I read an interesting article last week that re-affirmed my disdain for the corporate workplace. It will only take a few minutes to read so if you have the time go ahead and read it, otherwise I’ll give you the Cliff Notes version below. It’s actually a pretty interesting article..
Breakthrough: The Accidental Discovery That Revolutionized American Energy
This article tells the story about a mid-level energy company that was experimenting with fracking during the 1990’s. The company’s profits were dwindling, the stock price was falling and the CEO was unfortunately stricken with cancer. It seemed like a recipe for bankruptcy but then a young engineer discovered the perfect mix to unlock natural gas from shale and almost single-handedly saved the company. In two years, Mitchell Energy’s gas production went up by 250% and the company was sold for $3.1 billion. The owner, George Mitchell was now worth $2 billion and the engineer who discovered this breakthrough process that is now applied in fracking processes across the world made $100,000 the year the company was sold. He never even received a bonus.
The 40 Hour Work Week
I will never understand why people go into work and kill themselves working long hours and sacrificing their social life just to make someone else richer. If you’re getting paid by the hour, then you’ll see a direct correlation between how many hours you work and how much money you make. Unfortunately though, most high paying jobs aren’t hourly these days so you’re stuck working for a fixed salary.
I don’t know who decided that the work week should be 40 hours in America but if I were to sign onto a job and they told me they were going to pay me X amount of dollars for 40 hours a week then they’re going to get 40 hours a week. It’s usually laid out pretty clearly in your employment terms yet there seems to be an unwritten rule in certain industries that you have to work more than 40 hours a week just because everyone else is doing it. I guess I’m selfish in that respect since I feel that if you’re only going to pay me for 40 hours a week, then I’m only going to work 40 hours a week.
The fracking article is just one example of a guy who was probably killing himself to keep his job and the company afloat yet he received nothing beyond his normal salary in return. The piece goes into detail about how nobody thought Steinsberger’s method would work, yet he kept at it and refused to give up. I guarantee he was working 60-80 hours a week trying to prove that his method would succeed. And ultimately, Steinsberger was right. The process he discovered made billions of dollars for the owner and probably millions for upper management yet Steinsberger never even received a bonus.
The Correlation Between Performance and Pay
I can’t speak for every industry but I know that there’s very little correlation between performance and pay in my industry(engineering). In fact, at my last job, I had a co-worker who worked 10 hour days nearly every single day while I worked strictly 8 hour days. We were both smart and good employees but I’ll be the first to admit he worked a lot harder than me. After 8 hours, I was ready to go home or go to work for my second or third job. The last thing I wanted to do was stay another hour(I was even paid single time for overtime at my last job) but there were lots of people who stayed late and worked tons of overtime.
At the end of the year, my friend got a 4.5% raise and I got a 3% raise. I was happy just to keep up with inflation and that 1.5% extra meant absolutely nothing to me. Honestly, I thought he deserved way more than 4.5% and I would have been pissed if I were him. Isn’t this the the reason why communism doesn’t work? If people aren’t rewarded for success then they won’t be motivated to work hard.
Driven by Incentives
Whether it’s right or wrong, when it comes to employment I’m driven by incentives. I’ve always done well in school and I’m in about the same position now that I’m working. I’ve never felt the need to over-achieve when it comes to my job though. I go in and work hard for 8 hours, but at the end of the day I want to go home and relax, spend time with my fiancee or hang out with friends.
One of the things I like most about working for myself online is that I see a correlation between how hard I work and how I’m rewarded financially. I know I’m doing a good job working online because of how much money I’m making. If I slack off and don’t work for a month, I’m not going to get paid and that’s the way I like it.
In the corporate world, you will come across the over-achievers and you’ll also come across the under-achievers. I’m probably right about in the middle yet all three are often paid the same. I think engineering is a tough industry to distinguish elite performers from non-elite performers since there aren’t many quantitative metrics you can use to judge performance. In jobs like sales, the top seller is your best employee and you can pay him or her accordingly. If you have a firm of lawyers, your top lawyer will be the guy who brings in the biggest clients, bills the most hours and wins the most cases.
It’s not like that in a lot of fields though. First impressions and likeability could play more of a role in your compensation package and evaluation process than whether you’re actually good at your job or not.
Why be Loyal?
In the corporate world, there’s very little loyalty from employer to employee. As companies get bigger, they have shareholders to report to and they have to show profits. Don’t forget that you are one of their most easily expendable resources. No matter what you’ve done for them in the past, if the company isn’t turning a profit, they’re going to lay people off where it makes financial sense. So young and cheap workers like me will get to stay on while old and expensive workers will get the axe.
Ultimately, I’m not the type who’s going to ever kill myself working for someone else. If my contract says I get a $100,000 salary for 40 hours of work per week, I’ll be more than happy to work my ass off for that amount of time and be done with it. But now that I’m working two jobs, I value my free time even more and you’re going to have to pay me if you want me to work more than that.
Readers, do you find that you are rewarded financially the harder you work? Or do you put in long hours and see a measly 1.5% bonus like my friend(Btw, after taxes, that’s only .75% since it’s being taxed at your marginal rate!)?
-Harry @ The Four Hour Work Day
Get E-mail Updates
If you're interested in receiving weekly updates when we publish new articles, please sign up here. You can unsubscribe at any time. No SPAM, we promise 🙂
Latest posts by Mr. 4HWD (see all)
- How to Host a Frugal Graduation Party - April 28, 2015
- Side Hustling in Direct Sales - April 21, 2015
- 5 Cheap Vacation Ideas - April 14, 2015
This is a really interesting post – I agree with a lot of what you say about the corporate world taking taking taking but giving nothing back to the people who work in its lower layers.
However whilst you might be motivated solely by financial reward, there are many who aren’t.
Once a person reaches a certain standard of living, nice car, nice house, nice vacations, pension etc what is it that motivates them to keep working ?
Why does a multi millionaire keep working?
And most importantly why did Steinsberger keep developing a technique which he knew wouldnt belong to him, and that he was unlikely to profit from ?
I think that once extrinsic values have been satisfied (someone financial needs) then intrinsic (emotional) needs take over. A sense of satisfaction at doing a good job, or being the best at something is a powerful motivator.
Are you going to give up this blog when you have enough $$$$ in the bank or do you extract some intrinsic joy from the blogging process ???
Thanks for commenting, I appreciate your thoughtful comment. I would say that I’m in the majority though, I think most people get so accustomed to nice car, house, vacations, etc that in order to maintain that lifestyle they have to keep working.
You’re right about Steinsberger though, he may not have admitted it, but he obviously loved what he did and that’s why he kept doing it. I started blogging because I enjoy it, you’re right. I got lucky in the sense that it turned into a viable money making opportunity.
The reason I don’t plan on getting employed again. I like working ‘for myself’ and, as you mentioned, if I do my job right, I earn well.
Yea that’s definitely one of the benefits. But you never know when the perfect day job will come along and enable you to do both.
There is no perfect job. I want to spend time with my family (and the kid we’ll have in few months) and be able to travel at ease. I’d rather have the business get me more money than get a killer job 😀
That would be my husband. He works in a much smaller industry but when he took over as project manager/commissioning agent the company went from making like 300k to 800k ( no idea what actual numbers are, totally made up but u get my point). He puts so much passion and effort into his job it kills him. Finally after workong his hole off for 18 months I demanded he ask for a raise it was insane what he was doing at what rate. Without a question they gave him a $5/hour raise.
My husband needs to become self employed. He will do very well for himself but we don’t have the financial freedom for him to do so right now. Eventually he will though.
Yea your husband was exactly who I had in mind when I wrote this article. I don’t think it’s a bad thing to have a mindset like that but I really don’t understand it personally. That’s why I like working online/for myself so much. If I kill it, then I make a ton of money, makes sense to me.
You’re right though, wait until you have a little more financial freedom and then take the risk..
Everyone learns the hard way, including myself. After 13 years, I figure it’s better to be my own boss. Not easy, but no complaints. Eat what you kill!
I’ve definitely already come to that realization but haven’t found a way to match my day job income working by myself. Getting closer and closer though 🙂
I may be the minority here, but I am enjoying my job in the corporate world. I enjoy the work that I do. I find my projects interesting, I feel challenged and accomplished at the end (of most) days, I do have fun doing what I do. At this current point in my career, I do feel like I’m being financially rewarded for my hard work. But then, my company is employee owned and I get paid for overtime, which may make a huge difference.
Hmm not sure if you’re in the minority but if you’ve found a day job that you love then that’s awesome, congrats to you! I think there are definitely some jobs out there that are like that but I haven’t found the right one yet – day job-wise at least.
I’ve also only worked for one company, I’m at my second one now so we’ll see how things go.
Loyalty no longer exists in the corporate world. I haven’t been working for very long, but long enough to know that the long hours are not worth it. It is very true performance reviews usually have nothing to be with the bonus. Business decisions will be made to make a business operate lean and mean. Most of the time that means letting good people go and hire them back as contractors to avoid having to pay the benefits. It is now the norm to stay with a company only for a few years until you find a better gig. It is unfortunately that most of the worker bees have to jump from job to job. I am not sure the lack of loyalty really benefits the company or not, but I guess it is just the way to keep the business profitable?
My sentiments exactly: I haven’t been working very long either(4 years full time) but I’ve figured out real quick that working OT is not worth it. And you’re right I can’t tell you how many stories I’ve heard of bosses telling their employees how well they’re doing and then they get some measly bonus or merit increase.
One other thing I’ve noticed is that businesses make it very hard to move up without switching companies. For example, if I want to get a promotion to the next level I’d be better off going to another company for a couple years and then coming back then moving up within my own company. That’s just so stupid to me. But I’m not gonna bitch about it all day – I’m doing something about it so that if my day job career doesn’t progress the way I want to I can move on to my own business and work for myself.
This piece is spot-on. That’s why I now work for myself. Corporate jobs never pay a person according to his or her hard work. I went through hell at my last corporate job, and received a quarter raise. I doubt I will ever go back to that lifestyle.
Timiarah recently posted…“The LEGO Movie” Is a Secret Masterpiece
Thanks Timiarah, I think a lot of people feel this way but not many of them are willing to do anything about it. I actually like my day job and get paid very well, yet I’m still considering leaving in a few years to pursue my own stuff. I can only imagine what it would be like to work somewhere/something you hated.
Baby boomers didn’t work so hard because they love their jobs so much or expect some reward. They did it to keep the “fire me first” target off their backs during the endless restructurings of the last three decades. Glad to see the younger generations refusing to fall into that trap. All I got for the overtime I put in was heartburn and company expectations for even more. Still, I’m surprised you get away with doing less, since tech is so notorious for insane workloads, and management puts intense pressure on to meet totally crazy deadlines.
I agree with that, it’s not worth it for me to do OT. Fortunately my job doesn’t really require it so I can avoid any type of show down for now. I’m in engineering so it’s a bit different, but yea tech is pretty crazy but you’re also compensated pretty well, have the opportunity to make a big impact, equity, etc