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The parent was not comparing labor vs. capital, but rather labor vs. labor e.g. the set of all software engineers at a company. It's perfectly reasonable to exp
by programmarchy 10y ago
The parent was not comparing labor vs. capital, but rather labor vs. labor e.g. the set of all software engineers at a company. It's perfectly reasonable to expect the salary distribution to fit a bell curve.
And I disagree with your conclusion that this would likely increase wages for all employees. In the least, it's very likely to penalize high performers by redistributing their wealth to low performers, so employers can maintain the appearance of "fairness".
It's equally likely that this would decrease wages for all employees. If the incentive to perform well is diminished (e.g. "why work harder if you won't be rewarded?"), then it will lower the bar for quality across the board, providing less value to employers, ultimately pushing the price (i.e. wage) downward.
- spoonie 10y agoit's very likely to penalize high performers by redistributing their wealth to low performers Seems to me that the problem here is that company isn't able to convince the low performers that they are low performing. If the high performers are paid more due to some objective metric, the low performers should be able to see their own path to higher performance. If not, then it's the company's problem for having a pay scale that rewards negotiating skills or nepotism over objective performance evaluations.
- unholiness 10y agoAny attempt to "objectively" measure performance to influence salary will actively harm company culture. Unless your company is literally an assembly line, Godhart's law takes over so quickly and your employees are going to spend their time abusing the metric. Just paying employees the market rate, while imperfect, is overwhelmingly preferable.