We have a saying in Florida that “they pay in palm trees.” Not really, but it can seem that way for people wanting to relocate here from out of the area. Often, we get people from New York, California and other higher paying markets that will say things like “I am at 180K, but willing to take 150K base to be in Florida”. Or, we get those coming from the rural areas for more career opportunities, only to want a big increase to do so because of “Cost of Living” differences.
Where you want and chose to live is your choice. Whatever location you choose will put you in the pool of others already here. The base then is only one tenth of the equation, and employers will then equate your asking price to your skill, attitude, aptitude, experiences and their need. Only when an employer asks you to relocate on their behalf do you have more negotiating power.
99% of the time, employees will focus negotiations around the base salary alone despite what is offered in the package. Why? For a multitude of reasons with one being cash flow. Just like location of your choice, cash flow is all relevant to the expenses to support your lifestyle and an employer does not determine your living standards.
Negotiating base salary separately and then going back to address everything else is similar to a client desiring to negotiate the GMP (Gross Maximum Price) to build a project and they want you to commit to the price, only to go back and want upgraded finishes, several months off the schedule and a special payment plan without changing that GMP. As much as you want the project, at some point you have to walk away because the expectations are unrealistic.
It’s worse for an employer negotiating with an employee, because a project has a scheduled duration. The employee and employer relationships are burdened with compensation conversations typically on an annual basis, making each year a repeat for each side realigning expectations.
SFS has a blog article on their site that addresses the history of compensation.
The article mentions that in reality, today’s performance reviews don’t work due to the scattered workforce. Many employees don’t necessarily interact daily with the person responsible for doing their reviews and addressing their performance and compensation. Sounds like the new remote workforce is experiencing the situation that jobsite-based construction professionals know all too well.
Let’s talk base. What drives your base salary up? It is not due to the years you have been with the company, unless your company has a written policy on last one in first one out. Even if they do have a policy, I guarantee if someone is not performing to the standards of the company, or is high maintenance to their supervisor, they will be out. (so called lack of work, forced to travel or work nights when they know the person won’t or can’t causing a resignation etc.) And definitely, if with time your base salary cuts too much into the bottom line, that employer will move on.
Base salary is driven by a multitude of factors and the monetization model of the company.
Some of those factors being:
- Strong work ethic: Setting and achieving goals.
- Dependable: Consistently following through.
- Positive attitude: Creating a good environment.
- Self-motivated: Working effectively with little direction.
- Team-oriented: Making the most out of collaboration, open to sharing knowledge
- Effective communicator: Understanding the benefits of clarity; written and spoken
- Ability to learn and embrace company technology
- Clear understanding of your job and the job of others around you
- Experience with the type of projects being built/business company is in.
- Experience in the marketplace – relationships
- Formal Education, certificates, training
- Stability – Ability to work through company growing pains/market conditions
- Flexibility – to work special projects, evenings, travel etc.
Forbes has an article titled Hiring Qualities that are more important than experience. They go more in depth as to why these qualities can be more valuable than skill.
Often Superintendents and Project Managers come in and demand a high base salary, but lack many of the qualities listed above. When we ask them why they feel they should be at that compensation rate, they state “Because I have been doing this for thirty years”. My answer back is “yes, and there is value in your building experience. But if an employer has to give you a Field Engineer to do the rest of the job, or constantly be talking you off a cliff, then financially and emotionally they are better to go with someone else”. You either have become “The 21stCentury” construction manager or you are still the manager from 2001. Oh, how things in our industry have changed since then.
Click here to read our updated annual salary survey. You can also read more from our blog on this subject, and also about how salaries are calculated by ownership in construction.
It is all about the base + benefits+ soft skills when it comes to who to keep and who goes. I have yet to see someone who stays relevant to the times and controls their own behavior have to worry about having and keeping a job. Even if their current company falls on hard times, they have choices and fit right in to the next home if their base salary is in line.
What’s your base justified by?
Career focused employment options correlate to what someone thinks they are worth, compared to what someone is willing to prove they are worth. There isn’t a stable employer out there willing to risk their business by throwing money at something they like, verses proven return on investment.
Meghan Trainor and you might think it’s all about the bass/base and not treble, but without the treble, you could be without the base when it comes to employment.