An Unkindest Cut

[fatrockstar]

I'm making this public because there's nothing in what I'm about to say that needs hiding. As someone directly affected by the entire situation I feel I am entitled to voice an opinion, and would hope that a hiring manager motivated to investigate my blog would understand my position and respect it. Nothing in this entry is illegal. All figures stated are either mine to share or a speculation.

Recent events that began with a mass firing/layoff at Microsoft have finally reached contract staffing. Microsoft's mandate to reduce billing rates is being passed directly to the contractor by almost every agency that provides such staff to them. I was told earlier today that this manifests as a $10/hour pay cut for people in my line of work with my level of experience. I was appalled. I expected to take a hit, but not such a big one.

Let's do the math here. $10 is 10% of $100. Without revealing my personal salary numbers I must say this: If $100/hr is what they're actually billing Microsoft I am getting screwed out of a lot of cash to begin with. This is standard practice, unfortunately. The executive decision to avoid loss of revenue at all costs by placing the burden on me and my fellow workers will at best lead me to bankruptcy in a month or two. At worst it will take me out of this market completely. I imagine this has crossed the minds of every other person who has done the math as well.

Emotions run high on this issue. I have heard accusations and defenses from every angle. Blame Microsoft. Don't blame Microsoft. Be grateful you have a job at all. That big a cut and I might as well not have a job. Blame the agencies. Washington is an at-will employment state. Sympathize with the agencies. Everybody has an opinion and everyone has made up facts to support them. I personally do not believe that the agencies have handled this well at all, and they have not been given adequate time to.

I worked long and hard to reach the amount of pay I get now. The cut my agency is implementing all across the board sets me back seven years. Any of you close to me knows what this means to me. After working my ass off to get to a point where I could support myself knowing my husband would leave me, I feel very cheated. I burned through hard-earned savings to climb out of my last career into this one. I have made numerous sacrifices to "have a job at all." I am exceptional at what I do, and the more I do it, the better I become at it, so it's hard not to be angry that it all leads to this. I am not alone.

Everyone I know is affected by this situation. Over the last week I have talked with many groups of people, discussed the state of our industry, and worried about where the next mortgage or rent payment will come from. The only good that has come from that worry is a new sense of understanding and compassion that comes from knowing we are all in this together. My loyalties are not to any specific group of artists, coworkers, or friends, but to anyone I know. I am not going to help one person more than another, I'm just going to help wherever and whenever I can and hope it pays off.

In the meantime I will wait and see how this whole pay cut thing works out. With the amount of press it's getting, it may fix itself.

Comments

[dustin-00.livejournal.com]

I don't understand how Microsoft thinks this will work.

It seems to me that in 6 months all the contractors are going to be forced out of the area as they won't be able to even afford their rent.

[mcfnord.livejournal.com]

and so what do you think the landlords will do?

Landlords

[sea-gaagii.livejournal.com]

I have one tenent who is a contractor/vendor at MS. I have been keeping my fingers crossed, so far he hasn't been hit by this.

The degrees of separation on LJ seem to be closing in!

[mcfnord.livejournal.com]

oh sweet jesus!

my tenant works for the Gates Foundation. fortune: secure!

[dustin-00.livejournal.com]

The prices would drop, but by then people will be doubled up or moved out and gone.

Guess Microsoft will have to start importing more Indian dudes.

[winifred.livejournal.com]

Gah. They're already piled up fourfold in those dinky little apartments by the MS campus. This will hit them just as hard.

[mcfnord.livejournal.com]

I've been wanting to tell you about an argument I started in an MS lunchroom. Some guy was telling another guy how he's stupid to rent, just throwing his money away. I butted in with unusual hostility. I wonder where that pecker is now, with his grand theories of constantly increasing home valuations. Some kind of Microsoft effect, he called it. What a fucking loser. I hope he fucking remembers me.

[winifred.livejournal.com]

Like most of us that bought homes in the last five years, it seemed like a good idea at the time. The mistake is in assuming it is possible to predict the future. It's a smarter move to rent now, but it won't always be. Telling someone they're stupid to rent when NOBODY is building equity is a bit arrogant, just like someone telling a homeowner they're stupid for owning is. There was a time where owning was ideal. Now... well, you live on this planet, I'm sure you already know.

[mcfnord.livejournal.com]

Ten is a big whack. In the end I might suck up a 6-year setback. Nor can we know what the future holds. You'd think I'd have passions about this, too, but the last recession changed my point of view. I did meet with my agent and mostly I just laughed.

[winifred.livejournal.com]

I do my best to be understanding with the people I talk to directly at my agency. Hiding my feelings about it to keep from unloading on them is difficult. I probably should have laughed when she told me the hit I'd take.

Suckage

[sea-gaagii.livejournal.com]

Sucks that if the agency is keeping x% of the $100, that they don't eat x% of the $10 an hour pay cut.

10% is steep, but I am betting this end up bring at leat a 20% pay cut in actuality because of the agency not willing to lube up their butt for any of the recession loving.

Re: Suckage

[winifred.livejournal.com]

The $100 is a speculation. I have been told by many people that the overhead can be as low as 30-40%. If that is so, the $10 cut is even bigger than it needs to be.

One agency is already passing along a 20% pay cut. Not fun for those guys.

[mcfnord.livejournal.com]

I try to be around 30% agency overhead.

[crackferret.livejournal.com]

I wish that the agencies would take a little bit of cut from this; they do make pretty good bank. This is going to be HARD on people.

It's going to get worse before it gets better in the industry; I think it got a little bloated and now things are starting to fail around the edges. It *is* hard work to work your way up in the industry, and it's discouraging as all heck to suddenly find that part of the rug is being pulled out from under you.

You're definately not alone. My husband was laid off from Microsoft last month after a lot of years at the company, so we're in that "great, all that for what exactly?" spot.

I hope it works out for you; when I heard the news, I was immediately worried for a lot of friends that are going to be in the same situation. :: hug ::

[winifred.livejournal.com]

Thanks.

I had lunch with a friend of mine who used to work for an agency, and she believes the agencies ARE taking a hit and laying off recruiting staff. Funny how instead of playing the "we're all in this together" card and disclosing this, all the agency memos choose to emphasize that they are your overlords and you will take what is given you. I'm sure the news would have been taken differently had they not been such assholes about it.

[crackferret.livejournal.com]

I think it would help if people knew this. It doesn't solve all the problems, but it would certainly make people think about how widespread the problem is and garner a heck of a lot more sympathy.

Any update on how bad the cut was for you?

[winifred.livejournal.com]

None yet. I am officially out of work as of last Friday, so the cut will affect my next contract with my current agency. That will be at 15%. Still a big ding.

[dianthus.livejournal.com]

I've become somewhat confused about this: Is the 10% from what MS is paying, or just what the contractor (aka you or I) is receiving? Because if MS is paying 10% less, and I get 10% less, then $agency is still also getting 10% less.

[winifred.livejournal.com]

The 10% is from the base rate. That percentage is said to be passed on in its entirety to the contractor.