I recently received a call from an acquaintance from the Sacramento Professionals Network who wanted to know how they could be more relevant to their members who were unemployed. My first answer was to give them hope. I’m not sure how this could be conveyed, but if one does not have hope, then enthusiasm, determination and effort all decline. I posted this story on Facebook, and a friend of mine suggested that people stop holding out for jobs with the same salary that they were making before. His argument is that poverty (due to unemployment) was more likely to be caused by holding out for a job that pays what you want, instead of taking something that pays a little less when it comes along.
I think there is an important point here. Let’s do the math. Let’s say you were making $100,000 a year before you were laid off. If you were offered a job that paid $80,000 should you take it? In this economy, YES! $100,000 annually equates to $8333/month. For every month over 2 months of unemployment, you now are worse off than you would have been if you had taken the job.
Let’s say that you end up unemployed for over 12 months before you land a job that paid $100,000. That means that for 10 months, you lost $8333/month of salary. Let’s also suppose that your unemployment benefit was about $2,000/month. You now have lost $6333/month or $63,000. That $63,000 will take you THREE years to make up. So, in this example, for every year you are unemployed, you will need three additional years to dig yourself out of the hole you are in.
Now, some of you may argue that once you take a job that pays less, that you now have a new standard as far as your salary. I hate to be the bearer of bad news, but… I believe this is going to be the new norm for awhile. Salaries are going to be going downward in most occupations. If you are holding out for a return to the “glory days”, you may be in for a long wait.
Be a leader. Do your homework and make decisions based on facts instead of emotions. I am facing the same prospects as many of you. My contract rate has gone done, clients are willing to pay less for services now than they were just a few years ago. This is the new norm. Even if this changes in two or three years (which I think is overly optimistic), you are better off taking a job that pays less in the interim.
All the best!
All the time!