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Pay bump muddles stability/risk equation

DEAR J.T. & DALE: I’ve been getting calls from headhunters. I like my current position, so I don’t bother with them. However, one recruiter called when I was having a bad day, and the opportunity sounded interesting. bizO-DautenOdonnel_DaleJanine_BizOIt’s a startup, offering a 30 percent increase in pay. The people are great, but something about it worries me. My current company is stable, but a huge bump in pay isn’t going to happen. Thoughts? – Justin

J.T.: You are wise to be careful. A big bump in pay is designed to hook you. Keep in mind that the higher pay will be spread out over the year so their risk in hiring you is minimized. Speaking of risk, you know that most startups fail. If you take the job, I’d suggest saving every penny of your salary increase in the event that you find yourself suddenly out of a job.

Dale: Yes, the sky might fall. But never forget that we live in a time of disruptive technologies, which means that the distinction between stability and risk starts to blur. Still, we can count on this: the mathematics of compounding numbers.

Say you stay in your current company and you average a 5 percent raise every year. If you now make $50,000 and get nine raises over the next 10 years, your income would rise to nearly $78,000. Nice.

However, jump to the new job at $65,000, then get the same 5 percent annual increase, and a decade out you’re at $101,000.

But here’s where it gets interesting: Assume that you jump jobs every third year, getting a big (30 percent) raise each time, while getting the same average annual increases in other years. Under that pleasant scenario, a decade out you’d be at $191,000 (versus that $78,000 for “stability”).

So is the risk staying put or being willing to jump?

J.T.: OK, but those calculations leave out an important factor in deciding to switch jobs: Which one makes you more or less marketable going forward?

Dale: Yes and no. Sticking with one company rarely gives you the diversity of experience that comes from working with multiple organizations.

J.T.: I’m not arguing for staying in one place forever, but I am arguing for choosing jobs based on personal growth. If you make yourself more valuable, you’ll be more highly valued in the job market. Grow your talent and experience, and the opportunities will follow.

Dale: We can agree on the importance of growing your talents and experience, but I’d add this: Growth comes with change and with risk.

Dear J.T. & Dale: I was offered a new job with a great company. I was excited until I saw the offer letter. I’ll be on “trial” for 90 days, during which they can fire me at any time without explanation. When asked, the HR manager said it is standard practice. I find it offensive. Should I push back and not sign it? – Ginger

Dale: Don’t be offended, Ginger. It is indeed a standard procedure in many organizations, and a good one.

J.T.: Studies show that employee performance in the initial 90 days is highly correlated with how successful the employee will be for the long term. So, setting some parameters on early performance gets the relationship off on the right foot.

Dale: Further, instead of being offended, you could admire the company’s honesty. As a practical matter, you are always “on trial,” even if you have a contract or you’re part of a union. The only issue in letting you go is what it costs them. In most cases, that depends on being forced to pay unemployment, and plenty of companies understand how to play that game. So the risk is always there; this company is just making it official.

J.T.: It worries me that you would hesitate to agree. Does this mean you are not 100 percent confident in your ability to be successful? Are you concerned about your own skills, or about the company? Whatever the case, if you have worries, you really need to explore and resolve them. Don’t start the job unless you have the right attitude and mind-set, including confidence that you will sail through the trial period.

Jeanine “J.T.” Tanner O’Donnell is a professional development specialist and the founder of the consulting firm jtodonnell. Dale Dauten resolves employment and other business disputes as a mediator with Please visit them at, where you can send questions via email, or write to them in care of King Features Syndicate, 300 W. 57th St., 15th Floor, New York, NY 10019.