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The idea that pay has anything to do with the value an employee adds to a company is almost always a fiction, except in coop-style arrangements. You get paid as
by kgin 6y ago
The idea that pay has anything to do with the value an employee adds to a company is almost always a fiction, except in coop-style arrangements. You get paid as little as it would cost to replace you with a sufficient replacement. Remote work increases the labor pool and lowers that replacement cost for the company.
A company may have decided to go remote, but if they were to immediately cut all salaries to the lower remote-rate, they would lose too many expensive local workers faster than they could hire new cheaper remote workers and productivity would severely disrupted.
Because of this, they're using individuals moving away from HQs as a convenient rate limiter to do it gradually.
- chrismeller 6y agoI see this as pretty much the exact opposite. Previously the employer valued the employee at, say, $100. They also valued having that employee physically on-site at $100 for all that “open collaboration” crap we’ve heard for years. That means the employee makes $200 because they’re spending $100 more to accommodate the employer’s onsite desire and they wouldn’t work for a net of $0. Now the employer has realized (because they were finally forced to actually invest in it) that having that employee onsite wasn’t providing them the extra $100 in value they thought it was. It has nothing to do with the employee’s intrinsic value changing - if anything it is reinforcing that it hasn’t. It has to do with employers having finally realized that for decades they were putting an absurd amount of value behind having employees onsite ($100 extra for the employee, $200 extra for offices, $200 extra for food and other perks, etc.) without actually receiving the tangible benefits they thought they were. The shorter way to say this: cost of living is a factor. They now realize spending all that extra money to have people onsite isn’t worth it - either employees are at least as productive (valuable) remotely or are at worst only minorly less productive (valuable) remotely, so it’s not worth the premium they were paying to have them nearby.
- ubercow13 6y agoAren't you just agreeing with the GP? They now realize spending all that extra money isn't worth it, but they can't just change everyone's salary in one go.
- chrismeller 6y agoMmm, yes. I accidentally replied to the wrong person in the middle of the night. My bad. Ignore me everyone!