The decline of the professional
Discussion
surveyor said:
I personally think the previous generation have sold the future generation down the river - well mainly the banks...
Inflated house prices - who really benefits? not the home owner as the next one just costs more, unless you downsize. The main benefiter? The banks with an increased borrowing levels. The boom in house prices was seen as a good thing by many - I personally think it was nearly as bad as a crash.. Consistent modest growth is far more sustainable.
Final Salary pensions? They were sustainable for decades. Then the rules changed, businesses were allowed to underfund them, and suddenly the final salary schemes are too expensive. Who benefited from the underfunding? The management delivered better results, and presumably better dividends to the shareholders - investment funds/banks....
You are going off topic, and unfortunately with factually inaccurate data.Inflated house prices - who really benefits? not the home owner as the next one just costs more, unless you downsize. The main benefiter? The banks with an increased borrowing levels. The boom in house prices was seen as a good thing by many - I personally think it was nearly as bad as a crash.. Consistent modest growth is far more sustainable.
Final Salary pensions? They were sustainable for decades. Then the rules changed, businesses were allowed to underfund them, and suddenly the final salary schemes are too expensive. Who benefited from the underfunding? The management delivered better results, and presumably better dividends to the shareholders - investment funds/banks....
Lowering interest rates to promote borrowing (and as a product asset inflation), is a government led policy as consumer activity replaces sluggish wage growth. The primary beneficiaries of these policies are Govt (increased taxes) - mainly to fund legacy spending commitments (largely unaffordable) AND those able to access credit to buy appreciating assets. The banks take is fractional compared to the asset gain. Of course they benefited, but the pay out was shared.
The point 're whom owns the shares again is very inaccurate. Banks are no longer involved in highly speculative activity such as proprietary holding of shares for gain. It's too risky, and the loss absorption (capital) required to be held against it, is too expensive. They just don't do it.
Where banks are seen to be holding large quantities of SHS is as a custodian so holding for other people. The biggest holders of shares are investment funds / vehicles and mainly the unit holders are pensions and people's savings. The banks are only getting paid to provide a service NOT inflating the value of those shares up or down. These services can provide additional income to the funds, reducing costs and allowing better income outflows to the ultimate beneficiary.
It probably does look unfair with banks paid at source on greater than $20 trillion of assets held in pension funds and vehicles (so their take out is concentrated, rather than dispersed). But when the funds earn 99% vs. The banks 1% (which is a real fee split to one of the worlds biggest Pension funds) exposes the fallacy of the argument.
The skewing of the economy away from heavy industry towards service sector businesses (particularly Finance); was for many reasons - but in the most it's net positive for the UK. Greed has been it's biggest failure; with govt, banks and consumers demonstrating that in spades.
Which to bring this back On Topic, those older workers around you have benefited massively over the years through asset appreciation and lavish pension promises where the paying for it can is kicked onto the next generation. Judging yourself against the wrong generation rather than peers, might help your perception.
You can either accept this, or as others have said do something about it. Be prepared to move about or change industry sectors. You probably won't have to compete against those older guys with comfortable lifestyles and pensions for the jobs. You will probably have to work harder in the short term to attain their levels of wealth - but everyone (your age) is in the same boat...
Look at other means of income or asset appreciation. It might be difficult if money is tight, but lots of other opportunities exist. There was a guy on here whom started some form of car carbon buildup cleaning business in his spare time. Can't keep up with the work. From scratch he's built a business he can earn from, or has a positive asset value if he scales it.
It can be very easy to always look and believe the negative - adjusting your way of thinking as to dealing with this might be required. You are younger so should be more adaptable, and on the real plus side probably always had an inside toilet with quilted velvet NOT leaves to wipe botty.
SVS said:
The decline of the final salary pension and house price inflation mean that even the top few percent of earners don’t have the lifestyle of previous generations.
It depends how you measure it. The average worker has a car, computer clothing and entertainment unavailable to anyone fifty years ago.Just about everything other than housing is cheaper now, and most social and wealth classes are better off over all.
Looking at where I grew up, recent generations are doing far better than previous ones.
It’s also tied in to social mobility; there is virtually no chance in decades past that someone like me, from a normal working class family would have been able to do what I now am. For this to happen others have to move in the opposite direction, leading to underachieving children of professional families believing that things have got worse in general.
James, sorry, WRONG on one point.
20 or 30 years ago, you did not have broadband, insane tv packages, mobile phone packages. These are all new costs we did not have. More stuff, like sat navs, Ipods, 200 quid headphones. Not all necessary admittedly, but some are.
Costs are very much not the same as they were.
Yes, wages have increased in some areas, but not in others. If you work in retail or warehousing you cant really afford to live comfortably in some areas, it can be done, but at a cost. Was that always the case?
20 or 30 years ago, you did not have broadband, insane tv packages, mobile phone packages. These are all new costs we did not have. More stuff, like sat navs, Ipods, 200 quid headphones. Not all necessary admittedly, but some are.
Costs are very much not the same as they were.
Yes, wages have increased in some areas, but not in others. If you work in retail or warehousing you cant really afford to live comfortably in some areas, it can be done, but at a cost. Was that always the case?
chunder27 said:
James, sorry, WRONG on one point.
20 or 30 years ago, you did not have broadband, insane tv packages, mobile phone packages. These are all new costs we did not have. More stuff, like sat navs, Ipods, 200 quid headphones. Not all necessary admittedly, but some are.
Costs are very much not the same as they were.
Yes, wages have increased in some areas, but not in others. If you work in retail or warehousing you cant really afford to live comfortably in some areas, it can be done, but at a cost. Was that always the case?
They are not new costs at all, they are extras that would cost you nothing if you did not choose to have them.20 or 30 years ago, you did not have broadband, insane tv packages, mobile phone packages. These are all new costs we did not have. More stuff, like sat navs, Ipods, 200 quid headphones. Not all necessary admittedly, but some are.
Costs are very much not the same as they were.
Yes, wages have increased in some areas, but not in others. If you work in retail or warehousing you cant really afford to live comfortably in some areas, it can be done, but at a cost. Was that always the case?
You only have them because they are absolutely amazing value for. Only, giving you things that to past generations would have seemed like magic.
Every single one of my friends in normal working class jobs up North lives a life far better than every single one of my parents friends did forty years ago. Houses with no workers can have cars outside them, people who work in shops can have a big television and a holiday in France.
The guy who runs the supermarket can have a car that would have blown away a Miura and the kid who went into Finance can have four homes with a car parked at each.
The only people going backwards are those whose parents were at the top in the past. For the rest of us we are still all doing better than our parents and grandparents did.
James_B said:
chunder27 said:
James, sorry, WRONG on one point.
20 or 30 years ago, you did not have broadband, insane tv packages, mobile phone packages. These are all new costs we did not have. More stuff, like sat navs, Ipods, 200 quid headphones. Not all necessary admittedly, but some are.
Costs are very much not the same as they were.
Yes, wages have increased in some areas, but not in others. If you work in retail or warehousing you cant really afford to live comfortably in some areas, it can be done, but at a cost. Was that always the case?
They are not new costs at all, they are extras that would cost you nothing if you did not choose to have them.20 or 30 years ago, you did not have broadband, insane tv packages, mobile phone packages. These are all new costs we did not have. More stuff, like sat navs, Ipods, 200 quid headphones. Not all necessary admittedly, but some are.
Costs are very much not the same as they were.
Yes, wages have increased in some areas, but not in others. If you work in retail or warehousing you cant really afford to live comfortably in some areas, it can be done, but at a cost. Was that always the case?
You only have them because they are absolutely amazing value for. Only, giving you things that to past generations would have seemed like magic.
Every single one of my friends in normal working class jobs up North lives a life far better than every single one of my parents friends did forty years ago. Houses with no workers can have cars outside them, people who work in shops can have a big television and a holiday in France.
The guy who runs the supermarket can have a car that would have blown away a Miura and the kid who went into Finance can have four homes with a car parked at each.
The only people going backwards are those whose parents were at the top in the past. For the rest of us we are still all doing better than our parents and grandparents did.
Either that or more people are inheriting more wealth.
Sparkzz said:
I believe your point is correct in some respects but I am including the typical 'middle-class professional' in the category of people who are not doing better than their parents. Many people do not have the lifestyle of the professional of 1950's - 1980's. Myself included.
Either that or more people are inheriting more wealth.
What is the lifestyle that you are referring to? Either that or more people are inheriting more wealth.
Second/third homes, expensive boarding school fees, posh golf club, helicopter, private jet, a castle with 10000 acres?
I'm one of this who live better than my parents did (doing only a slightly better job, but having a wife earning reasonable money too), vastly better than my maternal grandparents, and phenomenally better than all of my maternal great grandparents.
More people are inheriting more property wealth if they are lucky to have had relatives living in high demand areas.
Edited by MC Bodge on Sunday 2nd December 13:53
MC Bodge said:
Sparkzz said:
I believe your point is correct in some respects but I am including the typical 'middle-class professional' in the category of people who are not doing better than their parents. Many people do not have the lifestyle of the professional of 1950's - 1980's. Myself included.
Either that or more people are inheriting more wealth.
What is the lifestyle that you are referring to? Either that or more people are inheriting more wealth.
Second/third homes, expensive boarding school fees, posh golf club, helicopter, private jet, a castle with 10000 acres?
I'm one of this who live better than my parents did (doing only a slightly better job, but having a wife earning reasonable money too), vastly better than my maternal grandparents, and phenomenally better than all of my maternal great grandparents.
More people are inheriting more property wealth if they are lucky to have had relatives living in high demand areas.
Edited by MC Bodge on Sunday 2nd December 13:53
My argument is that I will have to climb further up the ladder before I can enjoy such a lifestyle. I'm talking about 2 holidays a year and an E - class for me and the wife. Not a private island and jet to get there.
Sparkzz said:
What I am saying is that many lower and middle-ranking professionals (such as myself) don't have lifestyles as good as people in the same positions 30 years ago. I aspired to a profession partly due to my experiences growing up of friends and family in these positions who lead nice lifestyles. Now I am in a similar position, I am not enjoying anywhere near the same level of comfort. I'm unsure of the complex economic reasoning behind it, but likely it is due to people lower down the socio-economic scale being better off whilst the professional has stagnated somewhat. Hence, the compensation I receive does not cut as much mustard as the equivalent amount would have in 1980.
My argument is that I will have to climb further up the ladder before I can enjoy such a lifestyle. I'm talking about 2 holidays a year and an E - class for me and the wife. Not a private island and jet to get there.
I can assure very very few would have had 2 holidays a year & 2 E class in 1980.My argument is that I will have to climb further up the ladder before I can enjoy such a lifestyle. I'm talking about 2 holidays a year and an E - class for me and the wife. Not a private island and jet to get there.
Sparkzz said:
What I am saying is that many lower and middle-ranking professionals (such as myself) don't have lifestyles as good as people in the same positions 30 years ago. I aspired to a profession partly due to my experiences growing up of friends and family in these positions who lead nice lifestyles. Now I am in a similar position, I am not enjoying anywhere near the same level of comfort. I'm unsure of the complex economic reasoning behind it, but likely it is due to people lower down the socio-economic scale being better off whilst the professional has stagnated somewhat. Hence, the compensation I receive does not cut as much mustard as the equivalent amount would have in 1980.
My argument is that I will have to climb further up the ladder before I can enjoy such a lifestyle. I'm talking about 2 holidays a year and an E - class for me and the wife. Not a private island and jet to get there.
Things have changed so much over the past few decades. At one time, as well as being more expensive, the "E class" would have been a better car to live with than a Superb, Passat, Mondeo, 3-series etc. These days your life will be likely to be no more comfortable with the E class than with the other cars above. You could argue that the E class is less relevant than it was in 1980.My argument is that I will have to climb further up the ladder before I can enjoy such a lifestyle. I'm talking about 2 holidays a year and an E - class for me and the wife. Not a private island and jet to get there.
Two holidays per year isn't that expensive if you choose for it not to be. Or it could cost £20,000 each time.
Do you wish to be comfortable or to stand above others in the wealth/status hierarchy?
Edited by MC Bodge on Tuesday 4th December 06:45
Sparkzz said:
What I am saying is that many lower and middle-ranking professionals (such as myself) don't have lifestyles as good as people in the same positions 30 years ago.
Perhaps the better paying jobs are just different ones now, and I don’t know that the average engineer in the 50s had an E-type and a big house either.James_B said:
Perhaps the better paying jobs are just different ones now, and I don’t know that the average engineer in the 50s had an E-type and a big house either.
My Dad was a manufacturing methods engineer in Aerospace from the 1960s onwards, developing and working out how to make parts for the likes of Concorde and cold war military planes. He is very knowledgeable about metals and production techniques and is also still good at problem solving. He enjoyed the work, but he wasn't paid well -we had a used Vauxhall Viva and a 3 bed semi.Management, niche consultancy or working in The Gulf in the 70s (as some of his colleagues did) would have been the only way to make decent money.
Solicitors, bank managers, accountants and architects may have made relatively better money back then.
Looking back to the early 1980s, another uncle of mine had his own business, a few discount shops (like Quality Save, the owner of which he knew), he had a Jag XJ12, (My Auntie had a Renault Fuego), a detached house and they went on a couple of nice foreign hols every year. He had a sheepskin coat like Del Boy too
Edited by MC Bodge on Sunday 2nd December 19:25
Condi said:
Thankyou4calling said:
Evanivitch said:
2 sMoKiN bArReLs said:
I've never done the sums, but my first house in 1986 cost £30,000, but the interest rate was 18%. What value of house would those repayments get today, (and wage inflation adjusted) £200,000-£250,000?
1986 house £30,000.In 2017, adjusted for economic inflation (BoE calculator) £83,750
Salary (£30,000) Adjusted for wage inflation (iCalculator) £69,000
Adjusted for house price inflation (Nationwide BS, UK average) £173,000
Not sure it answers your question, but it was an interesting exercise!
At the same time, in 1986, you had a salary of £30k. In 2017, adjusting for wage inflation, that salary is £69k.
So house prices have gone up by 576% in 31 years, while wages have only gone up by 230%. That is why first time buyers find it such a big hurdle to get on the housing ladder, and the wealth has been concentrated in the hands of those who already own assets, rather than those who have worked hard.
2 sMoKiN bArReLs said:
But, that calc does not discount 18% interest to 3% interest
That's because inflation and salary inflation are often closely link (with inflation largely following salary trends.So when interest rates were 14% in 1981, Salary inflation in 1980 was 18%.
In 1986 Wage Inflation 7.9%
Base Rate Interest 10.8%
The decline of the professional I would agree is real especially in areas like engineering.
Couple of main factors - everyone goes to uni these days so although companies go on about lack of good staff there is probably a bigger pool of candidates or fresh trainees to go at. or...
Outsourcing/off shoring this must have had quite an effect since the 70s and 80s too. We get stuff done in Norway that nobody seems to want the business for over here ditto with China.
If you are living in the North I'm really surprised to hear you can't maintain a decent standard of living from what I'm guessing must be at least a mid 40s salary? Mrs? Working? Kids? Aversion to credit?
Couple of main factors - everyone goes to uni these days so although companies go on about lack of good staff there is probably a bigger pool of candidates or fresh trainees to go at. or...
Outsourcing/off shoring this must have had quite an effect since the 70s and 80s too. We get stuff done in Norway that nobody seems to want the business for over here ditto with China.
If you are living in the North I'm really surprised to hear you can't maintain a decent standard of living from what I'm guessing must be at least a mid 40s salary? Mrs? Working? Kids? Aversion to credit?
mikees said:
Where are you based? I might be able to help.
Mike
Thanks for your help I am based in South West, Swindon area, but my issue is more to do with unable to pass security check due to residency(less than 5yrs)Mike
Anyway thank you for your kindness
Edited by kurokawa on Monday 3rd December 13:55
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