(More Than) Full-TimePosted: September 8, 2014
I recently read an article that said the average full-time worker in the U.S. works 47 hours a week. While some of these full- time workers are considered non-exempt from Federal overtime laws and are therefore paid overtime for the extra 7 hours a week they work, many of the workers qualify as salaried “exempt” from overtime regulation workers. That means they get paid the same whether they work 40 or 47 hours. I started thinking about my own work and I think the last time I only worked 40 hours in a week was when I was on vacation (at least I was supposed to be on vacation).
Being a CPA I started wondering about what all this meant in terms of pay. We keep hearing about the need to increase productivity, but if the amount of output is increased by working unpaid overtime then are we really becoming more productive or just taking a pay cut in terms of hourly pay? Let’s start with a well-compensated profession that earns $80,000 a year. That is above average pay in the U.S. and an amount many experienced CPAs earn after just a few years in the workforce.
If $80,000 is for 40 hours a week then the hourly pay comes out to:
$80,000 / (40 hours/week * 52 weeks) = $38.46/hour
That is a pretty good hourly rate, but let’s see what happens when the hours increase to 47 per week:
$80,000 / (47 hours/week * 52 weeks) = $32.73/hour
That is a 15% drop in the hourly rate and I know some teenagers with no college education that are getting paid $30 to referee a soccer game that takes an hour. Suddenly the actual rate of pay for professionals is starting to look a little suspect. Of course I hear people say, but CPAs are above average and those numbers are reality. Ok, let’s look at what happens if we up the pay to $90,000, but the hours also increase to 50 hours a week (hey, if we are above average we have to be above average all around including the time worked).
$90,000 / (50 hours/week * 52 weeks) = $34.62/hour
At least that is better than the $80,000 job working 47 hours a week, but it’s still not as good as someone who manages to trade-off working only 40 hours a week for $75,000:
$75,000 / (40 hours/week * 52 weeks) = $36.06/hour
The point of all this is that we CPAs make some pretty good money, but we also work some pretty long hours to earn that money. In deciding if that trade-off is worth it you really need to think in terms of hourly pay rather than total pay. Is it worth $34.62 to miss your daughter’s soccer game? That is only a question you can answer.