“Well, Newsweek says it’s good to change careers, right after they laid off all their editors.” – The Simpsons
Is it just me or do JFK and GHWB have tiny heads? Are all presidents made of concrete?
There are numerous aspects of your life that you can’t change – height, eye color, favorite flavor of fruit Gushers®, or the amount of backhair that you want to grow long so you can feel the wind blowing on it, wild and free. Some of these even have a significant impact on your career – taller people make more money (that’s true), and people who like grape Gushers© best are more likely to want to have their career revolve around astrology. And those with hairy backs should probably avoid employment in a Velcro™ factory.
But there are factors that are entirely within your control, and math provides some pretty good guidance on how to maximize your pay through career selection or a career change if you’ve still got some time between now and when you’re disappointed by your Social Security check and those stupid kids and their fancy Zima® wine coolers.
- Characteristics of the Industry
The choice of industry that you work in will have an amazing impact on your net worth during your career. Ideally, you’ll chose an industry. Since you’re reading this, I assume you’re smarter and better looking than 98% of the population and have, instead of an odor coming from your armpits when you sweat, a faint piney smell naturally graces the noses of those around you. But, like I said, you’re smart – even if you don’t first love what you do, you will certainly learn to like it a lot if it gives you great results.
All industries are not alike, since some of them throw off a lot more money than others. There’s a reason Apple® has a $500,000,000,000 in cash along with a collection of spleens and spare kidneys – it’s insanely profitable. Your local Mom and Pop café and pest control store? Not so much, they can’t afford any internal organs.
To be clear, there are great jobs in every field – there are people in retail sales who do wonderfully – there just aren’t a lot of them. So, first suggestion, if you want to go fishing, don’t start in a puddle.
I went off to Wikipedia (LINK) and found a great summary of industries in the United States. It dates to 2002, and no one has updated it for a while because all of the Wikipedia Admins are off updating the Justin Bieber page.
I took the percentage of people working in the sectors, and then divided it by the percentage of payroll they got, and the results were pretty amazing. At the bottom, getting only 37% of the average income, were hotels and restaurants. If you want to make bank instead of beds? Not the industry for you. If you want to make beds instead of bank? Head on over to the Hilton®.
- The best, earning more than twice (!) the average national payroll, was “Management of Companies.” Over 2.6 million people worked in this category, and it is a Tertiary Sector (last post) part of the economy. Keep in mind, people that work in, say, the hotel as mangers are called out in that category. These people are employed as managers as an industry. Amazing! And also not a surprise – the bosses are pretty good at negotiating their salary up as well as yours down.
- The next best was Utilities, earning 187% of the average income, but there are only a few jobs (660,000) in this industry, so it’s a bit harder to get in. This is a Secondary Sector job, so tends to be much more stable than the Tertiary Sector work.
- Finance and Insurance, are third on the list, with 168% of the average income. This didn’t surprise me at all, since, like the managers, the golden rule of “He who has the gold, makes the rules,” applies, and these folks are the gatekeepers to the gold. Over 6.5 million people were employed in this sector, living off of your insurance and interest payments. These are Tertiary Sector jobs.
- The next was a nerd tie: Scientific/Technical/Information, making 152% of the average wage. It is a revenge of the nerds, since they make more money than most of the football linemen that gave them wedgies, but less than the preppy tennis players who dated Buffy. These are also Tertiary Sector jobs. Notice the pattern, here?
What’s missing from this list? Doctors! The medical field is less than average as far as pay goes. The four bullet points above account for 19% of the workers in the country, but make 38% of the US payroll. So, if you’re hunting for a job that pays well, it’s hiding up there.
- Location, Location, Location
Cost of living has a huge impact on our ability have spare money to invest and save for our future, or to spend on something nice, like mosquito repellent or Chiclets®. Living in a high cost area, like LA or New York City? Yikes! Sam over at Financial Samurai got a huge number of hits (and me for a reader) when his post about Scraping By On $500,000 A Year (LINK) exploded all over the internet. In it he created a hypothetical family that was just squeaking by on $500,000 a year. It was controversial because so many people failed to feel a lot of sympathy for the family and yelled at their computer screens to the fictitious family on how stupid they were. Not the brightest bunch, right? Anyhow, I responded with how to Live Large on $50,000 A Year (LINK).
Location matters, and most of the time you don’t get paid city wages to live in the country where you can buy a house (not a great house, but a house) for $10,000 straight up (this is true). Generally, though, the wages don’t go down as much as the house prices do here in the sticks so you’re net ahead.
There are some great upsides to small town living – there’s less to spend your money on, commutes are generally better, and if you forget to close the garage door ALL NIGHT LONG (thanks, Pugsley) you find that everything is still there in the morning. (In truth, one night Pugsley forgot to close The Mrs.’ hatchback on the Wildermobile II, and left it open all night. We found a cat inside, and some spiders, but that’s it – not a thing missing.
The downside of low cost (and high trust!) living is that it is much harder to meet and make connection with high-powered folks who could help your career. For instance, when I lived in Houston, I knew a guy who is friends with a former President. He gave me his baseball tickets for one game. The view is below. And no, I didn’t bother them. Generally, you won’t make/meet that kind of people in a small town (though there are exceptions, like Batman – LINK).
The guy directly in front is a Secret Service guy. When Pugsley dropped a cup of ice, his head whipped around like Justin Bieber on a merry-go-round as pushed by The Rock. He assessed the three year old as “not a threat.” He doesn’t know Pugsley!
- How likely is the job to be outsourced/done by Artificial Intelligence?
Much more likely than you think. The BBC has a website (LINK) that calculates the likelihood that your job will be automated within the next 20 years. The internet has already killed formerly lucrative and widely held jobs, like travel agents – used to be one in every little town – now? Gone. Newspapers are on the way out. As I mentioned before, truck drivers are “soon,” and then we’ll have a surplus of people who like biscuits and gravy without a job.
Trends in information will drive careers, too. How long until competition from people like hurts traditional publishers? Already there. Pewdepie has more reach than the Wall Street Journal (this is true!), and that’s good – this flourishing of media outlets will effectively kill the gatekeeper, allowing us ever greater freedom of information sources. But the people at CNN won’t like it a bit as they compete against . . . everyone. Anderson Cooper might have to find a job cleaning pools, or delivering cotton candy to orphanages.
- What credentials are required?
Lastly (for this post) when contemplating a career, what credentials are required? As I’ve mentioned before, only a few college degrees make any sense nowadays. Anthropology? French literature? You’d be better off in a coma for four years – at least you wouldn’t spend $100,000 plus on a degree best suited for working as a barista.
Additionally, the costs for college are heading up much faster than inflation – and have been for years. The reasons for this are really simple – a goldfish will grow to match the size of his tank, and my butt will grow to the size of my jeans, and a college will grow to consume every possible dollar of federal student aid and student loans that a student/parent combination can take out. And buy climbing walls, and safe spaces, and pay for new girl’s luge/rifle team uniforms. Ohhh, and have you seen the latte machine?
For many in the future, I’d suggest you skip college, unless your career demands it. There are a few jobs that require the credentials you get in college:
- Doctor – includes all types. Some of them, however, have salaries that don’t justify the cost of medical school. That’s right – medical school used to be a slam dunk win, let’s buy the Mercedes. Recently I read of a doctor that had student loans high enough that she would never be able to pay them off. And student loans cannot be discharged in bankruptcy. Only release? Death or moving to Canada, which is like death, but with better food.
- Lawyer – Used to be a great ticket to the upper middle class. Still is, for some, but the median income of lawyers keeps dropping over time. A good corporate lawyer will always be needed, but paralegals in Bangladesh can do the work more cheaply than a new associate. And when Lawbot2000® hits the court room? Look out!
- Professor – Overdone – unless you’re politically connected, you’ll die a pauper. But one with leather patches on your tweed jacket.
- Engineer – Still pays out, but losing its ability to pay out as costs increase. Lots of managers come from here, but automation will pull even more jobs. Plus, how many trains are there, anyway??
- Accountant – Required, and a lower tier school will do just fine, if you can avoid the AI rollout that will eliminate most of the jobs.
- Teacher – Will eventually be replaced by “coaches” who help students after they watch the Led Zepplin of tutors on the web.
- Veterinarian – Still costs a lot, and probably is dicey as far as payout right now, and soon kittens will be self-repairing.
- Optometrist – I can see this being automated out of business. See this, get it?
- Dentist – This profession is eliminating itself through technical advances – fewer dentists are needed now than in the past because they’re so darn good.
- Psychologist/Psychiatrist – Talking about this field just depresses me.
So, keep in mind it’s all changing, and maybe with stem cell therapy, in ten years you can be taller, too. Just think the salary that 6’10” tall you (that’s 8 meters tall) will command!