< Previousthe amount of money that the market will be willing to pay you to do that job at best changes, and at worst collapses. Unsurprisingly though, when it comes to the social value of an individual job far fewer of these factors are relevant, and with such an obvious imbalance between the two we could argue it’s because the jobs market is therefore more closely aligned with the needs of capitalism rather than social good. THE CATEGORIES OF VALUE Below are the 18 umbrella categories that when combined determine the overall remuneration of a specific job when compared to others. In short, the higher the score for all of these factors the more likely it is that that job will be highly paid - and I’ll show you how this works in a live example at the end of this section. The umbrella categories are: 1. Certification Requirements The more certifications, credentials, and or licenses that a job requires, which often take an individual significant effort, money, and time to acquire and maintain, the more likely it is that the job will be higher paid. 2. Confidentiality and Trust The greater the level of confidentiality and or trust required in a job the more likely it is that the job will be higher paid. 3. Complexity The more complex or difficult the job is, and the more intricate the decision making, responsibilities, and tasks are - including Governance, Risk, and Compliance (GRC) - the more likely it is that the job will be higher paid. 4. Cultural Expertise The greater the requirement for experience, knowledge, and the understanding of different business MARKET FACTORS AFFECTING SALARIES . S O, YOU’RE a demanding ambitious human being and you want it all - you want a job that is financially and socially rewarding. Or maybe you just want to be rich and don’t care too much about having a job that’s socially rewarding, or maybe you care more about having a job with a great amount of social impact rather than the size of your pay packet. If any of these scenarios sounds like you, and let’s face it at least one of them should, then this is what I’ll be digging into in this section and you might be surprised by all the different factors that have to align in order to make a job valuable in the market place - especially when it comes to jobs that are economically valuable and ergo highly paid. ECONOMIC VERSUS SOCIAL VALUE When it comes to projecting the true economic value of a job there are 18 factors that I’ve identified that are important. And, as you’ll see for yourself, change the value of any one of them and 100311institute.compractises, cultures, and languages, in a local or global context, the more likely it is that the job will be higher paid. 5. Impact of Failure The greater the consequences and costs of errors, failures, and or mistakes in the job, which can range from minor inconveniences to significant financial and legal liabilities and even the loss of life, the more likely it is that the job will be higher paid. 6. Industry Profitability The more profitable and financially healthy the individual industry in which the job is located is, with jobs in more profitable industries often commanding higher salaries than those in less profitable sectors, hence the disparity between the private sector and the public sector, the more likely it is that the job will be higher paid. 7. Language Skills Requirement The greater the need for proficiency in specific languages to effectively perform a job, especially those involving communication with diverse populations or international stakeholders, the more likely it is that the job will be higher paid. 8. Level of Experience The greater the amount of relevant work experience required to excel at or perform the job the more likely it is that the job will be higher paid. 9. Level of Expertise The greater the breadth and or depth of expertise, knowledge, and skills required, whether that is through certification and or through practical experience, to perform a job the more likely it is that the job will be higher paid. 10. Level of Impact The greater the impact that the job has on the overall performance, strategy, and success of a company, as well as its broader impact on the economy, industry, society, or combinations thereof, the more likely it is that the job will be higher paid. 11. Level of Responsibility Notes: 101311institute.comThe greater the level of accountability, responsibility, scale, and scope of the job, and the extent to which it involves managing people, projects, and resources, the more likely it is that the job will be higher paid. 12. Level of Risk The greater the potential for exposure to financial, legal, physical, and or reputational risk in the job, which may additionally require specialist experience and expertise to avoid and mitigate, the more likely it is that a job will be higher paid. 13. Market Demand The greater the demand for the expertise, knowledge, and or skills associated with the job, and therefore the greater the level of competition for candidates with those attributes in the labour market, the more likely it is that the job will be higher paid. 14. Multi-Disciplinary Expertise The greater the requirement for knowledge and skills that span a wide range of fields, and the greater the requirement for individuals who can apply and integrate these as appropriate within an organisation, the more likely it is that the job will be higher paid. 15. Output Quality The higher the expectations and standards for the accuracy, quality, and thoroughness of the work produced in the job, which in themselves might require more extensive attention to detail, effort, and expertise, the more likely it is that the job will be higher paid. 16. Specialised Knowledge The greater the need for deep, specific, and often proprietary knowledge in a particular field or industry, which may be acquired through extensive education, experience, and or training, the more likely it is that the job will be higher paid. 17. Specialised Skills The greater the requirement for advanced, specific, and often technical skills to perform a job, which may be acquired through extensive education, experience, and or practical experience, the more likely it is that the job will be Notes: 102311institute.comhigher paid. 18. Talent Scarcity The more scarce or rare the people with the attributes and talents needed to perform a job, whether that’s because of the market demand and or the specialisms needed, and the harder it is to find and or attract people, the more likely it is that the job will be higher paid. Notes: 103311institute.comMATTHEW GRIFFIN 311INSTITUTE.com ONLY 28% OF HOW MUCH A JOB PAYS YOU IS DIRECTLY RELATED TO YOUR HARD OR SOFT SKILLS .SOME EXAMPLES . S O, having explained how different factors affect the value and thereby compensation of particular jobs let’s run some real world examples so you can see for yourself how changing just one of them - let alone many of them - can have a dramatic impact on the compensation people receive for doing those jobs. TAKE THE ALTERNATIVE VIEW However, as you look through the examples on the next couple of pages I’d also urge you to change your own perspective - whether you’re an individual or a representative of a government or an organisation - because while today so called external forces have a huge, almost out sized, impact on the value of jobs and their compensation there are quite often things that you can do to influence them as well for your own benefit. 105311institute.comHOW MARKET FACTORS AFFECT JOB COMPENSATION In this example, where we compare the job expectations and market dynamics for office cleaners versus hazardous chemical cleaners, both of which ostensibly have the same goals but very different expectations and requirements, we take a look at how changing different factors affect how much cleaners are paid to perform their jobs, and you can clearly see the impact that these factors have on the hourly and annual wage ranges. 01. CERTIFICATION REQUIREMENTS 10. LEVEL OF IMPACT 02. CONFIDENTIALITY AND TRUST 03. COMPLEXITY 04. CULTURAL EXPERTISE 05. IMPACT OF FAILURE 06. INDUSTRY PROFITABILITY 07. LANGUAGE SKILLS REQUIREMENT 08. LEVEL OF EXPERIENCE 09. LEVEL OF EXPERTISE 11. LEVEL OF RESPONSIBILITY 12. LEVEL OF RISK 13. MARKET DEMAND 14. MULTI-DISCIPLINARY EXPERTISE 15. OUTPUT QUALITY 16. SPECIALISED KNOWLEDGE 17. SPECIALISED SKILLS 18. TALENT SCARCITY EXAMPLE 01 OFFICE CLEANER AVG. WAGE RANGE $13 to $16 Per Hour $21,000 to $34,000 PA Sources: US Bureau of Labor Statistics EXAMPLE 02 HAZARDOUS CHEMICALS CLEANER AVG. WAGE RANGE $38 to $48 Per Hour $70,000 to $100,000 PA Sources: US Bureau of Labor Statistics CHART KEY LOW - HIGH _ +01. CERTIFICATION REQUIREMENTS 10. LEVEL OF IMPACT 02. CONFIDENTIALITY AND TRUST 03. COMPLEXITY 04. CULTURAL EXPERTISE 05. IMPACT OF FAILURE 06. INDUSTRY PROFITABILITY 07. LANGUAGE SKILLS REQUIREMENT 08. LEVEL OF EXPERIENCE 09. LEVEL OF EXPERTISE 11. LEVEL OF RESPONSIBILITY 12. LEVEL OF RISK 13. MARKET DEMAND 14. MULTI-DISCIPLINARY EXPERTISE 15. OUTPUT QUALITY 16. SPECIALISED KNOWLEDGE 17. SPECIALISED SKILLS 18. TALENT SCARCITY EXAMPLE 01 SOFTWARE DEVELOPER SCENARIO : FULLY AUTOMATED BY AI THEREFORE “TALENT SCARCITY IS LOW.” AVG. WAGE DEPRECIATION EST. 90% to 100% Sources: Multiple, inc. Labour Economics, G. Borjas; The Impact of AI on the Labor Market, Stanford University. EXAMPLE 02 SOFTWARE DEVELOPER CURRENT REAL WORLD COMPENSATION AVG. WAGE RANGE $40 to $65 Per Hour $83,000 to $133,000 PA Sources: US Bureau of Labor Statistics HOW CHANGING A SINGLE MARKET FACTOR AFFECTS COMPENSATION In this example we look at the job role of Software Developer but change the Talent Scarcity variable. As we know one of the factors affecting job compensation is the Market Demand-Supply relationship, and today we live in a world where software developers are in high demand but where supply is often constrained - and we have accurate wage data for this. However, what if every other factor remained the same but talent was abundant, not scarce, or even fully automated by AI, what would be the impact on wages then? CHART KEY LOW - HIGH _ +WAGE SCORE : SLIDING SCALE SCORE CARD In total there are 18 Market Factors that affect the amount of compensation a particular job receives and we can give each of these factors a score out of 10. Once totalled up, with a maximum score of 180 and the minimum score being 0, the rule of thumb is that the higher the score the more likely it is that that job will be highly paid, and vice versa. On our Wage Score 90 or below indicates a job will be paid below the US average, and a score above 90 will mean it’s higher - all along a sliding scale. Sources: Investopedia, Paycom, SmartAsset BOTTOM 5% Below $15,000 AVERAGE USA WAGE $53,000 TOP 5% Above $335,000 901800WILD CARD : THE REQUIREMENT OF THE PERSONAL TOUCH Our objective is to establish the possible compensation potential for a job and its likelihood of automation in the future. However, while changing a single Market Factor, as we have seen, can dramatically change a jobs compensation, and while hard and soft skills can be automated in time, there is one thing that trumps automation in almost all cases and that’s how much of a Personal Touch a job needs. The greater the personal touch, such as in a care home or hospital, the less likely it is that the role will be automated. NOT AT ALL More Automatable . VERY IMPORTANT Less Automatable . 501000 HOW IMPORTANT IS IT THAT THIS JOB HAS A PERSONAL HUMAN TOUCH ? Example Factory Assembly Inventory Management Example Care Assistant NurseNext >