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At risk of sounding like a mercenary, in my experience the only realistic way to get paid your market value is to be on the market. It's just way easier to get

At risk of sounding like a mercenary, in my experience the only realistic way to get paid your market value is to be on the market. It's just way easier to get a pay bump by switching jobs. If you wait for your employer to give you a raise, they usually will drag their feet for as long as possible and then give you something disappointing. One consequence of this is, in companies that are willing to do it, it can be useful to negotiate a title promotion even if they don't give you a raise, because you can then use that title in your next job negotiation. BTW, giving this advice depresses me. I'm constantly amazed companies make such a weak effort to retain employees via good compensation policies. The cost of recruiting and interviewing candidates, not to mention training new hires, is huge.

lotsofpulp 6y ago
>The cost of recruiting and interviewing candidates, not to mention training new hires, is huge. Clearly it's not more than the cost of providing higher pay. Most people would rather not switch jobs as there is considerable risk involved if you're not performing labor that results in very profitable sales. People would rather work with the devil they know than the devil they don't, so unless they're in upwardly mobile careers such as engineering, law, finance, or medicine, they probably don't have many good options.
- radegast 6y ago
  Why do people think companies act rationally? Behavioral economics shows time and time again people make irrational decisions all the time. Considering company is just a group of people, these irrational decisions are compounded. So I wouldn't say it's 100% clear whether a company saves money retaining employees vs training new.
- overgard 6y ago
  I think it's more likely this: calculating the cost of giving an employee a raise is very simple. Calculating the cost of finding a new employee is extremely variable (how long does it take and how many people are involved?) and also involves metrics that are very hard to measure (how much more would the team lead and the team members have gotten done that week if they weren't interviewing candidates?) Usually if you're debating management, especially non-technical management, solid numbers win out over hand waivey numbers, even if the hand waivey numbers are representing something far more important and the solid numbers are representing something in a very limited context. An example: Tom is a mediocre programmer, but he's worked for the company for 5 years and has a lot of institutional knowledge. He wants an above average salary now. Should we give it to him? The obvious answer would be to let him walk, he's asking for more than he's really worth. Ok, but how much does the equation change if we factor in that it's going to take 3-5 months to hire his replacement, and you'll need to interview about 20 candidates, some of them for multiple hours, not to mention potentially flying them out? Also now Tom is walking with his institutional knowledge, and the bugs that used to go to him are going to someone that doesn't have the 5 years working with the system he does, so whoever has to pick up his slack is going to be slower than Tom is even if they're a better programmer overall.
xtracto 6y ago
>The cost of recruiting and interviewing candidates, not to mention training new hires, is huge. As a team leader let, I have been so frustrated with this. HR has no clue on how time consuming is to transfer context knowledge. There is a point where companies should do all in their power to keep people. But they fail to account for these types of indirect costs.
- Viliam1234 6y ago
  > HR has no clue on how time consuming is to transfer context knowledge. It is not consuming HR's time, I suppose. Therefore... The general problem is that different parts of the company are evaluated based on their separate metrics, which usually ignore the "externalities" they create for each other. Sometimes those externalities are caused by incompetence that isn't captured in the metric. (Imagine that you would pay developers by the number of lines they write, but no one would ever check for bugs. If one day the developers start producing really bad code, their measured productivity stays the same; it's the measured productivity of the users that would plummet. The developers might even get a bonus that quarter, if they produced more lines of code than usual.) Sometimes the metric is actively harmful, so that doing the right thing would actually hurt the measured productivity of the department. (Imagine that the developers are paid for introducing new features, but no one acknowledges the existence of bugs. It would be a nice thing to fix at least the worst bugs, but doing so would mean the developer stays behind at implementing new features, and gets fired. So even if the developer is fully aware of the situation and wishes to fix the bugs, out of self-interest they would choose not to.)
curryst 6y ago
> BTW, giving this advice depresses me. I'm constantly amazed companies make such a weak effort to retain employees via good compensation policies. The cost of recruiting and interviewing candidates, not to mention training new hires, is huge. On the other hand, turnover can bring a new perception to a problem. I have no idea what the value of that relative to the cost of recruiting and onboarding. In some companies like FAANGs it wouldn't surprise me if some level of turnover was intentional. Google probably benefits to some degree by hiring engineers that just quit over at Amazon; it gives them an insight into how Amazon is solving X problem, which may inform how Google tackles that problem.

lotsofpulp 6y ago

>The cost of recruiting and interviewing candidates, not to mention training new hires, is huge. Clearly it's not more than the cost of providing higher pay. Most people would rather not switch jobs as there is considerable risk involved if you're not performing labor that results in very profitable sales. People would rather work with the devil they know than the devil they don't, so unless they're in upwardly mobile careers such as engineering, law, finance, or medicine, they probably don't have many good options.

radegast 6y ago
Why do people think companies act rationally? Behavioral economics shows time and time again people make irrational decisions all the time. Considering company is just a group of people, these irrational decisions are compounded. So I wouldn't say it's 100% clear whether a company saves money retaining employees vs training new.
overgard 6y ago
I think it's more likely this: calculating the cost of giving an employee a raise is very simple. Calculating the cost of finding a new employee is extremely variable (how long does it take and how many people are involved?) and also involves metrics that are very hard to measure (how much more would the team lead and the team members have gotten done that week if they weren't interviewing candidates?) Usually if you're debating management, especially non-technical management, solid numbers win out over hand waivey numbers, even if the hand waivey numbers are representing something far more important and the solid numbers are representing something in a very limited context. An example: Tom is a mediocre programmer, but he's worked for the company for 5 years and has a lot of institutional knowledge. He wants an above average salary now. Should we give it to him? The obvious answer would be to let him walk, he's asking for more than he's really worth. Ok, but how much does the equation change if we factor in that it's going to take 3-5 months to hire his replacement, and you'll need to interview about 20 candidates, some of them for multiple hours, not to mention potentially flying them out? Also now Tom is walking with his institutional knowledge, and the bugs that used to go to him are going to someone that doesn't have the 5 years working with the system he does, so whoever has to pick up his slack is going to be slower than Tom is even if they're a better programmer overall.

xtracto 6y ago

>The cost of recruiting and interviewing candidates, not to mention training new hires, is huge. As a team leader let, I have been so frustrated with this. HR has no clue on how time consuming is to transfer context knowledge. There is a point where companies should do all in their power to keep people. But they fail to account for these types of indirect costs.

Viliam1234 6y ago
> HR has no clue on how time consuming is to transfer context knowledge. It is not consuming HR's time, I suppose. Therefore... The general problem is that different parts of the company are evaluated based on their separate metrics, which usually ignore the "externalities" they create for each other. Sometimes those externalities are caused by incompetence that isn't captured in the metric. (Imagine that you would pay developers by the number of lines they write, but no one would ever check for bugs. If one day the developers start producing really bad code, their measured productivity stays the same; it's the measured productivity of the users that would plummet. The developers might even get a bonus that quarter, if they produced more lines of code than usual.) Sometimes the metric is actively harmful, so that doing the right thing would actually hurt the measured productivity of the department. (Imagine that the developers are paid for introducing new features, but no one acknowledges the existence of bugs. It would be a nice thing to fix at least the worst bugs, but doing so would mean the developer stays behind at implementing new features, and gets fired. So even if the developer is fully aware of the situation and wishes to fix the bugs, out of self-interest they would choose not to.)

curryst 6y ago

> BTW, giving this advice depresses me. I'm constantly amazed companies make such a weak effort to retain employees via good compensation policies. The cost of recruiting and interviewing candidates, not to mention training new hires, is huge. On the other hand, turnover can bring a new perception to a problem. I have no idea what the value of that relative to the cost of recruiting and onboarding. In some companies like FAANGs it wouldn't surprise me if some level of turnover was intentional. Google probably benefits to some degree by hiring engineers that just quit over at Amazon; it gives them an insight into how Amazon is solving X problem, which may inform how Google tackles that problem.