Blue:
I believe in paying market rates for labor, recognizing that market rate, even within a given geography, is a price range, not a price point.
Pink:
Well, if one's wage is but enough to pay one's rent, cable and electricity, one doesn't earn enough. On the other hand, if one's wage is too low to afford the electric bill resulting from having so many Christmas lights that one's home makes the local, well, one's doing that falls outside of what I'd call living a "modestly livable" lifestyle. I'm reticent to be too specific about what is and isn't "livable" or "modest," but I think my various life experiences give me a pretty good sense of what's reasonable, livable, modest, etc. -- which, like "market rate," is a range -- and what's not.
You're a business owner; I was too. That experience alone, if one founded one's firm, places one face-to-face with frugality's imperatives. I went to boarding school, which, though I didn't face money woes, was
an exercise in forced austerity (as it still is), thus giving me a good sense of what bare minimum housing and wardrobe entails and doesn't.
AFAIC, whatever "bare minimum" entails, if that's all the income one can command, something's amiss with either the employer or the employee. I can say on a case by case basis what specifically is amiss, and I can say on an economy level (city, county, state, region, or country) whether a given person's situation has in it something that's amiss, and I can tell who -- employer or employee -- is on the borderline of being "amiss."
Tan:
No.
I don't have a problem with her paying her CoS $80K/year. I know, however, that her doing so, and others following suit means sooner or later the Congressional CoS positions will go to folks who either lack experience (not a good thing) or who have tons of it, along with a spouse/partner who earns a lot, and who'll take/use the position for its power (also, not a good thing). That's the problem with paying below market rate for any job/labor.
An alternative, of course, is that because she pays below market for her CoS, she's going to experience high turnover in that position. That's the wrong position in which to have that happen.
How organizationally disjunctive would it be if you had to replace your corporate controller, COO, EVP for marketing, or your HR VP or some other senior executive role every one to three years?
Brown:
You tell me what kind of "adjustment" I'd, by your reckoning, make.
What I'd do is pay market rate for labor, provided the five-year aggregate market rate (including labor overhead costs that don't appear in a paycheck) for that labor is lower than the cost of exchanging labor for capital. Specifically re: phone answering, that'd mean replacing an employee with an automated phone system.
I'd say that means I'd make a large adjustment, shifting wages to market rates, perhaps operating with fewer staff (1 or 2 fewer FTEs) overall, and exchanging labor for capital where possible.