Fair Questions: Why Pay For Stress?

A question I have been considering recently as I have been searching for steady employment after graduating with my second degree is: how much money will I need to be offered to be able to accept any particular stressful job?

The answer is of course that it depends on the type of stress, its duration, and what my financial needs are at the time.  We all seem to intuitively grasp that some jobs should pay better than other jobs based on their nature, but at the same time many of us have egalitarian intuitions that would seem to thwart currently accepted pay differentials in some cases.

When I decide what level of pay I would accept for a particular position, there are a few questions I ask.  What is the cost of living in the area?  How much more money beyond the cost of living do I need to pay back student loans relatively quickly?  Does the weather in the area create additional stresses for me?  How many people would I be responsible for and accountable to?  How many hours would I need to work to accomplish the job duties?  Is there a gym nearby where I can relieve stress after work?  Is there a church in the area where I can go to refocus my life when stress at work seems to be weighing on me heavily?

These aren’t the only questions I would ask, but the basic idea here is that the benefits of the job have to at least match the costs.  While most people aren’t spectacularly rational, most people still perform a cost/benefit analysis on an intuitive level when deciding on a job.  Granted, that analysis is often sloppy and people often find themselves later regretting that they agreed to take on a particular job.  And even if we are careful and methodical in our analysis, there are simply too many factors to control for in life and unexpected events can change our cost/benefit ratio very quickly.

So why should companies pay us more money for taking on more stress?  How does it benefit them to pay us more just to alleviate our stresses?

Some companies don’t believe that it does benefit them, and they try to minimize their labor costs by finding more impoverished areas in which people are willing to take jobs for very low wages out of desperation.  When the desperate folks take the job, they typically want it because they believe that it will relieve certain kinds of stresses in their lives (i.e. poverty and the many stresses that flow from it).

Then as they become more familiar with the job, they realize that the wages don’t match the job duties and that they are seriously underpaid relative to the pay of others in similar positions elsewhere.  And by this point, they often feel that they have enough marketable skills and work history that they can get a similar job that does provide better pay.  And the more hardworking and talented employees often can in fact do this, leaving the company in a position in which they have to try to find more people to hire who are desperate for employment.

And as the business continues this cycle of routine turnover, they gradually deplete the pool of decent employees in the surrounding area until the people who are trying to run the business can’t help but fail.  Then of course they can take the money they saved in labor costs and move their facility elsewhere to start the process again.

On the other hand, there are other companies who do believe that it benefits them to pay their employees for greater stress, and this belief is quite rational.  People can only handle so much stress, and if you want them to be able to handle a great deal of stress at work, it behooves you to make sure they don’t have stress from poverty.

Employees under high stress from poverty and the difficulties at home that flow from it tend to be distracted with other worries at work and make more mistakes as a result.  They tend to have a lower tolerance for high workloads at their jobs.  They tend to have less emotional strength to deal with interpersonal issues in the workplace that foster effective teamwork.  They tend to be less able to manage reliable transportation to and from work.

All of these things cost productivity and efficiency for your business, and on top of this people tend to be more likely to leave the job fairly quickly after being hired instead of staying for 10 or more years, costing time and effort to replace them at minimum and often resulting in a lack of high quality service provided by a business with experienced and stable employees.

Ultimately, businesses are well served to pay higher wages for the amount of stress their employee will undergo because the alternative is paying for that stress in lost productivity and long term inefficiencies.

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One Response to Fair Questions: Why Pay For Stress?

  1. Pingback: The Problem with Problem-Solving: Collaborative or Systematic? | Isorropia

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