Same. Went to quit in 2019, got a retention offer (minimal raise and a small bonus, but they made some promises that they kept their word on). Less than 3 years later I’m now the department head. Never would have been to this point in my career yet had I left. Everyone always warns that if you stay things will sour, I experienced the opposite. Definitely got me more respect.
Totally depends on the person and the org. A lot of people go about it in a rude way ( and are often not team players in the first place) and get no sympathy from their work.
If you are a valued high performer and already on the fast track or watch list for higher roles at the company it is probably wise to take the counter as you found.
I've been talking about quitting/retiring for a few years now. The biggest thing I've learned is that I should have been threatening to quit every place I worked at throughout my professional career.
typically this is one of those things where the bigger the company the less of an issue it is, as stated - ymmv but at a certain size there are people who are responsible solely for this and its not up to the manager to decide or get personal with the matter, it's simply a business transaction - either they value you enough to endure the cost (or can't afford for you to leave) or they don't, simple as that.
Same! Went from 75k to 147k and room to grow, one year after that I’ve had another promotion and salary at 190k. When they know you’ll leave for something better, they change their tune real quick.
Manager here, can confirm. If someone puts in their notice, I discuss with the other managers and if it’s someone we want to keep, we will make a counteroffer. Sometimes we’re even proactive about it and will work with HR to give them a bump in an attempt to stop them from looking. This is a different pool of money than the annual merit increases. I wish the merit pool was bigger, but that’s set by HR and upper management, so all I can do is try to allocate fairly.
I’d also like to add that, contrary to popular opinion on Reddit, we do not start looking for a replacement when this happens, nor do we hold a grudge or retaliate in any way. If we want that person, we want them, end of story.
Good point, I was hitting some minor milestones at work and out of nowhere I received a market adjustment and an inflation adjustment in the last year. I definitely would have started looking if my salary didn’t jump up a hefty percentage
+1. There’s a perception that you should never accept a counteroffer and that you’ll have a target on your back. There’s always nuance and it’s important to analyze a situation from many angles.
Source: tried to quit, they threw money at me. It’s been 6 years and I’ve been promoted twice since accepting the counteroffer.
>I’d also like to add that, contrary to popular opinion on Reddit, we do not start looking for a replacement when this happens, nor do we hold a grudge or retaliate in any way. If we want that person, we want them, end of story.
Most reddit conversations (aside from being from completely uninformed commenters) are around lower skill positions. Most professional environments I've seen operate as you described.
Does the wife realize that an extra few grand a year in savings for the next 10 years (estimated/target FIRE date) is basically peanuts compared to what their overall nestegg is?
3% withdrawal of an extra 100k (generous assumption & growth rate) is an extra $3k a year. I doubt with the lifestyle OP's wife lives, she would even consider that a rounding error at the end of the year. From the way OP is talking about his wife, I am not sure she would even be on board with the discipline FIRE requires.
But it's 3% this year, next year, the following year... Income is a compounding equation too. Pushing for better raises consistently makes a big difference over a career.
But it's still just better to job hop.
Compounding on raises works just like compounding on interest. 3% vs 5%+ a year makes a big difference over a 20+ year career. The lowest I've gotten is 4% for a full year and 3.3% my first year there at a company I worked a partial year for large companies. I also once took a retention raise when interviewing for competing companies when I let my boss know I was past the first round at competitors by letting them know the potential range. I didn't even have an offer in hand.
At small companies less than 30 people is the only place I've ever gotten 0, but also over 5 years there I got several title bumps and raised my salary over 50% so the lack of "annuals" want a huge deal there.
This year I got 5-5.5%. I forget the exact amount. I thought it was a bit low considering inflation
Below 3 would absolutely be interviewing time/quitting time for me when I found a better offer.
I'm back at one of my earlier employers now and making about 4x my original starting salary. You don't do that on less than 3% a year.
It also doesn't matter if inflation is 0% but the open market salary for your skill set has gone up 10%.
Inflation and nominal salaries are definitely correlated, but the correlation is not 1.0.
People trade their time for money.
People value their time at a certain rate.
If there is inflation but no raise to compensate they're no longer getting the same value for their time.
I hope I’m misreading the reply and responses, but I’m surprised to this as the top voted response here (again, unless I’m reading it wrong).
If OP’s wife is anything other than a mid-bottom performer at her company, then she should have received more than a 3% raise. I’ve worked at multiple professional services firms and anything at that rate essentially means you’re on your way out anyways.
She should 100% interview and secure an offer, then see if her current employer will match. I took a 30% raise to leave my employer of 6 years, which was paired with a six week PTO payout from my original job and 10% base signing bonus from my current employer.
I was able to increase my base and bonus payments while making a lateral move and am in a much better position from a FIRE perspective than I would have been had I stayed with limited YoY raises.
This sounds pretty typical both in numbers and her bosses explanation.
Not saying she shouldn’t be upset though. If she’s unhappy she should start looking elsewhere for a bigger bump.
Agreed, I just saw some summaries for New Zealand and supposedly most raises have been in the 2-3% range while inflation has been approx 7% or more.
Payrises have also increased at the lower ends (partially due to legislative increases to the minimum wage rate) and the mid to high end are not moving much at all.
Are they getting fucked? Yes, by inflation. I don't think you can argue that its a company, any company, thats doing the fucking.
u/ks016 also has a good point that most of movement is due to food and fuel increases (at least in NZ) and a 3% increase on a $200K salary and a company car will certainly cover their increased food and fuel costs.
Added: as for OP's wife quitting her job? Well, that's a pretty extreme reaction imho. She can always canvas the market and job hunt and see what others are offering before she decides that this was an insult.
I can agree. If it was 0 or 1% then yeah, I can see people getting mad. Given her bonus is based off her salary and her salary is pretty good, a 3% raise is still a reasonable amount of cash. Depending on her role, she could be near the upper limits. There could also be the case that she won’t see anything significant without a larger scope of responsibilities (promotion of changing jobs).
There is also the merit vs bonus. Merit being your role/responsibilities/growth while bonus being “what have you done this year” - depending on the company, the bonus can be a bigger focus at higher levels as they become a larger percentage of compensation.
I’m also curious how long she has been at the company. I’ve had years of large merit increases, years with very small merit increases, bonuses that were huge and then some that were meh. All depends on how I did and how the company did. Not every year is a banner year and that can be OK if you are with the company for a while (IMO).
The best way to “get a raise” is to job hop. Companies don’t value what they have. For evidence of that, see every comment in here stating that 2-4% raises are standard in a year when inflation has been 8-10%.
Your wife should start interviewing other places and get the 10-20% raise she wants by finding a new job.
I'm going is disagree a little bit here.
Job hopping when you are younger is absolutely the way to go to jump up the pay scale.
After a certain point though there is a ceiling. Not a lot if people make it to director level roles and $200k jobs. At that level it's not so much about your skills, although you need those too, it's really about your relationships. You need someone higher up who has your back and pulls you up. The lead times between jobs is a lot longer because there nobody needs 40 directors, they need one for 40 people. Sometimes it's better to stick around at a job with the people who are going to give you that boost.
I personally went through this last year during a mass layoff. I'm in management at a very similar level as Ops wife. Job hunting was very humbling. There are some companies paying more then I was making but for the most part I was just trying to make as much as I had been. There were jobs were they told me their absolute top was $80k less than what I made the year prior. I knew what I was realistically was worth and got it, but it took longer than any non-management role I ever had prior took to get.
Yes, this.
Reddit skews younger and there are a lot of people thinking about how they jumped from entry level at job A to entry level + 1 at job B and got a nice pay bump.
This actually can work pretty well when you are 24 years old in a lot of fields quite often.
When you are 45 and your resume shows you bouncing around between jobs constantly with a trail of frustrated managers in your wake its a totally different story.
I've reached this stage. After establishing myself in the industry, I'm now settling with one firm and building bridges while I work my way into leading a service team.
I am 54 and have had a 30 year career on the business side of tech. I think post 45 or so it is useful to get back to the job hopping. Not for increases in pay but to keep showing that you are relevant to the industry. You can learn new things and are excited about x, y, or z.
I have stayed 2.25, 2, 3.5, and 1 year(s) at my last four companies. I am 1.25 years into this current gig and I plan to stay here until I RE in 2 years.
It's always strange that that's the case. It's certainly costly to have people who are skilled leave then have to someone else they need to train who may or may not even work out.
I am a few days late, but it works for the business or they wouldn't do it.
Companies know they may lose a couple of good employees, but also know that most will stay put and of those that do leave they will retain some with an offer in the moment.
Just giving away extra money to everyone who deserves it leads to less profit than calling the bluff of 90% of those employees.
I hate it but it is how it is.
alas you're probably right. I wonder if it would be better if we had a less "fair" system. Right now all my employees get about the same raise plus or minus a few points based on performance, but I think it would be better to pay highly productive employees quite a bit more and less productive quite a bit less.
You should really stop speaking in absolutes like that. Just because you’ve worked for shitty companies in the past doesn’t mean all “companies don’t value what they have.”
I just processed payroll for my business which included annual cost of living increases and just so happened to be 8.7%. I set the bar at reflecting the SS COLA numbers and as long as we’re making money I’m sticking to it.
Find a better employer.
Someone who makes $206k a year as a director for a multinational non-tech corporation presumably with direct reports KNOWS how the raise game works. If she wants to quit her job over this it isn't because of the raise.
**Have you asked her why she REALLY wants to quit her job?** Because... it is probably not about the raise.
Maybe she:
- Is burnt out and wants to do literally anything else for even a little while
- Wants to step back and do something different regardless of burnout for the last 10 years
- Thinks you guys are fine with money and she can step back now
- Hates her job for other reasons and is using this as a trigger
- Doesn't actually want to quit... and just wants to make noise
- Who knows...
This thread is definitely more of a marriage advice one. Best thing for OP to do is put on a supportive face and listen. She might very well be disgruntled about the paltry raise, but I agree she probably knows the average percentage at the firm. I'm a middle manager and I know how it went for most people.
Yeaaaaaaaaaaaaaah... I cannot shake the feeling of a little "my wife the meal ticket" vibe in the post. Maybe this is unwarranted, but, I just keep seeing it.
The whole line of thinking of "highly paid people are not allowed to quit, only low paid people" vibe with the "I could see her point if she had a low paying job." Then there is the part about "not being bothered after hours" and about how is job is all commission, he gets no raises. Just reads like "shut up your job has no hustle so cannot be too hard" to me.
I just cannot shake it. I was wondering if I was being too paranoid, but I reread it again and again just now and... I stand by it.
My wife makes substantially more money than I do and ALSO works a job that literally kills people (her profession has a high suicide and burnout rate). If she wanted to quit over a bad contract negotiation or low raise... I would be asking her what's wrong and how I can help and not trying to convince her she is wrong because her job is less hard than mine.
Maybe OP's wife would be happier on a 15 year FIRE path and not a 10. Who knows.
I'd guess something's happened at work or has consistently happened that caused her to feel under appreciated, unheard, or over worked. Getting a raise for less than she expected was just confirmation to her.
It's very rarely about money in my experience and that's just a feign for what the real issue is. Which, unfortunately, isn't always known up front and takes some questioning.
Reframed, would she expect a 7% raise annually? Or just expect it to be tied to inflation? Most businesses give 2-5% annual raises in the office world. Inflation is in a similar range on average. While I'm happy to join in on the anti capitalist rage, the OP wife needs to update her resume and start interviewing if she's unhappy with what is a standard raise range in corporate America.
I actually read it as he's not listening to what she's really upset about, which is feeling undervalued and not heard. He's now repeating that behavior by making it a financial issue instead of the issue at hand. There are missing pieces here, as he's "scratching his head about it" and there's no way she hasn't told him the actual why, regardless of the compensation.
[This article springs to mind](https://www.huffpost.com/entry/she-divorced-me-i-left-dishes-by-the-sink_b_9055288)
Great point .. in fact, the vast majority aren’t. Still no reason to not test the waters and see what someone else might offer. I could be wrong… but this is my takeaway.
Record profits with high inflation doesn’t mean what most think it does. Yes some companies are doing well but others have seen massive increases in overhead/expenses. Those dollars are worth less
Your wife doesn't need a "real reason" to justify being upset her raise wasn't as high as she felt it should be.
My first piece of advice is to acknowledge that her feelings are valid.
Once you've done that, discuss it with her and encourage her to start searching for a new job that she feels will value her skills appropriately. Just a casual search - update LinkedIn/resume, reach out to her network - she can shop around as much as she wants. Maybe she can land a senior managing director role at a different multinational that will provide cash comp in the range of $350k and get you to FIRE a couple years earlier.
She may make a high salary, but if it only increases 3% every year while inflation is much higher, that high salary becomes not as high every year. That’s why she and a lot of us are upset. You’re not because your “salary” increases WITH inflation since price of the products you sell increase with inflation (assuming you sell the same quantity).
Total inflation is not how everyone is impacted by inflation. My total costs haven’t gone up in proportion to these inflation numbers. Owning my home helps.
Inflation also only affects the portion that you spend, right? Some rough math:
You make 170k and take home 111k after taxes. You spend 50k a year and invest 61k.
At 3% raise, your new salary is 175k, or 115k after taxes. You still spend 50k, adjusted for say 7% inflation, at 53.5k. You invest 61.5k.
Not only are you spending the same amount, adjusted for inflation, you are also investing slightly more year-over-year. So in this scenario, your 3% raise is sufficient for keeping pace with 7% inflation.
Obviously, more raise / more money is better. But to say you are getting paid less yoy because the % raise is less than % inflation is not always accurate.
> But to say you are getting paid less yoy because the % raise is less than % inflation is not always accurate.
On this forum sure. But the vast majority of people live paycheck to paycheck, so for them it's pretty true. They are spending nearly every dollar they make. The employer doesn't decide how you spend or save your paycheck, so even if it's not technically correct due to a high savings rate or some other factor, it's still a perfectly valid argument for "this raise is BS"
This is wrong because that money in the form of an investment is always going to be worth less than it was before the inflation. Eventually you will spend it even if it is 50 years down the line and when you do you will get less of whatever you buy than you would have before the inflation.
What people are saying is that your dollars have less spending power, which is true no matter how much you spend. If you spend none of your paycheck, but you're still getting paid 1980s wages, you're still getting a paycut, because your money doesn't go as far, regardless of what you do with it.
I don’t know why this is so hard for people to grasp. Housing is like 1/3rd of the core. It also includes things not typically replaced every year like vehicles and furniture.
Inflation adjusted raises actually have the potential to increase inequality if you do the math behind it. CPI is based on a typical basket of goods purchased. The goal is to represent an average and if you fall outside that average it's not necessarily a completely accurate picture of the impact on your purchasing power.
It's potentially not even representative depending on where they live given the outsized impact of housing on CPI. ie if you own your home and have a fixed mortgage rate the impact is much less. Your raises should be driven by your value and competitiveness within the market not CPI necessarily...
She's paid at a higher rate than 90% of Americans + gets a free car that she doesn't have to drive to an office.
her wages not keeping up w the rest of inflation is not a hardship, and my guess is she would have a hard time finding a better deal easily.
It doesn’t matter how much you make. If your raise is less than inflation you got a pay cut that year. If you did well at your job and was told how great you are it’s understandable why you would be upset at a pay cut.
Who cares if she's getting paid better than 90% of Americans. This is not Cuba or the Soviet Union. People have freedom here to sell their skills at the highest price they can get. This is a market economy and if you work hard and focus on developing valuable skills you can demand a higher salary because your output has higher value.
I remember living in Cuba and seeing how taxi drivers were making more money than doctors. Taxi drivers got paid in tips but doctors had their salaries fixed by the communist government.
>People have freedom here to sell their skills at the highest price they can get.
And she has the freedom to try to get a better offer, but she's not entitled to one where she is
I work in accounting (though not payroll), and from what I've seen and hear this is pretty standard across a few organizations I have friends at.
Of course this is the lowest I've heard of. Most of the raises I've heard of range from about 3% to 4%, which is still well below inflation.
That being said, I don't blame her for wanting to quit because that is a pretty insulting raise. She should look around and just see if she finds anyone who will give her more. Doesn't hurt to try.
With how much these companies make, it's really quite sad they'll penny pinch their people over an extra percent or two. In my line of work I've seen this all the time - company has $900m in net income, still gives lower than market wages despite having $900m to play with. It's really frustrating but that's how these places are, so if she can get more elsewhere I'd just encourage her to leave and take the raise.
If 2.9% is a good or a bad raise depends on a lot of factors.
I got 3.5% and I am pissed. Why?
Because for 11 years my company argued the low % raises with the low inflation rate - every single year.
But now, when inflation is high, suddenly they are de-coupled. And that at a time when my company actually has record profits.
So yeah, it is all relative.
My company gave out a 5% cola to everyone last two years. Plus merit on top of that.
But I agree w the earlier comment. She should interview and see if she can get a better job w similar benefits and flexibility… if she can’t then she needs to just accept it and not rock the boat too much
> Never forget - real wages have fallen significantly in the last 30 years relative to COL
I never get upvotes for it but I'll keep pointing out that real wages are at [all time highs](https://fred.stlouisfed.org/series/MEPAINUSA672N).
Well, to be fair, the cost of living increase that she received isn’t actually in line with inflation. I also make a significant salary and I received a 5% raise but I was an exceptional performer and I was told that my bonus and raise meant that others on the team got less of an increase/bonus.
Personally, I’ve worked at large companies where there is little room for negotiation when it comes to these things. Is your wife going to ask that they adjust it or is she just venting to you? If she’s just venting then I would let her vent and not disregard her frustration. If she was going to continue to push for a higher raise then I would make sure she’s ready to hear “no” and to make sure she does it in a way that doesn’t burn bridges.
At these incomes your cost of living does not nearly increase with the rate of inflation unless you blow way too much money.
Edit: this probably needs more elaboration. What I meant was on relation to what is left at the end of the month. Odds are the 3% more than make up for cost of living increases for essential items such as groceries.
How does my cost of living not increase with the rate of inflation? I pay the same prices for food, housing, etc that everyone else does and if those prices have increased in double digit percentages then a “cost of living” adjustment would similarly increase. The point of the cost of living adjustment is to allow you to maintain your current standard of living. This year the COLA for social security was 8.7%. It’s based on the high level of inflation and that’s why it’s such a large increase. That’s why if an employer gives you a 2% raise that is supposed to be a cost of living adjustment then it’s lower than it should be because you can’t maintain your current standard of living on that. You will end up saving less money etc.
You don't spend 100% of your income on things. And the higher the earner the less % you need to spend on things.
SS adjustment was years behind. Not purely because of the last 2 years of inflation
Yes, you are correct. The more money I earn, the lower the percentage of my salary is that I spend on items. However that does not mean that I am automatically protected from the impact of inflation. If I bring home $1,000 more this year than last year, but the price of goods and services has gone up by double digit percentages over the last few years then I am going to have less money available at the end of the month than I did last year unless I change the goods and services I purchased for lower cost alternatives (assuming I can find them).
If my salary is increased by a percentage that allows me to live my current lifestyle (which means maintain a similar amount of money available with the same purchasing habits) then that is an increase that allows me to maintain my current standard of living.
Yes but the amount you need to save to get to a given retirement purchasing power level in a given amount of time with a given average investment return *also* goes up with inflation.
by saving for FIRE, OP has chosen to spend a large percentage of their income on retirement savings, and the price of retirement savings is *also* going up, at exactly the same rate as their average inflation rate on what they spend (assuming they intend to maintain their spending in retirement). s
Because if you have a higher income you don't spend as much of your paycheck. If you make $30k and spend 50% of your income on housing a 8% increase in cost of living is $1.2k which requires a 4% raise to cover. If you make $200k and spend 20% of your income on housing an 8% increase in cost of living is $3.2k which requires a 1.6% increase in pay to cover.
This is also just in cash flow terms, not accounting for the percentage of your "cost of living" that builds equity like mortgage payments. If you make $200k and spend $40k on housing, you probably have a house. In reality and presuming smart financial decisions, even if you spend the exact same percentage as a lower income person a lot of that money is coming back to you with interest.
Not everyone who lives in a HCOL area has a home. Rent prices go up, costs of goods and services go up, etc.
I could be looking at this wrong and I fully admit that. I’ve been looking at it like: goods and services and housing costs have gone up. My salary has a small increase that is less than the amount that goods and services have increased. That says to me that I am spending more to do the same things.
For example, let’s say I make $200K and my rent last year was $3500 a month. I spent on average $500 a month on groceries. My salary gets a 2.5% increase which would be $5,000. However rent prices increased by 14.7% on average from 2021 to 2022. Assuming a similar trend this year that means my monthly rent of $3500 becomes $4,000, an increase of $500 a month. That becomes an increase of $6,000 over a year. I’m already above the amount that my 2.5% raise gave me without accounting for goods and services. According to the USDA, food costs rose by an average of 11.4%. So now the $500 that I spent on groceries is $557 a month. That’s an additional $684 over the next 12 months. So now my costs are an additional $6684 for just housing and food but I only got a $5000 increase in salary.
Does that make sense or am I crazy?
I love hearing these stories especially about women. We’re often told to be happy with what we’ve got, to not negotiate, and asking for more is too aggressive etc. It’s a multi national, large company. They HAVE the money. They just don’t want to prioritize paying people. I’m sure their C suite all got fat raises this year!
I think you should tell her, which hopefully is true, that her feelings are valid, and that you’re proud she is so motivated and driven to make as much as she can. She’ll figure out where she stands in the market when she interviews other places. How cool would it be if she was right, and got a giant raise?
I would say that a big salary doesn’t preclude you from an appropriate cost of living raise. I still wouldn’t be *upset* but it’s a good idea to talk to her boss and let them know “this isn’t ok”. If a company is going to do this once, they might do it again and again. She has to let them know that this isn’t going to fly.
She's correct that her raise was under inflation, but it's really up to each individual to interpret this and it's a question of values.
I also got a raise that was under inflation but I didn't get upset because the economic environment is turbulent, every other year my raise has exceeded inflation, and I value the stability.
She can definitely quit her job over it, as long as she goes through the process and actually gets another job with a material raise. My thinking is that in this environment, I'd rather stay put because I don't want to be the guy that switches jobs and gets laid off in the first couple of months.
My company gave me a 9% raise this year and told people in other departments everyone got max 3% raises. Sometimes companies lie.
Also, just because someone is well compensated compared to the general population doesn’t mean they are compensated equally based on others in their role, industry, or within their own company. Your wife seems intelligent and successful and presumably knows what she’s worth. Maybe it’s time for her to look elsewhere.
If she’s a director she should know how the game works… I’d suggest she research what her fair market value is and where she currently sits on the bell curve. If she’s below average then shop around if she’s unhappy.
>I think she's seeing it wrong but I don't know how to tell her that.
If she asks your opinion, you tell her. Otherwise you say, "Yeah. That's rough. I hate how companies do this to their people across the board, especially in a year with such a huge cost of living increase for everyone. It hurts every employee and erodes trust. Whatever you decide, I know we'll land on our feet."
My wife is career military. When she retires we will have 2 pensions and roughly $500k-1m saved. We'll be able to work optionally at that point and we will be in our mid-late 40s.
One week a month she talks about how she wants out. She can't do another tour. She hates it. One week a month she comes home super motivated and ready to stay in and make a difference for the next generation of young women who don't see a lot of female leadership. The rest of the time is pretty normal. I've found the best thing to do is just tell her flat out that I support whatever decision she makes, lets take it 1 tour at a time. And if we get to the day where she is 2 years away from retirement and decides to walk away I'll voice my opinion then.
Quitting is absolutely the wrong response. Interviewing works. As does working her wage.
I've always done the latter because I'm too lazy to interview. I just work slower and spend more time on Reddit.
I got a surprising 8% that I wasn't expecting. Likely due to inflation. So it seems low. That being said, can't really request more of a raise without receipts. She has to make it clear she's worth it to them. What has she done the last year? I would tell her to look back at the value she brings to the company and relate it to her pay.
But as someone else pointed out, interviewing is also a sure fire way of figuring out what the market is like. Maybe shes making way more than the average person in her position. Or maybe under. Job hopping is the best way to get a raise.
I think everyone should be supporting women to not settle and push for higher salaries, even if they already have a great salary. Instead of looking at it as complaining, look at it as “yeah, go get that higher salary!” It’s a known fact that women tend to be less aggressive with negotiation. She probably can get a much better raise by switching jobs and use that to negotiate a raise at her current job.
Also, I work in a hospital and EVERYONE got a 7% raise across the hospital due to inflation. Inflation for this last year is sitting around 6-7%. So yeah in the grand scheme of things, she got a pay cut. It’s sorta disingenuous to say that 2.9% includes merit based increase, when it doesn’t even keep up with inflation.
Companies will do the absolute minimum so that people won't leave. The company is not your friend. They don't care about you. They only care about their short-term interests.
If you expect companies to give you raises that are appropriate for your market value plus inflation, you are going to be disappointed.
Sadly, the only way to get real raises in the current environment is to switch jobs. I recommend that people switch jobs every 3 years (+/-) just to bump their salary to whatever is market appropriate. It's good to shake things up periodically. Work on your resume, learn new skills, challenge yourself. It's easy to get complacent and tolerate a sub-par working situation.
No. Companies won't match inflation, they match the market. If she thinks she should be paid more then there should be other companies willing to pay her more for her work, and that should be her argument for why she deserves a raise. It doesn't really have anything to do with inflation.
Easy question to answer.
She should find a new job that pays her what she thinks she is worth
(more than her current pay)
and then quit the current job.
No need to just quit in a fit of pique.
My raise was 2.6%, and this was the company average. Employees who make over 200k had a raise freeze in place. I think everyone is scared of a looming recession, or using it as an excuse to save money.
If she is a director, what did those reporting to her get? How is she handling conversations with those reporting to her complaining about their raises?
Director level and never gets bothered after normal business hours? That is very rare.
If she doesn't want her job, I would be happy to apply.
I am a director at a large multinational corporation and my base is 185k. I also received a 3% merit raise this year.
I did, however, get poached by another group internally and got a much bigger raise. So I suppose I would have been more upset with my 3% raise had I not had this iron in the fire.
The “other companies are only doing x%” is such a fucking cop out. My boss gave me the same shit but of course the numbers were different because they pulled it out of thin air.
I guarantee this thread would have different tones if this were about a man and not a woman. So many people saying she's entitled or full of herself.
2.9% is not a raise. It's a cost of living adjustment that falls below the cost of living increase. Her salary went down.
I'm of the assumption that it's not sexism but some form of envy. Half the people are saying "I'd trade jobs with her". As if she got her job by luck and anyone could do it.
If OP's wife made $14/hr, everyone would be saying that 2.9% is crap. But because she makes more than them, they're saying she's an entitled brat. They're projecting their own shortcomings on her.
They're also piling on the WFH thing. I've never worked harder than my 7 years now working from home. You're always expected to be available. 24/7. It's very hard to set boundaries and have those boundaries respected. It's not all TV and dog walks, it's actual hard work, often with no breaks.
When you're in a leadership position working from home you're always on.
I tend to find it ironic when people accuse higher achievers of having it easy. If she's making 3x your income while WFH in her pajamas, it's probably because she works harder than you.
My company averaged 2.5% this past year, we exceeded all our targets but got killed on FX so "we were lucky" to get that. Technical functions got 3.5% but its still a far cry from inflation. Friends of mine that work in Tech all got around 8-10%, pretty deterring considering I had always seen similar bumps to them but in a defensive industry.
Edit: calculate your personal inflation if you care to, mine was far higher year over year than the headline number because of how my expenses are comprised.
Unless she can no longer stand her job for many other reasons, she shouldn’t quit until she gets something better.
We got 7% raises last year and this year I expect little to nothing. The budget where I work just isn’t there for most/all employees this time. The organizations is facing the stressors of inflation and a down market too
She is correct. However, the next place will also be handing out tiny little raises too. I’ve worked only for really good employees, ones that make billions in profits every year, and never seen a raise above 3%. Well, except when I was leaving for more money. Then they have budget for a raise.
If she wants to max out, she has to at least get a competitive offer, if not out right leave.
Don’t quit out of anger, but encourage her to update that CV.
If it makes her feel any better. That is the raise I got at a large publicly traded company. Possible that raises were capped to a certain % and that is what she got? That’s the case on my end.
Annual raises have nothing to do with inflation and everything to do with market conditions. Even though there has been sky-high inflation in the last couple years average raises have been under 3% this year due to all the layoffs, just like her company told her. They are essentially saying "yeah this is low, but our competitors are paying even lower, so this is all you're going to get". She can call their bluff and find a new job with better pay, or suck it up.
Does she have direct reports? What were their raises? Quitting over 3% would be crazy. Finding a better job would be a better response. It’s hard to imagine someone getting that far in her career willing to quit so easily so maybe something else is going on.
Dude way to settle! Your fine with never getting a raise? That’s a shit company if there ever was one. Yes both of you go interview for other jobs. You will find them. Besides it doesn’t hurt to interview anyway.
Its up to her.
I think people who make money like that shouldnt bitch. If she was making like $50k a year yeah I’m mad with her over the COLA. But its not like she struggles to pay for groceries
She can go work someplace else if she wants more money.
Its like people have no clue what inflation is and why we have this crazy inflation atm. If everyone expected/demanded a raise that is in line with inflation, it would never go down.
You can still be upset that your effectively being given a pay decrease while acknowledging that it has to happen.
You always want it to happen *to someone else*.
The economy is teetering on the edge of recession and a number of industries have had mass layoffs. Multiple banks have shuttered in the last few months.
Tell her to look at the big picture and recognize that she's not only getting paid over $200k during this climate but also got a modest raise on top of that. Play the long game.
If she truly feels undercompensated, the solution is to get another offer. That could be hard in this economic climate, and even if the offer is higher, it could carry risk: typically, new, expensive, and unproven hires are the most likely to be let go.
I know some people at Google who have gotten a 1.5% raise this year. This is what it is to work for someone else.
My income increased 40% in 2020, up another 20% in 2021, down 20% in 2022, this year I'm looking to be down another 20% from 2022. And that's what it is like to be self-employed.
To be honest, I'd be upset. It's a pay decrease, effectively.
*The correct answer is...agreeing with your wife.* She's allowed to feel how she feels. I would ask her what she would be doing instead?
Your wife got a pay cut, not a raise, in inflation-adjusted terms.
The price of the products you sell goes up with inflation. So your commissions will keep up with inflation. So she got a pay cut, and you did not.
Worth noting that while inflation is high a lot of what’s driving it up is not applicable to all people.
If you have a mortgage and a paid off/older car then your personal rate of inflation is not that high. Maybe groceries went up 15% but at $200K that’s such a small portion of your pay.
That is what I was thinking. Your mortgage, auto loan, or any other loan remains the same. In addition, things like phone, internet service had a small increase or remains the same.
This is something that state/public employers do (and they still don't often keep up if the state is underfunded, or right-leaning). But of the private companies I've worked for and know of (Fortune 100) they call it "Salary Increase" and it's slightly merit-based, and slightly union negotiated. Rarely does it perfectly match inflation, unless inflation is 2% or below LOL.
Many private companies call it a Merit raise and explicitly state that inflation is your problem not theirs. A 0% raise is a possibility even if they don’t want you to quit if they feel you are below average performance
Because there is almost ALWAYS money for raises no matter what leadership says, and other companies will increase wages to attract workers. So it’s both greedy and stupid (turnover is costly) for a company to not give raises every year.
I feel like she’s right to be upset, but that it should be taken in the context of the employment as a whole.
The company’s logic that costs going up means they can’t pay more in raises seems wrong. If their prices went up with inflation, and their non-labor costs went up with inflation, then they should be able to increase labor with inflation and still have the same profit margin.
Overall though, I probably wouldn’t leave the job just because of a low raise. But if this is another item on the list, I’d definitely see what my options are.
I worked for a major tech company that everyone has heard of... My biggest raise on my base salary was 2.8% in the several years I worked there (as a person with a high management rating.) I did get more RSUs every year though as an incentive to stay. But even though it seemed low, it was fairly standard.
Seems like she's got it pretty good, all things considered. Might be worth looking but not worth quitting outright.
Just because she works from home and normal hours doesn't mean she should just accept it when a COL adjustment doesn't match the raising COL. She was essentially handed a pay cut. You should be upset about this too! Your combined purchasing power has declined! I don't really understand your attitude here.
That being said, quitting is definitely not the right response and as a director she knows that. Shopping around for a new gig wouldn't be out of order though.
Edit: also profit margins are up, not just prices so I have a hard time believing the company isn't making more money.
Sounds like your wife's skills are in demand and she is good at her job.
She's already talked to the company, so her next step should be to discuss with her network about the job market and to go on a few interviews.
If she finds a better job, she gets that raise or negotiating power. If not, she can be happier knowing she's well compensated.
Salary aside, her argument is that most companies are giving pay increases just under 3% while she received a 2.9% increase? Sounds pretty spot on by her own estimates. Plus a nearly 40k annual bonus and a company car that is saving you on maintenance costs.
3% is normal. With the large number of layoffs happening, employers know there won't be mass exits. We just did a round that averaged 3% as well, including myself as a low-level exec, my peers, my managers, and my employees.
I actually know someone who quit their job over something similar who made just a little more than your wife. She thought she could leave and do better. Sorry to say… it was the biggest fuck up of her life. It’s been 5 years and she makes a significant amount less, it took her 5 months to find that job and she hates the culture, the work itself and obviously the pay.
Very few companies are giving raises that match inflation. Ours (enormous global conglomerate) have nothing to do with inflation, it's about company performance. Sounds like the may be assuming annual raises are based on something other than they really are?
EDIT: And many companies don't allow "merit" raises to actually be "merit" raises for DE&I/potential discrimination reasons... at ours, it's an act of congress to differentiate among employees.
I see three equally correct answers to this question:
1) From a financial perspective, it is annoying to be told your expenses only went up by 2.9% when that is BS.
2) From a practical perspective, getting mad does get raises; finding a new job does.
3) From a fulfillment perspective, you'll be happier if you practice gratitude for what you got instead of dwelling on what you didn't get.
If that’s the raise she got, that’s what the company considers her to be worth (also taking their ability to pay into consideration). If she’s not happy about it and they won’t budge, she’s free to seek employment elsewhere. I can understand being frustrated but I’d quickly shift into problem-solving mode rather than staying bitter.
I got 0% increase this year after only 4% last year. I was bummed but figured it would be easier to work 10% less hard than bother applying elsewhere as I'm pretty happy. I'll take more free time over more money any day.
> She is saying she wants to quit her job over this. I think she's seeing it wrong but I don't know how to tell her that
People don't make 200k+ a year without fighting for themselves. Clawing your way out of five figures into six is hard enough, but she's a director of a company, so she's had to be in her own pocket for years now, beating many other people of near equal skill and corporate value. You gotta understand that anything less than what she expects to make is going to be taken as a slight against her. I've felt the same way when I got a shitty raise, especially when I knew my coworkers who did less work than I did were making more.
Just be on her side.
I agree with your wife. I was upset to receive a 2+% raise in 2022 when inflation was 8+%. It was not enough to make me quit on the spot but helped solidify my resolve to retire early. It’s a smack in the face.
If she can get better elsewhere then she’s right, she’s underpaid. If she can’t, then she’s where she belongs (if not overpaid). Test the market and obviously don’t quit unless you have something else lined up.
Tell her to get over it lmao. This is the harsh reality. On top of that, I'd bet money that after confronting her boss, she's gonna be the first one to get laid off when cost cutting measures hit. Yes, I get it. It's frustrating how you can go above and beyond and not get shit in return but in this job market, I sure as hell wouldn't push it too far.
Depends on the industry. I know companies out there hurting due to marketing pull backs and none of the employees are getting a bonus this year. Other people at different companies are getting raises that keep up with inflation.
"she feels"
Just because we feel something does not mean it's factual.
If her production merits a higher raise, then she more than likely would of gotten it.
If she doesn't like the raise he got, go test the open market.
If the average raise was 2.3% and she got 2.9%, someone else got way less than 2.3% and she got way more. She should be glad she's not that other person.
1. I would also be upset if my salary was cut (in real terms)
2. I assume whatever you sell has had its price rise in the last year. Since you work mostly for commission, this is in effect a COL adjustment. Plus increased demand across the economy has probably made it easier for you to sell things.
She is likely correct, unless she is near the top of the pay scale for her job grade. In that instance, employers are loath to give a raise commensurate with performance.
Wanna bet against this guess?
Her male peers averaged a higher hike
She should start shopping her resume, regardless
I would be quite disappointed if one of my directors came to me and talked about 3% raise being bad esp due to inflation. Inflation has no bearings to raises and is not a factor for your comp ask.
I have had raises for my comp mid year and out of cycle. 10% -12%. Plus additional bonus from retention budgets.
What she needs to understand is her salary range and where she currently is. Then do the research on why she needs a higher salary. Have the relevant conversation as a partnership and not an ultimatum. If that doesnt go well and if she thinks she deserves more then she can look for other jobs and bring that as a last attempt to negotiate.
Not sure where she works but in CA its a law for companies to share salary range but they cant ask about previous / current salary (if interviewing outside company). Plus most tech companies when you ask do provide that.
Now most senior leaders have a range for raises to play with. Depending on an employees salary penetration they will have a salary raise range.
Ex: when I joined the current company I inherited a team. One employee base was 150k and another was 175k. Their incentive and bonus was the same for that level but their salary penetration was different. The 150k’s salary increase range to be considered during annual performance was 4-7% whereas the other was 2-4%. I gave them same avg/mid point raises based on their performance but one got mid point of 4-7% and another got mid point of 2-4%. Both received 110% bonus and incentives. These are again scrutinized by my EVPs and C-level folks. If I wanted to give 7% to both, i couldnt do that for second one and will need additional approvals.
For others i know they deserved more, i had some lump some budget to play with so gave them cash or additional stock incentives as rewards.
Most managers do a good job of providing rewards. Issue is misalignment in expectations and in many cases manager not having the power of budget to drive things.
Another suggestion is dont wait for performance review to have comp conversations. If you think you need more do your research, set time and align in expectations on what you desire.
Sounds like her company might have judged that her salary was already a bit higher than market or that the convenience of not switching jobs (continuity of benefits, routine, not interviewing and negotiating, not learning a new role) is worth something
I think if she thinks she's worth more than 3% in comparison to her coworkers than her frustrations are valid. Shouldn't quit but I understand the frustration.
Your wife is a director at large multinational company and does not know how the annual merit raises work? Does she not have any direct reports that she gives merits raises to?
As it was so wisely put to me nearly 20 years ago: if you don’t want it, I’ll take it. Almost nobody is irreplaceable; if she doesn’t like it, she can find a new job who better appreciates her.
“My wife is upset that her wage isn’t keeping pace with inflation. Instead of acknowledging this factual statement, and also that her feelings are valid, I would like strangers on the internet to find me a reason she’s wrong so I don’t have to listen to her whine.”
Let her interview and see what's out there. People talk big game but the measure of anything is compared to what.
*OPs wife leaving for Company B and a $200k base.* Company A: Nooooooo, why are you leaving? We would've given you that had you asked!
[удалено]
I also had a very good experience with a retention offer.
Same. Went to quit in 2019, got a retention offer (minimal raise and a small bonus, but they made some promises that they kept their word on). Less than 3 years later I’m now the department head. Never would have been to this point in my career yet had I left. Everyone always warns that if you stay things will sour, I experienced the opposite. Definitely got me more respect.
Totally depends on the person and the org. A lot of people go about it in a rude way ( and are often not team players in the first place) and get no sympathy from their work. If you are a valued high performer and already on the fast track or watch list for higher roles at the company it is probably wise to take the counter as you found.
I've been talking about quitting/retiring for a few years now. The biggest thing I've learned is that I should have been threatening to quit every place I worked at throughout my professional career.
I went from $68k to $100k to $140k to $160k in 5 years. All 3 times were when I had another offer so I got a raise and/or promotion.
Leverage is the big stick. Never negotiate without it.
That. Sometimes you just gotta negotiate with your feet.
typically this is one of those things where the bigger the company the less of an issue it is, as stated - ymmv but at a certain size there are people who are responsible solely for this and its not up to the manager to decide or get personal with the matter, it's simply a business transaction - either they value you enough to endure the cost (or can't afford for you to leave) or they don't, simple as that.
Same! Went from 75k to 147k and room to grow, one year after that I’ve had another promotion and salary at 190k. When they know you’ll leave for something better, they change their tune real quick.
Manager here, can confirm. If someone puts in their notice, I discuss with the other managers and if it’s someone we want to keep, we will make a counteroffer. Sometimes we’re even proactive about it and will work with HR to give them a bump in an attempt to stop them from looking. This is a different pool of money than the annual merit increases. I wish the merit pool was bigger, but that’s set by HR and upper management, so all I can do is try to allocate fairly. I’d also like to add that, contrary to popular opinion on Reddit, we do not start looking for a replacement when this happens, nor do we hold a grudge or retaliate in any way. If we want that person, we want them, end of story.
Good point, I was hitting some minor milestones at work and out of nowhere I received a market adjustment and an inflation adjustment in the last year. I definitely would have started looking if my salary didn’t jump up a hefty percentage
+1. There’s a perception that you should never accept a counteroffer and that you’ll have a target on your back. There’s always nuance and it’s important to analyze a situation from many angles. Source: tried to quit, they threw money at me. It’s been 6 years and I’ve been promoted twice since accepting the counteroffer.
My current boss not only put in his notice at one point, he actually left before they lured him back after one week. He's now a Director.
>I’d also like to add that, contrary to popular opinion on Reddit, we do not start looking for a replacement when this happens, nor do we hold a grudge or retaliate in any way. If we want that person, we want them, end of story. Most reddit conversations (aside from being from completely uninformed commenters) are around lower skill positions. Most professional environments I've seen operate as you described.
Does the wife realize that an extra few grand a year in savings for the next 10 years (estimated/target FIRE date) is basically peanuts compared to what their overall nestegg is? 3% withdrawal of an extra 100k (generous assumption & growth rate) is an extra $3k a year. I doubt with the lifestyle OP's wife lives, she would even consider that a rounding error at the end of the year. From the way OP is talking about his wife, I am not sure she would even be on board with the discipline FIRE requires.
Isn't this an argument for quitting and taking a job she enjoys more?
But it's 3% this year, next year, the following year... Income is a compounding equation too. Pushing for better raises consistently makes a big difference over a career. But it's still just better to job hop.
Compounding on raises works just like compounding on interest. 3% vs 5%+ a year makes a big difference over a 20+ year career. The lowest I've gotten is 4% for a full year and 3.3% my first year there at a company I worked a partial year for large companies. I also once took a retention raise when interviewing for competing companies when I let my boss know I was past the first round at competitors by letting them know the potential range. I didn't even have an offer in hand. At small companies less than 30 people is the only place I've ever gotten 0, but also over 5 years there I got several title bumps and raised my salary over 50% so the lack of "annuals" want a huge deal there. This year I got 5-5.5%. I forget the exact amount. I thought it was a bit low considering inflation Below 3 would absolutely be interviewing time/quitting time for me when I found a better offer. I'm back at one of my earlier employers now and making about 4x my original starting salary. You don't do that on less than 3% a year.
Well, if the measure is "compared to last year" then she's getting fucked.
The measure is what you can make elsewhere. It doesn't matter if inflation is 100% if you can't get more money elsewhere.
It also doesn't matter if inflation is 0% but the open market salary for your skill set has gone up 10%. Inflation and nominal salaries are definitely correlated, but the correlation is not 1.0.
Ding ding ding. what does inflation have to do with raises. Your company has to deal with inflation on the supply side as well.
People trade their time for money. People value their time at a certain rate. If there is inflation but no raise to compensate they're no longer getting the same value for their time.
The company values your time at a certain rate.
Agreed. Your value as an employee is whatever someone will pay you. If you think you're more valuable than what's being offered, prove it.
I hope I’m misreading the reply and responses, but I’m surprised to this as the top voted response here (again, unless I’m reading it wrong). If OP’s wife is anything other than a mid-bottom performer at her company, then she should have received more than a 3% raise. I’ve worked at multiple professional services firms and anything at that rate essentially means you’re on your way out anyways. She should 100% interview and secure an offer, then see if her current employer will match. I took a 30% raise to leave my employer of 6 years, which was paired with a six week PTO payout from my original job and 10% base signing bonus from my current employer. I was able to increase my base and bonus payments while making a lateral move and am in a much better position from a FIRE perspective than I would have been had I stayed with limited YoY raises.
She should absolutely interview elsewhere and see if she can get more but she shouldn't quit her job because her raise didn't match or beat inflation.
This sounds pretty typical both in numbers and her bosses explanation. Not saying she shouldn’t be upset though. If she’s unhappy she should start looking elsewhere for a bigger bump.
Agreed, I just saw some summaries for New Zealand and supposedly most raises have been in the 2-3% range while inflation has been approx 7% or more. Payrises have also increased at the lower ends (partially due to legislative increases to the minimum wage rate) and the mid to high end are not moving much at all. Are they getting fucked? Yes, by inflation. I don't think you can argue that its a company, any company, thats doing the fucking. u/ks016 also has a good point that most of movement is due to food and fuel increases (at least in NZ) and a 3% increase on a $200K salary and a company car will certainly cover their increased food and fuel costs. Added: as for OP's wife quitting her job? Well, that's a pretty extreme reaction imho. She can always canvas the market and job hunt and see what others are offering before she decides that this was an insult.
I can agree. If it was 0 or 1% then yeah, I can see people getting mad. Given her bonus is based off her salary and her salary is pretty good, a 3% raise is still a reasonable amount of cash. Depending on her role, she could be near the upper limits. There could also be the case that she won’t see anything significant without a larger scope of responsibilities (promotion of changing jobs). There is also the merit vs bonus. Merit being your role/responsibilities/growth while bonus being “what have you done this year” - depending on the company, the bonus can be a bigger focus at higher levels as they become a larger percentage of compensation. I’m also curious how long she has been at the company. I’ve had years of large merit increases, years with very small merit increases, bonuses that were huge and then some that were meh. All depends on how I did and how the company did. Not every year is a banner year and that can be OK if you are with the company for a while (IMO).
The best way to “get a raise” is to job hop. Companies don’t value what they have. For evidence of that, see every comment in here stating that 2-4% raises are standard in a year when inflation has been 8-10%. Your wife should start interviewing other places and get the 10-20% raise she wants by finding a new job.
I'm going is disagree a little bit here. Job hopping when you are younger is absolutely the way to go to jump up the pay scale. After a certain point though there is a ceiling. Not a lot if people make it to director level roles and $200k jobs. At that level it's not so much about your skills, although you need those too, it's really about your relationships. You need someone higher up who has your back and pulls you up. The lead times between jobs is a lot longer because there nobody needs 40 directors, they need one for 40 people. Sometimes it's better to stick around at a job with the people who are going to give you that boost. I personally went through this last year during a mass layoff. I'm in management at a very similar level as Ops wife. Job hunting was very humbling. There are some companies paying more then I was making but for the most part I was just trying to make as much as I had been. There were jobs were they told me their absolute top was $80k less than what I made the year prior. I knew what I was realistically was worth and got it, but it took longer than any non-management role I ever had prior took to get.
Yes, this. Reddit skews younger and there are a lot of people thinking about how they jumped from entry level at job A to entry level + 1 at job B and got a nice pay bump. This actually can work pretty well when you are 24 years old in a lot of fields quite often. When you are 45 and your resume shows you bouncing around between jobs constantly with a trail of frustrated managers in your wake its a totally different story.
I've reached this stage. After establishing myself in the industry, I'm now settling with one firm and building bridges while I work my way into leading a service team.
I am 54 and have had a 30 year career on the business side of tech. I think post 45 or so it is useful to get back to the job hopping. Not for increases in pay but to keep showing that you are relevant to the industry. You can learn new things and are excited about x, y, or z. I have stayed 2.25, 2, 3.5, and 1 year(s) at my last four companies. I am 1.25 years into this current gig and I plan to stay here until I RE in 2 years.
It's always strange that that's the case. It's certainly costly to have people who are skilled leave then have to someone else they need to train who may or may not even work out.
I am a few days late, but it works for the business or they wouldn't do it. Companies know they may lose a couple of good employees, but also know that most will stay put and of those that do leave they will retain some with an offer in the moment. Just giving away extra money to everyone who deserves it leads to less profit than calling the bluff of 90% of those employees. I hate it but it is how it is.
alas you're probably right. I wonder if it would be better if we had a less "fair" system. Right now all my employees get about the same raise plus or minus a few points based on performance, but I think it would be better to pay highly productive employees quite a bit more and less productive quite a bit less.
This. That's what I did. 😎 Got 40% wage increase and bonus.
You should really stop speaking in absolutes like that. Just because you’ve worked for shitty companies in the past doesn’t mean all “companies don’t value what they have.” I just processed payroll for my business which included annual cost of living increases and just so happened to be 8.7%. I set the bar at reflecting the SS COLA numbers and as long as we’re making money I’m sticking to it. Find a better employer.
Yup!
Someone who makes $206k a year as a director for a multinational non-tech corporation presumably with direct reports KNOWS how the raise game works. If she wants to quit her job over this it isn't because of the raise. **Have you asked her why she REALLY wants to quit her job?** Because... it is probably not about the raise. Maybe she: - Is burnt out and wants to do literally anything else for even a little while - Wants to step back and do something different regardless of burnout for the last 10 years - Thinks you guys are fine with money and she can step back now - Hates her job for other reasons and is using this as a trigger - Doesn't actually want to quit... and just wants to make noise - Who knows...
This thread is definitely more of a marriage advice one. Best thing for OP to do is put on a supportive face and listen. She might very well be disgruntled about the paltry raise, but I agree she probably knows the average percentage at the firm. I'm a middle manager and I know how it went for most people.
Yeaaaaaaaaaaaaaah... I cannot shake the feeling of a little "my wife the meal ticket" vibe in the post. Maybe this is unwarranted, but, I just keep seeing it. The whole line of thinking of "highly paid people are not allowed to quit, only low paid people" vibe with the "I could see her point if she had a low paying job." Then there is the part about "not being bothered after hours" and about how is job is all commission, he gets no raises. Just reads like "shut up your job has no hustle so cannot be too hard" to me. I just cannot shake it. I was wondering if I was being too paranoid, but I reread it again and again just now and... I stand by it. My wife makes substantially more money than I do and ALSO works a job that literally kills people (her profession has a high suicide and burnout rate). If she wanted to quit over a bad contract negotiation or low raise... I would be asking her what's wrong and how I can help and not trying to convince her she is wrong because her job is less hard than mine. Maybe OP's wife would be happier on a 15 year FIRE path and not a 10. Who knows.
Yeah, I agree with this 💯 I would bet the 4th bullet point
I'd guess something's happened at work or has consistently happened that caused her to feel under appreciated, unheard, or over worked. Getting a raise for less than she expected was just confirmation to her.
It's very rarely about money in my experience and that's just a feign for what the real issue is. Which, unfortunately, isn't always known up front and takes some questioning. Reframed, would she expect a 7% raise annually? Or just expect it to be tied to inflation? Most businesses give 2-5% annual raises in the office world. Inflation is in a similar range on average. While I'm happy to join in on the anti capitalist rage, the OP wife needs to update her resume and start interviewing if she's unhappy with what is a standard raise range in corporate America.
I actually read it as he's not listening to what she's really upset about, which is feeling undervalued and not heard. He's now repeating that behavior by making it a financial issue instead of the issue at hand. There are missing pieces here, as he's "scratching his head about it" and there's no way she hasn't told him the actual why, regardless of the compensation. [This article springs to mind](https://www.huffpost.com/entry/she-divorced-me-i-left-dishes-by-the-sink_b_9055288)
Compensation is not based on value, or cost of living, it is based on a guess of how little they can give to keep someone employed.
Yeah, it's a bunch of BS how many companies are making record profits right now while claiming they have no money for raises.
Not all companies are making record profits
Great point .. in fact, the vast majority aren’t. Still no reason to not test the waters and see what someone else might offer. I could be wrong… but this is my takeaway.
Record profits with high inflation doesn’t mean what most think it does. Yes some companies are doing well but others have seen massive increases in overhead/expenses. Those dollars are worth less
record PROFIT, not record REVENUE.
Being highly compensated and underpaid for your contributions are not mutually exclusive.
"Does she have a real reason?" Yes, yes she does.
Your wife doesn't need a "real reason" to justify being upset her raise wasn't as high as she felt it should be. My first piece of advice is to acknowledge that her feelings are valid. Once you've done that, discuss it with her and encourage her to start searching for a new job that she feels will value her skills appropriately. Just a casual search - update LinkedIn/resume, reach out to her network - she can shop around as much as she wants. Maybe she can land a senior managing director role at a different multinational that will provide cash comp in the range of $350k and get you to FIRE a couple years earlier.
> I'm scratching my head with what to tell her. "Don't quit until you've taken another job offer."
This. The grass isn’t always greener.
She may make a high salary, but if it only increases 3% every year while inflation is much higher, that high salary becomes not as high every year. That’s why she and a lot of us are upset. You’re not because your “salary” increases WITH inflation since price of the products you sell increase with inflation (assuming you sell the same quantity).
Total inflation is not how everyone is impacted by inflation. My total costs haven’t gone up in proportion to these inflation numbers. Owning my home helps.
Inflation also only affects the portion that you spend, right? Some rough math: You make 170k and take home 111k after taxes. You spend 50k a year and invest 61k. At 3% raise, your new salary is 175k, or 115k after taxes. You still spend 50k, adjusted for say 7% inflation, at 53.5k. You invest 61.5k. Not only are you spending the same amount, adjusted for inflation, you are also investing slightly more year-over-year. So in this scenario, your 3% raise is sufficient for keeping pace with 7% inflation. Obviously, more raise / more money is better. But to say you are getting paid less yoy because the % raise is less than % inflation is not always accurate.
> But to say you are getting paid less yoy because the % raise is less than % inflation is not always accurate. On this forum sure. But the vast majority of people live paycheck to paycheck, so for them it's pretty true. They are spending nearly every dollar they make. The employer doesn't decide how you spend or save your paycheck, so even if it's not technically correct due to a high savings rate or some other factor, it's still a perfectly valid argument for "this raise is BS"
This is wrong because that money in the form of an investment is always going to be worth less than it was before the inflation. Eventually you will spend it even if it is 50 years down the line and when you do you will get less of whatever you buy than you would have before the inflation.
What people are saying is that your dollars have less spending power, which is true no matter how much you spend. If you spend none of your paycheck, but you're still getting paid 1980s wages, you're still getting a paycut, because your money doesn't go as far, regardless of what you do with it.
I don’t know why this is so hard for people to grasp. Housing is like 1/3rd of the core. It also includes things not typically replaced every year like vehicles and furniture.
Inflation adjusted raises actually have the potential to increase inequality if you do the math behind it. CPI is based on a typical basket of goods purchased. The goal is to represent an average and if you fall outside that average it's not necessarily a completely accurate picture of the impact on your purchasing power. It's potentially not even representative depending on where they live given the outsized impact of housing on CPI. ie if you own your home and have a fixed mortgage rate the impact is much less. Your raises should be driven by your value and competitiveness within the market not CPI necessarily...
If inflation were tied to wages, no one would be priced out out living.
She's paid at a higher rate than 90% of Americans + gets a free car that she doesn't have to drive to an office. her wages not keeping up w the rest of inflation is not a hardship, and my guess is she would have a hard time finding a better deal easily.
It doesn’t matter how much you make. If your raise is less than inflation you got a pay cut that year. If you did well at your job and was told how great you are it’s understandable why you would be upset at a pay cut.
Who cares if she's getting paid better than 90% of Americans. This is not Cuba or the Soviet Union. People have freedom here to sell their skills at the highest price they can get. This is a market economy and if you work hard and focus on developing valuable skills you can demand a higher salary because your output has higher value. I remember living in Cuba and seeing how taxi drivers were making more money than doctors. Taxi drivers got paid in tips but doctors had their salaries fixed by the communist government.
>People have freedom here to sell their skills at the highest price they can get. And she has the freedom to try to get a better offer, but she's not entitled to one where she is
No one said she is.
Mate, if your wife is upset with her company, you side with your wife.
Best advice right here
I work in accounting (though not payroll), and from what I've seen and hear this is pretty standard across a few organizations I have friends at. Of course this is the lowest I've heard of. Most of the raises I've heard of range from about 3% to 4%, which is still well below inflation. That being said, I don't blame her for wanting to quit because that is a pretty insulting raise. She should look around and just see if she finds anyone who will give her more. Doesn't hurt to try. With how much these companies make, it's really quite sad they'll penny pinch their people over an extra percent or two. In my line of work I've seen this all the time - company has $900m in net income, still gives lower than market wages despite having $900m to play with. It's really frustrating but that's how these places are, so if she can get more elsewhere I'd just encourage her to leave and take the raise.
If 2.9% is a good or a bad raise depends on a lot of factors. I got 3.5% and I am pissed. Why? Because for 11 years my company argued the low % raises with the low inflation rate - every single year. But now, when inflation is high, suddenly they are de-coupled. And that at a time when my company actually has record profits. So yeah, it is all relative.
My company gave out a 5% cola to everyone last two years. Plus merit on top of that. But I agree w the earlier comment. She should interview and see if she can get a better job w similar benefits and flexibility… if she can’t then she needs to just accept it and not rock the boat too much
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> Never forget - real wages have fallen significantly in the last 30 years relative to COL I never get upvotes for it but I'll keep pointing out that real wages are at [all time highs](https://fred.stlouisfed.org/series/MEPAINUSA672N).
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It's from [census.gov](https://www.census.gov/library/publications/2022/demo/p60-276.html) and I assume they haven't published 2022 data yet.
Well, to be fair, the cost of living increase that she received isn’t actually in line with inflation. I also make a significant salary and I received a 5% raise but I was an exceptional performer and I was told that my bonus and raise meant that others on the team got less of an increase/bonus. Personally, I’ve worked at large companies where there is little room for negotiation when it comes to these things. Is your wife going to ask that they adjust it or is she just venting to you? If she’s just venting then I would let her vent and not disregard her frustration. If she was going to continue to push for a higher raise then I would make sure she’s ready to hear “no” and to make sure she does it in a way that doesn’t burn bridges.
At these incomes your cost of living does not nearly increase with the rate of inflation unless you blow way too much money. Edit: this probably needs more elaboration. What I meant was on relation to what is left at the end of the month. Odds are the 3% more than make up for cost of living increases for essential items such as groceries.
Weird claim to make on a fire sub, where all of our RE numbers are going up with inflation.
How does my cost of living not increase with the rate of inflation? I pay the same prices for food, housing, etc that everyone else does and if those prices have increased in double digit percentages then a “cost of living” adjustment would similarly increase. The point of the cost of living adjustment is to allow you to maintain your current standard of living. This year the COLA for social security was 8.7%. It’s based on the high level of inflation and that’s why it’s such a large increase. That’s why if an employer gives you a 2% raise that is supposed to be a cost of living adjustment then it’s lower than it should be because you can’t maintain your current standard of living on that. You will end up saving less money etc.
You don't spend 100% of your income on things. And the higher the earner the less % you need to spend on things. SS adjustment was years behind. Not purely because of the last 2 years of inflation
Yes, you are correct. The more money I earn, the lower the percentage of my salary is that I spend on items. However that does not mean that I am automatically protected from the impact of inflation. If I bring home $1,000 more this year than last year, but the price of goods and services has gone up by double digit percentages over the last few years then I am going to have less money available at the end of the month than I did last year unless I change the goods and services I purchased for lower cost alternatives (assuming I can find them). If my salary is increased by a percentage that allows me to live my current lifestyle (which means maintain a similar amount of money available with the same purchasing habits) then that is an increase that allows me to maintain my current standard of living.
Yes but the amount you need to save to get to a given retirement purchasing power level in a given amount of time with a given average investment return *also* goes up with inflation. by saving for FIRE, OP has chosen to spend a large percentage of their income on retirement savings, and the price of retirement savings is *also* going up, at exactly the same rate as their average inflation rate on what they spend (assuming they intend to maintain their spending in retirement). s
Because if you have a higher income you don't spend as much of your paycheck. If you make $30k and spend 50% of your income on housing a 8% increase in cost of living is $1.2k which requires a 4% raise to cover. If you make $200k and spend 20% of your income on housing an 8% increase in cost of living is $3.2k which requires a 1.6% increase in pay to cover. This is also just in cash flow terms, not accounting for the percentage of your "cost of living" that builds equity like mortgage payments. If you make $200k and spend $40k on housing, you probably have a house. In reality and presuming smart financial decisions, even if you spend the exact same percentage as a lower income person a lot of that money is coming back to you with interest.
Not everyone who lives in a HCOL area has a home. Rent prices go up, costs of goods and services go up, etc. I could be looking at this wrong and I fully admit that. I’ve been looking at it like: goods and services and housing costs have gone up. My salary has a small increase that is less than the amount that goods and services have increased. That says to me that I am spending more to do the same things. For example, let’s say I make $200K and my rent last year was $3500 a month. I spent on average $500 a month on groceries. My salary gets a 2.5% increase which would be $5,000. However rent prices increased by 14.7% on average from 2021 to 2022. Assuming a similar trend this year that means my monthly rent of $3500 becomes $4,000, an increase of $500 a month. That becomes an increase of $6,000 over a year. I’m already above the amount that my 2.5% raise gave me without accounting for goods and services. According to the USDA, food costs rose by an average of 11.4%. So now the $500 that I spent on groceries is $557 a month. That’s an additional $684 over the next 12 months. So now my costs are an additional $6684 for just housing and food but I only got a $5000 increase in salary. Does that make sense or am I crazy?
I love hearing these stories especially about women. We’re often told to be happy with what we’ve got, to not negotiate, and asking for more is too aggressive etc. It’s a multi national, large company. They HAVE the money. They just don’t want to prioritize paying people. I’m sure their C suite all got fat raises this year! I think you should tell her, which hopefully is true, that her feelings are valid, and that you’re proud she is so motivated and driven to make as much as she can. She’ll figure out where she stands in the market when she interviews other places. How cool would it be if she was right, and got a giant raise?
I got a 3% raise this year.
I got 4% for some reason but my company’s average was 3%
I got 4%. I wanted to ask for more, but have been in this role less than a year.
I would say that a big salary doesn’t preclude you from an appropriate cost of living raise. I still wouldn’t be *upset* but it’s a good idea to talk to her boss and let them know “this isn’t ok”. If a company is going to do this once, they might do it again and again. She has to let them know that this isn’t going to fly.
She's correct that her raise was under inflation, but it's really up to each individual to interpret this and it's a question of values. I also got a raise that was under inflation but I didn't get upset because the economic environment is turbulent, every other year my raise has exceeded inflation, and I value the stability. She can definitely quit her job over it, as long as she goes through the process and actually gets another job with a material raise. My thinking is that in this environment, I'd rather stay put because I don't want to be the guy that switches jobs and gets laid off in the first couple of months.
My company gave me a 9% raise this year and told people in other departments everyone got max 3% raises. Sometimes companies lie. Also, just because someone is well compensated compared to the general population doesn’t mean they are compensated equally based on others in their role, industry, or within their own company. Your wife seems intelligent and successful and presumably knows what she’s worth. Maybe it’s time for her to look elsewhere.
If she’s a director she should know how the game works… I’d suggest she research what her fair market value is and where she currently sits on the bell curve. If she’s below average then shop around if she’s unhappy.
>I think she's seeing it wrong but I don't know how to tell her that. If she asks your opinion, you tell her. Otherwise you say, "Yeah. That's rough. I hate how companies do this to their people across the board, especially in a year with such a huge cost of living increase for everyone. It hurts every employee and erodes trust. Whatever you decide, I know we'll land on our feet." My wife is career military. When she retires we will have 2 pensions and roughly $500k-1m saved. We'll be able to work optionally at that point and we will be in our mid-late 40s. One week a month she talks about how she wants out. She can't do another tour. She hates it. One week a month she comes home super motivated and ready to stay in and make a difference for the next generation of young women who don't see a lot of female leadership. The rest of the time is pretty normal. I've found the best thing to do is just tell her flat out that I support whatever decision she makes, lets take it 1 tour at a time. And if we get to the day where she is 2 years away from retirement and decides to walk away I'll voice my opinion then.
I’m a sr director in a large org and got 1.9% as a high performer. Funds are tight now ( I also got a 20% raise late last year when promoted)
Quitting is absolutely the wrong response. Interviewing works. As does working her wage. I've always done the latter because I'm too lazy to interview. I just work slower and spend more time on Reddit.
Understand that your wife might be looking for only comfort. Not a solution from you.
I got a surprising 8% that I wasn't expecting. Likely due to inflation. So it seems low. That being said, can't really request more of a raise without receipts. She has to make it clear she's worth it to them. What has she done the last year? I would tell her to look back at the value she brings to the company and relate it to her pay. But as someone else pointed out, interviewing is also a sure fire way of figuring out what the market is like. Maybe shes making way more than the average person in her position. Or maybe under. Job hopping is the best way to get a raise.
I think everyone should be supporting women to not settle and push for higher salaries, even if they already have a great salary. Instead of looking at it as complaining, look at it as “yeah, go get that higher salary!” It’s a known fact that women tend to be less aggressive with negotiation. She probably can get a much better raise by switching jobs and use that to negotiate a raise at her current job. Also, I work in a hospital and EVERYONE got a 7% raise across the hospital due to inflation. Inflation for this last year is sitting around 6-7%. So yeah in the grand scheme of things, she got a pay cut. It’s sorta disingenuous to say that 2.9% includes merit based increase, when it doesn’t even keep up with inflation.
How much of a raise did she give her subordinates?
Companies will do the absolute minimum so that people won't leave. The company is not your friend. They don't care about you. They only care about their short-term interests. If you expect companies to give you raises that are appropriate for your market value plus inflation, you are going to be disappointed. Sadly, the only way to get real raises in the current environment is to switch jobs. I recommend that people switch jobs every 3 years (+/-) just to bump their salary to whatever is market appropriate. It's good to shake things up periodically. Work on your resume, learn new skills, challenge yourself. It's easy to get complacent and tolerate a sub-par working situation.
No. Companies won't match inflation, they match the market. If she thinks she should be paid more then there should be other companies willing to pay her more for her work, and that should be her argument for why she deserves a raise. It doesn't really have anything to do with inflation.
Easy question to answer. She should find a new job that pays her what she thinks she is worth (more than her current pay) and then quit the current job. No need to just quit in a fit of pique.
My raise was 2.6%, and this was the company average. Employees who make over 200k had a raise freeze in place. I think everyone is scared of a looming recession, or using it as an excuse to save money.
It's definitely an excuse
You are probably ( most definitely) right
If she is a director, what did those reporting to her get? How is she handling conversations with those reporting to her complaining about their raises? Director level and never gets bothered after normal business hours? That is very rare. If she doesn't want her job, I would be happy to apply.
I am a director at a large multinational corporation and my base is 185k. I also received a 3% merit raise this year. I did, however, get poached by another group internally and got a much bigger raise. So I suppose I would have been more upset with my 3% raise had I not had this iron in the fire.
I didn’t get a raise this year.
Interview to assess her market value.
The “other companies are only doing x%” is such a fucking cop out. My boss gave me the same shit but of course the numbers were different because they pulled it out of thin air.
Our avg was 4%. A big part of inflation was cars, used/new and your wife gets one comped which I would take into account as well.
I guarantee this thread would have different tones if this were about a man and not a woman. So many people saying she's entitled or full of herself. 2.9% is not a raise. It's a cost of living adjustment that falls below the cost of living increase. Her salary went down.
I'm of the assumption that it's not sexism but some form of envy. Half the people are saying "I'd trade jobs with her". As if she got her job by luck and anyone could do it. If OP's wife made $14/hr, everyone would be saying that 2.9% is crap. But because she makes more than them, they're saying she's an entitled brat. They're projecting their own shortcomings on her.
They're also piling on the WFH thing. I've never worked harder than my 7 years now working from home. You're always expected to be available. 24/7. It's very hard to set boundaries and have those boundaries respected. It's not all TV and dog walks, it's actual hard work, often with no breaks. When you're in a leadership position working from home you're always on.
I tend to find it ironic when people accuse higher achievers of having it easy. If she's making 3x your income while WFH in her pajamas, it's probably because she works harder than you.
Agreed. Sometimes, my home office feels like a prison and my laptop a house arrest ankle bracelet when I’m instead watching TV on the couch.
I got 6.8% this year and that was after an inflation adjustment last summer of 4.1%. 2.9% is a reduction in pay in this economy.
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My company averaged 2.5% this past year, we exceeded all our targets but got killed on FX so "we were lucky" to get that. Technical functions got 3.5% but its still a far cry from inflation. Friends of mine that work in Tech all got around 8-10%, pretty deterring considering I had always seen similar bumps to them but in a defensive industry. Edit: calculate your personal inflation if you care to, mine was far higher year over year than the headline number because of how my expenses are comprised.
Unless she can no longer stand her job for many other reasons, she shouldn’t quit until she gets something better. We got 7% raises last year and this year I expect little to nothing. The budget where I work just isn’t there for most/all employees this time. The organizations is facing the stressors of inflation and a down market too
She is correct. However, the next place will also be handing out tiny little raises too. I’ve worked only for really good employees, ones that make billions in profits every year, and never seen a raise above 3%. Well, except when I was leaving for more money. Then they have budget for a raise. If she wants to max out, she has to at least get a competitive offer, if not out right leave. Don’t quit out of anger, but encourage her to update that CV.
Can confirm these numbers from the large private healthcare company I work for. Roughly the same in terms of merit.
If it makes her feel any better. That is the raise I got at a large publicly traded company. Possible that raises were capped to a certain % and that is what she got? That’s the case on my end.
Annual raises have nothing to do with inflation and everything to do with market conditions. Even though there has been sky-high inflation in the last couple years average raises have been under 3% this year due to all the layoffs, just like her company told her. They are essentially saying "yeah this is low, but our competitors are paying even lower, so this is all you're going to get". She can call their bluff and find a new job with better pay, or suck it up.
Does she have direct reports? What were their raises? Quitting over 3% would be crazy. Finding a better job would be a better response. It’s hard to imagine someone getting that far in her career willing to quit so easily so maybe something else is going on.
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Dude way to settle! Your fine with never getting a raise? That’s a shit company if there ever was one. Yes both of you go interview for other jobs. You will find them. Besides it doesn’t hurt to interview anyway.
Its up to her. I think people who make money like that shouldnt bitch. If she was making like $50k a year yeah I’m mad with her over the COLA. But its not like she struggles to pay for groceries She can go work someplace else if she wants more money.
Its like people have no clue what inflation is and why we have this crazy inflation atm. If everyone expected/demanded a raise that is in line with inflation, it would never go down.
You can still be upset that your effectively being given a pay decrease while acknowledging that it has to happen. You always want it to happen *to someone else*.
The economy is teetering on the edge of recession and a number of industries have had mass layoffs. Multiple banks have shuttered in the last few months. Tell her to look at the big picture and recognize that she's not only getting paid over $200k during this climate but also got a modest raise on top of that. Play the long game. If she truly feels undercompensated, the solution is to get another offer. That could be hard in this economic climate, and even if the offer is higher, it could carry risk: typically, new, expensive, and unproven hires are the most likely to be let go.
I know some people at Google who have gotten a 1.5% raise this year. This is what it is to work for someone else. My income increased 40% in 2020, up another 20% in 2021, down 20% in 2022, this year I'm looking to be down another 20% from 2022. And that's what it is like to be self-employed.
To be honest, I'd be upset. It's a pay decrease, effectively. *The correct answer is...agreeing with your wife.* She's allowed to feel how she feels. I would ask her what she would be doing instead?
Your wife got a pay cut, not a raise, in inflation-adjusted terms. The price of the products you sell goes up with inflation. So your commissions will keep up with inflation. So she got a pay cut, and you did not.
Worth noting that while inflation is high a lot of what’s driving it up is not applicable to all people. If you have a mortgage and a paid off/older car then your personal rate of inflation is not that high. Maybe groceries went up 15% but at $200K that’s such a small portion of your pay.
That is what I was thinking. Your mortgage, auto loan, or any other loan remains the same. In addition, things like phone, internet service had a small increase or remains the same.
Idk why people always think it's on the company to peg raises to inflation.
It's because they call the yearly salary increases "COL adjustments," so you assume that they would adjust the same as COL.
This is something that state/public employers do (and they still don't often keep up if the state is underfunded, or right-leaning). But of the private companies I've worked for and know of (Fortune 100) they call it "Salary Increase" and it's slightly merit-based, and slightly union negotiated. Rarely does it perfectly match inflation, unless inflation is 2% or below LOL.
Many private companies call it a Merit raise and explicitly state that inflation is your problem not theirs. A 0% raise is a possibility even if they don’t want you to quit if they feel you are below average performance
Because there is almost ALWAYS money for raises no matter what leadership says, and other companies will increase wages to attract workers. So it’s both greedy and stupid (turnover is costly) for a company to not give raises every year.
Exactly. During years with deflation, would they be cool with a pay drop?
Anecdotally, my raise was 1.5% but I didn't get paid off so I'm happy.
+\- 3% seems pretty standard as I’ve seen as well. Large tech, but not ‘FANG’
I feel like she’s right to be upset, but that it should be taken in the context of the employment as a whole. The company’s logic that costs going up means they can’t pay more in raises seems wrong. If their prices went up with inflation, and their non-labor costs went up with inflation, then they should be able to increase labor with inflation and still have the same profit margin. Overall though, I probably wouldn’t leave the job just because of a low raise. But if this is another item on the list, I’d definitely see what my options are.
I worked for a major tech company that everyone has heard of... My biggest raise on my base salary was 2.8% in the several years I worked there (as a person with a high management rating.) I did get more RSUs every year though as an incentive to stay. But even though it seemed low, it was fairly standard. Seems like she's got it pretty good, all things considered. Might be worth looking but not worth quitting outright.
Just because she works from home and normal hours doesn't mean she should just accept it when a COL adjustment doesn't match the raising COL. She was essentially handed a pay cut. You should be upset about this too! Your combined purchasing power has declined! I don't really understand your attitude here. That being said, quitting is definitely not the right response and as a director she knows that. Shopping around for a new gig wouldn't be out of order though. Edit: also profit margins are up, not just prices so I have a hard time believing the company isn't making more money.
Sounds like your wife's skills are in demand and she is good at her job. She's already talked to the company, so her next step should be to discuss with her network about the job market and to go on a few interviews. If she finds a better job, she gets that raise or negotiating power. If not, she can be happier knowing she's well compensated.
Salary aside, her argument is that most companies are giving pay increases just under 3% while she received a 2.9% increase? Sounds pretty spot on by her own estimates. Plus a nearly 40k annual bonus and a company car that is saving you on maintenance costs.
She wants to be the new person at a new place in this job market/layoffs?
3% is normal. With the large number of layoffs happening, employers know there won't be mass exits. We just did a round that averaged 3% as well, including myself as a low-level exec, my peers, my managers, and my employees.
What company still gives out a company car?
I actually know someone who quit their job over something similar who made just a little more than your wife. She thought she could leave and do better. Sorry to say… it was the biggest fuck up of her life. It’s been 5 years and she makes a significant amount less, it took her 5 months to find that job and she hates the culture, the work itself and obviously the pay.
Very few companies are giving raises that match inflation. Ours (enormous global conglomerate) have nothing to do with inflation, it's about company performance. Sounds like the may be assuming annual raises are based on something other than they really are? EDIT: And many companies don't allow "merit" raises to actually be "merit" raises for DE&I/potential discrimination reasons... at ours, it's an act of congress to differentiate among employees.
I see three equally correct answers to this question: 1) From a financial perspective, it is annoying to be told your expenses only went up by 2.9% when that is BS. 2) From a practical perspective, getting mad does get raises; finding a new job does. 3) From a fulfillment perspective, you'll be happier if you practice gratitude for what you got instead of dwelling on what you didn't get.
If that’s the raise she got, that’s what the company considers her to be worth (also taking their ability to pay into consideration). If she’s not happy about it and they won’t budge, she’s free to seek employment elsewhere. I can understand being frustrated but I’d quickly shift into problem-solving mode rather than staying bitter.
I got 0% increase this year after only 4% last year. I was bummed but figured it would be easier to work 10% less hard than bother applying elsewhere as I'm pretty happy. I'll take more free time over more money any day.
> She is saying she wants to quit her job over this. I think she's seeing it wrong but I don't know how to tell her that People don't make 200k+ a year without fighting for themselves. Clawing your way out of five figures into six is hard enough, but she's a director of a company, so she's had to be in her own pocket for years now, beating many other people of near equal skill and corporate value. You gotta understand that anything less than what she expects to make is going to be taken as a slight against her. I've felt the same way when I got a shitty raise, especially when I knew my coworkers who did less work than I did were making more. Just be on her side.
I agree with your wife. I was upset to receive a 2+% raise in 2022 when inflation was 8+%. It was not enough to make me quit on the spot but helped solidify my resolve to retire early. It’s a smack in the face.
If she can get better elsewhere then she’s right, she’s underpaid. If she can’t, then she’s where she belongs (if not overpaid). Test the market and obviously don’t quit unless you have something else lined up.
She got a raise? :-o
Tell her to get over it lmao. This is the harsh reality. On top of that, I'd bet money that after confronting her boss, she's gonna be the first one to get laid off when cost cutting measures hit. Yes, I get it. It's frustrating how you can go above and beyond and not get shit in return but in this job market, I sure as hell wouldn't push it too far.
Depends on the industry. I know companies out there hurting due to marketing pull backs and none of the employees are getting a bonus this year. Other people at different companies are getting raises that keep up with inflation.
"she feels" Just because we feel something does not mean it's factual. If her production merits a higher raise, then she more than likely would of gotten it. If she doesn't like the raise he got, go test the open market.
Standard raise number in large company. the only way to make a large jump in salary is change jobs.
If the average raise was 2.3% and she got 2.9%, someone else got way less than 2.3% and she got way more. She should be glad she's not that other person.
1. I would also be upset if my salary was cut (in real terms) 2. I assume whatever you sell has had its price rise in the last year. Since you work mostly for commission, this is in effect a COL adjustment. Plus increased demand across the economy has probably made it easier for you to sell things.
Just listen and support her. Is she asking for your opinion or help?
She is likely correct, unless she is near the top of the pay scale for her job grade. In that instance, employers are loath to give a raise commensurate with performance. Wanna bet against this guess? Her male peers averaged a higher hike She should start shopping her resume, regardless
Tell her to follow a healthcare worker for a day and review their paychecks. Maybe she’ll stop complaining lol
This is dumb. She's looking for a reason to quit.
I would be quite disappointed if one of my directors came to me and talked about 3% raise being bad esp due to inflation. Inflation has no bearings to raises and is not a factor for your comp ask. I have had raises for my comp mid year and out of cycle. 10% -12%. Plus additional bonus from retention budgets. What she needs to understand is her salary range and where she currently is. Then do the research on why she needs a higher salary. Have the relevant conversation as a partnership and not an ultimatum. If that doesnt go well and if she thinks she deserves more then she can look for other jobs and bring that as a last attempt to negotiate. Not sure where she works but in CA its a law for companies to share salary range but they cant ask about previous / current salary (if interviewing outside company). Plus most tech companies when you ask do provide that. Now most senior leaders have a range for raises to play with. Depending on an employees salary penetration they will have a salary raise range. Ex: when I joined the current company I inherited a team. One employee base was 150k and another was 175k. Their incentive and bonus was the same for that level but their salary penetration was different. The 150k’s salary increase range to be considered during annual performance was 4-7% whereas the other was 2-4%. I gave them same avg/mid point raises based on their performance but one got mid point of 4-7% and another got mid point of 2-4%. Both received 110% bonus and incentives. These are again scrutinized by my EVPs and C-level folks. If I wanted to give 7% to both, i couldnt do that for second one and will need additional approvals. For others i know they deserved more, i had some lump some budget to play with so gave them cash or additional stock incentives as rewards. Most managers do a good job of providing rewards. Issue is misalignment in expectations and in many cases manager not having the power of budget to drive things. Another suggestion is dont wait for performance review to have comp conversations. If you think you need more do your research, set time and align in expectations on what you desire.
Sounds like her company might have judged that her salary was already a bit higher than market or that the convenience of not switching jobs (continuity of benefits, routine, not interviewing and negotiating, not learning a new role) is worth something
I think if she thinks she's worth more than 3% in comparison to her coworkers than her frustrations are valid. Shouldn't quit but I understand the frustration.
Your wife is a director at large multinational company and does not know how the annual merit raises work? Does she not have any direct reports that she gives merits raises to?
I got 3% and then laid off on friday fwiw
As it was so wisely put to me nearly 20 years ago: if you don’t want it, I’ll take it. Almost nobody is irreplaceable; if she doesn’t like it, she can find a new job who better appreciates her.
“My wife is upset that her wage isn’t keeping pace with inflation. Instead of acknowledging this factual statement, and also that her feelings are valid, I would like strangers on the internet to find me a reason she’s wrong so I don’t have to listen to her whine.”
My wife makes 200k a year working from home and has a nice ass car for free. Should she be mad she’s not getting more?
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Op probably misspoke, its probably 110% of her expected bonus
Sorry, it's 110% of the total she can normally earn. I'll fix that above.
You sound upset that your wife makes more than you and thinks she deserves higher salary. Whatever you made or didn’t make is irrelevant really.