Tuesday, July 27, 2010
In periods of economic distress, can workers get back to their old salary levels?
I took pay cuts twice in my career. In 1981, I was making about $36000 as a systems analyst in Dallas for a Blue Cross / Blue Shield consortium, which was falling apart. I resigned before the end came, and took a salary of $28000 at Chilton as a programmer/analyst with COBOL and learning ALC (in a DATACOM/DB/DC environment). By 1988, when the company was being sold to TRW and I was leaving again to go back East, my salary had risen to $43000. I took a job at $40000 in Washington DC, got no raise when I moved with a lateral sale of a small consulting business to Lewin/ICF, and then took a $40000 at USLICO, which would eventually morph to ReliaStar and then ING. When I got laid off and forced to “retire” at the end of 2001 at age 58, my salary was about $72000 (including the effect of a transfer to Minneapolis). With bonuses, somehow, unemployment based my benefits on it’s being $83000 in Minnesota.
Salary compounding with annual raises can recover an income level pretty quickly. The problem is getting the stability it needs to get the raises.