Oh dear me, this is just funny to me. Our beloved premier in SK just announced that he is putting in place a wage freeze…which also happens to include my position as well. This is so utter idiotic I can barely stop laughing. Why?
Well to put it bluntly, I just got my raise… just last week. So this will have utterly no impact until Jan 1, 2016 or so when I don’t get a raise next year. Also the amount of the savings from this move is a mere $15 million dollars when the entire budget short fall in predicted to be $600 to $800 million dollars which puts the savings in the range of 1.9 to 2.5%…or nearly nothing. To put that in perspective it’s like saying you plan to buy one less coffee out a week when you need a new roof on your house and have to replace your car in the same year, but have no savings in the bank and maxed out credit cards.
The reality of the move is entirely optics. There is nothing of substance but rather the illusion of trying to be prudent with our tax dollars after being on a drunken spending spree in this province for the last several years (spending from 2008/2009 until 2014 increased 54%, see here for data). And the cynic in me things this is the perfect way to set the stage to push all the unions to accept a 0% increase in their next contracts.
Anyway, the particular really stupid part of this move is they have failed to consider what they just did for a significant number of their employees: remove any motivation for them to even attempt working harder for the next year. In my case, my performance goals have barely had the ink dry on them and now you tell me regardless of how well or horrible I do in the next 11 months I will get the same wage increase of 0%. Just think about how much productivity is going to drop in the next year because of this little stunt, I can barely imagine the additional costs. The cost to productivity will easily remove any of the savings in over the course of the year.
Oh well, perhaps I should be grateful their aren’t more manipulative and had said that almost everyone would get a 0% raise except maybe the best performers…then take that away at the end of the year…or give them just 1%.
The good news is as long as I hit my saving target over the next few years the raises are largely not required for my early retirement plan to work. It just removes a bit more of cushion to the numbers.
So have you ever been under a wage freeze? How long did it last for you? (Or worse yet, a pay cut?)