Your Lifetime Earnings Are Decided in the First 10 Years of Your Career?(bloomberg.com)
bloomberg.com
Your Lifetime Earnings Are Decided in the First 10 Years of Your Career?
http://www.bloomberg.com/news/articles/2015-02-09/your-lifetime-earnings-are-decided-in-the-first-10-years-of-your-career
16 comments
I think the focus here should be that the escalator to steady job promotions and raises are over. There are too many who can't retire and those that are highly educated and underemployed. We should all be open to an entrepreneurial mindset as this data and others show that this is death of traditional career paths. I myself am drawn to the infinite upside and downside of entrepreneurship over the limited earning decided in the first 10 years of my career.
I like how in four days we went from "probably determined" ...
https://news.ycombinator.com/item?id=9031814
to "are decided."
https://news.ycombinator.com/item?id=9031814
to "are decided."
Yes. This headline is sad. To show that my lifetime earnings are "decided" in the first 10 years of my career, you would have to show a predictive model with an R-squared value of 1. That is not the case. If R-squared were very close to 1, you might say, that lifetime earnings are "highly influenced by" the first 10 years. The article does not even seem to indicate that. Instead, lifetime earnings appear to be "related to" income in the first 10 years. What is sad is that the mistake in the headline is off topic. Determination doesn't appear to be the point of the article. The point of the article appears to be that advantages that are visible in higher incomes at 25 play out, on average, as even larger income differences at 55. The point appears to be not that the system is determined, but that there are unequal advantages, one of which may be more disposable income.
We didn't. I've added a question mark to make that point.
Thanks for the link to the not-entirely-obvious dupe.
Thanks for the link to the not-entirely-obvious dupe.
I'm fascinated with the concept of moving up the corporate ladder. I went from a dotcom high growth company in 1999-2001 where the avg age was roughly 25 to a post dotcom company where the avg tenure was close to 25. I always wondered, why are some people CXOs by 45 while others are still "Lead X" or "Senior X" (aside from personal preference)?
I've observed a couple factors that seem to be important. Warning... some of the following my sound like the crap that frustrates you the most at your job.
Smarts really doesn't have anything to do with it. Sorry straight A students. Reality check time. Classes were basically useless for ascending the corporate ladder. You were duped. (For the record, my undergrad GPA was something like 3.7 so I was duped too).
High performers in the career ladder game are ruthless with their time. Sometimes it makes them seem like an ass but they're just focused on their end goal.
The high performers seem to be closer to the revenue. They're not always in sales, but they've been in roles that involve big picture deliverables. Or they were in sales.
They're picky about what they do. They don't say no, but they know how to distance themselves from petty, small, or insignificant busy work. They take care to manage their image as someone who works on a grander scale.
They plan their career path. It's not enough to simply work hard and hope it happens for them. They know how to create strategic projects and get themselves into a position to lead those initiatives.
Hard work is not enough. The high performers aren't just the hardest workers. Though they do tend to work very hard. Their hard work isn't always in the "doing" of the work at hand. Tbat type of hard work just gets you more work and maybe some corporate reward of $50 in perk buying gift cards. High performers see that and figure out what needs to be done to get to the nests level of management. Spoiler alert: it's. It the stuff in the job description.
Balance is not really an option. If you're not doing extra, someone else is. IF you're playing by the rules, someone else is figuring out the unwritten rules.
The rules to follow aren't the rules that are written down. If there's anything that's the most frustrating to those who try to advance but haven't cracked the code, this is it. The job description, the company policies, anything anyone tells you is a big deal... is only important to doing your job. It's not important to your career path. If you want your job to be doing your job, great. But if you want your job to be getting to the c-suite, figure out the rules of that game. Following the written job rules only gets you praise and silly perks.
It is a competition. If the ratio of employee-manager is 10:1, you have to beat out 9 others to be a manager. 50:1 for employee:director. 200:1 for employee to VP. 1000:1 for employee:CXO. You have to beat out 1000 others. I'm not saying all high performers are vicious, back stabbing sociopaths. But some are. Know how to deal with that. Be ruthless with your own time. Be supportive of others. Know which projects have visibility. Become someone who sends out the "we couldn't have done it without these people" email at the end of a big project.
If this all sounds like corporate, political bullshit to you, that's fine. It did to me too. But I watched people who were no smarter than me get promoted and I decided to figure out why. It turns out CXOs are hackers too. They hacked the career ladder. Good for them. I hacked my way to th CEOs chair too. I left my job and started a company.
I've observed a couple factors that seem to be important. Warning... some of the following my sound like the crap that frustrates you the most at your job.
Smarts really doesn't have anything to do with it. Sorry straight A students. Reality check time. Classes were basically useless for ascending the corporate ladder. You were duped. (For the record, my undergrad GPA was something like 3.7 so I was duped too).
High performers in the career ladder game are ruthless with their time. Sometimes it makes them seem like an ass but they're just focused on their end goal.
The high performers seem to be closer to the revenue. They're not always in sales, but they've been in roles that involve big picture deliverables. Or they were in sales.
They're picky about what they do. They don't say no, but they know how to distance themselves from petty, small, or insignificant busy work. They take care to manage their image as someone who works on a grander scale.
They plan their career path. It's not enough to simply work hard and hope it happens for them. They know how to create strategic projects and get themselves into a position to lead those initiatives.
Hard work is not enough. The high performers aren't just the hardest workers. Though they do tend to work very hard. Their hard work isn't always in the "doing" of the work at hand. Tbat type of hard work just gets you more work and maybe some corporate reward of $50 in perk buying gift cards. High performers see that and figure out what needs to be done to get to the nests level of management. Spoiler alert: it's. It the stuff in the job description.
Balance is not really an option. If you're not doing extra, someone else is. IF you're playing by the rules, someone else is figuring out the unwritten rules.
The rules to follow aren't the rules that are written down. If there's anything that's the most frustrating to those who try to advance but haven't cracked the code, this is it. The job description, the company policies, anything anyone tells you is a big deal... is only important to doing your job. It's not important to your career path. If you want your job to be doing your job, great. But if you want your job to be getting to the c-suite, figure out the rules of that game. Following the written job rules only gets you praise and silly perks.
It is a competition. If the ratio of employee-manager is 10:1, you have to beat out 9 others to be a manager. 50:1 for employee:director. 200:1 for employee to VP. 1000:1 for employee:CXO. You have to beat out 1000 others. I'm not saying all high performers are vicious, back stabbing sociopaths. But some are. Know how to deal with that. Be ruthless with your own time. Be supportive of others. Know which projects have visibility. Become someone who sends out the "we couldn't have done it without these people" email at the end of a big project.
If this all sounds like corporate, political bullshit to you, that's fine. It did to me too. But I watched people who were no smarter than me get promoted and I decided to figure out why. It turns out CXOs are hackers too. They hacked the career ladder. Good for them. I hacked my way to th CEOs chair too. I left my job and started a company.
I've been working in my career for about 4 years at this point, but everything you said resonates strongly with my experience so far. Thanks for sharing this.
Not entirely surprising, but disheartening news to those who didn't really get their careers on track right away. Here's hoping I'm an outlier, I guess.
Well here's one data point. I studied chemistry in undergrad and worked in various labs for about 6 years with a salary that left much to be desired. I've also programmed on the side for a few years during that time and eventually was able to make a switch into software as my full time job and I'm pretty happy with both what I do and my salary.
I think that, to a large degree, it's like any other learning curve. Unless you fight your way out of comfort zones, refuse to let the bozos upstairs define you and pigeonhole you, and change jobs as soon as you're at a dead end, you will plateau after 10 years, most likely... and be obsolete after 10 more. I don't think that it's inexorable, and I think that some (but sadly, not all) of the 45-55 income drop is voluntary (once the kids are through school, they downsize their houses, only have to pay 2 airfares instead of 4-5, and since they need less money, work less).
I could see this playing out for the employed, but I bet this doesn't really work for the self-employed or anyone who switched to business ownership from a career. I think I've made more in the past year than the first several years of my "career" (which was a pittance, I am no Rockefeller now..) and don't think this is unusual once you get traction based on some of the stories and income reports I've seen on HN.
"...that people who end up wealthy see a much steeper curve in their earnings than the rest of us."
So, people who earn more money, faster end up wealthy? Gee, I would never had expected that fucking obvious insight.
Also, studies show trends, averages, likely outcomes. They have little bearing on individuals. Otoh, if your planning economic policy for a corporation or country studies may be applicable.
So, people who earn more money, faster end up wealthy? Gee, I would never had expected that fucking obvious insight.
Also, studies show trends, averages, likely outcomes. They have little bearing on individuals. Otoh, if your planning economic policy for a corporation or country studies may be applicable.
Not really true. It's just a pattern. If you want it to be different then make it happen and be an outliner. The truth is these people just get stuck and accept. If this article applies to you and depresses you, then choose to be one of those people that is different.
This isn't really true of a tech worker that moves around and changes job titles frequently. If you want the market rate you have to go to the market. Not all careers have this luxury, but tech workers do.
"Tech worker" is too broad a brush. If you aren't good at web or mobile development, or living in a certain few hot areas, you don't really have this luxury either. Most tech workers do not fall into this category, and have to deal with massive corporate bureaucracies and acronym soup job reqs like everyone else.
Yeah you really do need both, the right skills and the right location, to gain upward mobility. That's not to say tech's like every other job even if you don't have upward mobility. You still don't have to fear getting let go, we had a IT help desk type guy get fired, took him all of a week to find another gig. His earning potential is capped, but it's still pretty nice compared to non-tech jobs.
While the 1 percent sees earnings grow nearly 1,500 percent over their lifetime...
This reference to "the 1 percent" is somewhat misleading. The evil of what we call "the 1 percent" (which is actually less than 1%) has to do with social connections and crony capitalism. They're talking about the top 1% as ranked by a metric they defined, which is income growth from age 25 to 55 (15.5x is the cutoff). Not the same set of people. You could have someone who earns $20k as a graduate student at 25, and $310k at 55 as a top software engineer... someone who actually worked to get where he is, and therefore the opposite of an asshole 1%er.
The asshole 1%-ers (the socially connected) probably don't all have 15x income growth from 25 to 55, because they start higher. They tend to make $300-500k around 25 and while some of them will be placed into CEO positions or PE firms by 55, there isn't enough room at that level (not even for them) and so a number of them will see (just like everyone else) only mediocre income growth. Upper-class, entitled types have an easy time getting half a million (in private equity and other nonproducing roles) by their late 20s... but many of them never make partner, stay around that level, and end up having lackluster careers compared to what you'd expected, had you met them in their 20s.
At any rate, this data is interesting but doesn't really establish the claim that "Your Lifetime Earnings Are Decided in the First 10 Years of Your Career". I happen to think that the claim is, sadly, true for many people... but these data don't really prove it.
This reference to "the 1 percent" is somewhat misleading. The evil of what we call "the 1 percent" (which is actually less than 1%) has to do with social connections and crony capitalism. They're talking about the top 1% as ranked by a metric they defined, which is income growth from age 25 to 55 (15.5x is the cutoff). Not the same set of people. You could have someone who earns $20k as a graduate student at 25, and $310k at 55 as a top software engineer... someone who actually worked to get where he is, and therefore the opposite of an asshole 1%er.
The asshole 1%-ers (the socially connected) probably don't all have 15x income growth from 25 to 55, because they start higher. They tend to make $300-500k around 25 and while some of them will be placed into CEO positions or PE firms by 55, there isn't enough room at that level (not even for them) and so a number of them will see (just like everyone else) only mediocre income growth. Upper-class, entitled types have an easy time getting half a million (in private equity and other nonproducing roles) by their late 20s... but many of them never make partner, stay around that level, and end up having lackluster careers compared to what you'd expected, had you met them in their 20s.
At any rate, this data is interesting but doesn't really establish the claim that "Your Lifetime Earnings Are Decided in the First 10 Years of Your Career". I happen to think that the claim is, sadly, true for many people... but these data don't really prove it.