The Pongo Blog
Poll: Would You Take a Salary Cut with a New Job?
February 07, 2011 (4:15PM) by Rick Saia, CPRW
Two years ago, I ran a post with a poll question that asked readers if they've ever taken a salary cut with a new job. It was a timely issue since we were still in a recession and unemployed job seekers were more likely to settle for something less in their paychecks just to work again.
Things have changed a bit since, but anytime is a good time to address the issue and ask the poll question again. For many, the thought of accepting a job that pays less money than they made before is repulsive, especially if their lifestyle is, shall we say, a bit on the extravagant side.
But there are times when you might have to swallow your pride and take a hit in the wallet. Here are five situations in which accepting a job with a salary cut might be a wise decision:
- You're unemployed, your benefits are running out, and you need a job to avoid financial disaster.
- You've been unemployed for awhile (say, six months or longer) and you don't mind a salary cut because you've learned how to live on less.
- Your chances of moving up are better with a new employer, even if it means taking a step or two back in your career path before you move forward.
- You loathe your current job, so you take one that pays less to save your health and sanity.
- Your new employer offers a smaller salary but pays for more of your benefits, giving you only a slight reduction (or maybe even a slight gain) in overall compensation.
You may find it difficult to accept a lower salary offer, but it may be a good move. To make the decision easier, it's important to know the salary range for the positions you're seeking, as well as trends in the economy and your industry to help shape your salary expectations.
Would you take a salary cut with a new job? Take our poll and add a comment.
[poll:39]
RELATED LINKS
Why Do Employers Want to Know Your Salary History?
3 Ways to Address Salary in Your Cover Letter
How Do You Handle the Salary Question?
Where I live, $8.00 - $9.00 per hour is considered a "good" wage. Rent or house payments are $800.00 -$1,200.00 per month. How can a person even live on a wage like that?!
Posted by: Rebecca | February 11, 2011 at 9:01 PM | Quote This Comment
I lost my job in 2009 and took a $15,000 pay cut when I took another job...I was just so grateful to be working and to have a job, so I jumped at it! I also was at my previous job for over 20 yrs so I expected a cut. Now I find myself out of work again....now I am forcing myself to consider jobs that are paying just above minimum wage, which is over HALF of my previous pay cut. This is a tough economy....the difficult part is, I want a job that I am going to be happy at and excel....
Posted by: Tammy Burgmeier | February 11, 2011 at 10:57 PM | Quote This Comment
I answered yes to more than 10%. I have been out of work since 6/2009. I was now (Feb 4, 2011) just offered a job at $7.25 per hour. For me this is a 32.61% pay cut. I was told right up front that this would be the starting wage and would this be okay with me. I said, YES!! It was $2.20 more an hour than unemployment for a 20 hour work week! You can not let your ego get in the way of making ends meat. In these really tough times you have to accept what ever offers come your way. At least you will have your foot in the door. I was always taught that some thing is better than nothing....
Posted by: M.A.B. | February 12, 2011 at 8:49 AM | Quote This Comment
You're absolutely right. All of you. I totally understand. Something is better than nothing. And as time goes on you learn to live with less, so you're able to deal with the pay cuts. It is more difficult when someone is just let go, and the thought of a paycut is beneath us, and we are outraged even insulted at first. But as time goes on you learn to cut corners. Especially when all other options have exhausted, and you really have no choice. It can be a very humbling experience, and one starts to revaluate what is truely important, what is needed and what is a want. It's hurting me financially. But this experience has taught me and forced me to really give up and prioritize things that I thought was absolutely a no go to change. Example, cashing in a whole life insurance policy and purchasing a term policy. Had to be done. Much too expensive, and I still have the security coverage I need at a significant cheaper cost. Personal disability policy. It's an extra, but can't be done when you have to pay food and pay necessary utilities and mortgage (you do it for your family). The list goes on. Before you know it, you can take that salary cut in that new job offer.
Posted by: LND | February 13, 2011 at 1:54 AM | Quote This Comment
Wow! Looks like this struck a bit of a nerve. Issues related to money usually do!
Some responses:
@ Rebecca -- The short answer is, "You can't, unless someone else in the house is earning money." That's one of the tragedies about the recent recession: Falling real estate prices haven't changed mortgage payments (save for owners who refinance), but it's created downward pressure on salaries.
@ Tammy, M.A.B. and LND -- Sometimes, we do what we have to do, even if we don't want to do it. That's part of why lots of people will be looking for new jobs as the economy improves: to get something better.
Thanks for your comments!
Posted by: Rick | February 14, 2011 at 11:34 AM | Quote This Comment
Old company was bought out by another and looking for work for a couple of months now.
Finally got an opportunity with a new company as I got a 2d interview and will ASSUME that I'll take a salary cut with the new cut.
I barely got any raises with my old company and now I have to take a lower wage from the prospective company.
If I'm lucky, I'll get the job. Otherwise, I'll be unemployed and my savings will be dwindling away!
Do employers realize that by offering low salaries that, when the economy improves, many workers will just look for another job with better pay?
Right now, I need the money to live and pay off my bills!
Posted by: Mike | August 15, 2011 at 6:10 PM | Quote This Comment