Beet
Atlas Star
Posts: 28,917
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« on: October 21, 2013, 04:54:30 PM » |
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A 12% raise over 4 years after 5 years with no raises amounts to a 1.3% per annum raise for the 9 year period. That is actually being generous because we're rounding up and not discounting the cash flows to account for the fact that money up front is worth more than money in the future.
Meanwhile the BLS says that a dollar from 2008 is worth $1.09 in 2013. That comes out to an average 1.75% per annum CPI inflation rate, assuming that inflation remains constant. So the current offer actually reduces the workers' real wages over the 9 year period. Keep in mind also property prices are not included in the CPI and the the market is particularly buoyant in the Bay Area.
On the other hand, the base pay is not the same as the total compensation package. If health care costs have increased at 5% per annum, that needs to be factored in too.
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