The obsession with constantly increasing your salary year-on-year is very much alive and well, at least in the US.
I'm not European, but I imagine that this isn't the case in Europe as it doesn't have the same culture around work.
I'm not European, but I imagine that this isn't the case in Europe as it doesn't have the same culture around work.
For example, while landlords aren't supposed to raise the rent by more than 2% per year, I've had my landlord surprise me with a 5% change, but moving is too expensive to realistically consider [1].
Factor in all the additional costs of living, and if you don't get significant raises every year, you're going to fall further behind each year and be unable to afford a family, a house, or an emergency.
It's not great.
1 - When I moved to a good neighborhood in NYC, I had to pay a brokers fee of 15% + moving costs + up front costs to the landlord. Say my rent was 3k, this would be 5400 (0.15 * 3000 * 12) + ~500 + 9000 (first + last + security), or approximately 15k just to move into a place you don't own.
Rule of thumb for me in my career is I expect at least a 5% raise yearly to account for cost of living and inflation of currency, otherwise, like you said, you'd be losing money YoY.
Thankfully, I've gotten many > 25% raises throughout my career. It's possible, but it's rare, and jumping jobs usually gives larger pay bumps.
My mortgage is less than $2200 for a 3100 square foot house brand new build and that wont go up besides property taxes and insurance.
(Fortunately, this is a good employer that realises what the reality looks like and is willing to offer me competitive raises to make it a doubly mutually beneficial arrangement.)
That being said, I was quite content with my pre-Covid salary which was pretty much average for a top end individual contributor locally. But I did need to make at least $20K more over in two years.
Then Covid happened, along with pay cuts and the local market dried up.
But now working remotely for BigTech means my base salary is a little more than it was pre-Covid and RSUs+Bonus is pure gravy that goes directly to long term savings.
It also meant my wife didn’t have to go back to work in the school system with a Covid going around.