Welcome to Your New Job: One that Pays 30%, 50%, 70% Less than Your Old One

January 2nd, 2009

According to CNN, phone service is an, “extravagance”?

The bankers and politicians who created this mess must really think that this is hilarious. As people are getting financially screwed to within an inch of their lives, the Wall Street pricks buy new homes with taxpayer bailout money and the crooked Congress gets an automatic pay raise.

What a country.

Via: CNN:

Happy New Year and welcome to your new job. One that pays 30%, 50%, 70% less than your old one.

That’s right: With more than three job seekers for every opening, more workers are having to take significant pay cuts to find employment.

“For people who have been laid off, this is obviously a buyer’s market,” said Ravin Jesuthasan, a managing principal at Towers Perrin. “We’re seeing pay levels in new positions coming down.”

In fact, 63% of unemployed workers said they would be willing to accept a job offer that pays less than their previous job, according to a recent survey conducted by the National Employment Law Project. Still, only 37% of respondents expressed high confidence in finding a job in the next four months despite being willing to make such a sacrifice.

Nearly 2 million jobs were lost in 2008 and economists say the unemployment rate, which stands at 6.7%, will continue to rise into 2010.

“People realize that this is a different environment, said Jeff Joerres, chairman and CEO of employment services firm Manpower. “People are more anxious and are willing to secure something even if it is less.”

Shaun Chedister, 30, is one of those people. Chedister was laid off from his job at Washington Mutual at the end of last year. After eight months of actively looking for work to help support his wife and four children, he accepted an offer from Ernst & Young even though the new position as an executive administrator paid less than half of what he was making before.

“My unemployment had run out, and I had to get something,” he explained.

But the adjustment to making $66,000 a year from $125,000 has been hard. “For the last four to five years I’d been making six figures,” Chedister said. “My lifestyle had been at a certain level.”

Now Chedister said he’s looking for a more affordable home. Last week one of the family’s cars was repossessed after he got behind on the payments.

“It could be worse,” he said, I could still be unemployed.”

Often the hardest part of accepting a pay cut is the change in lifestyle that goes along with it, says Manpower’s Joerres. “When you recalibrate your earnings expectations that means you have to recalibrate your lifestyle as well.”

And for those living paycheck to paycheck, that can mean having to move, sell possessions or give up everyday extravagances such as cable TV or phone service.

After Jarrod Posner, 34, was laid off from his $110,000-a-year job as a mortgage lender for D.R. Horton, he had to change careers to find employment. After months of looking he took a job as an enrollment counselor at the University of Phoenix – a position that paid $33,000.

“I was actually thankful because I was getting a job, but at the same time my wife and I realized we had to make a lot of lifestyle changes,” Posner said.

Since then, the Posners, who have two children, foreclosed on their home, moved into a rental property, downgraded from two cars to one and learned how to budget, he said. They’ve also given up their telephone and cable TV package. “All the little luxuries we don’t enjoy anymore,” he said.

Despite the dramatic downsizing that came with a 70% salary reduction, “I’m kind of happy,” Posner said. “It’s nice to know that I have pretty steady employment.”

Posted in Economy | Top Of Page

2 Responses to “Welcome to Your New Job: One that Pays 30%, 50%, 70% Less than Your Old One”

  1. Loveandlight says:

    What a country.

    Yes, I agree. As I keep saying, a lot of this predatory selfishness has to do with the insanity that is woven into the very fabric of our culture and society. Someone on my LJ friends-list had the good fortune to travel to Canada for a brief while last year. I’m not saying Canada or New Zealand or western European countries are some kind of paradise, but they can seem that way to US citizens who lament the loss of a sense of real community and civil society that has made America into the kind of country where these terrible policies and behaviors are normal and acceptable. According to the fellow on my friends-list, hearing about everyday life in the USA from him made the Canadians with whom he spoke feel guilty about complaining about their lives!

  2. Peregrino says:

    Villagers in Turkey, India, China, Mexico, Bolivia, and virtually everywhere else who get by on a household cash income of $500 a year or less and who can do almost any kind of hand labor ingeniously and whose lineage has been doing so for thousands of years and who derive profound satisfaction from simply being able to greet the new day I’m sure are deeply troubled by the news that corrupt WaMu mortgage counselors who can do next to nothing other than start their car, turn on their TV, and jive one fraudulent financial abstraction into another fraudulent financial abstraction are going from $125,000 a year to $66,000 a year.

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