Job Stablity Versus Savings

In terms of the economic recovery and how people feel about the economy, does the ability to keep a good job, and have a good expectation that it will be a long-term job mean more than having a higher income and saving more money? But, that higher income job might not be there 6 months from now, and you are only able to save a year or two of expenses before you are broke and poor...

How long could you last if you had to cover the mortgage, property taxes, utilities, health insurance, car insurance, and all the other bills you might have if you didn't have a steady income just on your savings? Would you see your savings dwindling and get freaked out?

Compare that to a job like a teacher or dentist who knows pretty much what their income will be for the next decade. Once they get the job, they know they will have the job for as long as they want to work. With this type of job security, they could save up for a nice vacation, a car they can take a car loan out on, and a house that is great.

As to the broader economy and recovery, do we worry that this type of crash might happen again? That it is still happening in Spain and Greece, so it is possible to happen here since not too much has changed except for the $7 trillion more in debt that we are and the increased debt payments that our taxes go towards? That 'Main Street' isn't seeing the same types of income raises and employment numbers that it would like to see? That it is still hard to find a 'good' job with benefits, even though I don't know if that is true or not. If you could easily find a new job in one month, you wouldn't have to worry so much about going through your savings. Wouldn't that make people more encouraged by the recovery?

 

OK, teachers used to be a good example.

 

I've been laid off by both IBM (30 yrs) and AT&T (5 yrs). In my personal opinion, job security no longer exists.

 

excuse my ignorance, but whats an FTE?

i guess things depend on where you are in your life. as a single person, i wouldnt have cared, and would have wanted a higher salary at the expense of the risk of job security.

as a married person, job security became more important for me and i was looking for a long term role.

but now with 2 kids, i'm willing to take a risk and start my own business so that i can provide for my kids something that i couldnt otherwise provide if i was in a cruisy/safe job.

risk vs reward. take a choice.

 

The market is changing. In the past more so than now, the trade-off of security to income was difficult. Security has little value in today's market place. I encourage people I know to consider themselves "free agents". An easy comparison is with the movie industry. Get the job knowing it won't last, get the best deal possible, build lasting relationships while on the job, enjoy the final product and move on to the next project. If there is a sequel, great!

Think of what is happening to the parent company of Blackberry, in the news today. Who would have thought that when President Obama said they would have to pry his Blackberry from his hand about 5 years ago, the company would be on the brink of being out of business! Same could be true of almost any company in the next 5 years.

 

There's no such thing as true stability anymore, at least to the old standards from the 60's-70's of 1 job then retirement - anyone who thinks that is in for a very painful awakening.

My husband and I are currently a mixed household - I am working a traditional job as W2 employee, for the precise reason that we know we have a paycheck coming in on X days. My husband is self employed, and it is the hardest thing ever. When it pays off, the rewards are great and the money he brings in is great. However, he is busting his butt EVERY SINGLE DAY and there are factors beyond his control, including seasonal lulls. It takes its toll on people, especially relationships. We feel it is a worthwhile risk though, because long term we hope to build it up to bigger point. He's been self employed full time for 2.5 years.

 

I compete with an army of folks in India and elsewhere that will work for 20% of what I make. You can hire 3 folks in India to replace me and pocket the difference. Or you can hire someone that works the same hours that you do, speaks English as a primary language, will stay around longer than the training period, and has a US work ethic.

It feels like a pendulum that swings both ways. I've been outsourced twice now, yet I'm back where I started. Obviously, IBM feels I'm worth what they are paying; on the other hand, I am a contractor, this time around, rather than an employee.

 

I know every situation is different, I am not making a judgement on how others do things. I just share my experience.

In 1999, my wife and I risked all our savings to buy a business. I was going to leave my corporate job, she was going to keep hers, I was going to run the business. Then before we even got started a change in plans. She would leave her job and I would leave mine. We looked at each other and decided we were going to be "all in" or nothing. If we failed it would be as a team and if we made it, it would be as a team. During bad times and good, she was there. She could see what we needed to make the business a success. She could see what the sacrifices were for. She could see when things started to turn. And given her personality compared to mine, we were better as a team. I would not do it any different in hindsight. I trusted her like I could trust no other, and I thing she would say the same about me. I can not imagine what the pressures would have been, if she was not involved.

 

I always felt I had a fairly high level of job security, but I entered the workforce at a different time. When I started public interest work in the 80s, there was so much federal grant money and foundation money available that one just went from grant to grant with no worries. And, the public interest group subculture within the non-profit community is so incestuous, it was easy to move from organization to organization (and move up) if one had any credibility at all.

Before the funding dried up by the late 90s and going into turn of the century (makes me sound really old), experience took over and I had opportunities to move from grant-funded to more secure organizationally funded positions and experience took over and by then, much like rogue, I feel like I was a proven commodity. We laid off a number of staff just a month ago, but I never felt threatened given that I know the value I bring to the organization both in terms of revenue and programs.

And through it all, I saved, with matching funds from the organization(s) going towards retirement. I never expected to get rich, but I could quit tomorrow and live comfortably until retirement age, but I would be bored to death.

I know that those just entering the workforce today or those early in their careers are dealing with a much more difficult scenario.

 

But, I think security does have a value in today's economy. And I would argue that the lack of security is one of the reasons people don't feel good about this current economy, and why people aren't willing to use loans to buy vehicles, remodel homes, or be able to take a long vacation.

I will agree that it isn't all on the employee side of the board. Lots of companies are having a hard time surviving, and there is no job security if your business or employer fails.

 

I agree. I think the value has diminished. There are two sides, I would love to have security and I would give up X for it, but you need the otherside someone who wants X and can provide the security. We have fewer willing to exchange security for X and fewer who can even offer security. The potential problem for many people is that they may enter into a situation where they think they are in a fair exchange of giving up X for security only to find the other party could not really offer any security - they end up sacrificing X and not getting security.

There needs to be a paradigm shift in the way people look at this. Once the sift occurs we will be back on track.

 

Ace...you know what just might provide security for a young person new to the workforce?

Heath insurance! Now that affordable insurance is available for those young workers who might still be looking for a job or in a job w/o insurance. Or those young workers, some maybe just starting a family, and have insurance provided by employer and will know that they and their spouse or future kids will never be excluded because of a pre-existing condition and will never face bankruptcy as a result of a medical catastrophe with lifetime limits now prohibited.

The health care paradigm shift as a result of the ACA!

 

Yes, there does need to be a different way of thinking about it, but that is what I am going through right now. I have worked 10 straight years and if I lost my job, I would be able to cover 3-4 years of expenses until I am right back to where I was before I started working, except with a few more toys.

Now, if I was able to sell my house and not have to worry about a mortgage payment, city taxes, HOA fees, and utilities...I might be able to survive a little longer, but I don't think I could make it to retirement like that, nor would I want to have to rent a place once I am that old for the rest of my life.

What doesn't exist is a $20,000 house that doesn't take much to heat or cool it. The paradigm shift isn't just going to happen on the worker side, it will need to happen on the livability side as well. Monthly fees and borrowing large amounts of money are the killer.

*I thought of some positions that offer more stability yesterday. Jobs like firemen and paramedics would be stressful while at work, yet if you can perform at the level needed, then there probably aren't too many layoffs and downsizing events occurring.

 

Under Obamacare some people can get health insurance for about $100/month. In many areas they could get health insurance for about $100/month before obamacare. Under Obamacare the $100 plan in many areas has very restrictive healthcare options - this had to be done to keep the cost down. In many situations an arbitrary cutoff means a small difference in income can be a large difference in out of pocket cost. In order for older people under Obamacare to have guaranteed insurability and affordable premiums, young people have to subsidize the costs. There are better ways to address healthcare reform.
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A growing, healthy business would love to hire you and people like you. A growing healthy, business in a stable and predictable economy would want to keep you and people like you employed and pay accordingly. As you have suffered so has many businesses. A business has to operate in a very competitive environment, often where customers will go else where to save a few pennies - business operates with less security as well. Regulations are often stifling - everyone telling a business owner how to run their business - everyone assuming a business is a bottomless pit of money. Sure, you don't want to hear about the difficulties of business owners - but many are suffering as you have or worse.