would YOU take a pay cut?

El obrero
In discussing contract consulting rates with two recruiters in the past, I was forced to face an interesting question – is a recession the time we should be willing to accept reduced rates (or salaries)? Can you justify making 66.67% of what you once made, just to keep making money?  Or is it better to grit your teeth and keep searching for – at least – pay equal to your previous position?

This question first of all depends on whether you’re in a position to weather a long downturn. If you’re living paycheck-to-paycheck, this question is answered with a resounding “yes.”  If you have some money set aside, you may be able to hold out longer for a better rate.

But what about taking that lower rate when you move on to the next job? Do you think the excuse that “it was just a filler” or “I just needed to keep working” will work to explain the pay cut to the NEXT company you work for?  Do you think the next company will bump you back up?

And what about titles, or responsibilities? Does it appeal to you to work your way back up the line?  For most people it is not desirable if avoidable.  Nobody wants to be the 40-year old supervised by a 23-year old.  No-one.

It’s not always easy. I know plenty of people who, for one reason or another, have had to make the decision to scale back in their careers, either salary-wise or responsibility-wise (or both).  People do it out of fear or desperation or sometimes simply out of a desire to work, no matter what the level.  It’s admirable if it’s done out of a position of self-confidence or honor, and heartbreaking if it’s done out of desperation.

Many people may see this as an analytical question:  should you accept an X% reduction in pay during economic hard times? I think this is a question that can only be answered by the individual in each case – what is your balance of pride versus need to work versus will to work?  Can you be effective knowing you’re working as hard (or harder) for less?  Can you make do? In the end, it’s not something a career blog or a coach can help you with; you need to know whether you can handle the reduction, and live with the consequences.

photo credit: Libertinus

  • http://www.bravenewlife.com Brave New Life

    I think it’s a product of (1) your self-perceived worth and (2) your short-term need of money.

    For instance, if I think my work in a certain field is worth $50/hour, and I’m not desperate for money – then I probably won’t accept $30/hour. On the other hand, if I make $50 but consider myself worth less, I’ll take less. Or… if I think I’m worth $50 but need to feed my family, I’ll take what I can get.

  • http://thismansjournal.com/ Darcy

    Well 66% income is always better than 0% income. It doesn’t have to be permanent choice and it’s an opportunity to get back to doing what you enjoyed. That’s your pitch if asked why your looking for a lower position. I have an associated that was a programmer, loved it, got promoted to management, hated it, went back to programming and loved it again.

    The only time I’ve had an issue working for someone younger was at a company where I contracted as acting department head, came back a year later in a reduced role, and reported to a guy who use to report to me. It was akward for both of us. My advice if you are looking at taking a percieved demotion don’t do it at the same company.

  • Chad

    It is a very very very bad decision to take less, as it will be almost impossible to make one 33% jump back to your old salary when things get “good” again (Who determines when things are good again?). You will basically be screwing the rest of your life.

    In my current situation I would give an emphatic “no”, and tell them where they can stick it.