Tuesday, January 18, 2011

To Make Money, Be A Garbageman


Plumbers and garbagemen make a good living despite their lack of PHP coding skills. That's because they're willing to do the necessary but unpleasant.

Basic economics teaches us that prices are determined by supply and demand. Scarce skills like being able to throw a baseball 100 miles an hour are highly compensated. But talent isn't the only source of scarcity. Sometimes, scarcity is a matter of popularity. Jobs in glamorous industries like Hollywood or videogame design often pay like crap. That's not because they don't add value. Rather, there are so many people who want those jobs that employers don't have to pay well. Conversely, employers have to pay very well to get people to do the jobs that are unpopular.

Everyone wants to be a developer at Google. The company is basically the World's greatest resort for programmers. But do you know whom Google pays the most? QA.

You see, Google wants its QA function staffed with the same kind of top talent as the rest of its operation. But few top developers want to do QA. Google solves this problem through the simple expedient of bribing them with way above market salaries. Think of them as Google's garbagemen.

The real insight here is that these jobs are necessary, unpopular, and unharmful. We're not talking about coal mining (a profession that provided many a high school dropout in West Virginia with a six-figure income and an early death from lung disease). Walking through sewage is unpleasant (and malodorous) but safe.

Nor is this principle limited to jobs and individuals. The same holds true for companies. If you find a way to deliver the necessary and unpopular, people will pay you for it.

3 comments:

RBerenguel said...

Agree, the problem is that this is "against us". I mean, how many mothers want their sons to be... plumbers? They want them to be lawyers, doctors and similar. But the average plumber makes (quite a lot) more than the average lawyer or doctor.

Being a mathematician, I am also on the "won't make any money" side, too ;)

Cheers,

Ruben

Deepam said...

True, true. People end up concerning themselves with status rather than practicality (I’m guilty of this sometimes). In turn, it leads to loss of valuable opportunities.

Anonymous said...

That indirectly says that anyone can make money. You just have to be like a garbageman. Make the most of anything you have. Making money is simple and exciting. Your attitude is the greatest factor.

P. Walters