Price’s Law, why companies pay the price

I first heard of Price’s Law on a Jordan Peterson YouTube video months ago and something about it stuck with me. When he explained the principles, everything started to make sense. A small fraction of people does the majority of the work. I had seen this time and time again and never thought of it as some kind of law.
Here’s how it works, you take the square root of the number of employees and that is the number of people who do 50% of the work, which is a hell of a lot. Plus, keep in mind that means there are just as many, if not more, employees who contribute nothing to the company. The odd part is the people who do the majority of the work know who they are, most of the employees know who they are. Most of the time management doesn’t know who they are.
When a company starts to have a hard time, or the writing is on the wall to abandon ship the people in that bottom portion who are keeping things afloat are the first to go. They have options, they know they can get the same job or a better one for more pay elsewhere and they do. So now the ten people out of a hundred are gone and half the work is not getting done with the 90 people who are left. Things spiral out of control and the company turns to shit.
I watched this before when I worked at a hospital. The 13th year I worked there nobody got a raise, they were starting everyone at zero and depending on how you performed you could look forward to a nice paycheck. After a year the reviews started to come in. supervisors were bringing up things that happened years before, things that the employee had already been disciplined for and brought up in previous reviews. If you were sent an email reminding you about something you were marked down. Punch in a minute late during blizzard when most of the staff didn’t show up and called in, fuck you no raise. It was clear the hospital didn’t want to pay anyone more than they desired and the writing on the wall was to jump ship. This hospital was the titanic and I knew how to row a boat.
I was the guy who was sent the email reminding me of a meeting. I didn’t ask for an email, there was no reason to send one, but my supervisor did and so I was marked down. My raise that year, 5 cents. I quickly did the math I my head and told him that didn’t even cover inflation and that I was making less than last year. He nodded his head in agreement and went on with the review. I didn’t pay attention. I refused to sign the review, and in the end, turned in a three-week notice. “Find somebody to replace me, you’re going to need it.”
Within a week 12 more people turned in their notices to the same supervisor and the same thing was happening across the hospital. Everyone was jumping ship and leaving as fast as possible. I don’t know if this was their plan all along. I heard stories during those final days of the most worthless person on the floor getting a four on their review while the people pulling their weight were marked down for the dumbest of reasons. The scoring for these reviews were odd.
There were different categories and you could score 1-5. A 1 meant you sucked at your job and were looking at being fired. A five was deemed impossible to achieve, nobody got a 5. 3 meant you were doing what you supposed to be doing and a 4 was going above and beyond what was asked. Of course, nobody was allowed to talk about their reviews with other people but word spread and the hospital turned into a total clusterfuck of chaos.
I ended up taking a job with the county after that for the same pay and I wasn’t cleaning up body parts off the floor. A year after that I almost doubled my pay at my current job.
The year of FUBAR at the hospital wasn’t the only example I came across of this behavior. I watched people bid for jobs they were qualified for and be turned down for some office politics that did not take into account the most qualified person for the job and instead used some other criteria that nobody could figure out. When you work hard and do mare than is asked and are turned down for a position you start to wonder what is the point.
Canada had a program to bring in highly skilled people from other countries through there immigration policies. These people applied and from their skills they were brought in and made citizens of the country. It was a high honor that people strived for. Then the policy changed, numbers needed to be filled regarding race and gender. Suddenly the most qualified were being rejected for reasons that didn’t make any sense and the program started to be viewed as a joke.
A few years after I left the hospital, I ended up being a patient there. My daughter was in the NICU and everyday for 91 days I was there and could see how the quality of work had dwindled. Don’t get me wrong, the room was clean and the staff working with her was amazing, but the elevator was broken for a majority of the time we were there. The hallways were dirty. Cleaning staff was rarely seen except for the lunch rooms. I was one of these people, I knew what was expected of me back then. Somehow over the years, things had changed.
The people like me had left and found something better.
So, what is the lesson from all of this? If you are taken advantage of at your job find a new one. Go where your skills will be appreciated. If your job is telling you to be happy you have a job, that is a huge sign that they don’t give a shit about you. If you find yourself doing most of the work don’t be surprised when your supervisor has no idea what is going on. When they do know what is happening don’t expect them to stick around. The last good boss I had at the hospital was fired. The manager said they didn’t know how to do their job, then they were replaced with one of the worst bosses I could have had. If you know you are one of those people, those who do a majority of the work where you are, know that you have options. When things start to look bad, run. The two things that could happen is that you find something similar to what you’re doing, or you come across something better. Aim for better, don’t settle.


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