3 ms·
>I don't see how this follows. Yeah, it depends on how "benefit to the company" is measured. One way would be to take the company's current revenue minus equip
by Thorrez 3y ago
>I don't see how this follows.
Yeah, it depends on how "benefit to the company" is measured. One way would be to take the company's current revenue minus equipment expenses, and say that was generated by current employees, and thus that's how much the current employees are worth, and divide that between the current employees. So that gives a profit of 0.
That ignores a lot of things though, such as value of past employees, value of investments provided by investors, and value that the current employees are producing that will only be realized by future revenue. It's hard to measure.
>the company would give raises to those under this figure and would withhold raises from those overpaid until inflation eats up the surplus
Yeah, that works, but it's not instantaneous. If you want instantaneous equality you need something else.
- bitshiftfaced 3y agoGenerally, looking at the margin better predicts real world behavior. If you add one employee, how much extra revenue would you expect to gain? A reasonable salary = (extra revenue - HR/overhead expenses - the minimum profit the company needs to justify the trouble of adding one employee). If the last term was zero, then there would be no reason for the company to exist, and so it wouldn't exist and neither would the job. But in reality, hiring managers are probably setting this internal rate on what the job market is showing along with how badly they need to fill a position in their particular case.