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It’s a common dilemma: When you are young, say just getting out of college, you tend to have plenty of free time but little money. Later, as your career takes off, you start to have more money but less time.
It would be nice to have both time and money at the same stage of your life. But if you had to choose, which would you pick? This post will look at a few ways that time-or-money choice is a fundamental characteristic of the job market.
First, let’s start by acknowledging that, for many Americans, the choice of more money has been taken off the table. Adjusted for inflation, the total value of the compensation received by Americans grew by just 11.3 percent in the 20 years from 1992 to 2012, or less than 1 percent a year.
This inching forward in compensation is not the vision people typically have of getting ahead in the workplace, especially since America has an aging workforce, with the bulk of Baby Boomers in their late-career, peak earning years. One would have thought those peak earning years would have seen a stronger rise in compensation.
If compensation growth has been sluggish, is it possible Americans have at least been rewarded with more time? Think about what a difference the Internet has made over the past 20 years. Perhaps its greatest attribute has been the way it has allowed people to use their time more efficiently. Here are some examples:
- Online shopping. A great deal gets written about online shopping around the holidays, and rightfully so; but the broader truth is that online shopping has become routine for people throughout the year. This doesn’t just save you the time driving to and from the mall. Think about all the time you save finding the right product with a couple quick searches, rather than schlepping from store to store.
- Telecommuting. The Internet has given more people the option to accomplish at least some of their work from home. This saves commuting time — and rush hours are usually the least efficient times to be traveling — plus the extra time people who work from home don’t have to spend making themselves look presentable every day.
- Home entertainment options. Twenty years ago, if you wanted to see a reasonably current movie, it meant a trip to the movie theater, or at least a trip to Blockbuster for a DVD (or was it still videotapes back then?) Now, between on-demand channels and streaming video services, premium content is available without leaving home. Not only that, but large, flat-screen TVs have made the home viewing experience much more impressive than it was on the CRT-based TVs of the early 1990s.
Think of all this time-saving as a form of deflation. With monetary deflation, you can do more with the same amount of money because prices go down. In this case, it’s time deflation. You might not have more free time, but you can do more with it because the time it takes to do certain things has been slashed thanks to technology.
Paid leave becomes more common
Another way that many Americans have gained in time rather than money over the past 20 years is through increased access to paid leave from work. The percentage of Americans who get paid sick leave has increased from 58 to 75 percent; access to paid personal leave has increased from 16 to 44 percent; access to paid family leave has increased from two to 13 percent.
For some, paid leave has become even more useful because it has become more flexible. Employers in some industries are starting to offer consolidated leave, which can be used for any purpose.
Career and retirement choices
Naturally, careers often make people choose between time or money — do I pick the high-pressure career with great financial rewards, or do I settle for less money in exchange for a more laid-back occupation? In a different way, people face a time-or-money choice in retirement. Much has been written about Americans being forced to work longer because of low savings, but supplementing your income is not the best reason for working longer because you can’t always count on being able to do so. On the other hand, simply having an occupation — something to fill your time productively — can be an important reason to keep working past normal retirement age. Once a person reaches retirement, it often seems that free time becomes too much of a good thing.
The choice between time and money is a recurring theme throughout our careers and even into retirement. Over the past 20 years, the option of more money has become scarce, but in many cases free time has become more widely available. Even if picking time over money would not have been your first choice, enjoy it while you have it.
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