the big present I gave my first employer

Note: this post was directly inspired by some of the comments on yesterday’s post.

When I was a young fellow, fresh out of accounting MBA school, I had a prestigious job working for one of the (at the time) six biggest accounting firms in the world. It was a small office, but it was the second biggest of the six in the city I lived in at the time. It was a well-respected firm and I was lauded by my school, friends, family and peers for landing a position there.

If you aren’t familiar with the work-life structure of the big accounting firms, a little background is in order. I’ll refer to them as the Big 4 (today there are four – during my professional career one has disappeared – Andersen – and two have merged). In the Big 4, the corporate culture is up-or-out. What does that mean? Nobody remains in static positions. There are three basic levels: staff, manager and partner. Staff and managers have a number of subdivisions, but a new joiner will progress, inevitably from junior staff to senior staff to junior manager to senior manager to junior partner to senior partner. You either get promoted on schedule or you are pressured to leave… or fired.

Everyone works hard in the Big 4. I have worked until 6 am, showered and gone back to work. I have worked week after week, 12-14 hour days every day including Saturdays and Sundays. The deadlines are unmissable and the pressure is enormous. The staff and seniors are typically devoted to no more than a few clients at once, and they have very little discretion in which clients and which areas they work. Managers have more latitude, but typically take on far more responsibility. They are responsible for training, mentoring, reviewing and organizing the staff on the project, and at the same time they must manage the clients’ expectations, pursue collections and billings and meet firm expectations on landing new business. Partners’ responsibilities are intense; mistakes on their part can destroy the firm. They must be technically proficient in accounting principles, “rainmakers” and office leaders. The days of the cheerfully drunk partner who shows up for golf and cocktails are long, long gone.

Staff and managers work exceptionally hard, though. I had a decent salary compared to my peers but I also worked 100 hour work weeks. My hourly wage was approximately $9 per hour as a staff person. Babysitters in New Jersey typically demand a minimum of $10 per hour. By the time I was a manager things weren’t much better – when I jumped to private industry I received a huge pay raise for nothing other than getting out of the grind. Had I stayed until I was a partner, I would have received a partnership income in the (I guess, depending on the market and a million variables) range of a quarter million per year. Retirement at 50 would have been achievable with a partner’s pension. I always knew I didn’t want to stick around to make partner. My intention was to stay two years then bolt – but then I stayed another – and another – and the next thing you knew I realized I was facing a big choice.

So what’s the point, Steve?

The Big 4 payoff is like a lottery. You make partner, you get rewarded for those awful hours and those long busy seasons. If you leave before then, you have been suckered. You gave up a lot of hours at minimum wage to build someone else’s firm; someone else’s client relationships; someone else’s partnership share. I spent years toiling at an awful salary to strengthen my firm and enrich the partners.

Don’t work like this for an employer.

I regret those hours now. I have a good consulting gig, don’t get me wrong. Leaving at 6 pm is a late day for me. I have few responsibilities and very little pressure. But if I had taken my 20s and poured those 100 hour work weeks into my own business, or even a small firm where I could have shared in the growth, I would have benefited enormously – more than just having a six-figure salary. I do have a fearsome resume to show for it; people in my field generally know what it means to have been in the offices and firms and fields and industries I was in, and it makes a difference in landing consulting jobs now. But I built no assets for me.

So the point is this: if you are working insane hours, stop and figure out your hourly wage. Stop and ask yourself: if I quit today, or I quit 3 years from now, will my resume look much different? Am I building something for someone else or for myself? It may be that you’re happy with your position as an employee – but if you’re working past the 9 to 5, you’re donating your irreplacable time – YOUR LIFE - to your employer, free of charge. That’s an awful nice present. Think about whether you’re happy giving it. You could probably spend a lot of those spare hours – which can never be replaced – doing a lot of things for yourself.

  • zeromoney

    I couldn’t agree more, I’m in my late 20′s and held one position for a year with a small start up company that demanded a lot of extra hours, and always on call. I didn’t receive any kickback for it at all, or even shares in the company until I quit, at which point they realized they needed me and tried to buy me out. Now I work an 8:00-4:30 job and couldn’t be happier, I play golf after work, or get home and enjoy the afternoon sun. Money isn’t everything, work to live, not live to work :).

  • http://www.moneysmartsblog.com/ Four Pillars

    Excellent advice Steve.

    I used to put in a lot of hours in my job which was more from my own pressure rather than the company. I did get some benefits from it but after a while I realized that I get paid more or less the same for working 9-5.

    I also moved to a new division of my company several years ago – it was kind of a “start up” – worked my ass off for a year and then they shut it down. That was my wake-up call that working hard for a big employer is a waste of time.

    If you want to work hard at something then either work for yourself or work on something you enjoy.

    Mike

  • http://hunternuttall.com/ Hunter Nuttall

    That’s an awful situation to be in…leave and admit that you wasted a chunk of your life, or keep hating it and hope it pays off someday. I’ve never had it as bad as you described here, but many times I’ve wondered what I was working for. It’s important to know.

    • http://www.bripblap.com Steve (Brip Blap)

      @Hunter: I don’t know if I would say “wasted” on some reflection. Maybe “should’ve scaled back.” As I said to Retired Syd, I should’ve learned that I didn’t need to be billable-hours-champ. I could’ve done without the face time and 8 pm meetings and probably still ended up as a faceless manager in an office making an average manager’s wage. It’s not like when I left I was a superstar – I was a hard worker and I got a few “attaboys” but nobody said I was the next Jack Welch or anything. I could’ve tanked a few meetings late in the afternoon and still gotten the work done.

      But you’ve got a point worth repeating: know WHY you are doing what you are doing. Even if you hate it, if it’s getting you to a goal you want it’s worth it. Suffering “just ’cause” is a bad, bad idea.

  • Curmudgeon

    Good stuff, Steve. I will say that I lacked the entreprenurial culture and experience in my 20s to make a go of my own business. For the last 15 years, my alternative income stream from my LLC has grossed between $20K-$60K a year, but I’ve always lacked that “high-wire” attitude that could have provided the final push to make it my primary income source. Part of that, granted, is my spouse’s psychological need to have me grounded with an employer, but even without that I’m not sure I could have done it.

    The point is that the culture and outlook play a big role in your fitness to build your own business. You can overcome some of your culture, but there is a need to remain grounded in your roots, for better or worse.

    I will retire in my 50s from working for The Man, and my consulting LLC will provide me both mental stimulation and additional income to live well and enjoy it. Despite my personal limitations, it’s a plan that most of my friends look upon with envy (“A man’s got to know his limitations” – Dirty Harry).

    • http://www.bripblap.com Steve (Brip Blap)

      @Curmudgeon: You hit upon a key point: some people are entrepreneurs, some aren’t. I don’t think I am. I work well in my twilight zone as a consultant. I didn’t like having a “boss” but I’m OK with having a client. At the same time I have yet to feel the desire to strike out on my own and hire staff and start my own consulting firm. It doesn’t sound like fun to me. One of these days I may thwap myself in the head and do it, but it’s hard to imagine today. But you’re completely right – culture and outlook are critical moreso than opportunity. An entrepreneur will out, I think.

  • http://retiredsyd.typepad.com Retired Syd

    Wow, that really brought me back (and not in a good way!) I too, did my time at a “Big 8″– yes, back when there were 8. Not only was it grueling, I found the structure to be demoralizing.

    Having said that, in the end, it was totally worth it. It gave me the experience to land my next job, which was a million times better in environment, pay, and self-esteem.

    And all of this brought me where I am today, retired at 44. Thank you Arthur Andersen!

    • http://www.bripblap.com Steve (Brip Blap)

      @Retired Syd: There are definitely benefits to working in a high-pressure environment like the Big 12/8/6/4/2/1 :). As I mentioned, most employers since then have assumed that I proved myself in the crucible and they don’t even worry about my work ethic – they know it was forged in the fires of Hell (how’s that for melodrama). I just wish sometimes that when I knew I was done I had cut back. I worked like a fiend up until the day I left, instead of scaling back. What did it get me? Nothing. We used to make fun of a fellow manager who cut out at 5 pm every day – we said he was a slacker, he was always low-rated, he never got good jobs. But you know what? He got paid 90% of what I did and he left at 5 pm instead of 10 pm every day.

      I loved my staff in the Big 6. I genuinely enjoyed some of my clients. I detested the partners and like you the structure repelled me. So on balance, I could’ve done without it, but my career might have been the worse had I not been there. So who knows?

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  • http://paradigmshifted.org/ deepali

    Glad I work in non-profit!

  • http://www.fathersez.com/ fathersez

    I have to agree with Retired Syd. Yes, the work hours are painfully long, and personal life takes a back seat. But the exposure and the networking opportunities are some of the best you can get at that stage of our lives.

    I have encouraged my daughter to seek jobs in the Big 12 – 1 (as you have said) though I do have a parent’s concern over the long hours.

    I’ll pass over this post to my girl. I think you have pointed out the downside in a very practical way. And I am sure the comments will keep coming. These will be useful for her to know.

  • http://www.thewisdomjournal.com Ron@TheWisdomJournal

    When you calculate your hourly salary, be sure and include the Social Security your employer pays, and the worker’s comp and the payroll taxes and the insurance and the retirement benefits. It adds up. When I talk to an employee who wants to go out on their own, I always show them what we pay as his employer. Usually you can add 60% or more of his salary BACK as the benefits he receives. It’s quite shocking.

    My hours that I work aren’t too bad but they vary from week to week. If I’m out of town, they may be very high (70+) or they may be very low (35). It all depends on what I’m working on.

    But, like you, I think constantly about the number of hours I put in and wish they were in my own business.

  • KM

    This post really hits home for me, as I have been working for one of the Big 4 firms for almost two years now. While I have been pretty lucky as far as not having to work very late (the latest I’ve had to work was 7:30…once), even working until 6-6:30 every night gets old pretty fast. When I first started, I thought I definitely wanted to stick it out until I made Manager, but now I honestly don’t know. I have been seriously contemplating starting my own small CPA firm lately, but I’m not sure I have enough experience yet to do so. Either way, I know I do not want to make Partner. I just need to figure out what I really want to spend my time doing. Thanks for the post. It really made me reflect on my current situation, and brought out feelings I have had for the past few months now.

  • http://www.thewriterscoin.com Writer’s Coin

    That’s a great story Brip. I always feel a little guilty that I’m not working crazy hours and crazy days but this makes me feel a lot better. As long as I’m using my time wisely to pursue other ventures.

  • http://cashmoneylife.com Patrick

    Steve, I know exactly what you mean. I just resigned from my position because I was working only for my employer and not doing anything that would benefit me. My position was extremely profitable for my employer. Despite multiple requests, they had no reason to want to move me to another position within our company so I finally left. My new job has a lot more opportunity for growth. Yes, I am still making another company a lot of money and will never reach the level of partner where I will get the golden parachute when I leave, but at least I have great hours and I am building skills I can take with me when I leave.

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  • http://earlyretirementextreme.com Early Retirement Extreme

    Academic research is fairly similar although I suspect it pays less (the hours are the same). The pressure is more indirect. It’s up or out as well, but not in the sense that one gets fired, but rather than one does not get rehired into yet another temporary position. The competition is due to each professor essentially training 10 potential replacements which then get to fight each other for his seat when he finally retires. In general each new position feels much like another chance to play the lottery from grad student to postdoc to second postdoc to untenured professor and then finally to tenured professor around age 40. The liberal arts may substitute postdoc for adjunct which is a somewhat worse position to be in. Approximately half fall off at each iteration. At the top sits the tenured professors enjoying the fruits of the labor while lamenting the fun they had while they were on the bench. Ah, the irony of it all.

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