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I’ve had dozens of jobs, most lasting no more than a few months, but I once did a ten-year stint as a blackjack dealer.
I hated the smoky environment, and dealing with irrational gamblers, but that was my best job.
It paid well, plus my employer let me work part-time and allowed me take time off (unpaid), at will, to travel.
I had to quit as soon as they offered a retirement plan, health insurance, and vacation pay.
You see, along with those new benefits came the requirement to work a more full-time schedule and the inability to take time off other than specified vacation time.
That was too restrictive for me.
The point is that you have to know what you really want when choosing a job.
You also have to fairly compare different employment opportunities.
For example, one job may appear to pay more than another, but may net you less per hour or per week once you look closely at job-related expenses and/or the value of the benefits offered.
So with those two ideas in mind — knowing what you want and knowing how to crunch the numbers — let’s look at how to compare jobs, starting with…
Choosing Work You’ll Enjoy
You’ll spend more time at work than doing just about anything else in life, so why not, if possible, find a job you’ll enjoy?
You still have to think about things like where the job is and how much it pays, so you can’t always choose the one that sounds the most fun or interesting.
But you can start with a list of jobs that involve work you’ll like, and then from that list start screening and comparing them based on other criteria.
Choosing A Workplace You’ll Enjoy
If you’ve worked more than a few places you know a good employer and good workplace can really make a difference in how much you enjoy a job.
There are happy workplaces with cheerful co-workers, and then there are toxic environments that can make you dread going to work each morning.
How do you determine the nature of a workplace before you apply for a job? In some cases, like with stores and restaurants, you can go as a customer and watch the scene.
If possible, ask employees what they like and don’t like about their employer, supervisors, and co-workers.
When you can’t visit the workplace use websites like Glassdoor, to see reviews. Employees reveal how much they make, how they’re treated, and much more.
For example, if you search “Caterpillar,” on Glassdoor, you’ll find 3,100 reviews, with an average rating of 3.6 out of 5 stars.
But don’t go by ratings alone
Read the reviews to see how you would fit into the workplace. For example, maybe many employees like the work but complain about the lack of opportunities for advancement.
If you want to advance, that’s a red flag, but if you have no ambition to work your way up through the ranks you can ignore poor ratings based on that factor.
You can even filter reviews based on your location, so when a company has multiple locations you get only the most relevant results.
Comparing Opportunities For Advancement
If you’re a superstar you might assume you’ll get promoted wherever you work. But if you’re less certain about your ability to sell yourself, you can increase the odds by choosing the right job.
One way to increase your opportunities for advancement is to work for employers with a lot of employees and many levels of management. After all, the more positions there are above where you start, the better your odds of moving up.
To get your research started, Business Insider has a list of the “25 Best Companies To Work For If You Want To Get Promoted Fast.”
You can also research companies on Glassdoor. Read the reviews posted by employees to see if the employer is known to promote from within.
Busy restaurants — especially chains — are known for fast promotion. For example, when I was young I ran a register and made sandwiches at a fast food joint.
In two months I was promoted to shift manager, and soon after was put on salary as an assistant manager. I was offered a position as a general manager within six months (I declined because it required a move).
According to Business Insider, “almost 50% of McDonald’s corporate restaurant managers started out as crew members, as did more than 60% of the company’s owner operators.”
There are non-financial “benefits,” like having an office with a great view or a flexible work schedule. These are difficult to compare or balance against each other or against the more strictly financial considerations.
Deciding how much weight to give these is perhaps the most personal, individualistic part of your job hunt.
But even some financially-measurable benefits can be tough to compare.
For example, let’s say you’ve narrowed your search to two full-time jobs, one which pays $15 dollars per hour, but with no health insurance, and another that pays $13 per hour plus provides a decent health plan. Which would you choose?
First, since full-time work implies about 2,000 hours annually, you make about $4,000 less with the second job (2,000 x $2 per hour less).
If the health plan may is valued at $7,000 per year, the second job sounds better, right?
However, the real comparison should be what you would pay for health coverage if you take the first job.
If a decent exchange plan would cost (after subsidy) $250 per month ($3,000 annually), you’re better off taking the second job and buying your own health insurance.
What if one job offers two weeks of paid vacation annually, and another offers three weeks? What are those extra two weeks worth?
At first glance it seems you can simply multiply your weekly pay by two to get the answer.
But it’s not so simple. If the first job pays $400 more per year, and you really don’t care about vacation time, the second job isn’t necessarily better, even if the theoretical value of that paid vacation time is $1,000.
Value is subjective, which brings us to one of the biggest challenges you have…
Comparing Total Pay The Right Way
Comparing the total pay of various jobs is not as easy as it appears. First, you have to decide which measurement is right for you. Let me explain…
You have to decide whether you want to take home as much money as possible (per week, month, or year), or whether you want to make as much as possible for your time.
For example, I once applied to be a driver for a food delivery service, because the drivers made a decent weekly wage.
But then I learned that they work 60 hours per week, which made their pay look not-so-good on an hourly basis.
Now, if you need more coming in monthly money to pay the bills, that driving position might be a great job. But time is what I value most. I wanted to work less and make as much per hour as possible, so I skipped the second interview.
I’ll always look at what I get paid for my time, but many people have less flexibility in their living expenses, so total income per month matters more. You have to decide where the balance lies for you.
And then, whether by hour or by year, you have to properly calculate the total pay. Here’s the basic formula for doing that:
- Start with cash wages.
- Add the cash value (to you) of benefits.
- Subtract all job-related expenses.
- Divide the total net pay by total job-related hours to calculate your hourly wage (skip this step if weekly or monthly income is your measurement of choice).
Let’s dig into this a bit deeper…
To your basic wages you add the value of benefits. An employee compensation calculator can give you a rough idea about the total value of a pay package, but when it comes to benefits, what really matters is the cash value to you.
For example, regardless of the theoretical value of a workplace gym, to you it’s $0 if you’ll never use it.
On the other hand, if you can drop a current gym membership, for which you pay $20 per month, the value is $240 annually, which is the savings you’ll get.
Free workplace daycare could be a nice benefit, but if you have no kids the value is zero.
And free lunches are worth only what you save, so the value depends on whether you would otherwise eat out every workday or bring a lunch. In other words, the actual cash you’ll save is the best best measure of the value of benefits.
Then you have to subtract the total job-related expenses, which can vary widely. For example, some jobs in construction require you to provide your own tools, so you have to consider the annual maintenance and replacement costs.
Typically, one of the biggest job-related expenses is transportation between your home and your workplace.
For example, at a conservative 30 cents-per-mile operating cost for your car, a job that is 20 miles further away than another costs an extra $60 per week ($0.30 x 40 miles daily x 5 days weekly).
That’s the equivalent of making $1.50 less per hour.
From my article, “How To Calculate Your Real Hourly Pay,” here are some of the job-related expenses you might have:
- Federal taxes
- State taxes
- Social Security and Medicare taxes
- Commuting expenses
- Childcare expenses
- Any other expenses that are necessary to keep the job
Of course, if hourly pay (rather than monthly pay) matters to you like it does to me, you have to also calculate the hours you’ll spend on the job and on all job-related activities.
As explained in that article on real hourly pay, you should count the time from when you leave the house for work until you return home, as well as including any necessary unpaid training time and such.
Follow that formula carefully for a fair comparison.
A job with better pay at first glance might pay far less per hour than another once you add the cash value of benefits, subtract job-related expenses, and divide net pay by the total work-related hours spent.
Finally, there are a few other things to consider when comparing jobs. Some have financial value that can be calculated easily.
For example, housing is sometimes provided for apartment managers or forest rangers.
In that case the value (if you’ve been paying attention) is not what the accommodations would rent for, but what you would otherwise pay for rent.
Some aspects are not so easily valued or compared. Doing work that you enjoy is mentioned above, but there are other potential considerations.
For example, a job might allow to live in a part of the country where you prefer to live. A job might involve regular travel, which is a plus or a minus depending on your circumstances and preferences.
Some jobs can also be used to make additional income beyond what they pay, even if the net effect is difficult to measure.
In “15 Ways to Use a Job to Make Money,” I detail strategies like using a job as training to start a business, as a place to sell things you make, and as a stepping stone to a better job.
To sum up, use the suggestions here to make a list of what’s most important to you, and start comparing those opportunities.
If you have a good job-hunting story to tell, please share it below … and keep on frugaling!