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Comment by mc32 | Hacker News Reader

I’m down for that. There are so many “facilitators” in middle management, some really good and quite a few bad ones and many making no difference. I don’t know how people thought they were good positions to hire for.

Remember before Covid many a company deadweight showing us the vast amounts of unwork they did at their companies on their YouTube videos? Proudly showing how idle they were?

Not all the firings are deadweight but a lot are. There is also a general tightening of budgets and people who are part of dead-end programs that are being let go. When the economy was hotter companies would keep these people to add at the margins; I think now that money is still tight they’re not keeping that luxury.

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In a zero interest rate environment, literally any return on investment justifies spending.

If interest rates are 3.8%, the company needs at least a 3.8% return every year on your yearly compensation to justify your job.

Not if they are compensated during the year.

Grocery stores have slim margins, but if you make 10k after selling 1M worth of stock buy turn over that stock 12 times a year that’s ~12% annual ROI not 1%.

If the company is spending $100k to employ you, you need to deliver $103.8k/year of value.

Again you assume a year delay on a workers full salary before the company gets compensated. Cash flow rarely works like that.

Uber driver does what 2 weeks of work before getting paid, they also front the cost of their car and gas etc. Meanwhile users are paying as soon as the ride occurs, so uber doesn’t need an account with a full years salary for every driver somewhere at the start of the year. Get paid before the worker and the worker is in effect giving you a zero interest loan.

Now for a consultant the company may get paid after the worker but the company is rarely waiting a more than a few weeks.

Do you see the broader point I'm making, which is that non-zero interest rates means delivering value isn't enough anymore?

+/- 0.1% over a year isn’t meaningful here. I understand that you’re unwilling to reconsider your beliefs when they are based on faulty math and thus don’t reflect the underlying reality here.

A plumber, doctor, teacher, cook, etc does work before getting paid and the company rarely needs to wait 365 days for someone to pay them for that work. This means your idea is inherently flawed, there’s no broader point when you’re making a mistake.

Further future revenue is generally inflation adjusted. If you borrow 1B to build a power plant you sell electricity at future prices not what electricity was worth when you started building. When the reverse happens say at collages when they get paid months before professors get paid, the school isn’t increasing salaries every month to keep up with inflation.

You'd calculate return on investment based on invested capital, not on expenses, so this does not follow.

That's .. not at all how interest rates work.

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