What's Your Time Worth?
Every time you go to work, you trade a non-renewable resource -- your time. It only makes sense, then, to quantify what it will take to make you show up tomorrow.When I was in high school, I worked for two years at Baskin-Robbins. These were the dark days before North America's favorite ice-cream joint teamed up with Dunkin Donuts and other franchises, so a Baskin-Robbins during a Chicago winter was a pretty lonely place. To pass the time, I indulged in a game I suspect everyone who's ever worked a crappy job has played. I'd divide my $3.35 hourly wage by minutes (5.5 cents), by seconds (.9 cents), by the time it took me to help a customer (28 cents) or by the profit I'd make goofing off for twenty minutes ($1.10). Later, at a $6-an-hour factory job, I rubber-banded clear tubes to bottles of tire sealant. I did my calculation on a per-bottle basis, and was crushed to discover that I was making less than a penny per rubber band applied.I haven't played this game for a while, but maybe I should. Indeed, it might be a worthwhile exercise for all the closet workaholics driving the modern economy -- a calculus of sorts for measuring the value of time. Despite awesome advances in medical science, the human mortality rate remains stubbornly fixed at 100 percent. That means that every time you go to work, you trade a nonrenewable resource -- your time -- for whatever cash and perks your employer deigns to provide. As with any transaction, the fairness of this one rests on the value of each side of the equation. It's relatively easy to put a price tag on the employer end -- wages and benefits are typically agreed upon at the outset. But what's an hour worth?It's a cogent question because, contrary to predictions of both doomsayers and utopians that productivity gains would signal the end of work, people are now working harder than ever. Our fast-as-the-speed-of-byte business scene and entrepreneur-as-conquistador mentality breed a manic devotion to work; this fervour in turn raises the expectations of employers, even those that don't offer stoked pay, stock options and luxurious benefits. Anyone who has visited the work-dressed-as-playground "campuses" of today's high-tech companies knows that employees are expected to put in very long hours. What's more, staffers are supposed to view their overtime labour not as drudgery but as a fun and fulfilling enhancement of their commitment to "the team."Those extra hours aren't a drop in the bucket: Full-time employees in the U.S. now work the equivalent of a full day more per week than they did in 1969. In the past three decades, the number of Americans who spend more than fifty hours a week on the job has risen by about thirty percent. Between 1976 and 1993, the average working man in the States increased the time he spent earning a living by 100 hours a year -- the equivalent of two-and-a-half weeks. Working women ramped up their hours even more, adding almost six weeks to their work year.And what are we getting for all those extra hours? Not much. While some hard workers have certainly been rewarded (Bill Gates has about four bucks for every year the earth has existed), most others have watched their incomes stagnate despite the scramble to dazzle bosses with a near permanent inhabitance of the office. Between 1973 and 1996, the real annual incomes of the richest five percent of American households increased by fifty percent, compared with a mere three-percent jump for the middle one-fifth and less than one percent for the poorest fifth.These are bummer numbers unless you happen to be in that top-fifth percentile. But even if you are among the privileged (or lucky, or skilled, or in high demand), you still implicitly attach a figure to every hour you agree to spend at work. Ideally, you're hoping to walk out each week with more than the pay check in your pocket. Fulfillment, experience, contacts and even fun aren't too much to hope for from a job. Accordingly, you should be able to come up with a bottom line -- a number that quantifies what it will take to get you to show up tomorrow. Here's how to do it:1. Start with your weekly net pay (after taxes and various deductions).2. If you work strictly for hourly pay, skip to step 4.3. If your company offers benefits (extended health care, retirement-savings plan), you'll need to beef up line 1. Are the benefits generous (covering, say, multiple annual visits to psychologists and masseurs; matching funds to the retirement plan)? Then multiply line 1 by 1.4. If your bennies are bare-bones, multiply by 1.25.4. Calculate the number of hours a week you actually spend at your job.5. Add up all the hours you spend on work-related activities. You shouldn't make the mistake of assuming that your hours at the office are the only ones to count when calculating your compensation demands. What about the time you spend getting to and from work? Hours spent preparing for your job? Hours spent "taking it easy" during what should be your free time so that you won't be worn out for work? Estimate the number of hours you spend on these activities in a week. Multiply that number by .6, then add that figure to line 4. (The reason an hour spent driving to work or getting ready at home is valued at only three-fifths of one hour spent at the office is that the former affords you the opportunity to control your environment. You can listen to the radio as you drive, or read in your underwear. Since the whole point of this exercise is to measure who's controlling your time, those "non-work" work hours count as partials.)6. Divide the total compensation you're receiving (sum of lines 1 and 3) by line 5. For example, say your after-tax pay is $400 a week and you've got generous benefits. You spend forty-five hours a week at your job and another ten on job-related stuff. So you multiply $400 by 1.4 to get $560, then you add 45 and 6 -- (.6 times 10) -- to get $10.98 an hour.This is your hourly get-out-of-bed figure. It's the number to think of every time your boss asks you to stick around for a couple of (unpaid) hours. It's the number to remember when you're contemplating purchases -- "Is this gorgeous $55 Fred Perry V-neck worth five hours of my time?"Of course, this is not to suggest that you pull out your calculator every time you think of committing to an hour here or there. But when you bear in mind that dazzling your boss with face time actually means selling an irreplaceable resource, it not only allows you to make smarter decisions about your time but also to weigh whether you're getting satisfactory returns on your labour investment. In the end, most people go to the office not because they've decided it's worth it but because they've got mouths to feed, mortgages to pay, dreams to build.Once you quantify the one thing you've got that you can never get back, you're in a position to judge whether the number is smaller than it ought to be (it usually is). Whether you address the result by working less, seeking higher pay, ramping down your "outside" hours or simply doing nothing while playing out fantasies of showing up at work with a shotgun, at least you've begun to think about the transaction taking place. Your time is all you really have to sell. Get the best price you can.REQUIRED TAG: This article originally appeared in Shift Magazine (www.shift.com).