Career awareness: Are you being paid in carnival cash?
You’ve gone through multiple interviews with several companies, and finally you’re starting your dream job as a data scientist or software developer, whether as a fresh graduate, or experienced hire. You’ve made it, right?
Your first instinct is probably to do your best to learn and contribute to the new role in a “nose to the grindstone” fashion. This is where I suggest taking a step back and digging deep into something a lot of us in tech (especially individual contributors) don’t think about: the organizational structure and how employees are compensated.
This might seem counterintuitive, since we want to pay our dues, first. But consider the scenarios I’ve seen all too often: Do you want to learn about how you could get promoted, 2 years later? What if, when you finally have the conversation, you learn that you need to spend one more year preparing a promotion packet? You regret asking the question too late, since if you’d known a year earlier, you’d have gotten started already. It’s simply too much lost time in one’s career, and damaging to team morale.
This is why I want to share some action items to make sure that you can build your career intentionally, and avoid the traps of “carnival cash” as a substitute for true compensation or promotions.
- Carnival cash
- Promotions - true compensation or carnival cash?
- How to increase career awareness
I borrow this term from Erik Dietrich. In short, “carnival cash”, in the professional world, are perks with no real value outside of that specific company. Examples are:
- Merch for being at the company \(N\) years
- Graduating from a cubicle to an office
- Winning an award at the year-end event
Note: I am not saying these things don’t mean anything - they indeed can show appreciation and build team culture. What I am saying is that they are mostly worthless outside of that company. No one outside of your company, be it your friends, family, or your colleagues in your next role, will care if you had an office.
So, I value these things, but never mistake them as a proper substitute for true compensation. I have seen many people make that mistake. You might have seen a lot of these scenarios in your career as well. The following examples come from many different organizations from people I personally know.
- An employee being given a $2,000 CAD raise for the year, and being told that it was the “highest raise in the team’s history”. (It was not. The flattery is carnival cash.)
- Free meals enticing employees to stay for an average of 2 hours/day extra of overtime. This is not true compensation - if overtime was truly valued, an accompanying raise would have been more acceptable. (Overtime might yield no productive results, in which case the employee should just go home.)
- Awards or gift cards that were meant to tide a team over a prolonged crappy situation. Same point as above.
Common patterns of carnival cash
Once again, here is a disclaimer that these little gestures of appreciation aren’t pointless. Often, being recognized for hard work and good results means a lot for morale. I’m just saying that they should not be used as a replacement for true compensation. The rule of thumb is that if it feels too much like flattery and trinkets, it’s carnival cash. If one is getting praised highly for a long time, but with no corresponding increase in true compensation, then they’re getting paid in carnival cash.
In this situation, the employee should bring up conversations regarding their true compensation, for example a pay bump with a corresponding promotion, instead of becoming complacent with the little toys and baubles that wouldn’t mean anything for their career and financial health in the future.
I use salary as a loose gauge for “true compensation” out of convenience, but note that this can be things such as work life balance, or types of non-monetary benefits that truly can help in the long term. This, of course, depends on what the individual values. What might be carnival cash to me, might not be to you, and vice versa.
Promotions - true compensation or carnival cash?
I somewhat disagree with a specific point in Erik Dietrich’s overall terrific post, where I borrowed the term carnival cash from, that promotions are more often carnival cash than not. This certainly can be true if it’s a situation where it’s a clear retention tactic, e.g. “we haven’t given this employee a promotion in 5 years, even though they’ve been asking for 2 years… but now they’re leaving, shocker! Let’s quickly offer that promotion and pay bump as a counter offer!”
In this case, the company had been knowingly paying in carnival cash, and hoping the employee wouldn’t notice. If the employee hadn’t gotten another offer in hand, the company likely would have continued to pay in carnival cash for as long as they could get away with it. This can happen regardless if the carnival cash happens to be a promotion.
However, to use my rule of thumb of whether it can help outside the company or in the future, I personally conclude that promotions can count as part of true compensation and not 100% carnival cash. This is due to me valuing public speaking and other types of career growth, in which a corresponding title helps me.
This brings us to the next point - how can one be aware that they’re being paid carnival cash over true compensation? The process can be opaque, and it was certainly was mysterious to me when I was beginning my career. Here is what I would suggest.
How to increase career awareness
Immediate actions that can help drastically with your career and toward true compensation, regardless of experience:
- Observe the current seniors or (people with the title you’re interested in). What is their average tenure in the company prior to being promoted? How many years of experience did they have, in total? What is their educational background?
- Start a conversation ASAP with your manager to ask about the “formal” way promotions are decided. This is never too early to do, as you are not necessarily saying “I am ready for a promotion right now”, but rather asking a administrative question on the same level of “how do I put in my vacation days in the schedule online”. Your manager should be happy to answer, to the best of their ability.
- If possible, ask around for the pay band. This is honestly the most difficult suggestion here, but sometimes even one other data point can help point out if things are horribly wrong for you. If this is infeasible, you can still learn about market rates from your network outside of your company.
With this knowledge in hand, it’s time to ask some tough questions.
- Do promotions seem to be purely tenure based? This means that you simply have to put in the time, regardless of how great the results you deliver are. If this timeframe is long, e.g. hit 5 years and you’ll magically get promoted, this might give you peace of mind at first - it seems rather predictable. Beware - what this really means, is that you’re taking carnival cash for a long period of time prior to that promotion.
- Stay in the know on industry averages. Is it feasible to accomplish what you value, in your current company or role? This isn’t only about promotions, but rather, are you working on projects you care about? Are you getting increased responsibility, like you had been promised last year? It is possible that you have hit a dead end in the current company and need to seek elsewhere to build your career intentionally.
- Seek a way to get carnival cash swapped to more true compensation. In a good organization, once an employee brings up a gap between true compensation and good performance, the change might come swiftly and fairly. However, in orgs with massive inertia, be prepared to let go of your wide-eyed innocence and faith in “meritocracy”, and not wait around for too, too long (months can turn into years), then regretting it 5 years later.
Frankly, I’ve written this post with some folks in mind, who have sought advice from me regarding career growth, and carnival cash situations they have encountered. I am compiling and sharing these thoughts in the hopes that they can benefit readers as well.
Let’s keep learning and growing in our careers with intentionality!