunch of my salary from the last 5 years. Right at the moment I can least afford to lose it
bmc2 | 5 hours ago
The stock grants are on top of a big salary. As long as you're at a public company, there's not a lot of risk.
astrange | 3 hours ago
ESPP is even more free money if they have it.
coke_and_coffee | 2 hours ago
It all depends on the company. If you believe in what they are doing, stock grants make a ton of sense.
Ok-Temporary-8243 | 5 hours ago
This. First thing most people realize (usually the hard way) is that it's easier to adjust your work to the pay then it is to work harder for more pay. And my managers always wonder why kids don't want to work hard anymore e
Sorge74 | 2 hours ago
My job has done this by specializing each roll very heavily. Used to be 1 employee did virtually 100% of one thing, but they slowly spread it out to allow for faster growth. You can bring in someone for actual entry level and then have them do that work. Pay folks more for more complex stuff. Also gives a lot of carrots to encourage hard work.
JefferyTheQuaxly | 4 hours ago
We need to go back to unions everywhere the best period economically in our history was when unions were strong enough to argue for fair pay and benefits for their workers. At minimum maybe poorer performing workers should be given a raise close to the rise in inflation, at max good workers should be given raises above what the economy grew at, there’s no reason people should be making less per year because of inflation or economic growth.
Ayjayz | 2 hours ago
Unions do like the opposite of what you say. Unions are all about stopping high performers from getting rewarded and bringing up the poorer performers.
JefferyTheQuaxly | 2 hours ago
Yes but high performers aren’t being rewarded, they’re raises are still under what economic and in some cases inflation growth is, so unions are the best option since corporations are not giving the bare minimum they should be unions should force them too
Ayjayz | 2 hours ago
High performers don't want the bare minimum and will leave if that's what they're getting. Unions make this problem worse since they push everyone's increases towards the bare minimum.
Vast_Bookkeeper_8129 | 2 hours ago
Them do nothing today. What has happened is a disconnection of labours and workers. There's a union for anyone who earns 2x the wage of a labourer.
coke_and_coffee | 2 hours ago
>We need to go back to unions everywhere the best period economically in our history was when unions were strong enough to argue for fair pay and benefits for their workers.
Real wages have never been higher than they are now so I'm not sure your arugment makes much sense.
CakeRobot365 | 5 hours ago
This right here sounds spot on to me. This is true at my company that internal promotions are capped, and it's ridiculous. It really screwed me over in my last position change, leaving me below the expected median salary, and currently looking for an exit after about 20 years there.
bumbumpopsicle | 4 hours ago
It’s imperative for the loyal employee to validate themselves both internally and externally. Loyalty is a virtue that should be presented to their existing employer alongside an outside job offer.
“I’m a loyal employee and I am giving you an opportunity to beat (not just meet) this validated external evaluation of my value. “
Ajlee209 | 4 hours ago
This is exactly my employer.
Work extra hard and maybe get 4% increase but you're likely to get a 3% increase yearly if you do your job well enough.
Want to get a promotion? Okay, you can apply for other jobs within the company but your unit likely won't have any available positions. Oh, you meant an actual promotion. We don't do those unless you prove that you are doing work (not exceptionally well) but outside of the confines of your current job. Those duties have to like up with the next level job almost exactly or else we won't give you a raise. Also, if you go that route you can only get 15% increase. But yeah, you can either likely not get a promotion or go to an entirely different area and leave all your friends and coworkers behind!
AngryTomJoad | 4 hours ago
i thought the title referred to the company hires a dog who licks peanut butter off you instead of giving you a raise
The term refers to across-the board raises “that are even and spread thinly, like peanut butter would be on a sandwich,”
i worked on wall street for decades and never heard this term before
Playingwithmyrod | 4 hours ago
I think it’s a fairly new term and reflects a modern approach vs the old school merit based bonuses and pay structures
DisappointedSpectre | 2 hours ago
Living in the corporate hell of a FAANG company I'm pretty sure this term is new as of this month, not just "fairly new".
adamdoesmusic | 2 hours ago
And then you get a reviewer who won’t give you a 5/5 after acknowledging that you earned it, but that it’s “not fair” to the others who didn’t score that well… and the score is directly tied to your pay.
Edit: yes I raised 10 kinds of hell, though it didn’t get me anywhere immediately. I got a 50% increase the next year tho from it, long story.
nardflicker | 39 minutes ago
I had to be the bearer of bad news to one of my coworkers informing them I get paid the same as them (they’ve been there for five years, I’ve been there for six months). They have certificates and whatnot that I don’t have, they were training me and were super cool and we bonded. At one point they asked what I was getting paid and said they understood if I didn’t tell them. I told them, but also thought they were paid much more than I, to find out that wasn’t the case. I thought that’s fucked, and if they want to try to get a raise or something, feel free to use my name as, at this point, I realized I gotta start looking elsewhere for more money and quickly saw the writing on the wall.
Management sat me down a few days later to talk about it, one of the managers mentioned they are paid less than other managers in the same position, and that’s just the way it is expecting me to understand. To which I replied along the lines of, well that’s horrible and unfair for you. I also mentioned that I thought my coworker was paid more than me, so I was just as shocked as them to find out I was paid the same as them even though they have certifications that I don’t have, and have been there for five years compared to my six months.
Just had my first round of interviews at a different business this week lol. Fuck corpo.
Trick_Situation_4421 | 33 minutes ago
Oh my God, I've had this argument with HR and senior leadership so many times!
You can't give someone a promotion and a THREE PERCENT PAY RAISE and expect them to do anything other than immediately start looking for a new job!
harbison215 | 5 hours ago
Counter point: Labor costs can be one of the largest expenses. It’s difficult to give large pay raises and then have the rest of your work force expect similar pay increases. Then suddenly your costs over run and you’re holding loyal employees but the company is on the verge of profitability. For a publicly traded company, this problem is exponentially worse.
I’m playing devils advocate here, but it is a bit more of a juggling act.
6a6566663437 | 5 hours ago
You're giving the large pay raises no matter what.
The difference is whether or not you're also going to through the expense of hiring new employees while doing it.
laserguy37 | 5 hours ago
I am part of the on-boarding and training process at my job, and it is so much more expensive to bring someone in from the outside to fill a role. We try to fill higher positions with current employees when possible, and that is a big reason. Another reason is hiring from the current employee pool can do wonders for improving the culture at a workplace.
Berserk72 | 3 hours ago
>when possible
This is doing all the heavy lifting. The entire reason this issue occurs is that the internal promotion mechanism are broken in almost every industry.
Until job swapping is not the primary way to increase wages, company culture will stay low.
harbison215 | 5 hours ago
Right but the other employee realize they have to leave to get that kind of pay increase and many people are too complacent. So it works.
6a6566663437 | 5 hours ago
>~~So it works.~~ Gradually grinds your company down
FTFY.
There's a reason you get some amazing company completely changing the world, and then 10 years later it's a terrible workplace enshitifying all of its products.
They thought everyone was complacent and "family".
harbison215 | 5 hours ago
I don’t disagree but there has to be a reason that this is the prevalent method for balancing labor costs and employee retention. If it were as easy as “just pay everyone more” then it would be more common. It isn’t.
6a6566663437 | 5 hours ago
> but there has to be a reason that this is the prevalent method for balancing labor costs and employee retention
The reason is it's easy and doesn't require the MBAs to understand or listen to the people actually doing the work.
>If it were as easy as “just pay everyone more”
That's not the alternative. The alternative is pay the good people more, and identifying the good people is hard for management to do.
harbison215 | 5 hours ago
I’ll be honest, then there is something I’m not understudying in the dynamic. Maybe it’s taboo to try to request budget increases and management doesn’t want to come off to the higher ups that they can’t control costs.
6a6566663437 | 5 hours ago
Basically, there isn't an objective way to measure "good people". As soon as you think you've found one, it'll destroy your company.
For example, let's say you tried to use "widgets built per hour" because you sell widgets. But it turns out the guy on the production line who is really good at making part of the widgets was helping 10 other people, which brought his overall production down to average.
Since he's now penalized for helping, he just makes widgets and makes more than any other individual. And the output of those 10 others drops a lot. You now reward the guy for being the top performer, but the company overall is in a much worse state because his output doesn't compensate for the 10 others.
Or let's say you pay a giant bonus to the top salesperson. The top salesperson is going to be the person who most effectively sabotages the other salespeople.
So you need management that actually understands what the workers are doing and can recognize who is really a "top performer" without formal metrics that can be gamed.
But then you have the problem of a whole lot of management can't do that. They just don't understand the work, or they just reward their friends because it's easy and they're friends.
I'm not saying it's an easy problem to solve. I'm saying that management regularly messes up, and "everyone gets 3%" requires less effort by management.
harbison215 | 5 hours ago
This is a great response. Thank you.
dust4ngel | 2 hours ago
> there isn't an objective way to measure "good people". As soon as you think you've found one, it'll destroy your company
as soon as you choose an “objective” metric that approximates actual value, everyone is incentivized to game the metric instead of producing value. c thi ngyuen wrote ‘the score’ about this very idea.
Empty_Insight | 5 hours ago
Depending upon your MBA program, some of them literally teach that McDonald's is the 'ideal' way to make profit- high turnover, nickel-and-diming, etc. Good MBA programs will tell you there are a number of strategies and this model is only useful for cheap, fast commodities... but not everyone with an MBA got a good education.
All it takes is one dumbass being in a position to make these kinds of decisions to cause long-term damage to the company.
HedonisticFrog | 5 hours ago
American corporations only prioritize the next quarterly profit instead of looking for long term growth. That's why. They only care about the next few months.
At my EMT job, one of my managers bragged about finally reaching a million a month profit. A year later at the union contract negotiations they offered senior workers a pay cut.
harbison215 | 5 hours ago
Is there another way to do things? Because ever increasing labor costs will mean more layoffs when there is a slow quarter. There’s a lot of short term thinking but it’s part of the balance that makes things work. If a company increases pay costs and then the economy dips for a few quarters, who’s going to be the first to be laid off? Most likely, the people whose compensation has had the biggest impact on those quarterly numbers. Employees can be liquid in that sense. They are often some of the easiest causalities to fixing balance sheets.
Mikeavelli | 3 hours ago
If you keep 90% of your workforce year over year and lowball them on raises, then you're getting a discount on the majority of your employee paychecks. If this discount surpasses the cost of hiring 10% of your workforce at market rate, then it saves money overall.
Most people, especially older and more expensive workers, don't want to hop jobs frequently, that's just something ambitious young people do because they're have to. Older workers often have kids and a mortgage, and value stability over a higher paycheck, so they'll stick around even though they know it's a bad deal.
Glad-Veterinarian365 | 5 hours ago
For small business this is true. But for mega corporations, usually they can pay an entire year of salary company-wide with about 3-6 weeks of revenue
Hyperafro | 5 hours ago
Executive compensation is the largest labor expense because for some reason we have to run a big company completely differently than how we run a small company. We put groups of people around tables to talk about vision and direction so they can make 6 figures with 7+ figure bonuses. When they make poor decisions people below them lose their jobs or benefits or no raises all to answer to share holders who chose to take an investment risk.
LavisAlex | 6 hours ago
I've found that a lot of company policy when it comes to retention is always short sighted.
Like you'd think in a system where companies have to compete for an edge there would br more focus on instititional knowledge within companies.
ClydeFrog1313 | 4 hours ago
They leverage the fact that leaving your job is a pain and applying is just a slog.
The problem for them is that top performers are sought after and so they run the risk of losing them. But most employees are replaceable to one degree or another and I suppose some companies feel comfortable with that risk. Just dont feel offended when people decide to leave for more money, its just business.
adamdoesmusic | 4 hours ago
They told me I was replaceable at my company. I can directly trace how my contributions transformed the company from a struggling, disorganized garage operation to the fastest growing company in the sector, to one of the main entities in our industry, led mostly by products I created and systems I built or implemented.
We got bought out, mostly due to the success of a deal that I initiated as well as our ability to rapidly scale the production of custom products without a lengthy certification process, something I worked for two years with the regulatory bodies to get for us.
During Covid, they laid everyone off. When people were coming back, they decided they just needed me as a contractor, as now they’re bringing in a “real” product design specialist (at multiples of my rate). After almost two years and a huge budget, he releases what is essentially an empty metal rack which is supposed to be compatible with the rest of the gear the company made.
The company closed not too long after.
DBCOOPER888 | 3 hours ago
Yes, like, of course everyone is replaceable on a long enough time scale, but companies who say this never account for the cost of replacement against their bottom line. Stronger retention policies will save them so much more money.
SarmackaOpowiesc | 3 hours ago
The vast majority of employees are not that smart or that bright. Most places will be fine if they move on.
The folks who they don't want to lose - they compensate them on the higher end of the bell curve since they know they won't be able to leave for higher comp easily.
DBCOOPER888 | 3 hours ago
This applies even to rank and file employees. It generally costs more money to bring on new employees than it does to compensate current employees.
el_diego | 2 hours ago
100%. I've seen companies spend 10s of thousands recruiting for replacement employees only to have those replacements leave in less than 6 months. Each time they could've just given the existing employee a fraction of that cost as a salary bump and would've prevented brain drain, but naaah better to burn money than promote people.
SarmackaOpowiesc | an hour ago
When you factor in raises across tens of thousands of employees - it is indeed cheaper to bear the burden of recruitment and replacing an employee
el_diego | 17 minutes ago
We're not talking union here.
Rando-43 | 3 hours ago
I had a boss once tell me that everyone is replaceable. Sometimes the replacement is better sometimes the replacement is worse. For whatever reason it has stuck in my mind rent free for years.
adamdoesmusic | 3 hours ago
You can replace a crankshaft with a toilet paper roll, doesn’t mean the car’s gonna run
Rando-43 | 3 hours ago
Wish I would have thought of that response!
adamdoesmusic | 3 hours ago
It comes to mind immediately only because I directly watched my company literally replace their crankshafts with cardboard, thinking they could sell the cardboard and bail before anyone noticed.
FillUpMyPassport | 3 hours ago
At most companies that follow merit based increases there isn’t a lot spread between the average raise (3-3.5%) and the top (4.5 to maybe 6%) so most folks are better off changing every 2-3 years if they can.
UDLRRLSS | 3 hours ago
> They leverage the fact that leaving your job is a pain and applying is just a slog.
No they don't. "Never attribute to malice that which is adequately explained by stupidity."
There are people in HR whose sole job it is (in a large enough company) to determine what the pay range of some position should be and to ensure that internal equity is balanced. This formula takes into consideration years of experience, title, and some related experience using the minimum requirements of the position. Experience inside of the company, gaining subject matter experience, is not worth any more than experience gained outside of the company. That is all.
It's a huge failing of the system but has held true for several different organizations my wife worked for.
mxzf | an hour ago
Eh, "ensure internal equity is balanced" is putting an obscenely kind spin on it.
The reality is that they're trying to maximize profit by charging as much as possible and spending as little as possible (including on payroll). They are paying people as little as they can get away with, not trying to keep things "balanced".
alltehmemes | 5 hours ago
Outside of public administration, institutional knowledge isn't really measured so it isn't valued: all the cogs in the machine are in the same class of liability.
Smithc0mmaj0hn | 4 hours ago
I agree but I often think of this info I read in a Seth Godin book. Every employee should be thinking about how they can become a constraint because then you have the company by the balls. Simultaneously every manager should be identifying the resources who are becoming a constraint to ensure no one can have the company by the balls.
It really is a game and as an employee you have to know how to play it.
alltehmemes | 4 hours ago
The managerial class needs to keep track of the constraints to use them as bargaining chips. At the end of the day, the managerial class should have some solidarity with traditional rank and file Labor to stand against Capital.
TheMauveHand | an hour ago
The problem is that no company I've ever heard of ever actually negotiates with this sort of constraint in mind; essentially, they will see it as blackmail, and in the best-case scenario they will give you your raise, tell you to offload your knowledge to your replacement, and fire you. More often than not they'll let you go immediately out of we-don't-give-in-to-blackmail spite.
The only exceptions might be high-ranking sales managers, but the idea that your intimate and exclusive knowledge of some obscure backend system will give you leverage at a salary negotiation is, unfortunately, bunk. They'll let you go, regret it a bit later, and suffer the consequences, but they won't change their tune.
Smithc0mmaj0hn | an hour ago
I hear you, but that is the game, if you as the constraint hold all the knowledge then you have to be smart enough to not give away that knowledge. Call the bluff either fire me, or shower me with rewards.
I worked at a major bank a few years ago and there was this guy in technology who knew everything about the legacy mainframe, specifically in the context of mutual funds. He and everyone else knew only he had the knowledge of how it all worked and when they tried to do knowledge transfers he would play dumb. During covid when we all went remote I remember this guy openly smoking cigars and drinking whiskey on his deck during conference calls. Everyone knew it was wrong but management couldn’t do anything because only this guy knew how it all worked. It was beautiful.
TheMauveHand | an hour ago
> Call the bluff either fire me, or shower me with rewards.
But that's my point: they will always call, never ever fold. Even if it means shooting their metaphorical foot off.
BreeezyP | 4 hours ago
It’s weird to me that some professions (things like cops/detectives) have formal tests that must be passed in order to make it to a promotion, but that’s so rare elsewhere.
There are MANY professions that would benefit from a formal test structure to prove you at least have an understanding of the book smarts kind of knowledge of the work. Some put that responsibility on certifications which is OK, but sometimes a bit too generic. Think things like health care administrators, for example, it’s kind of important they know the details of the work. Interviews alone aren’t sufficient screeners for that.
Alternative_Work_916 | 3 hours ago
I’m a developer. Imagine giving me a test that adequately reflects what I do. You currently have as much knowledge and understanding as the execs above me.
There are many professions like this. This is also why execs tend to make really stupid decisions based on irrelevant metrics.
SatyricalEve | 3 hours ago
Send me your most salient piece of code
Alternative_Work_916 | 3 hours ago
while(employed) {
money++ }
This joke is impossible on mobile.
TriPigeon | 2 hours ago
Which also explains so much of the functionality of websites on mobile 😂
coke_and_coffee | 2 hours ago
This is teenage-redditor^TM nonsense. There are millions of private companies that greatly value institutional knowledge and will offer competitive pay to employees that have that knowledge.
You're just making shit up.
alltehmemes | an hour ago
You'll be tossed by the wayside for someone cheaper at the first chance of missing the quarterly earnings: competitive pay is how an immediate problem's solution is out sourced, and then you're canned because you're liability exceeds your value.
coke_and_coffee | an hour ago
If this were true, why is my company paying me $175,000? Why don’t they just hire someone else for cheaper now? Why wait for quarterly earnings?
theouterworld | 4 hours ago
CSB/ I work with C suite executives across several industries, and on more than one occasion those execs privately mocked their own employees. In one instance I put together a very detailed analysis on what a company could do to increase retention. When the #1 thing was increase wages, and the second thing was "PTO policy that employees can use for days off". They laughed in my face, and did a PR push on two trap benefits instead.
They see their businesses as existing to only enrich themselves and their buddies.
keithcody | 4 hours ago
Training repayment TRAP or something else?
cantuse | 3 hours ago
Restricted Stock Units (RSUs) are an example of a trap benefit. Free stocks at the company that vest quarterly over a two year period, but are lost if you leave before they vest. Had this at a prior job that was great but not fulfilling, ended up keeping me stuck there far longer than I really should have been.
theouterworld | 3 hours ago
Education benefit where the company paid for classes but required employees to work for years after it pay back the full cost if the wire or were terminated. Managers were encouraged to change schedules so they were working during classes during the employees last semester so that the employee would either drop out of school or be terminated.
They also offered employees additional comp for selling plasma, the equivalent of 8 hours OT. But if you quit or were terminated, you got banned for life.
coke_and_coffee | 2 hours ago
> They see their businesses as existing to only enrich themselves and their buddies.
That is literally the whole point of business. We should not be surprised by this.
It is markets that force businesses to pay employees competitive wages. How are people on this sub so perpetually confused about economics?
Wolfeh2012 | an hour ago
> They see their businesses as existing to only enrich themselves and their buddies.
I mean, yeah, that's the whole point. Capitalism is designed specifically to make people with that mentality the most successful.
ia332 | 4 hours ago
Companies are interested in attracting talent, but not retaining it 🤔
ungoogleable | 2 hours ago
Even if you have happy employees who want to stay forever, relying on key people too much is a risk because shit happens. They may literally be hit by a bus. In a healthy organization you have documented processes, thorough training for new hires, succession plans where every role has a backup and a backup to the backup, etc.
topical_storms | 2 hours ago
I think people forget companies aren’t people, and these decisions are typically being made by people who do not necessarily [probably don’t] have the best interests of the company in mind. For most public companies, leadership is incentivized to generate profits in the short term over long term, and they are also typically paid such an inflated amount, that it contributes to this [unhinged] mentality of looking at people’s value as corespondent with their pay (“if my workers are making a 1/10th of what I do they are probably pretty replaceable”)
Last-Apartment1742 | an hour ago
My first job thrived on hiring fresh grads and then telling them they were all worthless and could never go anywhere else so why even try.
They also paid about a third of what other companies did.
Long story short everyone that started and spent about ten years there got fed up and left in the same 3 year span and last I saw they still haven't replaced us.
They could've just paid us what we were worth and instead they lost half their employees that had been there for almost half the lifetime of the company.
I guess the owner got rich as fuck off us though so that must've been nice.
TheRealGageEndal | 6 hours ago
I used to travel for a company and I got a .50 cent raise at my last job on my second year after doing the work of a lead without the title, pay, or really anything. I didn't have a certificate I needed for advancement and was told the company would help me get it. They never did and gave me a bunch of runaround.
I had a job offer that was for $5 more and accepted. When I told my boss he said it put him in a really bad spot because he really needed me and was hoping I would stick around. I told him that I can't pass on the money.
Before I walked the quarter mile back to my work site I had a plane ticket back for two days later.
I let my boss know I suddenly wasn't feeling well and was going to use my sick time to head back. I got back to the hotel and started packing up my stuff.
The new company told me to buy the certificate myself and gave me paid time to get it finished. I haven't even been with them a year and am about to get my second promotion.
Don't count on raises, just change jobs when you start to see toxic behaviour. Loyalty works both ways.
Followthemoney-NL | 5 hours ago
Exactly this.
People are often too afraid to do this, getting screwed over. Know your worth.
[OP] 3xshortURmom | 6 hours ago
More companies are adopting or considering “peanut butter” pay raises which are even and thinly spread increases for all employees instead of performance based raises, according to Payscale’s Pay Increase Preview Report. While 48% of organizations still plan to reward performance, a growing share either already use across the board raises or are planning or considering them.
Companies cite tight budgets, fairness concerns over biased performance ratings, and administrative simplicity as reasons for the shift. However, experts warn that equal raises can demotivate high performers, hurt morale, and lead to retention problems once the job market improves.
In today’s weaker job market, many employees may stay put despite disappointment. Still, experts caution that underpaying top talent is short sighted, as they may leave when opportunities improve. Employees unhappy with raises can explore benefits, update their resumes, and monitor job opportunities but should think carefully before making major career moves solely over one pay decision.
TryptaMagiciaN | 6 hours ago
We did peanut butter style. Then they claimed they were going to performance based. Then my manager just completed my review without me and I got the same 3% I always get for COLA instead of the possible 4% we can get up to.
Which, big whoop, 1%..
"fairness concerns" fairness is what they use to keep us all down. They destroy efficiency for fairness when being more efficient would mean more downtime for all employees.
Own_Candidate9553 | 5 hours ago
There's nothing less fair than treating everyone the same. If one neighbor is an asshole and another is nice, nobody would fault you for occasionally shoveling the nice neighbor's walk and leaving the asshole to fend for themselves.
Same with employees. If you want to be "just business" about it, it doesn't make sense to reward the person who slacks off and is unhelpful the same as the person who always comes in clutch, doesn't need constant supervision, whatever.
Yeah, it's a tough conversation, that's part of management.
TryptaMagiciaN | an hour ago
>Yeah, it's a tough conversation, that's part of management.
We don't have management anymore. We have Accountability and Liability Reduction. They cannot really even have conversation. Mine cannot even look me in the eye anymore. The problem with reducing liability through poor communication is that you begin to really lose sense of what goes on in your workplace. And then you can no longer be a competent manager. And then something goes wrong and the higher ups will let you take the fall.
That is what I cannot understand about the manager/directors. They are not immune from the effect of what they do on behalf of their bosses and when lawsuits start flying, the company stops standing behind them.
shozzlez | 2 minutes ago
Hopefully you at least don’t have to fill out yearly performance self evaluations or set yearly goals since they are now irrelevant.
AFearfulSilence | 6 hours ago
So COLA, then? I'm not willing to let them rename this shit to try to hide they are doing less.
chrisbcritter | 6 hours ago
Even better is across the board pay cuts. Try that at your company and wait a year. Look around at all your employees that have not left. Congratulations, you now have a list of underperforming employees that you should have fired.
son-of-a-mother | 6 hours ago
I don't think it is only underperforming employees who will stay.
Some employees will be considered too old by the job market, and so cannot leave. It is not easy for a 55 year old to job hop to a new firm. They will stay, but they will quiet quit.
JitteryJoes1986 | 5 hours ago
I know someone like this. He's 55ish and set to retire after working at the same F500 for almost 2 decades.
Sorge74 | 2 hours ago
One of my old managers retired from a fortune 50 a couple years ago. Dude had quiet quit like a decade prior. He still definitely did some parts of his job but he was ready for requirement.
chrisbcritter | an hour ago
That's true, but the same can be said of any bigotry. Women, African-Americans, LGBT people, and others often find themselves loyal to companies that pay less but accept them.
RedditReader4031 | 6 hours ago
Overly simplistic.
teshh | 6 hours ago
Not really, top performers often want the pay and recognition. Giving someone a 2% raise who brings in tons of revenue is just gonna drive your best performers to your competitors who will pay them.
The people you're left with are those who don't care and/or don't perform at that same level.
RedditReader4031 | 5 hours ago
Or they’re tied to vesting or they value their commute or they are allowed a certain level of WFH or they have a sense of loyalty or they owe time on a certification the employer paid for. Again, it’s not absolute.
gimmickypuppet | 6 hours ago
There’s more to life than work. Your top performer could easily have family, elderly parents, or some other circumstance. The time table it would take to truly see top performers leave can’t be measured in a year or two.
willacceptpancakes | 5 hours ago
This is me. My work commute is 5 minutes and it’s an easy job. I am a high performer but also don’t work nights or weekends at all.
Got a 3% raise this year. Fuck it. If I keep doing what I’m doing right now for 5 more years I won’t have to worry about saving for retirement anymore at 42 years old. After that as long as I cover my expenses I can do whatever job I want and or worry less about my current career.
teshh | 5 hours ago
Yea ik that... which furthers my point, a top performer who has dependants is definitely not going to stay. And yes it absolutely can lmao. If you've ever worked front office/sales it's clear as day. It may not be clear in traditional white collar roles but for those that actively generate revenues, it's no question.
A top salesman leaving, immediately affects the companies earnings, both in the short and long term.
Old-Buffalo-5151 | 6 hours ago
Talent never stays put in bad markets. What ends up happening is top guys move and you're left with the useless idiot's that cant find anything anywhere else.
Iv watched this happening in real time and the very real impact its having this generation of execs are so bad im so confused whats led to entire generation school just being so bad at business. And it's uniquely this particular generation because I've met very savy younger execs or the remaining old guard who know the importance of talent
Bcmerr02 | 5 hours ago
The overwhelming majority of MBAs now will cut off their nose to spite their face. They think by squeezing the expenses they're going to showcase their ability to increase profits when they really just break a system that was already profitable to juice the numbers so they can bounce at the first opportunity and the next guy has to fix what they broke.
It never fails to amaze me when they are put into any kind of authoritative position they make things immediately worse because they think they're God's gift to the shareholders because nobody else was smart enough to consider spending less on the people doing the work at a company. They are all so short-sighted, self-centered, and dumb.
KungFoolMaster | 6 hours ago
This is horrible, but not nearly as machiavellian as the proposed military warrant officer's bonus plan. Army warrant officers will ‘bid’ against each other for their next bonus.
https://taskandpurpose.com/news/army-warrant-officer-bonus-auction/
WTF is going on in the timeline?
Kataphractoi | 2 hours ago
Sounds like they're going to lose qualified people they'd otherwise want to retain.
GhostofBeowulf | 6 hours ago
Eh this is kind of short sighted. They just need to establish an effective organizational culture and through the ASA model will fill their ranks with employees who agree with their principles.
For reference I had a position in which our bonuses were all or nothing, either the whole company got it or nobody got it. And it worked very well, high performers will put in the work to get past the goal. Except everyone worked together instead of focusing on issues specific only to their jobs.
Nanerpoodin | 6 hours ago
Except when there's one department that misses goals 2 years in a row, due to shit completely outside their control, and now I'm barely working at all because it doesn't matter how hard I work, I'm just going to get screwed anyway.
NepheliLouxWarrior | 6 hours ago
The real lesson here is that wage increases should not be tied to bonuses and they should not be tied to performance but rather to rising costs of living.
iThankedYourMom | 5 hours ago
And then your competitor grabs all your top performers by giving them bonuses based on their performance and now they took your market share. What do you do then?
Old-Buffalo-5151 | 6 hours ago
Easy to have that work when everything is clicking but a bad string of luck quickly kills companies that operate like that iv witnessed it first hand in at least two orgs who promptly adjusted to department based performance rather than company
6158675309 | 6 hours ago
I've worked for companies with performance based plans. More people left because of that than anything else. It's impossible to determine actual performance in most large organizations. My experience was these systems were at best bad, usually they were detrimental.
My experience is leading groups of several hundred people, I have never seen any performance based system work well. In the end it allows for even more subjective outcomes where you cannot explain why person A got a 125% merit and bonus award and person B gets 50% and 25%. You can tell person B why, but it's always some subjective nonsense that does nothing but deflate them and they eventually quite quit until they find a new role somewhere else. Obviously, not everyone but those who can do.
Mejiro84 | 6 hours ago
Yeah, it tends to be great for people that have explicit measurable job-goals, or the ego to be able to bullshit-waffle whatever they've done into being 'fuck you I'm awesome pay me more'. For others, it's mostly a hassle to try and justify a boost, which management will shut down or not for their own effectively inscrutable reasons
Longshot726 | 6 hours ago
The organization I work for does merit or these peanut butter style raises depending on department structure. My department is performance based. Everyone hates it except a handful of people buddy-buddy with the executive teams. It's a whole bunch of work that turns out to be meaningless.
We pretty much all get the same pay raise anyway since they lump everyone but a dozen or so into the "meeting expectations" category. We may get 3% while those falling below expectations gets maybe 1% while those handful exceeding expectations somehow get 7 or 8% since the scale isn't linear at all and is totally subjective with no transparency. Everyone tries hard for the first couples years until they realize the goals sheet is pointless, so they start half-assing it like the rest of us since it doesn't matter.
mellolizard | 5 hours ago
I worked for company that had a performance based raises. Then they had the smart idea to show how everyone was graded based on position. Surprise, surprise all the senior management got the top performance and therefore highest raises. All the new, junior level got the lowest and the lowest raises. And then senior management was shocked all of the junior staff quit, myself included, within 6 months of that meeting.
BasvanS | 6 hours ago
“We have no money because we spend it all on stock buybacks and dividends! You will have to do with le…
Hey, wait, where are you going?!”
astrange | 3 hours ago
Stock buybacks are value neutral, they don't cost money. That's like saying you're spending money by putting it in your 401k.
Tech companies use them to give employees the shares.
BasvanS | 2 hours ago
Buybacks cost real cash. The company writes a check, that money is gone. That's not neutral, that's spending.
And your SBC point is literally proving the opposite of what you think. If buybacks were free, why would companies need to "use" them to cover anything? You're describing two expenses canceling out, not no expenses.
FortheredditLOLz | 6 hours ago
Jokes on you. I haven’t had a raise in four years. So I been raising office supplies and snacks like it IS my raise. Every time I went in, walked off with five reams of paper and dropped it off at a public library. One of the libraries legit asked me if my ‘company’ can drop off legal also because they thought i worked for whoever supplied them…..
LikesPez | 6 hours ago
The US military is doing this with the Warrant Officers Corps. It’s an auction for CW3 and CW4 to price their worth. They bid too high they get no raise and no bonus. They bid too low and they are awarded what the winning bid gets. Let’s say they all want 1,000,000. That’s blows the budget and no one gets rewarded.
allmediocrevibes | 6 hours ago
This is such an awful idea. I consistently have top performance metrics. Thats because I want a sizeable raise. If im treated the same as everyone else, Im going to perform the same as everyone else. I dont work hard out of the kindness of my heart. I work hard because I like money. Why would you intentionally drive out top performers?
RedditReader4031 | 6 hours ago
Will they cite administrative simplicity when they have to address rising turnover?
Berkut22 | 4 hours ago
So like union jobs then, without the union benefits.
fuzzygoosejuice | 6 hours ago
Our parent company is doing this along with the Jack Welch bell curve performance evaluation method. We manager were informed (at the last possible minute before evaluations were due, in true HR fashion) that our performance evaluations had to fill a bell curve this year and that we all had to have at least one person “below expectations.” Never mind that, even if all of your people are meeting the published job requirements and achieved all of their annual goals, we were all told that we had to find a reason to give somebody a “below expectations.” And that went for everybody, even functional-area managers and directors. One of my fellow functional area managers is the one who drew the short straw this year, and the only thing our director could find to ding him on was his email communications being difficult to read sometimes due to run-on sentences and punctuation. I’ve worked with this guy for 12 years, so we’re pretty close outside of work. He was around when our highly customized SAP was implemented, and retains a ton of esoteric knowledge of production transactions, issues, and how to resolve them. The same-day we got our reviews he started searching. We’re fucked if this guy leaves and we have one of those rare, obscure breakdowns in our production confirmation system. Willing to bring our production system to a screeching halt until TCS can fix the problem just to save 0.5% on an annual raise.
ConglomerateCousin | 6 hours ago
I heard Peanut Butter for the first time in a meeting about 4 months ago. We do the bell curve as well for ranking performance, but generally do not put anyone in the bottom tier unless they are really underperforming. I think this year they went with the PB method. It cannot be coincidence that I heard it in October which is when bonuses typically get decided. My company made millions and hit their targets. It’s exhausting
JonnyBravoII | 6 hours ago
A company I worked for years ago decided to change their performance rating system. Anyone rated a 3 (an average performer and most ended up here) were deemed "meets expectations although sometimes misses expectations". It had previously been "meets and sometimes exceeds expectations". This was a backdoor way of putting people on a PIP and getting rid of them without paying severance.
The expectation was that average performers would head for the exits. Instead, the top performers headed for the exits and it blew up in management's face. I had left the company by that point but apparently the change caused huge problems and was a disaster.
These peanut butter raises will suffer the same fate.
dust4ngel | an hour ago
“we’re taking away incentive for people who outperform to continue outperforming. hopefully actors in a market are indifferent to incentives.”
JC_Hysteria | 6 hours ago
Why would you give your top performers bare minimum raises?
If someone’s role is only getting a “raise” that matches inflation, it has already been decided that you would be somewhat easily replaceable. The new budget wasn’t invested in you.
Top performers know their worth- and it’s usually rooted in stock value/bonuses, not as much their hourly wage. That’s the difference.
bad_luck_charm | 3 hours ago
I've gotten high enough up in my organization to understand that the people making the decisions about the raise pool and the people who are identifying top performers are different people.
If the strategy is to spread the peanut butter as thin as possible, there's no room to reward anyone. Sure, I could probably give my top performers a decent raise, but then everyone else would get nothing. There's no good solution.
JC_Hysteria | 3 hours ago
The scope I’m referring to doesn’t have “top performers” on every team…part of the reality is how churn rates are factored into the decisions.
A capex/opex budget is passed, and then it’s up to strategic managers to decide where that goes via approved proposals.
The inflation raises aren’t a “we want to keep you” signal- it’s a “you’re not fired” signal (until the next budget cycle).
The more senior manager usually isn’t going to burden themselves with the personnel decisions that aren’t theirs to make- it’s just business, so the role beneath them makes the call.
bad_luck_charm | 2 hours ago
I hear you, but I'm not sure I understand what point you're making.
JC_Hysteria | an hour ago
The article argues that companies lose value by opting to dole out broad, inflation-based wage increases YoY vs. weighted performance increases. It argues the former causes the unintended consequence of its best hires opting to leave/lower their effort.
It’s a mischaracterization of what’s going on- the companies are not “losing value” if these people decide to leave. It’s all factored into the decisions- and increasingly it’s a means to manage churn in the short-term (i.e. get people to voluntarily leave without the negative PR).
People often like to believe their professional value should be worth more than what they’re actually paid, what the market rate is for the role, and/or how their contributions are perceived by decision makers.
BuvantduPotatoSpirit | 6 hours ago
That'd depend on your current salary. If you're a top performer already making $120k in a role that typically makes $90k, an inflationary raise reflects that you're already paid like a top performer.
JC_Hysteria | 5 hours ago
Yeah it’s all relative, subjective value. I’ve been paid more at a company contributing less, and vice versa.
The argument of the article is only accurate if the strategy involves keeping the same people for as long as possible…but that’s just not how the market has moved as of late.
Most large companies do have their sights set on the next 3-5 years, so they optimize strategy, hiring, and resources for that timeframe- not the longer term.
ih8theeagles | 4 hours ago
I mean if you have a job paying 33% more than your worth for sure count your blessings but that's not typical lol.
BuvantduPotatoSpirit | 4 hours ago
Being a top performer is also not typical.
If you're getting paid 33% more than average for your position, it's typically going to be because you're worth more, because you're more productive than average.
Sales jobs often do this automagically with commissions, but the principle can apply in other positions
ih8theeagles | 4 hours ago
I get that but the post is about giving raises to everyone evenly with at least my assumption, salaries matching what the market is paying. Anyone who acknowledges they are paid more than fairly for their work doesn't really apply in this situation. In fewer words, I didn't think your original comment was relevant because it's so obvious.
BuvantduPotatoSpirit | 4 hours ago
You responded to my comment as though I'd ignored the context and said something else?
That's certainly a choice.
ih8theeagles | 4 hours ago
Unless I'm mistaken your stating that some top performers won't be lured away or even offered more than their current salary yes?
JC_Hysteria | 4 hours ago
Right, the article is trying to argue people that got a paltry raise can be a “top performer” and has leverage…but that’s nonsensical.
I was expanding to essentially say: companies with high growth targets will definitely pay particular people more to help reach those goals.
In the example, I’m sure there are people working at Starbucks corporate who were granted more than 2% gross increase YoY…but they’re probably referring to rank & file roles and claiming there are “top performers” in the bunch.
OmegaDonut13 | 6 hours ago
Performance based raises in my experience can have negative side effects too. I worked for a biotech company that was all about that and the company atmosphere was a complete CYA shitshow where collaboration and problem solving was slowed to a crawl because if anything went wrong it was a total blame game. Instead of just solving the problem it was finding who to blame and finger pointing. Different departments didn’t work well together because “you might screw up and make me look bad.” Hated working there.
shottylaw | 5 hours ago
That's the system we live in, though. Shortsighted is literally the corporate way of life. There will be a whole new set of eager and broke college students ready to slave away due to crippling debt and high costs of living that we can take advantage of, anyway. Q2Q profits, kick the can down the road until after I jump out of the wreck I made and land safely thanks to my golden parachute.
It's a feature, not a bug.
BourbonSupreme | 6 hours ago
Everybody should get a raise to cover inflation and higher cost of living. Top performers should get an additional raise on top of that. Employers will chose one or the other, based on which costs them less, and that's why they will struggle to retain employees. Same as it always been. This article doesn't say anything new.
heythosearemysocks | 5 hours ago
Came here to say this. My company pushes a pay for performance philosophy. So if you do well you will be rewarded, but that reward means other, capable and still valuable employees, get nothing.
Eventually those ‘average’ employees move on. This forces the high performers to take on more work or at a minimum spend time training replacements from the start which leads the over performers to burnout.
This could easily be avoided if they decided to provide those in charge of the pay cycle a modest increase in budget. However we don’t because that would come out of our profit margin and shareholder value.
It’s a vicious cycle
dust4ngel | an hour ago
> Top performers should get an additional raise on top of that
they should be compensated for high performance, but that could come in the form of bonuses, which don’t stick around if for some reason next year they decide to check out.
BasvanS | 6 hours ago
Am I the only one that spreads their peanut butter in morbidly thick layers?
Also, I’m not sure how record profits rhyme with no room to pay the people doing the actual work.
(I do, don’t worry. I just think it’s insane to work like this.)
Bcmerr02 | 5 hours ago
Add in the fact that the pay range for new hires shifts higher due to market competitiveness and inflation, but existing workers are basically held in place. It doesn't take long to realize they have no intention of paying you what you're worth and won't bother to update your pay until you make less than they would pay a new hire while having the experience that makes you a better employee. The system is broken.
hippydipster | 5 hours ago
I got snow caps on my sandwiches
psychologystudentpod | 3 hours ago
You got egg nog in my goat milk.
ZarglondarGilgamesh | 5 hours ago
Peanut butter: Yes, the layer should be at least as thick as the toast slice
Profits: Because they’re not optimizing for equitable distribution, they’re optimizing for maximum profit. Employees get what they’ll tolerate.
sbfb1 | 5 hours ago
I have performance based pay, I hit top tier and while my bonus was amazing, my pay raise hit 3%. Not that I expected 10, but someone not hitting top tier probably got 1.5-2% is crazy to me
grahamfiend2 | 5 hours ago
I have similar thoughts. I got a rating for 2025 that is considered top performer. Was the hard work worth the extra 2% I’ll get in my annual raise? Even the extra 5% I’ll get on my bonus?
Probably not.
sbfb1 | 4 hours ago
It does long term for next bonuses and raises, also, at my company you don’t see people hit top tier back to back years. I hit it in 2022 and now 2025. It’s subjective, and I get that but also frustrating
Smooth-Highway-4644 | 6 hours ago
Hire me for the job. Pay me. Why do I need to perform or do extra, you hired me for something I do. I either do it or don't. I ain't gonna kill myself over it.
ih8theeagles | 4 hours ago
That's fine promotions, raises, and bonuses typically go to people who over perform their responsibilities. You probably already have the job you want. You were hired at a salary you agreed to when onboarded and I assume you've been paid for your time.
UmatterWHENiMATTER | an hour ago
People always say this... so, I assume it is or was true somewhere. I've never experienced it or known anyone personally who experienced it and told me about it. Instead, those things go to outsiders and insiders only. Extra work gets you everything except extra pay.
ih8theeagles | an hour ago
Well we've never met in real life but. I started over in my mid thirties as a maintenance tech for an apartment community. I had some handyman skills, rose up pretty quick and was a supervisor within a year. I spent four years doing that and was promoted to regional maintenance supervisor.
During this time I was working a lot and missed out on some things in life I regret. Kids birthdays and the like. I'm nearing fifty now and in asset management for a construction firm and it's not too bad. I'm grateful younger me crawled through the crawlspaces and unclogged the shitty toilets.
thisisal0w | 5 hours ago
Honest question: does this article read as propaganda? How in the world could they know what the hundred of thousands of people in a position to give raises are planning.
Badlyfedecisions | 5 hours ago
I’m a high performer at my company and recently got a 15% raise. Standard this year for people was 3%. However, I was also below market rate for my position to begin with.
The amount of hoops my managers had to get this done was insane. I’m talking like up to multiple VPs at minimum to get approval. It may have gone higher, but those are people I know had to sign off.
I’m grateful for my raise of course but the fact it takes people of that level to sign off on an above standard raise is pretty absurd.
PicoRascar | 2 hours ago
I'm in consulting and see this a lot. It drives me bonkers. Amazing young talent who are fully billable, easy to work with and are emerging rock stars, generating many multiples of their salaries in billable work get denied a reasonable raise so they quit. Just had an amazing girl quit on me because the firm offered her a $15k raise bringing her to $85k, she wanted $20k. They wouldn't budge so she quit and just like that $370k in revenue stalled plus a few pissed off clients.
Of course, the firm defends it by saying if we give her a raise, everyone will demand one and our margins will suffer. It's so stupid.
raleel | 6 hours ago
Performance based data is very hard to acquire for many jobs, and metrics are hard to define. This means it ends up being how well you network and how well you socialize. My own company has very few job families that have good metrics at all and all of the ones outside of management are extremely loose, having nothing to do with their jobs.
Vegetable-Face-2518 | 5 hours ago
You will always be hamstrung by the fact that the HR department is benchmarking roles and after you max out, what then? You can’t get a promotion because there isn’t a higher position.
Mr_YUP | 3 hours ago
“More companies are leaning into “peanut butter” pay increases this year, according to Payscale’s Pay Increase Preview Report.
The term refers to across-the board raises “that are even and spread thinly, like peanut butter would be on a sandwich,” according to career coach Colleen Paulson.”
I was very confused
OffSidesByALot | 6 hours ago
I think on a case by case basis, this might not be a bad thing. I’ve worked in companies where the biggest ass kissers got the biggest raises and promotions, despite being the biggest slugs and a liability. It would be nice if everything was merit based… But that’s just not reality. There are multiple examples, but one glaring example for me was Kmart. Not exactly a mom and pop operation… But trust me… Cream did not rise to the top.
yogfthagen | 2 hours ago
So, companies are basically saying they cannot afford to have employees that do the work that needs to be done.
It's a legitimate point that the workers have been dealing with inflation for a long time, and have generally not gotten the raises needed to cope with that inflation. So, they are falling behind. Because of that, they're looking for better jobs.
Which is more expensive, because recruiting, hiring, and training is a LOT more expensive than retention.
But, for the workers, the issue remains the same. Prices are going up faster than wages. So, they're still falling farther and farther behind.
Companies are going to have to deal with the fact that the top performers are going to leave. They're going to have to deal with the fact that retention is NOT a concern. They have to deal with the fact that the workforce marketplace is about competition, not retention.
Workers have been underpaid for a long time, and the dam is cracking.
p33p0pab33b0p | 5 hours ago
just wait, the trend today is eliminating annual merit increases. You negotiate a salary and that is what you get paid unless you take another role or leave company. You'll wish for PB raise.
tapwater86 | 5 hours ago
Short sighted and business decisions go hand in hand. Everyone assumes they will sell or bail before the consequences of their actions or decisions arise. Literally every business decision is made without forethought into future issues it may cause.
Layoff highly skilled employees because they’re expensive
Offshore jobs to low quality workers because you can get more of them for cheap
AI replacing entry level jobs meaning there’s no upcoming workers to get skills
Failing to take care of employees so that good ones leave and only shit ones who can’t find work elsewhere stay
Raising the price of subscriptions and adding advertising, because where else are you gonna go? Everyone is doing it now and mega mergers are eliminating competition every year.
The quality of products sliding. Changing ingredients at the cost of taste. Shrinkflation. Shoddy code going out in software. Global outages of services.
How long before things start having safety issues because of cutting corners?
CEOs don’t care because they are paid in stock options and want the price to go up at all costs. They know they’ll get a golden parachute if they can push the numbers high enough.
The board doesn’t care because they can resign and walk away after selling high.
The only time decisions are made without forethought into consideration for the future is when it comes to cutting costs. Massive imports before tariffs hit, planning the next massive layoff wave and how many roles in a 3rd world country are required. How can OpEx be increased versus CapEx to reduce the tax burden.
band-of-horses | 3 hours ago
My company on average gives about 2.5% raises. Top performers and people in the lower end of their pay and might get that bumped up to 3% - 3.5%. wow!
Whenever someone asks in a leadership Q&A we are told inflation doesn't matter, we structure compensation adjustments to be "market competitive". It's just soft collusion between companies to all do this and say they're competitive with each other...
RestepcaMahAutoritha | 3 hours ago
Most companies retaining employee policy is the same as phone companies retaining customers. If youre a new customer you get a good rate but since you've been with us for 20 years we charge you up the ass.
thegooddoktorjones | 2 hours ago
Having just gone through a round of performance reviews where everyone in the department was rated 3 because real raises are not in the budget, I’d rather get peanuts than pretend that performance will be rewarded, then pull the rug at review time.
ktut | 2 hours ago
My company gave 2% across the board last year, promising performance based raises this year. They lied. 2% again this year. I gave my two month notice. No one at the company even tried talked to me about staying. My last day is this Friday.
Freudianslip1035 | 6 hours ago
I swear people who write these articles have never run any sizable business. Brass tax- performance based increases bring a litany of internal risks; morale issues, liability issues, FAPE allegations. Bad employees cause these issues and it also impacts the high performers. You know what work; peanut butter increases and high performance standards that drive revenue. Then you can make the increases size able more years than not.
exalted985451 | 5 hours ago
>Brass tax
virtual_adam | 5 hours ago
lol everyone absolutely trashes stack ranking and performance based raises. So bosses change to evenly given raises and now that’s bad?
Ok top performers are more than invited to join stack ranking companies and enjoy that aspect of constantly being judged by quarterly metrics
crazycatlady331 | 5 hours ago
When I was in college, I worked for a big box dept store (that is still around). I was reliable, frequently covered others' shifts, and would work in a different dept as necessary.
The performance evaluations were exclusively determined by how many credit cards we opened. Nothing else. One could call out every other shift and tell off customers and they would get a better raise than the reliable employee if they opened more credit cards.
The credit cards were easy to open when the store first opened but quickly became a saturated market. This was an affluent area, so there weren't a lot of people who opened store cards to build credit (there were more Amex platinum cards). Within a year of the store's opening, everyone who wanted a card (and could get one) had one.
sleeplessinreno | 5 hours ago
Something similar happened the last time the minimum wage was raised. I was about 3 years in, promoted and making significantly more than when I started obviously. The kicker was all current employees would receive a $1 raise on top of their performance review raise. All new employees would start at $2 above base wage.
Well, that system, put my current wage almost equal to a new employees that I was part of the training and management. Not cool. Eventually, I decided I didn't want to be in that position anymore and go back to being a general worker. The supervisors were humming and hawing that I was going to take a $0.50 pay cut. I was like "yeah, no problem."
After busting my butt to get to that point and get a raise and then have the rug pulled from me, and probably the majority of the staff, for significantly more work for an extra $0.50.
I was young, but it really disenfranchised me as worker from that point forward. While the "peanut butter spread" isn't exactly the same comparable scenario; it triggered a memory of how some of these people might be feeling.
flsingleguy | 5 hours ago
I work in local government and they have always done peanut butter raises. They also have annual performance reviews but you only need to “meet standards” to give the peanut butter raise. There really is no incentive to be a top performer and do just enough to meet standards.
TheBloodyNinety | 5 hours ago
Not much changed here. 2-3% is the typical “merit” baseline. Refusing to give high performers more would be new and will just cause them to leave provided someone else will pay the desired amount which is not new.
Personally, I’m a high performer and earn well above my peers. I asked for a large raise and if they don’t give it I have other options.
That’s the market for me right now. In 2 years it might not be. Always be willing to make the move while the irons hot.
euromarketsguy | 4 hours ago
Labour cost increases can squeeze margins for firms that compete on price, which is why many economists note employers may adjust headcounts or pricing rather than simply absorb higher wages. In competitive markets, the pass-through from wages to consumer prices depends on productivity and market structure.
itzdivz | 4 hours ago
Hindsight is 50/50, especially for public traded companies since they offer refresher/stocks that vest annually the longer ur there the more rewards. I have so many colleagues regreted jumping ship a 20/30% raise and forfeit their unvested stocks that couldve been a lot more. Especially past 10 years
brainrotbro | 4 hours ago
Without "peanut butter" raises, the people that work closer to the money always end up getting better raises, because they can more easily tie their work to company revenue.
magicweasel69 | 4 hours ago
As an RN in America the only way to get paid even half of what you are worth is to move every year. These bloodsucking companies that run health care in America do not care about you and will throw you to the wolves for their institutional decisions. The real perpetrators will never take the hit. So move and do not care what these blood suckers say. I went from $36 hr as a new grad to $45 in 2 years by moving jobs. Now I move again and I can get $48 or more. This is without even moving speciaties.
drfrog82 | 4 hours ago
Even tho some orgs do “performance” based raises, you end up having to normalize your team due to “budgetary” concerns. So then everyone still gets nearly identical raises. All such a sham.
chaunceychaunce | 4 hours ago
I was given 2% per person to work with. It doesn’t even matter at that point. Performance is good from all, what am I gonna do, give someone only 1 percent? 1.5 percent? So that I can give someone else 2.5 percent? It doesn’t matter at that point. Unless you have really bad performers who actually don’t deserve much or anything, you’re going to piss someone off.
Kindly-Talk-1912 | 4 hours ago
It’s easier to get an interview while working. Than if your hired tell them you can start the day after your resign and state when you’ll be leaving. 2 to 4 weeks or Evan till they food a replacement or you’ll be part time tot help train. so you’ll be working the only thing to acct for is the small gape in income. Be about two to three weeks depending on company before your first paycheck.
ChristmasStrip | 4 hours ago
The harsh reality is, if most companies are giving peanut butter raises, finding another company that pays steak raises is going to be hard. Companies know this unfortunately.
thebivvo | 3 hours ago
Unfortunately, this is pretty feasible in today's market. I would love to leave my job, but there are so few and they are hard to find/get. It is also far easier for companies to discriminate in today's job market. A lot of people will take a peanut butter pay raise and accept that insult just to keep a job that is needed.
timoperez | 2 hours ago
Big corporate would love a reason to be able to stop increasing people’s salaries in line with inflation. Putting down the long-term practice of COLA increases in favor of throwing all the rewards to the preferred people is an obvious way to further create a caste system of workers
FlyingBishop | 2 hours ago
This article is so dumb. No mention of cost of living increases. Really, "peanut butter" pay raise sounds like a way to brand cost of living increases (which should simply be applied automatically based on CPI) as a raise. Which is the way people talk about it in the US, and it's a deliberately dishonest strategy by management. Management explicitly bends the truth in negotiations and this article doesn't even address that.
Ok-Bug4328 | 2 hours ago
I’ve seen it both ways.
At companies that asked me to “differentiate” the raises for my team the end result was a trivial difference between top and bottom.
It’s a waste of emotional energy when the outcome is 2.8% for him and 3.2% for her.
krichard-21 | an hour ago
I tried that exactly ONCE. My manager quickly explained why that was a mistake.
Once you think through the process. It's really quite obvious.
Top talent must be retained. Those at the bottom end of the performance ranks need to know and understand what's happening.
Justaticklerone | 56 minutes ago
Nobody wants to see the office slacker get the same pay raise as one of those that try to maintain self-discipline, and determination to succeed and advance. You don't just lose top talent, you inevitably end up with only slackers. Then you say "Nobody wants to work anymore!" after your "desirability to work here score" gets torpedoed.
No-Significance4623 | 18 minutes ago
It’s really interesting to read about the differences between countries. In Canada, I’ve been a working professional for 10+ years and these are the only raises any of my organizations have ever had. 1.5-2.5% annual increase, applied evenly.
Beautiful_Finger4566 | 4 hours ago
isn't that the whole concept of labor unions?
you're rewarded for tenure, not performance
everyone gets the same raise regardless of merit
it's also why non-union companies outperform union ones... all the top performers at union ones leave for the pay raise
takingastep | 2 hours ago
It's kind of amusing to see people worry about how the "top performers" are getting the same percentage raises as people "doing the bare minimum".
Meanwhile, for the ordinary folks "doing the bare minimum" (/eyeroll), that "peanut butter" raise probably ends up being more like "too little butter scraped over too much bread". It probably becomes yet another excuse not to actually pay employees living wages.
Blacktransjanny | 3 hours ago
Nothing better than being a manager with a rockstar employee carrying the department and also being straddled with one of the laziest employees who outright knows they're checking a diversity box as their only contribution. This way they can both know that hard work isn't rewarded!