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Do you hate your work?

Reggie Perrin: Workplace disatisfaction is nothing new

Jobs aren’t ideal for most of us, but they’re our number one moneymaker. It’s counter-productive to hate work when it mostly has to be endured.

Besides, the alternatives – extreme early retirement, starting your own business, or death – all have downsides.

For some reason, however, more and more people seem to be finding the very nature of modern work intellectually intolerable.

Is this due to the changing reality of work? Or is it due to the growing post-Boomer-era feeling of self-empowerment – and dare I say self-entitlement?

Why you hate work

I’ve been having this very discussion over on Monevator reader ermine’s excellent blog. In Digital Taylorism – Why our Jobs are Getting Worse he writes:

When I started work at my current company as a lowly grunt Assistant Engineer, I had the authority to fill in a purchase requisition for up to £500 without higher level authorisation, and that was about right for the level of work. It wasn’t generally abused, either.

Now I have to get authorisation from the next level up simply to buy a rail ticket, and that next level has to get the okay and a reference number from some other part of Business Operations. I don’t know what you have to do to buy pens and paperclips these days.

He goes on to explain that he used to find software development a creative process, but now finds it as rigid as any production line. He quotes a Guardian article that itself quotes an academic paper on the subject:

[From now on] “permission to think” will be “restricted to a relatively small group of knowledge workers in the UK”.

The rest will be turned into routine and farmed off to regional offices in eastern Europe or India.

Ermine’s post follows a coherent and consistent line on his blog – modern life is rubbish, it’s increasingly justifiable to hate work, and he’s determined to get out.

It’s well worth a read.

Work was never all that for most people

It’s my contention though that work was mostly always rubbish for the educated classes, and that it’s only nostalgia that causes people to believe otherwise.

As for the ‘working classes’, only a fool would want to die at 50 after three decades working underground in a pit, or to sew buttons onto jeans in a factory all day.

I understand the sense of community that went with those jobs, but even that was a corollary of a far tighter social straitjacket than any modern workplace will lock you into.

The music changes, the technology too, but young and idealistic people keep getting older, and in my view that’s why people hanker for a crummier past.

As I commented to ermine:

In my view, you’re really describing how big corporate companies were a fun place to work 20-30 years ago, but aren’t now.

But these days the bright jobs are in start-ups or finance or working for yourself.

The old days, whether tugging at Mr Mainwaring’s forelock or working down a pit or being a shop girl in Woolworths, were no fun.

At least you don’t die at 50 of coal dust inhalation now if you’re a bloke down a pit, or have to put up with the boss calling you a ‘silly girl’ between pinching your bum in the typing pool.

Graduating to office politics

Another mistake when comparing then and now is to believe the hype about education and social mobility.

The small number of 50- to 60-somethings who were educated in the grammar school system after passing their 11+ and who went on to university were cut from entirely different intellectual cloth to the great mass of the near-50% of students that now enjoy higher education.

That’s not to disparage people trying to better themselves – it’s a statistical fact.

All students from across the eras were not created equally. The 11+ passer was the elite achiever of his (or more rarely her) generation – the equivalent of today’s multiple A* student who aspires to earn a fortune in law or The City or medicine. And if anything, those that climbed out of the comprehensive school system were even brighter.

It’s therefore madness to compare the average earnings of that small number of graduates from 30-50 years ago with the vast body of graduates today and to be surprised at their declining average fortunes, when the talent pool is so different.

Similarly, it’s dangerous to conclude jobs are getting worse because lots of graduates find themselves doing rote tasks once employed.

Plenty of people graduating now would have been in the typing pool or junior bookkeepers or the equivalent 30 years ago. They wouldn’t have moved along the same escalator of progress enjoyed by the educational elite that dominates the chattering classes. They wouldn’t have been thinking much in their jobs 40 years ago – and they’d have had to call the boss ‘Sir’ and wear a suit in summer, and beg the bank manager for a mortgage and a lot of other restrictions, too.

The problem is fairly average students have been sold the lie that they can do and be anything they want. The average wage in an average office that awaits them is a big comedown for the thousands who graduate with degrees in theater, music technology, photography, or marine biology.

Besides, post-Industrial Revolution progress has been about taking something done by specialists or artisans and finding a way to do it using less skilled operators and machines so it can be mass-replicated at a lower price.

Those bemoaning how much software engineering or surveying have become routine tasks perhaps don’t realize that it’s financial engineering and architecture – or even interior design – that are attracting the truly smart thinkers today.

If we’d stood in the way of this trend, we’d still be buying woolen waistcoats for a month’s wages and darning them two decades later.

(Just ask your nearest Luddite).

The 1970s: Just as easy to hate work (and your boss)

Of course, as I discovered when I challenged the strange draw of sweatshop manufacturing or the equally perverse hatred of free trade, the idea that our jobs are getting worse is probably too deeply embedded in the popular imagination to be easily assuaged.

People forget the downsides of yesteryear – the numbing computer-less record keeping, the drab offices, the strict hours, the routine bullying and sexism, the choking paternalism (and cigarette smoke!), the one-company-or-you’re-out career paths, the lack of Facebook at your desk – to focus on today’s vague existential problems, which are a lack of self-fulfillment or intellectual stimulation.

But even these woes are nothing new.

One of the best TV sitcoms ever was The Fall and Rise of Reginald Perrin. Adapted from a novel of the same name, it was all about a middle-aged, middle manager’s inability to find happiness at Sunshine Deserts – a bland corporation on a featureless trading estate on the edge of the commuter belt.

Not only was the hero Reggie driven deranged by those supposedly halcyon bygone days – when the format was updated in 2009 it didn’t really work, because the new Reginald Perrin was free to flirt with his female co-workers, play with email, and work from home.

As for the non-spiritual annoyances – the overly enthusiastic upstarts, and the boss promoted beyond his competence – they were just the same as ever.

The hollow middle-classes

I’m not dismissing anyone’s views about work out of hand, and there is certainly a discussion to be had here.

Even The Economist has been on the case, citing a study called Job Polarisation in Europe that purportedly shows the middle-class being hollowed out:

In the 1970s and 1980s employment in quintessentially middle-skilled, middle-income occupations—salespeople, bank clerks, secretaries, machine operators and factory supervisors—grew faster than that in lower-skilled jobs.

But around the early 1990s, something changed. Labour markets across the rich countries shifted from a world where people’s job and wage prospects were directly related to their skill levels. Instead, with only a few exceptions, employment in middle-class jobs began to decline as a share of the total while the share of both low- and high-skilled jobs rose.

On the face of it this backs up the critics’ case, but I’d need to dig a lot deeper into the research before I accepted the conclusion that IT has replaced swathes of back office middle class jobs, to the detriment of that cadre of employees.

I don’t deny computers have had this affect (I saw my father do it at company after company, like some Grim Reaper of the CPU-powered Apocalypse) but I don’t accept the outcome was bad.

While they may have had some prestige to them, most jobs replaced by computers were routine. Moreover, the introduction of IT enabled more people to do more interesting stuff – witness, for example, the huge explosion in magazines and newspapers in the 1980s that occurred once desktop publishing had freed writers and designers from the tyranny of the typesetter and the print shop.

This benefit is reflected in the hollowing out study, which shows higher earners making up a greater total share of hours worked. I’d say this was due to people moving up the food chain, in refutation of the dumbed-down work hypothesis.

As for the also-increasing total hours of lower-earning work that’s seemingly come at the expense of middle-class incomes, well yes, there’s no doubting call centers and retail have replaced some rungs on the corporate ladder, but as I’ve argued those lost jobs were hardly great, anyway.

There could be other trends at play, too, like more women entering the workforce but choosing to take on less intense employment in the service sector, and so swelling the total lower-paid hours worked.

By all means hate work, but…

I’m the last person to defend most jobs and office work as anything but a means to an end. I’d like financial freedom to choose exactly what work I do, and I see the attractions of retiring early (even though I’ll likely always do something gainful on the side).

But what I do dispute is that work has got worse. On the contrary, I think for most people it’s got better.

Today’s office drones are fretting about their meaningless roles while booking holidays on LastMinute, chatting on first-name terms to the CEO in the kitchen, and listening to Lady Gaga on their iPods. They can hardly imagine the strictures of yesteryear.

No era is perfect, but I’d rather be a cubicle slave now than a ’60s office drone.

Readers, what do you think? Am I – against all odds – an excessively sunny optimist? Please let us know where you think work is going in the comments.

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Weekend reading: Money Mavens

Weekend reading

My weekend musings, followed by some money-tastic weekend reading.

Those of you who’ve been reading Monevator for a long time (I’m looking at you, sis!) will recall it’s been a tough old slog for yours truly.

I must hold the record as the whiniest blogger out there when it comes to the actual practice of blogging. (My comparison of blogging with $1-a-day Third World labor became something of a cult classic in certain blogging circles).

I like to think I have a decent blog with some useful information for anyone looking to grow their dough. But I know I’m a lousy actual blogger.

I take ages to write posts. I don’t make any real money from the lucrative money blog niche. I don’t promote my posts much anymore, I’ve got bored of submitting my blog to carnivals, and my blog is a secret in real-life.

It’s a miracle you found me!

Enter the Mavens

Here’s where – I hope – the Money Mavens come in. I was delighted to be invited to join this informal network of bloggers a couple of weeks ago, though I um-ed and ah-ed about it.

My fear is that as a rubbish blogger, I won’t have time to contribute fully to their initiatives. It takes me hours to write a post, and time is only getting tighter.

Will I find the time for networking? We’ll see. From your perspective, though, there should be only positive changes.

I’m a regular linker to a few of the Mavens already – Oblivious Investor, Wealth Pilgrim and Len Penzo – and the other members are also from the top-drawer.

I plan to run two special link roundups a month, pointing to some of my fellow Money Maven’s best posts old and new. This will be in addition – not instead of – your normal link round-up.

I also hope to flag up and discuss some of their ideas in individual posts in the months ahead.

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The danger of small cap share tips

Ramp dangers

Like many UK investors who foolishly pick stocks with a proportion of their portfolio, I’m a big fan of the writings of John Lee.

(Lord) Lee has been giving regular updates on his portfolio in the Financial Times for many years. A few years ago, he revealed that by investing in small caps held within tax efficient wrappers (first PEPs, later ISAs) he’d grown a portfolio worth over £1 million.

Considering the annual contribution limits on PEPs and the follow-up ISAs, that’s an excellent achievement in anyone’s book.

Lee’s method is to buy low P/E small cap companies paying decent dividends that he considers overlooked by the market, and to reinvest the income into new shares. I think it’s as good as any method of actively picking small caps; at the least it keeps you away from blue sky punts.

John Lee moves the market

There’s a downside to being a John Lee fan, however. Because Lee is popular and because he tends to favour illiquid small cap shares, anything he writes about often experiences a sharp spike upwards in its price.

On Saturday 4th September 2010, for instance, Lee wrote about four AIM shares: Christie Group, Concurrent Technologies, Pressure Technologies, and THB.

Here’s their performance in trading on the Monday morning, as I write:

  • Christie Group: Up 15%
  • Concurrent Technologies: Up 14%
  • Pressure Technologies: Up 6%
  • THB: Up 10%

In contrast, the FTSE 100 is up 0.42%, while Aberforth Smaller Companies (an investment trust that holds Lee-style small caps) has dropped 0.75%.

It’s clear that Lee has moved the market in his four shares this morning, for a hefty average gain of 11%.

Patience is a virtue

John Lee is richer this morning as a result of his column on Saturday, but I want to stress that I don’t think he is doing anything wrong at all. From all the evidence he is a scrupulous man, writing to share his knowledge with other investors.

Also, Lee is a long-term buy-and-hold investor. The price of these shares on one Monday morning won’t be of much interest to him.

It’s also possible that his fellow investors haven’t even had the chance to push the price of these four shares up much. Rather, market makers may have read Lee’s column over the weekend, and bumped up their prices in anticipation that new buyers will emerge. Many small caps are very illiquid at present – I’ve moved prices by investing just a couple of thousand pounds – so it’s a reasonable move on their part.

Now, I have both Pressure Technologies and Concurrent Technologies on my own watchlist, and I’m very heartened to see Lee likes these companies, too.

However, I have not so far bought shares in either. It’s senseless to pay 14% more for shares today just because another investor has shown his hand.

My suggestion if you like these or any other companies that Lee writes about is to be patient. The price rise should drop away as the buzz dies down.

In the short-term the stock market is a voting machine, but in the long-term it’s a weighing machine. It’s earnings that ultimately drive share prices, not newspaper columnists.

Beware of the ramp

Incidentally, some readers recently mooted a ‘Monevator effect’ in the comments to my article on Lloyds preference shares.

The price did run up the day after I posted that article, but I think that was a coincidence; the Investor’s Chronicle also published a piece that week, and I think it has rather more sway than my blog!

If Monevator ever does move prices, then you should certainly beware of buying into short-term spikes, just like run-ups from any other source.

In particular, be very careful with discussions of illiquid shares on bulletin boards. There have been cases where posters have been found to deliberately ‘ramp’ the price of some hapless small cap, then dump the shares at the top. There’s even been rumours of the professionals getting in on the act.

Anyone who lived through the frothy Dotcom days – where a share’s price could double on being mentioned in a popular lunchtime TV program – can tell you about the risks of chasing ramped small caps.

In my experience, the best stock picks are made in relatively unknown companies that you alight on through your own research. You may be wrong that the shares are a bargain, but at least the price won’t have already been over-inflated by the opinions – correct, incorrect, honorable, or self-interested – of others.

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Weekend reading logo

My regular Saturday musing, followed by the links to some great articles.

Felix Dennis makes no secret in How to Get Rich about his pleasure in sending large cheques to the Inland Revenue to settle his tax bill.

An old Lefty, Dennis doesn’t mind doing his considerable bit for those who haven’t had the opportunity in life to overcome a drug and hooker addiction through poetry and tree planting.

Also, he sensibly points out that a big tax bill is a sign of success.

Most of us will do all we can to avoid paying excessive taxes and to reduce our capital gains tax bill, but at the end of the day, owing a wodge to HMRC means you’re doing something right.

However it’s one thing to pay your taxes with a clear conscience and a smile, and quite another to find you’re going to be clobbered for more taxes for a year you thought was done and dusted.

Yet that’s exactly what 1.4 million UK citizens have woken up to today. Perhaps you’re one of them, who will be hit by an unexpected bill for a cool £1,500 in extra tax payments, according to the BBC:

Nearly six million people in the UK have paid the wrong amount of tax.

About £2bn was underpaid via the Pay as You Earn (PAYE) system in the past two years, with about 1.4 million people owing an average of £1,500 each.

But £1.8bn has also been overpaid and some 4.3 million people will get a rebate because they have paid too much.

A new computer system has allowed more discrepancies to be identified, but HM Revenue and Customs said the “vast majority” of tax bills were correct.

The number of people affected by over or underpayments is also higher than usual because HMRC is currently reconciling two years of PAYE contributions at the same time, rather than just one.

Watch your postbox carefully. You could be in line for a £300 windfall, or discover you’re £1,500 poorer than you thought.

For anyone without an emergency fund that’s a lot of money to find, though I suspect you’ll be able to pay it back through an adjustment to your PAYE code for 2010/11.

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