A Teachable Moment: That Young Person’s Viral Complaint About Her Job at Yelp Doesn’t Realize the Real Minimum Wage Is $0

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Our grid depends on this mineral


You identified two problems but do not propose any solutions to either one; and you missed the two real problems.

This open letter from a young customer support employee of Yelp in San Francisco to her CEO has garnered a variety of comments that display a common bifurcation: some are sympathetic to her struggle to get by in a very costly region on a modest salary, while others wonder if the letter is an Onion parody of clueless entitlement: An Open Letter to My CEO.

I am sympathetic to anyone who arrives in a very competitive “big city” with no local contacts and not a lot of experience or specialized training. That describes me when I arrived in the San Francisco Bay Area a few decades ago.

My B.A. is in philosophy, which has a similar market value to your degree in English, i.e. near-zero. But this doesn’t mean my training in philosophy has no value; it simply means you can’t walk up to a potential employer and say, “Hi, I have a degree in philosophy, hire me.”

The value is only reaped by applying what you have learned. Studying philosophy taught me a number of specific analytic skills: to seek out false assumptions and identify problems and potential solutions. If you can’t frame the problem accurately and coherently, it’s impossible to identify any useful solutions.

These skills have served me well, despite my “worthless” degree. Though nobody had any sound reason to pay me a lot of money simply because I had a B.A. in philosophy, life presents a constant flow of problems that need to be analyzed in ways that enable the development of solutions.

In other words, there is a super-abundance of opportunities to apply what I learned.Taking my own experience as an employee, employer, business owner and entrepreneur, I’ve condensed what I’ve learned about creating value (i.e. earnings) and the emerging economy into a book.

It is less a career-guidance book and more of an explanation of how the economy actually works. It covers the eight essential skills you need to successfully navigate the economy as it is, not as we wish it was.

Rather than tell you the book is useful, I’ll apply what’s in it.

I don’t think your age, gender, ethnicity, etc. is relevant. Anyone can apply what I’m sharing.

You have identified what you perceive as your two big problems: the cost of living in the S.F. Bay Area is very high, and your pay is too modest to enable the lifestyle you anticipated/expected.

You identified these two problems but do not propose any solutions to either one; and you missed the two real problems. Problems don’t solve themselves; problem-solving requires analysis, diligence and a willingness to learn from others, to experiment and fail–not once, but continually.

You did not identify the third problem: your expectations are completely mis-aligned with reality. The S.F. Bay Area is one of the most attractive, stimulating, dynamic urban regions in the world, and it attracts capital and talent from all over the globe.

The demand to live and work here outstrips the supply of dwellings and high-paying jobs, so the costs of living are very high and the pay for labor is low unless you’re able to take advantage of specific skills or social contacts.

Many of the people who come here seeking work are highly educated, experienced, creative, ambitious, hard-working, dedicated, etc., and many possess enviable social skills (social capital).

If you intend to find work here (i.e. if you don’t have a large monthly income from a trust fund), you will be competing against extremely competitive, ambitious people, many of whom focus not on the hardships but on the opportunities. Expecting to outcompete these people for a high-paying job is unrealistic unless you have competitive skills, a strong work ethic, abundant social and human capital, etc.

Whatever you lack, you will have to acquire in order to be competitive in this environment.

If you want a degree that opens doors, earn a PhD in EE/CS from UC Berkeley or Stanford, or get top marks in your Stanford/Haas School (UCB) MBA program.

For the rest of us mere mortals, credentials don’t offer much advantage, as this is one of the most over-credentialed locales on the planet.

The question is: what can you do to create value? It’s not so much a matter of having job skills or experience; it’s how those can be applied to create value–either for your employer or for your own enterprise.

So the real problem you have is: what can you do to increase your value creation and thus your earnings? “Unfair” doesn’t count. Labor has a market value, end of story. Unfortunately, there is an oversupply of labor around the world and a scarcity of high-paying jobs.

It may seem like there is an abundance of high-paying jobs in the Bay Area because we’re in the bubble factory of the world, but this is only a reflection of frothy VC-fueled valuations of zero-profit companies and highly paid employees’ ability to make their employers obscene amounts of money.

If you want to earn $100,000, you need to bring in $500,000 in revenues for your employee, minimum.

The second problem you have is: what can you do to dramatically lower your cost of living? Since you didn’t properly identify the actual problems, you were incapable of finding solutions. Now that we’ve identified your real problems, we can seek solutions.

As for living costs: your goal should be to live on one of your two paychecks a month: $733. Immigrants often get by on low-paying jobs and yet manage to buy a house and pay the mortgage off in five years. They do this by sharing expenses. If you want a very low-cost lifestyle, try befriending immigrants in your social circle (or add them to your circle). Someone will likely know someone in their extended group who has a room for rent (in a house they’re buying by pooling six adults’ modest wages).

As for food–shop only in Chinatown or ethnic markets. If you are careful and observe what the older ladies are buying, you will not be able to carry $20 of groceries. Just recently, I bought two pounds of beautiful tangerines for $1 in Chinatown and wonderfully fresh yao-choy veggies for less than $2. Many fish are available for $2 or $3 a pound; if you’re vegan, pressed tofu is a cheap substitute for meat. Asian-style cooking only uses a few ounces of meat/meat substitute anyway.

A carton of black beans used for seasoning (it adds umami) will cost you $1.29, and last you a year. A jar of chili bean sauce (a teaspoon enlivens a dish most wonderfully) costs $2.29.

You get the point: learn to cook vegetable-based meals and your costs to eat gourmet food will drop under $100 per month. A pound of beans and some Asian veggies will feed you for a week, and with some cheap seasoning, it will be delicious.

We eat better at home for $150 than people who spend $2,000 a month eating out. Anybody can learn how to cook with low-cost ingredients on YouTube University. Make a pot of spicy dal, experiment.

If you don’t have any family to share expenses with, form a family-type group of responsible, honest friends. Rent a house with them, make some basic good-neighbor rules, and kick out whomever fails to fulfill their duties and responsibilities. It will be good experience for running your own enterprise.

Here is my version of a letter you could have sent Yelp’s CEO:

Dear CEO:

I know you’re busy, but I have two ideas that will immediately lower the costs of providing customer support while boosting productivity and employee retention.

After three months in customer support, I’ve observed that a few employees have developed ways to handle customer issues quickly and with relatively few coupons. Others solve customer issues by throwing coupons at everyone.

I’ve developed a brief, concise training program that would give every customer support employee the tools to resolve customer problems more efficiently and at lower cost than the present system.

If customer support teams were able to earn bonuses based on their improved productivity and lower costs, this would immediately improve employee retention, at a modest cost that would be more than paid for by higher productivity.

The benefits from these two ideas would be immediate. I am hoping you can get me fifteen minutes with the V.P. of customer support to present my training/productivity ideas, and I’m excited by the possibility that we could make dramatic improvements with a modest investment of time and virtually no capital costs.
Yelp Employee
cc: V.P. of customer support

Which letter do you think would be more effective in accomplishing your goal of earning more money–your letter or my letter? As management guru Peter Drucker noted, businesses don’t have profits, they only have expenses. Value creation boils down to cutting costs, boosting revenues and increasing productivity.

This is as true of a sole proprietorship as it is of a major corporation.

If the management of Yelp failed to show interest in your letter/proposal and did not even hear you out, you learned a very important lesson:

Yelp’s management is incompetent and/or dysfunctional, and there is no opportunity for you at Yelp. This new knowledge clarifies your solution: find a job at a company/agency that is open to new ideas and is thus a place where you might be able to contribute value and grow your own human/social capital–and your earnings.

If you want to be in PR/media, start designing media/PR campaigns for small businesses for free. Most won’t have any social media exposure; they will welcome your efforts to boost their revenues/customer base.

This is your job from hour 41 (after your full-time gig) to hour 55. Convincing small businesses to give you, an inexperienced person with no track record, hard cash, will be difficult; convincing them to let you design and produce a social-media campaign and share any increase in revenues with you is a much easier sell, because you’re taking the risks: if the campaign flops, you earn nothing, and the business owner isn’t out any cash.

But you will have learned a lot by the time you run 10 or 20 such campaigns, and if you do a good job, are honest, forthright and do what you say you’re going to do, you’ll assemble a useful network of contacts that will lead to opportunities you cannot anticipate.

There is much more in my book, but I hope you’ve learned something that can be applied to your future endeavors from this Teachable Moment.

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Contributed by Charles Hugh Smith of Of Two Minds.

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  • http://groups.yahoo.com/neo/groups/political_reading_room/ disqus_3BrONUAJno

    Intelligent people shouldn’t spend more on education than it can net them in return on investment, such as wages. Anyone who does might not have learned anything that will ever do so.

  • BostonLiberty

    Perhaps a 2-4 year hiatus between High School and College would have made a difference here. But I am sure Yelp filled her seat within 24 hours.

    • Anita Tant

      ❝my .friend’s mate Is getting 98$. HOURLY. on the internet.”….two days ago new McLaren. F1 bought after earning 18,512$,,,this was my previous month’s paycheck ,and-a little over, 17k$ Last month ..3-5 h/r of work a days ..with extra open doors & weekly. paychecks.. it’s realy the easiest work I have ever Do.. I Joined This 7 months ago and now making over 87$, p/h.Learn. More right Here!!b710➤➤➤➤➤ http://GlobalSuperEmploymentVacanciesReportsLife/GetPaid/98$hourly…. .❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:❦2:::::!!b710……

  • Public_Citizen

    I got half way through the narrative of poor life choices and litany of “Oh Woe is Me” and had to give up.
    Perhaps she would have made a better start in the “big city” if she had done what I and many others did in our youth, 4 guys sharing a large one bedroom apartment in a modest neighborhood instead of trying to pretend what a “big girl” she was by taking on a load of debt before she knew what the costs involved were.
    Poor decisions, especially when made without any information, often lead to poor or undesirable outcomes. If this lesson were still taught in schools, instead of giving everyone a trophy for showing up and maintaining a steady body temperature, young adults might find the path to success instead of placing themselves firmly on the path to inevitable failure.

  • SP_88

    Higher education is sold to people as something that will give them the key to unimaginable wealth. And so they are willing to spend whatever it takes to acquire this education with the belief that they will graduate and suddenly they will be in high demand by employers looking to hire them. But when these people suddenly realize that their six figure diploma in BS isn’t what they thought it was, suddenly they resort to being a self entitled whiner and they complain about how unfair the system is. Instead of accepting the fact that they have made poor decisions they blame their problems on everything else. Instead of trying to identify the problem and find a solution, they want everything handed to them. They expect to be paid six figures just for showing up.
    This society of entitled complainers is becoming a big problem. It’s hard enough to find good help these days, but now everyone expects to get paid a lot without having to do the work. These people even want unskilled workers to be paid a lot and so they demand that minimum wage is raised to an unreasonable amount so that it’s fair for everyone. But it’s not fair to reward the lazy people with the same pay rate as people who worked hard to get where they are. Just because someone has needs doesn’t mean that someone else has to fulfill those needs.
    Poor planning on your part does not constitute an obligation on my part. Solve your own problems.

    • Chef Sp

      People need to be paid enough that they can SPEND enough to at least keep he economy going….or am I delusional?

      • SP_88

        People need the opportunity to EARN enough to be able to keep the economy going. You can’t simply jack up minimum wage for unskilled workers to try and compensate for a lack of good paying careers. It has the opposite effect. Companies pay workers as much as they are worth. In a free market, that pay will find it’s own balance. If it is too low, workers will go somewhere else, too high and the business won’t make money. Having the government force businesses to pay more will cause them to cut costs by laying off workers and raising prices of their products, etc. And the result is that the higher pay will be offset by a higher cost of living and higher unemployment which defeats the purpose of the higher minimum wage.
        A free market will find a balance for all these things. When the government interferes and starts forcing businesses to raise this and lower that, it makes a mess of the whole thing. It creates bubbles, monopolies, wealth inequality, unemployment or underemployment, and all sorts of other problems. And that’s where we are now. The government interference has screwed up the economy and now these idiots think that more interference will fix it. It won’t.

  • Nexusfast123

    Higher education and the qualification is now a debased con. You can see this most Western countries as they relaxed entry standards and the number of graduates exploded. The system does not generate many high quality jobs and they closed down blue collar opportunities as a result. The only thing left is to sell is an expensive con that getting a degree will get you a good job. The only thing that will do that is the name of the college and that will never change under the current system.