3 ms·

How do HR and People teams solve a problem like inflation?

3 points by hunglee2 4y ago

PaulHoule 4y ago
Sounds like advice from the McKinsey group or elaborately a very long winded explanation of why employees can at best ‘talk to the hand’.
necovek 4y ago
This is indeed playing with words insincerely: > what happens when inflation rates begin to drop? Will companies drop salaries to match? Decreasing salaries only makes sense with a negative inflation (deflation?) — so this is rarely, if ever, a concern. Generally, if business is doing well, it's doing better than inflation, and it could very well compensate to match. Of course, market forces are multiple, and businesses doing well is not well defined either, but disingenuous takes like this don't help anyone.
incomingpain 4y ago
HR doesn't have any choice in the matter. This is written as if they do? >Handling inflation in compensation is a tricky topic. We want to do right by our employees and for us that means in a way that can be sustainable long-term. The GDP of a country is the definition of the annual labour of all workers which defines/supplies it was all the necessaries and luxuries of life. Imagine a system where you input useful labour and receive the goods and services without every considering a currency. This measurement will always stay the same. My useful labour will receive so many goods and services. In the case of many GDP, it is measured in a local currency but that doesn't matter. You will still receive the same goods, but extrapolating to a currency simply makes the transaction simpler. When the local currency is inflating. It does not change the actual underlying necessaries of life. It means the cost of the labour has gone up that amount because the necessaries have gone up that amount. It doesn't matter what the currency says, you still get your slice of the necessaries. So when an employer doesn't match inflation, and thusly is giving you less necessaries. The logical conclusion is they are taking advantage of you, or they assert your skill, dexterity, and/or judgement has reduced in the last year. Which is virtually never the case. So they are taking advantage. They wish to pay you below labour cost to enrich themselves at profits.

3 points by hunglee2 4y ago

Sounds like advice from the McKinsey group or elaborately a very long winded explanation of why employees can at best ‘talk to the hand’.

necovek 4y ago

This is indeed playing with words insincerely: > what happens when inflation rates begin to drop? Will companies drop salaries to match? Decreasing salaries only makes sense with a negative inflation (deflation?) — so this is rarely, if ever, a concern. Generally, if business is doing well, it's doing better than inflation, and it could very well compensate to match. Of course, market forces are multiple, and businesses doing well is not well defined either, but disingenuous takes like this don't help anyone.

incomingpain 4y ago

HR doesn't have any choice in the matter. This is written as if they do? >Handling inflation in compensation is a tricky topic. We want to do right by our employees and for us that means in a way that can be sustainable long-term. The GDP of a country is the definition of the annual labour of all workers which defines/supplies it was all the necessaries and luxuries of life. Imagine a system where you input useful labour and receive the goods and services without every considering a currency. This measurement will always stay the same. My useful labour will receive so many goods and services. In the case of many GDP, it is measured in a local currency but that doesn't matter. You will still receive the same goods, but extrapolating to a currency simply makes the transaction simpler. When the local currency is inflating. It does not change the actual underlying necessaries of life. It means the cost of the labour has gone up that amount because the necessaries have gone up that amount. It doesn't matter what the currency says, you still get your slice of the necessaries. So when an employer doesn't match inflation, and thusly is giving you less necessaries. The logical conclusion is they are taking advantage of you, or they assert your skill, dexterity, and/or judgement has reduced in the last year. Which is virtually never the case. So they are taking advantage. They wish to pay you below labour cost to enrich themselves at profits.