Salaries at direct work orgs are a frequent topic of discussion, but I’ve never seen those conversations make much progress. People tend to talk past each other- they’re reading words differently (“reasonable”), or have different implicit assumptions that change the interpretation. I think the questions below could resolve a lot of the confusion (although not all of it, and not the underlying question. Highlighting different assumptions doesn’t tell you who’s right, it just lets you focus discussions on the actual disagreements).
Here’s my guess for the important questions. Some of them are contingent- e.g. you might think new grad generalists and experienced domain experts should be paid very differently. Feel free to give as many sets of answers as you want, just be clear which answers lump together, so no one misreads your expert salary as if it was for interns.
What kind of position are you thinking about?
Experienced vs. new grad
Domain expertise vs generalist?
Many outside options vs. few?
Founder vs employee?
What salary are you thinking about?
What living conditions do you expect this salary to buy?
Housing?
Location?
Kids?
Food?
Savings rate
What is your bar for “enough” money? Not keeling over dead? Peak productivity but miserable? Luxury international travel 2x/year?
What percentage of people can reach that state with your suggested salary?
Some things that might make someone’s existence more expensive:
health issues (physical and mental)
Kids
Introversion
Ailing parents
Distant family necessitating travel.
Burnout requiring unemployed period.
What do you expect to happen for people who can’t thrive in those conditions?
If you lost your top choice due to insufficient salary, how good do you expect the replacement to be?
What is your counterfactual for the money saved on salary?
People often cite EA salaries as higher than other non-profits, but my understanding is that most non-profits pay pretty badly. Not “badly” as in “low”, but “badly” as in “they expect credentials, hours, and class signals that are literally unaffordable on the salary they pay. The only good employees who stick around for >5 years have their bills paid by a rich spouse or parent.”
So I don’t think that argument in particular holds much water.
n = 1 but my wife has worked in non-EA non-profits her whole career, and this is pretty much true. Its mostly women earning poorly at the non-profit, while husbands makes bank at the big corporate.
Where does this idea come from Elizabeth? From my experience (n=10) this argument is incorrect. I know a bunch of people who work in these “badly” paying jobs you talk of who defy your criteria, they don’t have their bills paid for by a rough parent—instead they are content with their work and accept a form of “salary sacrifice” mindset even if they wouldn’t phrase it in those EA terms.
EA doesn’t have a monopoly on altruism, there are plenty of folks out there living simply and working for altruistic causes they believe in even thought it doesn’t pay well and they could be earning way more elsewhere., outside of conventional market forces.
The sense I get reading this is that you feel I’ve insulted your friends, who have made a big sacrifice to do impactful work. That wasn’t my intention and I’m sorry it came across that way. From my perspective, I am respecting the work people do by suggesting they be paid decently.
First, let me take my own advice and specify what I mean by decently: I think people should be able to have kids, have a sub-30 minute commute, live in conditions they don’t find painful (people only live with housemates if they like it, not physically dangerous, outdoor space if they need that to feel good. Any of these may come at at trade off with the others, probably no one gets all of them, but you shouldn’t be starting out from a position where it’s impossible to get reasonable needs met), save for retirement, have cheap vacations, have reasonably priced hobbies, pay their student loans, and maintain their health (meaning both things like healthcare, and things like good food and exercise). If they want to own their home, they shouldn’t be too many years behind their peers in being able to do so.
I think it is both disrespectful to the workers and harmful to the work to say that people don’t deserve these things, or should be willing to sacrifice it for the greater good. Why on earth put the pressure on them to accept less[1], and not on high-earners to give more? This goes double for orgs that require elite degrees or designer clothes: if you want those class signals, pay for them.
Hey Elizabeth—just to clarify I don’t think you’ve insulted my friends at all don’t worry about that—I just disagreed from my experience at least that was the situation with most NGO workers like you claimed. I get that you are trying to respect people by pushing for them to be paid more it’s all good.
As a small note, I don’t think they have made a “big sacrifice” at all, most wouldn’t say they have made any sacrifice at all. They have traded earning money (which might mean less to them than for other people anyway) for a satisfying job while living a (relatively) simple lifestyle which they believe is healthy for themselves and the planet. Personally I don’t consider this a sacrifice either, just living your best life!
I’m going to leave it here for now (not in a bad way at all) because I suspect our underlying worldviews differ to such a degree here that it may be hard to debate these surface salary and lifestyle issues without first probing at deeper underlying assumptions here about happiness, equality, “deserving” etc., which would take a deeper and longer discussion that might be tricky on a forum back and forth
Not saying I’m not up for discussing these things in general though!
I tested a version of these here, and it worked well. A low-salary advocate revealed a crux they hadn’t before (there is little gap between EA orgs’ first and later choice candidates), and people with relevant data shared it (the gap may be a 50% drop in quality, or not filling the position at all).
This is an interesting model—but what level of analysis do you think is best for answering question 7? One could imagine answering this question on:
the vacancy level at the time of hire decision (I think Bob would be 80% as impactful as the frontrunner, Alice)
the vacancy level at the time of posting (I predict that on average the runner-up candidate will be 80% as the best candidate would be at this org at this point in time)
the position level (similar, but based on all postings for similiar positions, not just this particular vacancy at this point in time)
the occupational field level (e.g., programmer positions in general)
the organizational level (based on all positions at ABC Org; this seems to be implied when an org sets salaries mainly by org-wide algorithm)
the movement-wide level (all EA positions)
the sector-wide level (which could be “all nonprofits,” “all tech-related firms,” etc.)
the economy-wide level.
I can see upsides and downsides to using most of these to set salary. One potential downside is, I think, common to analyses conducted at a less-than-organizational level.
Let’s assume for illustrative purposes that 50% of people should reach the state specified in question 4 with $100K, and that the amount needed is normally distributed with a standard deviation of $20K due to factors described in step five and other factors that make candidates need less money. (The amount needed likely isn’t normally distributed, but one must make sacrifices for a toy model.) Suppose that candidates who cannot reach the question-4 state on the offered salary will decline the position, while candidates who can will accept. (Again, a questionable but simplifying assumption.)
One can calculate, in this simplified model, the percentage of employees who could achieve the state at a specific salary. One can also compute the amount of expected “excess” salary paid (i.e., the amounts that were more than necessary for employees to achieve the desired state).
If the answer to question 7 is that losing the top candidate would have severe impact, one might choose a salary level at which almost all candidates could achieve the question-four state—say, +2.5 SD (i.e., $150K) or even +3 SD ($160K). But this comes at a cost, the employer has likely paid quite a bit of “excess” salary (on average, $50K of the $150K salary will be “excess”).
On the other hand, if there are a number of candidates of almost equivalent quality, it might be rational to set the salary offer at $100K, or even at −0.5 SD ($90K), accepting that the organization will lose a good percent of the candidates as a result.
I suspect you would then have a morale problem with certain employees running the numbers and concluding that they were seen as considerably more replaceable than others who were assigned the same level!
You can fix that by answering question 7 at the organizational or movement levels, averaging the answers for all positions. Suppose that analysis led to the conclusion that your org should offer salaries at this position grade level based on +1 SD ($120K). But you’re still running a 16% risk that the top candidate for the position with no good alternative will decline, while you’re not getting much ROI for the “excess” money spent for certain other positions. You could also just offer $150K to everyone at that level, but that’s harder to justify in the new world of greater funding constraints.
In sum, the mode of analysis that I infer from your questions seems like it would be very helpful when looking at a one-off salary setting exercise, but I’m unsure how well it would scale.
Salaries at direct work orgs are a frequent topic of discussion, but I’ve never seen those conversations make much progress. People tend to talk past each other- they’re reading words differently (“reasonable”), or have different implicit assumptions that change the interpretation. I think the questions below could resolve a lot of the confusion (although not all of it, and not the underlying question. Highlighting different assumptions doesn’t tell you who’s right, it just lets you focus discussions on the actual disagreements).
Here’s my guess for the important questions. Some of them are contingent- e.g. you might think new grad generalists and experienced domain experts should be paid very differently. Feel free to give as many sets of answers as you want, just be clear which answers lump together, so no one misreads your expert salary as if it was for interns.
What kind of position are you thinking about?
Experienced vs. new grad
Domain expertise vs generalist?
Many outside options vs. few?
Founder vs employee?
What salary are you thinking about?
What living conditions do you expect this salary to buy?
Housing?
Location?
Kids?
Food?
Savings rate
What is your bar for “enough” money? Not keeling over dead? Peak productivity but miserable? Luxury international travel 2x/year?
What percentage of people can reach that state with your suggested salary?
Some things that might make someone’s existence more expensive:
health issues (physical and mental)
Kids
Introversion
Ailing parents
Distant family necessitating travel.
Burnout requiring unemployed period.
What do you expect to happen for people who can’t thrive in those conditions?
If you lost your top choice due to insufficient salary, how good do you expect the replacement to be?
What is your counterfactual for the money saved on salary?
People often cite EA salaries as higher than other non-profits, but my understanding is that most non-profits pay pretty badly. Not “badly” as in “low”, but “badly” as in “they expect credentials, hours, and class signals that are literally unaffordable on the salary they pay. The only good employees who stick around for >5 years have their bills paid by a rich spouse or parent.”
So I don’t think that argument in particular holds much water.
Do you have any citations for this claim?
Implict and explicit from https://askamanager.com/ and https://nonprofitaf.com/ (which was much epistemically stronger in its early years)
n = 1 but my wife has worked in non-EA non-profits her whole career, and this is pretty much true. Its mostly women earning poorly at the non-profit, while husbands makes bank at the big corporate.
Where does this idea come from Elizabeth? From my experience (n=10) this argument is incorrect. I know a bunch of people who work in these “badly” paying jobs you talk of who defy your criteria, they don’t have their bills paid for by a rough parent—instead they are content with their work and accept a form of “salary sacrifice” mindset even if they wouldn’t phrase it in those EA terms.
EA doesn’t have a monopoly on altruism, there are plenty of folks out there living simply and working for altruistic causes they believe in even thought it doesn’t pay well and they could be earning way more elsewhere., outside of conventional market forces.
The sense I get reading this is that you feel I’ve insulted your friends, who have made a big sacrifice to do impactful work. That wasn’t my intention and I’m sorry it came across that way. From my perspective, I am respecting the work people do by suggesting they be paid decently.
First, let me take my own advice and specify what I mean by decently: I think people should be able to have kids, have a sub-30 minute commute, live in conditions they don’t find painful (people only live with housemates if they like it, not physically dangerous, outdoor space if they need that to feel good. Any of these may come at at trade off with the others, probably no one gets all of them, but you shouldn’t be starting out from a position where it’s impossible to get reasonable needs met), save for retirement, have cheap vacations, have reasonably priced hobbies, pay their student loans, and maintain their health (meaning both things like healthcare, and things like good food and exercise). If they want to own their home, they shouldn’t be too many years behind their peers in being able to do so.
I think it is both disrespectful to the workers and harmful to the work to say that people don’t deserve these things, or should be willing to sacrifice it for the greater good. Why on earth put the pressure on them to accept less[1], and not on high-earners to give more? This goes double for orgs that require elite degrees or designer clothes: if you want those class signals, pay for them.
There’s an argument here that low payment screens for mission alignment. I think this effect is real, but is insignificant at the level I’ve laid out.
Hey Elizabeth—just to clarify I don’t think you’ve insulted my friends at all don’t worry about that—I just disagreed from my experience at least that was the situation with most NGO workers like you claimed. I get that you are trying to respect people by pushing for them to be paid more it’s all good.
As a small note, I don’t think they have made a “big sacrifice” at all, most wouldn’t say they have made any sacrifice at all. They have traded earning money (which might mean less to them than for other people anyway) for a satisfying job while living a (relatively) simple lifestyle which they believe is healthy for themselves and the planet. Personally I don’t consider this a sacrifice either, just living your best life!
I’m going to leave it here for now (not in a bad way at all) because I suspect our underlying worldviews differ to such a degree here that it may be hard to debate these surface salary and lifestyle issues without first probing at deeper underlying assumptions here about happiness, equality, “deserving” etc., which would take a deeper and longer discussion that might be tricky on a forum back and forth
Not saying I’m not up for discussing these things in general though!
I tested a version of these here, and it worked well. A low-salary advocate revealed a crux they hadn’t before (there is little gap between EA orgs’ first and later choice candidates), and people with relevant data shared it (the gap may be a 50% drop in quality, or not filling the position at all).
This is an interesting model—but what level of analysis do you think is best for answering question 7? One could imagine answering this question on:
the vacancy level at the time of hire decision (I think Bob would be 80% as impactful as the frontrunner, Alice)
the vacancy level at the time of posting (I predict that on average the runner-up candidate will be 80% as the best candidate would be at this org at this point in time)
the position level (similar, but based on all postings for similiar positions, not just this particular vacancy at this point in time)
the occupational field level (e.g., programmer positions in general)
the organizational level (based on all positions at ABC Org; this seems to be implied when an org sets salaries mainly by org-wide algorithm)
the movement-wide level (all EA positions)
the sector-wide level (which could be “all nonprofits,” “all tech-related firms,” etc.)
the economy-wide level.
I can see upsides and downsides to using most of these to set salary. One potential downside is, I think, common to analyses conducted at a less-than-organizational level.
Let’s assume for illustrative purposes that 50% of people should reach the state specified in question 4 with $100K, and that the amount needed is normally distributed with a standard deviation of $20K due to factors described in step five and other factors that make candidates need less money. (The amount needed likely isn’t normally distributed, but one must make sacrifices for a toy model.) Suppose that candidates who cannot reach the question-4 state on the offered salary will decline the position, while candidates who can will accept. (Again, a questionable but simplifying assumption.)
One can calculate, in this simplified model, the percentage of employees who could achieve the state at a specific salary. One can also compute the amount of expected “excess” salary paid (i.e., the amounts that were more than necessary for employees to achieve the desired state).
If the answer to question 7 is that losing the top candidate would have severe impact, one might choose a salary level at which almost all candidates could achieve the question-four state—say, +2.5 SD (i.e., $150K) or even +3 SD ($160K). But this comes at a cost, the employer has likely paid quite a bit of “excess” salary (on average, $50K of the $150K salary will be “excess”).
On the other hand, if there are a number of candidates of almost equivalent quality, it might be rational to set the salary offer at $100K, or even at −0.5 SD ($90K), accepting that the organization will lose a good percent of the candidates as a result.
I suspect you would then have a morale problem with certain employees running the numbers and concluding that they were seen as considerably more replaceable than others who were assigned the same level!
You can fix that by answering question 7 at the organizational or movement levels, averaging the answers for all positions. Suppose that analysis led to the conclusion that your org should offer salaries at this position grade level based on +1 SD ($120K). But you’re still running a 16% risk that the top candidate for the position with no good alternative will decline, while you’re not getting much ROI for the “excess” money spent for certain other positions. You could also just offer $150K to everyone at that level, but that’s harder to justify in the new world of greater funding constraints.
In sum, the mode of analysis that I infer from your questions seems like it would be very helpful when looking at a one-off salary setting exercise, but I’m unsure how well it would scale.