I totally forgot I wrote this back in 2013 for Protégé Magazine (yes, with the accents). Reproducing here now.
There is a curious trend emerging in developed economies
where the professional services industry is simultaneously home to the highest
salaries and some of the lowest hourly wage rates in the economy. This is primarily because, at least for the
first 10 years of your career, these industry demand exceptionally long working
hours. Consider the following anecdote: a friend of mine, a senior consultant
at PWC, earns c. $90000 a year with bonuses. Lots of cash; but he works 60
hours a week on average—at fifty weeks a year that’s $30 an hour. Plumbers earn
more than that.
In surveys of business school graduates, three themes
emerge—money, status, success. Nothing wrong with any of those, but it’s worth
being aware of the trade offs.
A graduate salary for business oriented degrees pays
close to the average Australian household’s disposable income. Salaries for
accountants at grammar schools, a job available to university graduates (albeit
with no career progression) hover around $90000 p.a.—placing you close to the
top ten per cent of income earners in one of the world’s most affluent
countries. So you’ve pretty much made it straight out the gate.
Maybe that kind of money isn’t enough. You want Porshes,
Zegna and the harbour foreshore. Fair enough, but consider two things. First,
those kinds of things cost a lot of money.
The kind of cash where maybe you’re going to need to make partner. Maybe you’re
good enough, but the likelihood is very low, and in the meantime your firm is
going to be flogging you.
In a fantastic paper from 1996, ‘Rat Race Redux: Adverse
selection in the determination of work hours in law firms’, Landers et al found
that only 10 per cent of employees at major firms ever made partner. However,
they also noted that firms were aware of behavioural science studies showing
that humans are inclined to continuously overestimate their ability. They would
use this knowledge to design their incentive systems, advertising that they
only hire the best and that only the best make partner. Now anyone interested
in status wants to be ‘the best’, so everyone works like a dog and a rat race
emerges.
A rat race is both a popular culture term for a mad dash
for something of limited worth and a particular kind of game. Put simply, a rat
race is where someone’s outcome depends on their ranking in a group, and that
ranking is predominantly determined by hours of effort. There is an incentive
to always work a little bit harder until everyone is working at their maximum.
Anyone who takes their foot off the accelerator instantly falls to the bottom
of the rankings. That’s what you’re up against in your quest for the foreshore.
But maybe all those hours at low hourly rates are worth
it in the long run. You can think of them as an investment that pays off later.
In the long run you will be partner with a sensible hourly wage and have your
Maserati, your Chanel and your mansion.
Here’s where the second consideration comes in: chances are you’ll still
be unhappy.
Research by psychologist Tim Kasser and colleagues
suggests that individuals with materialistic values are significantly (in both
the colloquial and statistical sense) more likely to report feelings of stress,
anxiety and depression, more likely to display antisocial behaviours and less likely
to report high levels of subjective well being relative to those who don’t have
such values.
If money, status and things aren’t going to make you
happy, what’s the point? Maybe you follow the philosophy of Chinese Weibo star
Ma Nuo who said “I would rather cry in the back of a BMW than be happy on the
back of a bike”. Good luck to you then. But otherwise, maybe have a think about
what else you can get out of your career—interesting work, colleagues you
actually want to spend time with, work-life balance (money and time to spend it), a
sense of success and the big one: a meaningful job. Those things can all be
acquired without sacrificing your work-life balance.
Once you know what you want, choose employers based on
which one fits your criteria rather than which one is the highest profile. A
career with a boutique firm may yield higher wages rapidly and leave room for
work-life balance, but the tasks may grow stale owing to the lack of career advancement.
Conversely, a career with any of the world’s major firms is likely to be
dynamic and wide ranging, but won’t leave much room for work-life balance. The
public service will see you solidly middle class and provide quite interesting
work, but you might find the bureaucratic pace crushingly slow.
Be assiduous when investigating prospective employers. Through
a range of anecdotes, Madeleine Bunting explains in ‘Willing Slaves: how the
overwork culture is ruling our lives’ how firms are hip to all these
existential requirements nowadays and are using it to get more out of people
for less. Tellers at Tesco aren’t paid more but they are encouraged to ‘live
the values of the firm’. Microsoft is only hiring people who are ‘passionate
about the brand’. Everyone is encouraged to be emotionally invested in their
work and draw spiritual sustenance from it. For those who just want to make
some bucks and go home to their actual life, this is rather annoying because
the firm expects unpaid hours from you on the grounds that your work should be your life. But for those who
don’t have many hobbies, this new focus in management theory presents an
opportunity to feel like your work is part of a bigger project and to feel like
your work is, in its own small way, changing the world.
How to navigate the insidious marketing and management
know-how of the modern world? Perhaps the best idea is just to maintain a big
picture view of what ‘success’ is. Certainly being respected is part of
success, but by who? If your mother in law doesn’t respect you but she’s a
bitch, then it doesn’t really matter does it? Certainly financial security is a
part of success, but how much money offers security? Live where the public
schools are good and you’ll make the cost of the house back on foregone private
school tuition. Then consider other things that might be more mundane but are
arguably much more fundamental to be a ‘success’. Things like being a likeable
person, a good person, a happy person.
This article was originally published in Protégé Magazine 2013, an annual publication of the Australian National University Actuarial, Finance, Economics and Commerce Society.
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