Enterprise Software

CEO exercises controversial recruitment strategy: Low advertised pay

Ben Huh is a CEO who believes you can find the most qualified and passionate personnel if you offer a low salary.

I was reading a blog by Ben Huh, CEO of icanhascheezburger.com, in which he spoke of his belief that you get the best employees for a job by advertising that job with low pay. (For example, his company posted two jobs recently: One for an office Admin, and one for a Jr. Designer, with the hourly rate for each listed as $8.55 to $10 per hour.) His rationale:

We advertise lower wages for entry-level positions because the worst candidates focus on money the most. Believe it or not, advertising lower-than-market wages actually helped us yield better candidates. Higher advertised wages resulted in much higher level of noise from candidates who really didn't care about the job. (FYI: Advertised pay and actual pay are two different things.)

That reads as though he increases the salary once the employee signs on, but I'm not sure.

I can understand wanting to weed out the people who are looking for career satisfaction in terms of how many numbers come after the dollar sign. It has been my experience that the people who concentrate on salary, particularly in the first interview, are not primarily interested in what they'll be doing, only what they'll get paid for doing it. And it has also been my experience that a job candidate's talent is not always directly proportionate to his or her confidence or ability to ask for a commensurate salary.

However, there are some other issues to consider. Job candidates who have a long and/or successful job history can better quantify their value. And if that value is more than what is offered, why would they settle for that pittance? It may be wrong to judge your own value by the salary you command, but it can't be denied that others may be judging you on that basis.

And let's not forget that there will be companies out there throwing out low salaries not to attract the passionate but maybe just to exploit someone who may be down on his luck. Mr. Huh may have good intentions to attract the passionate, but the intentions of other CEOs may be just to spend less.

Huh also stated:

Every manager and CEO has a story about the lazy-***, unqualified person who demanded a top salary and a raise every three months. But those same managers and CEOs will also tell you about the butt-busting, entry-level employee who never complained and eventually rose to become the team lead or an executive. Guess which of the two they recruited away to their next company?

I'm not denying that this has happened, but aren't these people using criteria beyond salary demands to judge the viability of a candidate? There are lots of ways to weed out the lazy and the unqualified other than with a simple low-salary mind game.

About

Toni Bowers is Managing Editor of TechRepublic and is the award-winning blogger of the Career Management blog. She has edited newsletters, books, and web sites pertaining to software, IT career, and IT management issues.

274 comments
hlhowell
hlhowell

A cheapskate is a cheapskate. What kind of car does he drive? I think I can pretty safely bet it's not a Focus or a Fiat 600. Yet the vehicle that carries him around is worth more than the employees that made him successful. This is decietful at best, and unlawful at worst, depending on the amount of fraud in the postings and job descriptions, along with the responsibilities. Worse, depending on the state or country he may be in serious violations of labor, tax, and fiduciary laws. If it is not his own company, he is placing others at great risk by his behavior. Lots of luck Mr. Huh. You're going to need it.

anthonytperry
anthonytperry

This is a ridiculous idea and very short sighted. Only the desperate and unskilled will apply. Experienced IT people invest a great deal of resources in their education. They know their worth and the value they bring. The bottom line is that everyone needs to provide for their family. Just like Law, Medicine, and Accounting, IT is a profession and deserves competitive compensation. When the worker gets a better offer, I'm confident they will move on.

ssampier
ssampier

I don't know how anyone lives on these salaries. Monthly rent in an average city is at least $600-$800 a month. I used to make $41,000 a year and I struggled to find a decent place in this rural area for 25% of salary for living expenses (2255 net * .25 = 563.75).

rodromex
rodromex

Cheap BASTARDS!!! I bet they don't apply the same "logic" when it comes to their own salaries and compensation.

ldinetta
ldinetta

I worked for only a few companies in my career, and I'm still working, but I have to comment. The guys like me who took the job because they wanted to accomplish something always got the short end of the stick. I watched colleagues who demanded more money upfront always make more than me, even if i felt better about what I was doing. Those guys always took advantage of the situation and they're retired. I'm not! But I'm still a vital part of the workforce.

jayohem
jayohem

Huh is a good name for that person. Huh?! just about sums it up. You won't get the best, but you certainly will get the most desperate almost at the "will work for beer" level. If Mr. Huh was starting up and offering sharesies, that would be another case. But Walmart wages for qualified people will attract only those people truly desperate for work.

GRMDP
GRMDP

He's a troll. Why would anyone want to work for him unless they "had" to? There is always a goofball CEO/CIO we have to watch out for. -Greg

HypnoToad72
HypnoToad72

useless things like bills? Forget these leech-like CEOs. Start small businesses.

cardhun
cardhun

Does not want to present itself as a cut-rate bottom-basement company. The interview process is supposed to weed out superficial and pretender candidates. People who show no basic understanding of the company, its goals, its competitors, and the likely needs of its customers are the ones focused on money rather than responsibility.

alejandro.delavilla
alejandro.delavilla

In the modern job markets where job stability is inexistent, carreer development is fuzzy and company directions are determined by pure politics, working for a company is ONLY about money. Specially software development positions. I personally do not trust anyone who comes and say that he/she is loyal to the company and works because it's her/his dream position. Monay makes the world go'round. That's the only truth. Passion is to be kept for your loved one.

pizrround
pizrround

I just checked the calendar. it's still a few days too early for this to be an April Fool's prank.

pizrround
pizrround

This guy Ben Huh must be associated with The Onion, right?

wbaltas
wbaltas

For my first few jobs out of College the salary wasn't advertised. I interviewed two or three times before salary was discussed. In my first job, I jumped at the offer (relatively low pay but with a great career growth). I learned a lot. After three years, I interviewed with another employer, my first employer (the low paying job) offered me a 30% raise; I turned it down for a 45% raise and a new job. In my current position, the salary was advertised, but I was able to negotiate an amount above the amount offered. Experience and the ability to articulate the experience helps a lot. If an employer wants a career minded individual, don't advertise salary. Have a minimum of two or three interviews, and bring it up near the end of the second or in the third interview.

AlChirico
AlChirico

It seems clear that this CEO is myopically focused on the bottom line instead of being focused on the business like Mr. Lacedaemeon, for example. This guy is probably a textbook MBA with little practical business experience. That being said, it is an almost universal truth that the minute a low-balled employee can find a better job, they will quit. What does that do for the bottom line, Mr. CEO.

newtonr
newtonr

I wonder how much Mr. Huh gets for pearls of wisdom -- is he paid highly and is therefore, by his own standards, a lazy-***, or is he low paid (and just a miser)? Either way, he isn't looking to hire someone who will stay long -- as soon as they have the experience, they WILL be able to get a better paying job (and that's even if they are enthusiastic) offered to them by someone who sees the enthusiasm and is willing to pay them what they are worth, and not based on how much they can hold back. Thanks for pointing him out to the rest of us -- hopefully, he'll just have a hard getting anyone to work for him... period. The days of treating people like a commodity need to stop!

mjstelly
mjstelly

I think Mr. Huh is playing a dangerous game of double-speak and mental gymnastics. On its face, his plan appears focused on building a workforce of high-minded employees dedicated to their work for the love of it. Great! Mr Huh, this is a for-profit enterprise, not an NGO saving lives in Haiti. Beyond the hype, it appears nothing more than a cheap parlor trick to lure gullible and/or vulnerable laid-off workers into giving him something for nothing. Show your principles in action, sir. Why don't you work for minimum wage? That'll show your employees you walk your talk.

marathoner
marathoner

Really talented & passionate youngsters with other sources of money might bite on this but a regular kid just out of college with student loans wouldn't be able to, no matter how passionate and talented she is. I think it would be better to offer reasonable pay but have a contract probation period of six months where they can be dismissed no questions asked. You can't expect people to do good work when they are living in a cardboard box and eating nothing but ramen noodles. He's just a cheapskate. I hope people don't buy it. They don't need $60/hr but they should be offered a living wage.

rramos
rramos

I became a business owner because I was tired of being an employee at the whim of other business owners. Blame it on my enterprising father, but I saw many of his workers join his company solely for a paycheck with little interest in the quality of their work and the level of productivity needed to keep the business profitable and afloat. Many would hide behind their certifications and degrees, but had no genuine interest in moving the company forward. Those that did were rewarded, but only after many years of service and many of those went on to start their own businesses using my fathers company for mentorship and even at time support. Everyone thinks that all of the company profit go to the big bosses and thought there is some truth in that, its mostly a lie that employees throw around the water cooler. Fact is most CEO's don't have a salary at all!... they are vested in the company and if it fails, they fail. The only money they can safely draw out of the company without getting taxed to kingdom come is based on how well the company does. So in times like these, they earn nothing... not even $8/hr. So this CEO is going back to a tried and true method of growing his people, because the most talented folks will not take a job just to chase more money, they will take it to chase greater opportunities to use their talents.

ljack223
ljack223

I've grown weary of hearing about how the "cream rises to the top". My experience in the real world has been that the big bosses bring in their kinfolk (or their friends' kinfolk) to fill the top-paying, high-profile jobs and continue to pay pittance to the hardworking employees who actually do the work.

lynnwatkins
lynnwatkins

I'd like to know what Mr. Huh's salary is. That could answer alot of questions, because: 1. If he's paying himself a low, low wage, then he practices what he preaches and he's getting what he's paying for. 2. If he's a well paid CEO, then his own words would imply that he's highly overpaid for the value that he's offering.

lynnwatkins
lynnwatkins

I'm looking for a cook, a maid, a gardener, and a personal driver. Starting salary: $0 with an anticipated raise in the not near future to $8 per hour for those who excel in their jobs. Only the most dedicated need apply. Anyone searching for market rate for these positions should not apply. Must have previous experience. Candidates are required to be tested for particular skill sets, be willing to relocate, and start immediately.

FlNightWizard
FlNightWizard

I worked for a Fortune 50 tech company. It had 2 letters and one of those was an H. It was a numbers game when it came to any compensation. The majority of the time the department wasn't given any budget money to give raises. So the whole department suffered. This went on for over 5 years. It wasn't whether you were qualified. It was if you where lucky to be in the budget. Even our sales division, who were on commission, was given a cap on how much they could make. You worked hard, you were penalized. It was the almighty shareholder the whole company was geared to. They never wavered more than a couple of pennies in the money they paid to shareholders every quarter. This caused thousands of lost jobs in the last 2 years. But they met their numbers.

datashepherd
datashepherd

When asked about salary, I used to respond (to paraphrase) this way: I consider the challenge and the fit to be the priority--you can't buy your way out of an unsatisfying job. Assuming the salary is generally commensurate with the demands and responsibilities of the position, I'm going to be okay that front. It isn't the same as advertising a position at a low salary, but the negative responses have indicated that HR and hiring managers just aren't focused on the "best,...most passionate" candidates.

jimmyreed4tech
jimmyreed4tech

Sounds good for entry-level work, if you can get by with that lack of experience then more power to you!

WmTConqror
WmTConqror

Toni, Thank you for the article. I wouldn't have known of Icanhaschezburger or Mr Huh. Of his 2 Feb 2010 blog "Are you what you earn?" from Mr Huh's website benhuh.com. Mr Huh's own history states that he opened a startup only to have it fail and him in debt (Huh states 40k). He says he put in the work as a consultant to get himself out of debt and was out of debt in a year. Clearly he was getting a premium above 10/hr. Assuming a normal work year @ 40hrs that's 2010 hrs, or 60 hr would be 3120 or 80hrs would be 4020 etc.. So maybe he was working 60+ hrs but would have at a minimum been earning 15+ an hr. However he marketed being a consultant, he didn't accept a paycheck that wouldn't support his debt / lifestyle. The intent of his blog is to evaluate and answer the question "Are you what you earn?" I think more to the point of your article quoting only his statement without the reasons or intended audiance he stated in the blog: "If you?re a hiring manager or CEO and you?re reading this, I encourage you to summarily reject a candidate if they bring up compensation (unless you prompt the topic) in the first interview. To me, it?s an indication of the following: The candidate?s inability to control their personal expenses, which inevitably leads to drama and demands at work. The candidate?s lack of belief in his or her ability to succeed and grow within the ranks. The candidate?s inability control the diarrhea of the mouth, the leading symptom of the disease called poor judgment. So what should a job seeker do? If the economy has dealt you a bad hand, I am truly sorry to hear that. I know what it?s like because I?ve been there. If you have high financial requirements in order to absolutely survive, I don?t really know what to say than go get a job at a bank (you know what I mean). But if you really want to have a great career, don?t worry about how much you?ll be paid now. Instead, focus on finding a company you?d love to work for and a job you?ll enjoy doing, then find a way to live within your means. That?s the recipe for growth both financially and personally." For business people he is stating classic hiring practices, if a candidate brings up money before you do, that's a red flag. From a personal level, it's like buying a car from a salesman who keeps pushing price opposed to what your needs / requirements are. I agree with you, if a companies hiring department isn't weeding those resmues out earlier in the process Mr Huh should look to hiring a new staff in the HR arena. I agree with the others who correctly pointed out simply you get what you pay for. But that is the risk of business and making money meet the need. Not a system for hiring cheap. For people in the job market, he is quoting the idealistic, if you work and love what you do, and can afford the salary that is offered, your life will be happier. Don't equate your worth with salary. For those of us, including Mr. Huh, that have to have a roof over out head and food to eat his job advertizement / or job advertisement from companies that lowball talent aren't ever going to be a long term place regardless of how much we enjoy that company. What Mr. Huh wants to find is a diamond among a box of quartz. It happens. More so with small start ups. But generally you go through a whole lot of quartz. Most companies that hire on the lowball process are dedicated to holding you just long enough to get experience for the next job.

mafergus
mafergus

Just reminds me of why I love this country. Everyone has an opinion and an orafice used to remove waste. Every company has a different opinion on what their hiring policy is and should be. His direction will be shaped by his philosphy. It isn't any better or worse then the place that pays top dollar plus, the places outrageous demands on every employee and has a turnover rate out of this world. Personally, I don't believe in lowballing people, but I agree with his point that when the money becomes the primary focus, it can be a bad sign, but it's a bad sign whether it's $8 or $80 an hour. The answer isn't posting "fake rates". It's setting a decent range based on your market situation and working to make your working environment the best it can be.

dadonaldd
dadonaldd

What a load of pelosi... this will just get you junior employees that will SETTLE for peanuts.

dadonaldd
dadonaldd

What a load of pelosi... this will just get you junior employees that will SETTLE for peanuts.

erica
erica

The idea makes total sense to me. Though I don't like the idea of less salary, I'd definitely consider it if telecommuting is an option sometime down the road. I enjoy what I do as a programmer and if I didn't need to try to keep a roof over my head (already lost our house in the housing mess), I'd probably do it for $8.00 an hour just to put food on the table and keep gas in the car.

Dyalect
Dyalect

for lowering the value of IT jobs.

joeller
joeller

25% of Salary for living expenses? I have not seen that since before the Reagan Recession. Since 1981, I've counted myself lucky if I could find a job where I am paying only 50% of wages for rent/mortgage, insurance, vehicle, gas and food. When you add in upkeep for the home, that percentage goes up to about 85%. And this is in the rural area of Maryland. And people wonder why I stil own a CRT TV, a 12 year old computer and no smart phone.

bernalillo
bernalillo

Get about 10 guys to share one appartment and just eat beans you could do this easily and the CEOs of America wouldn't have to work so hard to make their Billion dollars a year salarys. Really now, why must you be so self centered?

joeller
joeller

That is not a feasible solution in this economy at least in this part of the country. Anyway people fresh out of college need real world experience under guidance before they can be considered sufficiently good programmers to make it on their own.

ivoyhip
ivoyhip

In the modern society, it is very easy to find out the salary range for a particular position. The sources of this information include Internet and trade publishing. I have some friends who are fresh grad from college. They are all very clear about the typical income for positions that they are interested in. They feel it is an insult from potential employers who offer one dollar fewer than the typical pay in the industry. In short, I even doubt if Mr. Huh can acquire people with average talent to work for his company.

Tony Hopkinson
Tony Hopkinson

less than what you are on. There's and yours. In real terms there's no such thing as a low paying job, there are just low value ones. You were only worth 30% more to your previous employer. They didn't want to pay more than that because that's all the role with you in it, was worth to them.

Tony Hopkinson
Tony Hopkinson

service... Says it all really doesn't it. Unsalaried CEO declares no earnings, course the 500,000 shares came in a bit handy... Joined his company soley for a paycheck. They went to work to put food in their children's bellies and clothes on their backs. To give them a better start in life than they got. My dad started working at twelve, now his son earns three times as much as he ever did, that is something worthy of pride. Pull the silver spoon out of your arse, you condescending clueless twit.

lomahongva
lomahongva

I am looking for a good life coach. Starting salary -$10 (minus ten dollar) with raise up to $0 for those who excel. Must be passionate about the job! And seriously, I am sure pretty soon we are going to see this kind of clever head hunting... oh well. While a voluntary job is a wonderful idea, which I support, I also must say no for greedy corporations living off people with passion.

jedmondson
jedmondson

I feel your pain re the company with the two letters. And I thought the place I came from before was bad...

erica
erica

I think we need to re-evaluate our approach here folks. It was because of the demand for higher wages, that my former employer let all but 40, of our 500 member IT department go and sent jobs to India. I'd rather take a lower pay and keep my job than have it sent to some third world country.

Dyalect
Dyalect

people end up tied to credit forever and banks get rich. all a conspiracy!!! -- my $0.02 dyalect

ssampier
ssampier

Twenty-five percent is the recommended amount for mortgage or rent payments. Once you include all other home expenses (utilities, upkeep, home owners insurance, and taxes) it shouldn't ideally be more than 33%. Car payments, gas, and other all expenses are separate. Your monthly car payment shouldn't be more than 20%. That leaves 47% for gas, vehicle upkeep, health insurance, food, entertainment, and savings. Who actually lives this way I don't know, but I would like to (and not live like a pauper, of course).

joeller
joeller

30%!!! Wow. However in the field of Government Contracting which is just about all that is available around here, a 3% raise in considered about the max you can get without switching companies no matter how valuable they consider you. Also interesting enough, I have never seen an IT job around here worth its salt that even mentions salary in the ad other than to say salary is negotiable.

mfcoder-hh
mfcoder-hh

Then you have a strange set of values.

edh1215
edh1215

, but we need higher wages to deal with the ridiculous cost of living we have.

dougogd
dougogd

Most people I know for their home it is more like 50-75% of what they earn. The only way it would be along the line you stated rent or house payments would have to be no more than $500 a month. That tells you one thing people need to earn more money a month. The only way that would happen is if businesses pay more to their employees.

joeller
joeller

Arise ye prisoners of starvation; Arise ye wretched of the earth... Seriously though something has to happen or something will happen. If these big executives continue to get mega bonuses for cutting their labor costs through cuts in benefits, pay cuts, and layoffs, while causing recessions and bank failures, then a point will be reached where people will not take it any more. Then watch out.

joeller
joeller

Yes but who wants to start a new job every year assuming you can find one. Then you lose money from having a lower leave accrual rate. (Not to mention that all the higher paying jobs are up in the DC area which would require expenditure of 3 hours commuting per day with all that entails vis-a-vis the cost of gas, auto wear and tear and the value of your time.) Actually since 2001 there have only been three years where the rate of inflation has been over 3%, 2005, 3.4, 2006, 3.2, and 2008, 3.8. So I lost money those years. Most of the rest were between 2% and 3% so I didn't gain a whole lot either.

Roc Riz
Roc Riz

...that the higher up execs get HUMONGOUS bonuses and raises. They justify this so that they can keep good people, otherwise they would leave. I hear this all over the financial news. Another fact is that the pay of these higher executives has grown to more than 350 times that of what a regular worker makes. In the 70s it was 50 times. This is getting outrageous. Something has to be done.

dougogd
dougogd

You are actually loosing money at that rate.

Tony Hopkinson
Tony Hopkinson

Of course I've took lower paid jobs. I took a 7k pay cut to get into inhouse IT, and then a 4.5k cut to get into commercial development. 87, and 99. Since then no, I don't have to anymore.

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