Wednesday, December 11, 2013

Low Level Employees Are Only Worth 1/847th of an Executive

The math is in and it appears that entry level, low level employees at various corporations are only 1/847th the value of corporate executives.

After spitting out illegitimate children, majoring in stupid shit, expecting the world to pay for them, and in general making bad decisions all around, their productive capacity as measured by the labor market shows them to produce a meager .001 of economic value that their better educated, harder working counterparts do.  

Efforts have been made to increase the productive capacity of society's lowest class so that they too may be able to tell what the difference is between a debit or credit is, why you shouldn't breed before you're 20, and how learning basic math skills is required to make it out of poverty.  But despite trillions of dollars spent on the public education system, all it seems to have done is brainwash people into a entitlement mentality and enrich a class of education majors.  There still (amazingly) seems to be some genuinely stupid (or lazy) people in the country who will never ever manage the intellectual or tradesmanship muster to produce more than 1/10th of one penny the production for every dollar their executive counterparts have.

End Sarcarm...though only slightly

Let me ask you people this.

Why is it we look at corporate executive pay as a multiple of the lowest paid employee as some kind of measure of overpayment to the executive?

What if we did it in reverse?  What if we took the logical opposite and applied that rule?

If an executive makes 847 times more than the lowest paid employee, if labor markets are efficient, then by default doesn't that mean the lowest paid employee is only 1 847th as productive?

What if we, with the same hatred, vitriol, envy, and bigotry the left has, skewed the lower classes claiming they're only

1/847th as productive?
1/847th as smart?
1/847th as hard working?

Oh, don't get me wrong.  You don't have to convince me that most corporeate executives get there through non-meritorious means (look it up), but you can't simply say this disparity between CEO and entry level pay is solely because of "big bad meanie" executives.  I would say the majority of it has to do with why entry level people are making as little as they are.

In other words, the single dad, who didn't graduate from high school, who works at the local McDonald's and can basic subtraction and addition, does not compare to the CEO who has her MBA, CFA, CPA, can balance books and knows how to interpret statistical marketing reports and knocks out 80 hours a week.  And you can let your emotions and ideology get in the way, but it doesn't matter.  That is why CEO and executives make more than the noobs.  They're older, they have experience, and they busted their asses off.

Now you can get mad about this.  You can go ahead and protest, but you know what's great? 

Let's say you get your little $15 an hour.

Let's say the minimum wage goes up to $10/hour.


Yep, robots.

You see, you're so unskilled that you're only about $3/hour a way from being replaced by robots.  Yes, they are complex, yes they are advanced, but you know something?

They shut the ef up and do their job.  They're never late, they never "um oh, like, yeah, I'm um sick" and they don't breed illegitimate children, let alone get an entitlement complex.  So much so they can replace you.

Don't like that?


That's reality and I'm trying to help you realize that rather than kiss your ass like Obama or Oprah.

So it's up to you kiddies.  Do you want to whine and complain only to be replaced by robots (or in other cases, illegal aliens) OR do you want to go to school for a real reason, stop making stupid decisions, and only have to work at McDonald's to make ends meet until you're on to bigger and better things?

Oh, that's right.  YOu'd have to try.

Best to sit there and wallow in your pity and envy and do nothing.


therock said...

One of the contributing factors in the CEO hate is the big rewards they get for failing hard. If the buck stops with you and your company does well, you should be absolutely compensated with respect to that fact. However, if a 10 year old with ADHD could do the same lousy job as you do as your firm swan dives to shit, then walking out with millions isn't exactly good, either from a market signal standpoint or an ethical one. ( not that I expect much)

Anonymous said...

This is already happening Cap. Applebee's is eliminating their wait staff with actual tablets at all the tables.

Southern Man said...

Every rich person I know lives and breathes his profession every waking moment. They're ALWAYS at work. And the ones who are retired spend pretty much every waking moment mentoring, serving on boards and advisory committees, and giving their money to charity. Yeah for rich people! I'd join them if I weren't so damn lazy.

Jose said...

There are a lot of companies with highly paid executives that have a really low ratio, including many in the cathedral-related institutions. Surprisingly, they like this ratio.

Their secret: contracting.

The lowest paid worker in one of the big bad industrial concerns is probably someone stacking boxes in a warehouse. The lowest paid worker at McQuade Consulting is a first-year associate with a MBA and previous work experience; McQ contracts out all non-essential work, so the people making minimum wage don't count for the ratio. Ditto for many other cathedral institutions...

Funny how these things work.


dannyfrom504 said...

interestingly enough. my cousin's hubby was a manager at mcdonald's. made a VERY good living.

then he got a gig at harrah's. now he's a pit boss in the roller's suite.

if you sling burgers at mcdonalds and you strike, you should be fired. period.

Sean M. said...

"Every rich person I know lives and breathes his profession every waking moment. They're ALWAYS at work. And the ones who are retired spend pretty much every waking moment mentoring, serving on boards and advisory committees, and giving their money to charity. Yeah for rich people! I'd join them if I weren't so damn lazy."

Yep. True!

Anonymous said...

I was an engineering intern, designing life-saving medical devices (which required knowledge of control systems, feedback, laplace transforms, etc) and I was only making 15 per hour. Granted, the company was awesome and I was happy to work there, but if I had been paid $20/hr the company wouldn't have gone out of business.

NormalGuy said...

We're all expendable. Only loyalty to each other gives us any worth.

However, you cappy cap would say that slavery is beneficial because the business class gets to have lower expenses and more production; and if someone is willing to be a slave and another isn't, the person who is willing to be a slave is the better person.

Illegal aliens are exactly that, they're illegal in the country they're in. Hiring them, demotes the people who are citizens, it's the breaking of loyalty that gives people their worth.

Technology is another factor though. It's not so much laziness that is the problem that technology will wipe out but that it will either wipe out low IQ people or make them low level humans begging or being paid to live, it cannot be any other way.

If you cannot make a living and have a family by working a job, the job itself is useless for an adult, either give it to students or use technology. Any job that requires humans to operate needs to be paid at a living wage.

asdf said...

It is more likely that the vast middle of a company is producing most of the value, but that a lot of that is getting taken by executives. My guess is that the engineers at company produce more value then they are paid, and the difference between those figures is mostly hovered up by executives.

I can personally point to projects I've done that saved my companies millions, but I was only given a fraction of that. Pay is based on bargaining power, and bargaining power is only loosely based on productivity.

aerodawg said...

long ago i saw a study that showed that people in the upper two income quintiles worked an average of 50+ hours a week. those in the lower 2 quintiles averaged 30 hours a week

Pete Brewster said...

Yeah, well, Captain, for every CEO who worked hard to get where he is today (i.e the guy who started the company in the first place) you'll find ten with no more smarts or capacity for hard work than their subordinates, who got to the top by figuring out how to get other people to do their work for them while still taking the credit---and forcing others to take the blame and get shitcanned in their place when they fucked up.

See also: pretty much every female executive ever. Behind every such woman are the bodies of ten men she made do all her work and stabbed in the back by way of thanking them. to the radio said...

Actually, NormalGuy, slavery is economically unviable.
First, owning slaves costs money.
Even if they don't enjoy the same standard of living as the master, they still have to be housed and fed all the time.
You can't kill slaves when business goes south.
You can't lay them off.
You can sell them, but if everybody else is selling theirs, then maybe you can't.
Kinda like houses after the bubble burst.
Also, slavery discourages economic and technological innovation.
The system of slavery has it's own inertia.
Why should I look for a more efficient way to do things when I have slaves instead of employees?
And slaves last a lifetime, so it's very hard to shift gears and respond to market place innovations introduced by employer-employee based enterprises who are always looking for ways to beat the slave based economy.
The mistake that was made that caused the Civil War was the failure of the North to realize that their economic and technological innovation would eventually render the slave system uncompetitive and that it would collapse on it's own.

And as an aside, Democrats try to claim the first Republican President Abraham Lincoln as their own to disguise their own racist history.
What most people don't realize is that in addition to the Emancipation Proclamation, Lincoln also wanted to send all of them back to Africa.
That's why the country of Liberia was created.