I guarantee this next sentence will be true: at some point, you thought you were being underpaid.
Salary has always been a sensitive issue, but these days it’s a hot button topic.
I spent most of my twenties being resentful that I wasn’t paid as much as I thought I should. It was only later in life that I understood that how much we are paid depended on a wide variety of factors – some micro, some macro, and some in between.
With that in mind, here’s a simple framework for you to diagnose your own salary situation.
It is by no means comprehensive or scientific, but I find that it takes out a lot of guesswork from the equation.
Reason 1: You need to improve yourself
The first thing to examine is arguably the most painful one because it potentially involves some self-criticism. Before you cry out claims of being exploited, take a hard look at yourself first.
At this level, your salary depends on various things such as experience, skills and relationship with your colleagues/bosses.
Lacking any of these will mean you will be paid less, but does not mean you are underpaid.
It’s very easy to absolve yourself of responsibility and blame everyone else for circumstances, but we’d make the argument that self-awareness is key.
The worst thing someone can do for themselves is to be a poor or mediocre performer at work, but expect to be paid a rockstar’s salary – the mental barrier of pride and entitlement can be a huge stumbling block.
What you can do:
Speak to a recruiter: Recruiters often seek out promising candidates to place in companies. They’ll have a good idea what employers are looking for, and will be able to identify gaps in your skill sets. In general, if a recruiter hasn’t contacted you to inform you about magical job opportunities out there, you are not grossly underpaid.
Speak to your supervisor: Ideally, your immediate supervisor should be able to help you identify the areas you can improve. Compared to a recruiter, they’ll also have working knowledge of where your flaws are.
Also: Don’t underestimate the importance of negotiating your salary, network and the ability to sell yourself.
Embark on a journey of improvement, and when you are ready, negotiate for a higher salary.
Further reading:
What self awareness really is and how to cultivate it
How to negotiate salary
How to ask your boss for feedback
Reason 2: Your skills are not in high demand
It’s also entirely possible that you’re a great employee at work, but still get paid less than others.
As much as you it hurts to say this: How much the market (customers/clients) is willing to pay for your services matters quite a bit.
This is also affected by the number of people willing to do your job for cheaper.
Here’s an example: You might want to be paid $200 per hour for giving generic math tuition.
Your main obstacles to be paid that amount would be:
- The vast number of tutors willing to be paid far less than $200
- The parents who are only willing to pay $100 for generic math tuition
You can observe this phenomena in the creative industry as well where payment with exposure is unfortunately a thing.
People get away with underpaying musicians/photographers//writers/designers simply because there is a vast number of people willing to do work at extremely low prices (think fiverr).
Morally, it’s fashionable to say that all jobs are equally valued; but the unpleasant truth is that most consumers and customers have a clear idea of how much they expect to be willing to pay for said services.
Further reading:
Why having a degree doesn’t mean higher salary
What jobs are on the rise in 2021?
What are the growth sectors for Singapore during COVID-19?
Asian boss: Underpaid, overworked: Being an animator in Japan
Reason 3: Your employer is not being fair
So you’ve done all you can to upgrade yourself, your skills are in demand, your company is booming – but you’re still being underpaid. It’s time to finally blame the powers above.
You’re probably familiar with the narrative that business owners, shareholders and top level management pay themselves handsomely, while paying everyone else a middling salary.
Now, let’s get this straight. It’s perfectly reasonable for people higher up the food chain to be paid more. Paying everyone the same salary hardly works. People should be rewarded for skill, innovation, creativity, leadership and risk-taking.
Where it gets dicey is how much more? Over the past two decades, CEO salaries have risen far faster than the average worker, and Singapore is no exception.
One big reason for this is because of shareholders’ desire to see more profits and dividends. You want to invest in a profitable company, right?
Who wouldn’t?
In turn, this incentivises management to cut cost, including staff costs – often at the expense of the folks lower on the corporate ladder.
What you can do:
- Check out sites like glassdoor, payscale, salary.sg to see whether your low salary is unique to your organisation.
- If it’s below the minimum range, then you might want to consider a new workplace.
- If it isn’t, then it might be a broader market demand problem (see above).
- If you can’t beat them, become them. Set up your own company, or become self employed. Maybe even become the change you hope to see.
Further Reading:
Is the Singaporean CEO overpaid?
Shareholders first, or employees? What we don’t talk about when we talk about corporate governance
Why aren’t wages keeping up with the economy? It’s not the economy, it’s management
IMPORTANT: Do this in the right order!
Truth is, most of us start with blaming our employers for our low salary because it’s the easiest and most natural thing to do.
Often, this does more harm than good.
Why? Even if your employer is indeed exploitative, what happens is that it often blinds you to the two other reasons why you’re underpaid.
What happens after is all too familiar:
- Employee thinks they are underpaid
- Blames company and misses the opportunity for introspection
- Employee fails to find new opportunities because they don’t improve themselves
- Narrow worldview develops
- Angry for life; leave bitter comments on the internet
For that reason, our preferred start is working on yourself first.
Capable talents get singled out, headhunted and approached for opportunities.
They don’t need to work for exploitative companies because they have options.
Career switches are easier.
The result is that they get stronger networks, better projects to strengthen their portfolio and so on. It eventually all adds up to become an exponential advantage.
TL;DR: Want to be paid more?
Take a hard look at yourself first before anything else.
Stay woke, Salaryman
I appreciate this post. I ran a large company and was responsible for setting the pay for hundreds of employees. There were a few who expressed dissatisfaction with their pay rates but the real problem was that if we put out an ad for their job hundreds of people would show up, there was too much supply and not enough demand and as you said that controls the wages that get paid. Also I had a few mediocre performers, not bad enough to terminate but not really all that efficient either. They got paid less because they were worth less to the company’s owners, the shareholders. I always got high wages on my way up the ladder because I was a clever chemical engineer, and there never were enough of us to go around. Because we had to offer ever increasing pay to new engineers and were always at the threat of losing our talented engineers to the competition our pay just kept going up. And if you are perceived as the best of the lot then you get promoted to higher paying positions as well.