“Hi, nice to meet you! What do you do for a living? Oh, that sounds nice. How much does a job like that pay? Do you get a pension? Are you invested in the stock market? You are? Great! What mutual funds and stocks do you own? What, you’re not diversified? Let me tell you what you need to do!”
You may draw the conclusion that he was a stockbroker or an arrogant hedge fund guy (although, that wasn’t a thing back then). On the contrary, he was a school teacher in Bedford-Stuyvesant, Brooklyn, New York—at a time when it was dangerously crime-ridden, poverty-stricken and uninfested with hipsters. To put my fairly worthless psychology degree to use, I believe he asked these questions because he was a very friendly person and truly interested in people. He might have also thought—as a teacher—he was substantially underpaid compared to everyone else.
Fast forward to decades later, I’m literally asking the same questions as an executive recruiter. I talk about salaries, bonuses, stock awards, options, benefits and all types of money-related matters. Some people are comfortable sharing this information, while other are very guarded.
Recent articles reported that, as part of an overall study of salaries of their employees, Google found it was paying men less than women working in similar roles in 2018. The results were in stark contrast to what management expected to find. This leads me to question why we have an obsession of secrecy surrounding salaries and an avoidance of talking about our net worth. If corporations openly disclosed employee compensation, it would be an illuminating and instrumental tool to help people make better and more informed career decisions.
I have noticed that candidates will come to me and angrily claim that they are severely underpaid. As a person who speaks about salaries for a living, at times, I’ll advise a potential job seeker that they are either fairly or slightly overpaid compared to other people in comparable positions. Generally, they don’t believe me. There is very little opaqueness and transparency with respect to salaries. If you go onto various websites, in my opinion, their data is ridiculously inaccurate.
My humble suggestion is that companies should disclose all salaries, benefits, options, stock grants, vacation days and all other remuneration. It would shed direct light on what is really happening in the marketplace. Instead of thinking that there is a gender, race, religious and age disparity, we would know for certain one way or the other. You can compare person x to employee y in the same company, city or job to determine if there is a discrepancy. We can’t count on vague averages that you’ll find online. If you take Jeff Bezos, Mark Zuckerberg and 100 police officers, firemen and teachers, the data would reflect that the average person earns $100 million a year and has a net worth of over $2 billion. Similarly, a person working in Silicon Valley, California or Manhattan, New York would earn more than someone in a similar role in Detroit, Michigan or Des Moines, Iowa.
Openly available knowledge of salaries would offer much needed intelligence to employees to enable them to make important decisions regarding their careers. If people are overpaid, they’ll keep quiet and not make too many waves. If they are underpaid, they could speak up, talk with their boss and inquire as to why that is. You may erroneously believe that people at the high end in your industry earn a certain amount of money. If it comes to light that they earn far less, you may want to change your career goals. How many people tell their children to become doctors or lawyers? If the parents and college kids knew the real numbers, they could make much more informed career decisions. Think of how broken our system is when we make young people take out hundreds of thousands of dollars in student loans, commit to four years of college and more debt in graduate school—only to learn that they can never earn enough in their field to justify the costs and time commitments.
If you go out to dinner or for some drinks with close friends, after an hour, you’ll know all the intimate details of their love lives, issues with their children, how many times they go to the bathroom at night and how sexy they find their spouse’s sister or brother. However, when the conversation turns to money, everyone becomes quiet. The only one who brags is the person you feel is over-exaggerating to simply impress the group.
Instead of coveting the lavish lifestyles that your friends and family portray on Instagram or Facebook, you’d now know that they are living far beyond their means—and you won’t feel that you’re missing out.
If we can get past this so-called taboo of discussing money, we’d all benefit. It would open the door to more real and honest conversations about saving for the future and having sufficient funds for retirement and other commitments. Decisions to pursue a career, switch jobs, major in certain subjects in college or moving to other states could be based on real hard data instead of just hoping for the best.