Recently I was reading a question on the Rock Star Finance Forum by Our Financial Path around “Should I like My Job”. It got me thinking, how do I define a good Job.
How do I define a good job?
So any thoughts about whether you have a good job usually starts with your satisfaction. Do you enjoy what you do day in and day out? Does it motivate you to get up in the morning or do you routinely have a case of the “Mondays”? We spend more hours at work then doing any other activity. If you do not enjoy goign to work every day then it will impact the rest of your life. That being said Job Satisfaction is not the only piece of the work pie.
Not Only Job Satisfaction
Job Satisfaction only takes you so far. If it was we would all take our dream jobs for free. Compensation is the next important aspect of job choice. Now compensation is largely proportional to the barriers of entry to a job. Compensation is also inversely related to the desirability of the job. If you had a extremely desirable job which everyone wanted to do, then it would pay poorly.
Labor is just another supply and demand market, and an excess supply caused by this scenario would drive the pay through the floor. As such often, but not always, compensation and job satisfaction are inversely related.
Barriers to Entry
There are of course a significant number of outliers where the high job satisfaction job has high barriers of entry. Those barriers could be years of schooling, a high end unique skill set, or even whom you know. The sweet spot is to pick a position limited in pay by a barrier rather then satisfaction. Then choose the barrier that causes you the least impact.
In my case, I chose years of college and other training. Engineering school is no picnic. I decided I’d rather have the barrier be up front and smoother sailing later in my career. I’m now in some ways cruising on the good ship career. However, the choice of college is not the only thing that got me to smooth seas.
Opportunity for Advancement
Which brings us to the last aspect of a good job, Opportunity. I’ve spoken before of the importance of crafting your brand. Well a job that satisfies you is great. So is a job with great compensation. However, if there is no opportunity that better be the job you want for life. The problem is we are ever changing as life goes on. The job you like now may not be the job you want a decade from now. But a job without opportunities will make it hard to change with life.
Even worse, technology and companies change over time. That great job you have now may be obsolete a decade from now leaving you to start over. Needless to say compensation would have to be stratospheric compared to another job if one allows you to work 5 years and the other 30.
My Experience with a High Paying Dead End Job
I ran into this early in my career actually. I started out in IT as a developer 15 years ago. My first job had me developing for a very specific piece of purchased enterprise software. When the company I worked for outsourced the software I developed for there was talk of the need for a contractor at 200 dollars an hour. Sure I could have jumped from my 50K a year entry level developer to a job paying 10x as much. However I saw the writing on the wall that this particular software would only last a few years before the software disappeared.
Furthermore, at 300 dollars an hour people would start to crowd into the area and competition would quickly drive down my billable rate. For a 22 year old I was largely prescient, the developer of the enterprise software went under a few years later. I’ve made way more in my career even to date then I would have made in a year or 2 of contracting for that software, and I still have marketable skills going forward. It also did not help that I found coding largely satisfaction free, which is why I no longer do it.
All Three Required for a Good Job
From my perspective, satisfaction is a big piece of the pie but the real goal is having a makeup of all three: Opportunity, Satisfaction, and Compensation. I would consider an opportunity for a short period of time if it only had 2 of the three, but for the long term I want a position with all 3. I would not consider a position that only had one of the three unless it was that or unemployment.
Now something to keep in mind, is while you want a balance of all three, where you tilt (which you favor) will change over time. For example at the beginning of my career, opportunity needed to be overweighted as I was at the bottom end of the possible compensation simply because of my experience. Meanwhile, as I approach retirement the need for opportunity will decrease as the need for advancement options with higher pay decreases. As such at certain stages of your life the balance will shift between the three.
Tilting Towards one of the Three
Finally, different people and careers will also require different tilts. For example a school teacher after tenure probably has less need for opportunity then a corporate employee. Instead they perhaps are tilting more towards a particular type of satisfaction of making a difference in a young kids life. A future business executive meanwhile need more opportunity early on to make it to the top. Still in either case, there needs to be all 3 available to truly have a good fit.
Do you consider your current job a good job? Where does it stand on the scale of Satisfaction, Compensation, and Opportunity?