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The article centers on this: > The point is not so as to be paying a "decent wage" or anything of that sort: it is to be paying a higher wage than other employ

The article centers on this: > The point is not so as to be paying a "decent wage" or anything of that sort: it is to be paying a higher wage than other employers. There are a couple of key take things to take away from that. * The employer is less pressured to find candidates. Candidates will find the employer if it means double wages. * The employer has more choices. They aren't locked into settling for somebody vaguely competent from a limited pool of applicants. * Employees are locked in knowing they cannot go somewhere else for equivalent money. Despite those points there are limitations to this approach. For example, I have known many low income people who would not join the military even though it could mean double or more in wages. Likewise I have also known many people who refuse to get into software knowing they could double their wages. I would also be willing to accept lower wages elsewhere if the work were engaging and meaningful (however a person defines meaningful). The only way that super high wages make sense numerically is if it results in retaining employees for a longer enough period to reduce expenses of employee replacement over a satisfactory time period and results in a premium on choice of employee from the population at large. Wages alone won't provide a combination of those though. There has to be something in addition that makes the employer stand out in world class fashion. That could be unique opportunities, superior training, an accreditation program, research recognition, or something else. If this is missing the organization is going to swell with a certain percentage of bad candidates that will decay the organization over time from the inside out. Government agencies emphasize the later more than the former because they have budget limitations on what they are allowed to pay employees and because the later has proven more historically reliable at retainment.

smt88 7y ago
> * The only way that super high wages make sense numerically is if it results in retaining employees for a longer enough period to reduce expenses of employee replacement over a satisfactory time period and results in a premium on choice of employee from the population at large.* This ignores the large increase in productivity from each individual employee. Better-paid employees are less stressed, healthier, less busy at home (because they can afford domestic help), and spend less time commuting. All of those things provide ROI for higher wages irrespective of turnover.
- terminalcommand 7y ago
  This may be true, if the employees are receiving high salaries under normal working conditions. But sometimes, the high pay is a result of insane work conditions. For example investment bankers, lawyers in biglaw all work crazy hours and are under an immense stress from juggling multiple projects at the same time. You sacrifice your health, family, friends for earning a high salary. The turnover at those jobs are super high and the job requires a certain amount of breaking-in. In my experience (as someone working in Biglaw), high pay equals high stress, because the employers demand it.
- austincheney 7y ago
  > Better-paid employees are less stressed, healthier, less busy at home (because they can afford domestic help) Again, that isn’t always true. It is true when comparing $40k to $100k but less true when comparing $200k to $400k. When looking at that argument in terms of scale it is an argument of diminishing value that does not guarantee the increased individual productivity the argument would promise. The reason why that argument can suggest but not promise increased individual productivity is that increased wages alone does not directly correlate to better leadership or a more valuable team.

smt88 7y ago

> * The only way that super high wages make sense numerically is if it results in retaining employees for a longer enough period to reduce expenses of employee replacement over a satisfactory time period and results in a premium on choice of employee from the population at large.* This ignores the large increase in productivity from each individual employee. Better-paid employees are less stressed, healthier, less busy at home (because they can afford domestic help), and spend less time commuting. All of those things provide ROI for higher wages irrespective of turnover.

terminalcommand 7y ago
This may be true, if the employees are receiving high salaries under normal working conditions. But sometimes, the high pay is a result of insane work conditions. For example investment bankers, lawyers in biglaw all work crazy hours and are under an immense stress from juggling multiple projects at the same time. You sacrifice your health, family, friends for earning a high salary. The turnover at those jobs are super high and the job requires a certain amount of breaking-in. In my experience (as someone working in Biglaw), high pay equals high stress, because the employers demand it.
austincheney 7y ago
> Better-paid employees are less stressed, healthier, less busy at home (because they can afford domestic help) Again, that isn’t always true. It is true when comparing $40k to $100k but less true when comparing $200k to $400k. When looking at that argument in terms of scale it is an argument of diminishing value that does not guarantee the increased individual productivity the argument would promise. The reason why that argument can suggest but not promise increased individual productivity is that increased wages alone does not directly correlate to better leadership or a more valuable team.