Never let a good crisis go to waste
“Never let a good crisis go to waste”, a quote from Winston Churchill in the 1940s as the world approached the end of World War II.
Churchill was speaking about the union formed between Roosevelt, Stalin and himself. The trio that led to the establishment of the United Nations which created opportunities in the midst of a crisis.
You can apply this quote to many things in life but in this blog post I want to apply it to you and your financial goals.
As I am sure you are all aware, there has been an increased level of chaos in the world of late with a war in Ukraine, inflation getting out of control and the cries of recession starting to get louder. This all coming not long after the peak of COVID-19.
The need to make more money has never been more important.
Even with all of this doom and gloom, my industry has been struggling to recruit (and maybe your industry as too). The labour market of late has been very hot and companies have really been struggling to fill job positions. There could be a few reasons for this:
People have retired
People don’t want to work
People have moved on to work in a different industry
The industry has grown and needs more people
The reason doesn’t really matter. If your employer is struggling to recruit for a role that is similar to yours, you need to apply the never let a good crisis go to waste mantra. Whatever you do, don’t let the governor of the Bank of England tell you not to ask for a pay rise.
These types of opportunities don’t come along very often. Companies are struggling to find the skills necessary to run their business so the pendulum has shifted such that employees have more bargaining power. And if you are one of those truly loyal employees that believes that their employer always has their best interests at heart, you need to live in the real world. When times get tough, your employer will drop you like a stone if they need to. So it is important that you are wise to the opportunity.
I personally started putting the squeeze on my employer about 6 months ago. I initially spoke to my boss and then followed up with an emailing listing out my concerns. The main points I raised were along the lines of the following:
The industry is very buoyant
There are many job roles available and recruitment consultants are approaching me
The job roles being offered are for more senior positions
Gave examples of the salaries being offered by competitor companies
Suggested inflation is high so I needed to think about ways of increasing my income
Suggested I enjoy working at the company and feel I am doing a good job but that I needed to consider my options given the circumstances
Suggested I was worried that some of my colleagues may decide to move jobs
I laid it on thick.
I had no intention of leaving the company (unless a job at a select few companies came up) but I knew I had to make the case. As they say in the North East “shy bairns get nowt”. If you are not willing to speak up and negotiate, nothing will be done.
So after laying it on thick, my boss made the case to his superiors. At the same time, one of my colleagues announced that they were leaving the company to take a position with a higher salary. Now I was sad to see my colleague go but this just strengthened the case and my poker hand had just gotten stronger. The turn had been good, now I was excited to see the river (sorry, I will stop with the poker lingo)…
Not long after the news that my colleague was leaving came out, my boss came to me with an update. He had taken onboard what I had said and suggested that salary uplifts were being considered. He also suggested that new opportunities to move into more senior roles within the company were to become available.
I started to wonder, maybe they will just increase my salary a little bit just to try and keep me happy but not too happy. Enough to stop me leaving. But I was wrong. I got an email from my boss that made me pleasantly surprised. The email suggested that they had increased my salary by over 15% without a promotion. And the prospect of a promotion would still remain.
I think this just shows exactly why you always need to fight for being fairly compensated. Who knows if anything would have been done if I never said anything. After all, all I had to do was have a few discussions and make a few valid points.
I am sure employers would prefer if you said nothing but I think it is best to be honest. Obviously you can’t try this trick every time but (if you are in a position to do so) the recent hot labour market has opened this opportunity. I much prefer this approach when compared to applying for another job, being made an offer and then accepting a counter offer from your current employer.
I also feel at the moment (with the prospect of a recession looking more and more likely) that it may be more sensible to stay with your current employer and try to increase your salary internally (instead of taking a new role elsewhere). It is not always the case but if there is a downturn the first in, first out policy can often apply. If you have been in your current role for a longer time and your employer values the experience you provide to the company, then you may be less at risk to losing your job in a downturn. But as always nothing is guaranteed so be prepared. Gaining a salary increase can improve your preparation.
Let me know in the comments if have done this recently or are thinking to. Also let me know if you thought this post was insightful.
