Remote Employment won't last (contractor, resign, resignation, definition)
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What justification is there to downgrade employees in LCOL areas? I could see it naturally happening from the free market in action, but to actually go in and be like "You live in Omaha, so you get 20% less" is pretty unjustified if you're truly doing the same work. I don't pay my plumber any more or less depending on which neighborhood he lives in.
I could see the inverse being justified though: "You live close enough to come in for the occasional on-site work, we'll pay 20% more for that"
What justification is there to downgrade employees in LCOL areas? I could see it naturally happening from the free market in action, but to actually go in and be like "You live in Omaha, so you get 20% less" is pretty unjustified if you're truly doing the same work. I don't pay my plumber any more or less depending on which neighborhood he lives in.
I could see the inverse being justified though: "You live close enough to come in for the occasional on-site work, we'll pay 20% more for that"
I think you underestimate the cost-cutting philosophies. The justification is to reduce labor costs.
But it works both ways - companies might look for LCOL area employees expecting to pay less but workers might look for HCOL employers expecting to make more. Whether it's a wash or one prevails will be determined by market conditions. I do agree it will probably adjust through lower salaries for new hires rather than cutting salaries for existing employees.
Remote work makes it easier for employees to job search and perhaps even easier pyschologically to change jobs. Job change - even by your choice for a better job - is one of life's most stressful events and a home work environment is a constant that may reduce an element of that.
I think you underestimate the cost-cutting philosophies. The justification is to reduce labor costs.
But it works both ways - companies might look for LCOL area employees expecting to pay less but workers might look for HCOL employers expecting to make more. Whether it's a wash or one prevails will be determined by market conditions. I do agree it will probably adjust through lower salaries for new hires rather than cutting salaries for existing employees.
Remote work makes it easier for employees to job search and perhaps even easier pyschologically to change jobs. Job change - even by your choice for a better job - is one of life's most stressful events and a home work environment is a constant that may reduce an element of that.
The job search thing is huge.
I want to move out of my current area. I don't like it here. It would be much easier for me to move to Raleigh from podunk TN if I could keep my current job. Once I'm wherever I'm going to end up, it becomes easier to get a local job there.
What justification is there to downgrade employees in LCOL areas? I could see it naturally happening from the free market in action, but to actually go in and be like "You live in Omaha, so you get 20% less" is pretty unjustified if you're truly doing the same work. I don't pay my plumber any more or less depending on which neighborhood he lives in.
I could see the inverse being justified though: "You live close enough to come in for the occasional on-site work, we'll pay 20% more for that"
Cost of living has been a factor in determining wages in a geographical area for as long as I have been working. It makes business sense and companies are more concerned about maximizing profits than being fair. Also, you could make the argument that the workers are being paid the same in terms of affording the same lifestyle in the two different areas.
Also, being close to a few people who work at the top of the management chain, the C-suite and top management aren't leaning towards all-remote work. If anything, many of them would like to get workers back in the office. The big Wall Street firms want their workers back ASAP but won't force the issue YET because they don't want to deal with costly and time consuming lawsuits of someone gets sick. I can see the tide changing in spring. Especially since the spread of the virus seems to be mostly through social gatherings and activities.
Cost of living has been a factor in determining wages in a geographical area for as long as I have been working. It makes business sense and companies are more concerned about maximizing profits than being fair. Also, you could make the argument that the workers are being paid the same in terms of affording the same lifestyle in the two different areas.
Also, being close to a few people who work at the top of the management chain, the C-suite and top management aren't leaning towards all-remote work. If anything, many of them would like to get workers back in the office. The big Wall Street firms want their workers back ASAP but won't force the issue YET because they don't want to deal with costly and time consuming lawsuits of someone gets sick. I can see the tide changing in spring. Especially since the spread of the virus seems to be mostly through social gatherings and activities.
I don't think cost of living has been a direct factor in determining wages but that is a factor which determines market demand. A company in SF doesn't pay a higher salary than one in OK because they recognize the COL is higher so paying more is fair but because they simply couldn't find workers willing/able to work in SF for an OK salary. I think we are in agreement on this but where does it goes from here? How will the market demand play out? Will the COL workers drive down wages or will the high COL salaries drive wages up?
It all comes down to jobs/worker ratio. Currently, the jobs and workers are in the high COL areas. Companies don't locate in SF or NYC because they like paying high taxes and wages but because that is where the predominant supply of workers and customers are. While WFH allows an OK worker to take a job with a SF company there aren't enough OK workers to make a significant dent in SF jobs so I don't think a SF company is going to be able to replace many of their high COL workers with low COL workers. But there will be some downward pressure on wages in high COL areas. On the flip side, companies in low COL areas may see upward pressure on wages as they no longer have low COL workers captive.
I can tell communication is starting to break down due to a lack of face time. Morning scrums have basically stopped or have gone down to once a week. My manager is out for the next two days and didn't even send an email blast to the whole time. People are in maintenance mode, not giving a damn.
Some face time would help fix that. However, with an explosion of local cases and setting new records every day, I don't see that this will be possible until a vaccine is widely available.
That's all a management issue. WFH is not like this at all companies, with all teams, or all managers.
That's all a management issue. WFH is not like this at all companies, with all teams, or all managers.
I agree, but when you haven’t seen most of your coworkers since March, there is definitely a drop-off in teamwork. It’s easy for things to be out of sight, out of mind under the circumstances.
I don't think cost of living has been a direct factor in determining wages but that is a factor which determines market demand. A company in SF doesn't pay a higher salary than one in OK because they recognize the COL is higher so paying more is fair but because they simply couldn't find workers willing/able to work in SF for an OK salary.
Exactly this.
Companies don't pay more or less based on any other personal factors. They don't care how many kids you have, what your spouse's income is, how expensive your neighborhood is, how much debt you have, etc.
Lowering an employee's salary because of where they live is as outrageous as saying "Now that your kids are out of preschool and your wife is working full time, we're going to cut your pay"
I agree, but when you haven’t seen most of your coworkers since March, there is definitely a drop-off in teamwork. It’s easy for things to be out of sight, out of mind under the circumstances.
Again, that's a management issue. My husband has worked with teams around the world. He's managed a team in India while he was in the US. He never once went to India. I have a friend who also manages teams around the world including Europe, Asia, and India. She doesn't ever visit them. She's been managing internationally for over 20 years. It's all in the management. Everyone is cut out to be a manager.
Companies don't pay more or less based on any other personal factors. They don't care how many kids you have, what your spouse's income is, how expensive your neighborhood is, how much debt you have, etc.
Lowering an employee's salary because of where they live is as outrageous as saying "Now that your kids are out of preschool and your wife is working full time, we're going to cut your pay"
The reason isn't not ridiculous is there is historical precedent for adjusting salaries based on COL.
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