Comments on: Are You Ready For A Pay Cut?

By: MyLifeROI

MyLifeROI — Mon, 08 Feb 2010 18:14:50 +0000

@Ryan @ Planting Dollars,

I wouldn’t call it doom and gloom at all. The numbers are very available and very real — US workers are over-compensated relatively speaking.

For a job that does not need to be location specific, does being American justify a 20% premium over being Czech?

The strange thing is that productivity in America is rising faster than pay, so our problem isn’t really productivity. It’s just pay.

By: MyLifeROI

MyLifeROI — Mon, 08 Feb 2010 17:52:54 +0000

@MoneyEnergy,

I can see how someone would be offended. But they shouldn’t be. They are simply reacting to what the market wants.

But bubble professions are just that, and as long as the people who get involved have a good back up plan, they will be fine.

By: MyLifeROI

MyLifeROI — Mon, 08 Feb 2010 17:50:59 +0000

@David/Yourfinances101,

What line of work are you in?

I honestly think a lot of people need to start better preparing for pay cuts. Whether the employer outright cuts your pay or not is a moot point, it seems a lot of people are getting raises that are smaller than inflation. That is a pay cut, just not as obvious.

I’m already prepared for my <3% end of year raise… or, a pay cut in other words!

By: Ryan @ Planting Dollars

Ryan @ Planting Dollars — Mon, 11 Jan 2010 04:59:18 +0000

This sounds a bit like doom and gloom, but it’s all about perspective. I think there could be a silver lining as we’ve seen from the current recession. Pay is not everything and pay is not the key element in human happiness. If manufacturing workers are faced with a huge pay cut that may entice them to actually pursue something they enjoy since there isn’t as much of a pay difference.

The current threat of competition will hopefully be a shot in the arm for Americans to get competitive themselves by becoming more efficient and worth their rate of pay versus their foreign counterparts.
Ryan @ Planting Dollars´s last blog ..Another Day in Paradise for $5.50

By: PS

PS — Thu, 07 Jan 2010 13:12:33 +0000

You guys are stressing me out. I’m not looking for a pay cut and I’s sadly middleclass. Just paying attention to what the gov’t spends vs. our domestic products is scary and there isn’t much better times in sight

By: MoneyEnergy

MoneyEnergy — Thu, 07 Jan 2010 05:10:36 +0000

@Jeff, you’re right…. I’ve read the details on individuals who seek to illegally immigrate to the U.S. and from their communities they save up over $60,000 grand sometimes just for the opportunity. 60 grand!!! What North American can get that kind of money from his/her friends? (maybe some, but I don’t know them…)
MoneyEnergy´s last blog ..Biggest Foreign Buyers of U.S. Debt

By: MoneyEnergy

MoneyEnergy — Thu, 07 Jan 2010 05:08:07 +0000

Nice to hear someone else talk about “bubble professions.” I totally agree – at least in Canada, you don’t even need a real estate agent – neither to buy nor to sell your home. It’s just been a big boom profession that really isn’t necessary (no offense to real estate agents – I know you’re talented and you could do many sorts of things). In my opinion (and this will be a contrarian point of view), even retail-level financial advisors (i.e., those with clients with less than, say, 500k in investment assets) are unnecessary. We need better financial education, not broker-pushers and pushers of dogmatic retail investment advice who make their fees off the uneducated. (Again, no offense to the people who act in this capacity themselves).
MoneyEnergy´s last blog ..Biggest Foreign Buyers of U.S. Debt

By: David/Yourfinances101

David/Yourfinances101 — Tue, 05 Jan 2010 11:10:35 +0000

I took about a 28% paycut in 2009. I had a pretty good idea it was coming, but I still didn’t prepare in time. I cut back on spending, I was just a little too slow and too timid about it.

I am fine, but I could have done better.

Its usually a litle worse than you think. Or, if you take this mindset, it lessens the blow considerably.
David/Yourfinances101´s last blog ..The Naked Portfolio Manager: A Review

By: Jeff

Jeff — Mon, 04 Jan 2010 21:49:23 +0000

@MyLifeROI, I lived in a rural part of China only 3.8 million people :-) Every person I spoke with (but one) did not have a credit card and EVERYTHING they owned was paid for. People used personal loans from family members to pay for their first apartment/house. All cars were paid for in cash. They had debit cards, but only the “rich” had a credit cards (so I heard). The only person who did have a credit card was a small business owner who did alot of overseas purchasing for his business. People used the ATM a ton, but only to get cash because not many places took debit/credit cards yet. The big citys do accept cards, but usually at places that Westerners frequent.
Jeff´s last blog ..Net Worth – December 2009

By: Craig

Craig — Mon, 04 Jan 2010 21:45:38 +0000

@MyLifeROI, Hopefully not a situation I have to have but I know your point. This question has been posed before in other ways. A company gives employees the choice of having lay offs or 20% pay cut (or whatever %). Thing is more people said lay offs. It’s just hard to motivate yourself to do the same thing when you know you are being underpaid, and affecting your lifestyle. Maybe a new job could weigh the same pay, of course there is a risk. No one answer, very tough scenario.
Craig´s last blog ..Weekly Personal Finance Twitter Chat: Scholarships