Industrial & Organizational Nurse
Transition Analysis 1
Moving from hourly to salary positions can be challenging based on many factors. Managers and directors often find they make less than some of their employees by a process referred to as compression. When negotiating your first or next salaried role, the following practice is advised.
If moving from hourly to salary, particularly within healthcare, consider two semi-annual increases of 1% to 3% (using 2% as an average if needed), but change the base numbers to define your specific situation.
Year A follows the 1st of two annual increases at 2% (1% to 3%) - cost of living
Year B follows the 2nd of two annual increases at 2% (1% to 3%) - merit increase
Generally, use a five-year plot and know that there are online calculators for this. The values below represent an annual wage of $100K compounded by 2% twice annually.
2020 A: 100,000
2020 B: 102,000 (for each next level multiply the new value by 1.02)
2021 A: 104,040
2021 B: 106,122 end of 2021
2022 A: 108,243
2022 B: 110,408 end of 2022
2023 A: 112,616
2023 B: 114,869 end of 2023
2024 A: 117,166
2024 B: 119,509 end of 2024
2025 A: 121,899
Compression occurs because salaried positions are often not granted increases in pay as regularly as hourly positions. Managers and directors also lose overtime benefits, but typically work no less than 48 and often more than 55 hours weekly without additional pay for roles that are advertised as 40 hours weekly. Furthermore, bonuses are often tied to metrics that may not be met for reasons beyond your control.
A good rule for transitioning would be to ask for no less than what your current wage would be in three or more years. If you currently make $100,000 annually (see 2020A above), then transitioning to a salaried role should offer no less than $112,616 (see 2023A above). This might seem like a lot, but it is very likely what you would be making in three years without transitioning, without meeting bonus goals, without overtime, and without all the other hassles of 24/7 responsibilities.
If moving from hourly to salary, particularly within healthcare, consider two semi-annual increases of 1% to 3% (using 2% as an average if needed), but change the base numbers to define your specific situation.
Year A follows the 1st of two annual increases at 2% (1% to 3%) - cost of living
Year B follows the 2nd of two annual increases at 2% (1% to 3%) - merit increase
Generally, use a five-year plot and know that there are online calculators for this. The values below represent an annual wage of $100K compounded by 2% twice annually.
2020 A: 100,000
2020 B: 102,000 (for each next level multiply the new value by 1.02)
2021 A: 104,040
2021 B: 106,122 end of 2021
2022 A: 108,243
2022 B: 110,408 end of 2022
2023 A: 112,616
2023 B: 114,869 end of 2023
2024 A: 117,166
2024 B: 119,509 end of 2024
2025 A: 121,899
Compression occurs because salaried positions are often not granted increases in pay as regularly as hourly positions. Managers and directors also lose overtime benefits, but typically work no less than 48 and often more than 55 hours weekly without additional pay for roles that are advertised as 40 hours weekly. Furthermore, bonuses are often tied to metrics that may not be met for reasons beyond your control.
A good rule for transitioning would be to ask for no less than what your current wage would be in three or more years. If you currently make $100,000 annually (see 2020A above), then transitioning to a salaried role should offer no less than $112,616 (see 2023A above). This might seem like a lot, but it is very likely what you would be making in three years without transitioning, without meeting bonus goals, without overtime, and without all the other hassles of 24/7 responsibilities.
Transition Analysis 2
If you regularly work overtime (OT), the following calculations should augment your transition decision. In the example above, 2020A was $100,000 based on 40 hours per week or 2080 hours annually. For this next example, $100,006.40 will approximate 2020A as it divides neatly to $48.08/hour. While many professions actively limit overtime, registered nurses, imaging technologists, respiratory therapists, engineers, and others have ample opportunity to work 60 or more hours per week in an hourly capacity for the entire year.
For routine overtime, add the calculated OT to your routine annual wage. If the overtime rate is time-and-a-half, then multiply your base hourly by 1.5, then multiply that value by 52 for weeks in the year, then add the new value to your 40-hour annual wage. That is your 41-hour annual wage. When averaging 41 Hrs/Wk, the 40 Hrs/Wk value of $100,006.40 plus one hour of OT weekly becomes $103,756.64 annually.
The following table is adjusted for each four hours of OT over 40 (up to 60) that you have the potential to earn as hourly. This becomes a practical consideration if you regularly work overtime. Again, you should change the base numbers to define your specific situation.
At $48.08 hourly or $100,006.40 annually, your additional wage would be $72.12 OT hourly for each hour beyond 40. For annual adjustments, further multiply each OT hourly set (4, 8, 12, 16, 20) by 52 before adding that value to the original 40-hour annual salary of $100,006.40.
For routine overtime, add the calculated OT to your routine annual wage. If the overtime rate is time-and-a-half, then multiply your base hourly by 1.5, then multiply that value by 52 for weeks in the year, then add the new value to your 40-hour annual wage. That is your 41-hour annual wage. When averaging 41 Hrs/Wk, the 40 Hrs/Wk value of $100,006.40 plus one hour of OT weekly becomes $103,756.64 annually.
The following table is adjusted for each four hours of OT over 40 (up to 60) that you have the potential to earn as hourly. This becomes a practical consideration if you regularly work overtime. Again, you should change the base numbers to define your specific situation.
At $48.08 hourly or $100,006.40 annually, your additional wage would be $72.12 OT hourly for each hour beyond 40. For annual adjustments, further multiply each OT hourly set (4, 8, 12, 16, 20) by 52 before adding that value to the original 40-hour annual salary of $100,006.40.
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44 Hrs/Wk
+208 OT Hrs $15,000.96 OT $115,007.36 |
48 Hrs/Wk
+416 OT Hrs $30,001.92 OT $130,008.32 |
52 Hrs/Wk
+624 OT Hrs $45,002.88 OT $145,009.28 |
56 Hrs/Wk
+832 OT Hrs $60,003.84 OT $160,010.24 |
60 Hrs/Wk
+1040 OT Hrs $75,004.80 OT $175,011.20 |
Using the example above, someone making a base annual wage of $100,006.40, who consistently worked either 48 or 56 hours a week earned closer to $130,008.32 or $160,010.24, respectively. As such, it is a good idea to know your worth within your current wage structure, especially in the context of inflation and the myth of the 40-hour salaried work week.
Inflation Analysis
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Linear Inflation by Decade
January 1930 through December 1939 was -18.13% January 1940 through December 1949 was 69.78% January 1950 through December 1959 was 25.11% January 1960 through December 1969 was 28.67% January 1970 through December 1979 was 102.91% January 1980 through December 1989 was 62.08% January 1990 through December 1999 was 32.10% January 2000 through December 2009 was 27.93% January 2010 through May 2019 was 18.19% Cumulative Inflation by Decade January 1930 through May 2019 was 1,397.61% January 1940 through May 2019 was 1,742.39% January 1950 through May 2019 was 989.75% January 1960 through May 2019 was 774.03% January 1970 through May 2019 was 577.49% January 1980 through May 2019 was 229.17% January 1990 through May 2019 was 101.01% January 2000 through May 2019 was 51.71% January 2010 through May 2019 was 18.19% |
($1 after inflation required $0.82) ($1 after inflation required $1.70) ($1 after inflation required $1.25) ($1 after inflation required $1.29) ($1 after inflation required $2.03) ($1 after inflation required $1.62) ($1 after inflation required $1.32) ($1 after inflation required $1.28) ($1 after inflation required $1.18) ($1 after inflation required $14.98) ($1 after inflation required $18.42) ($1 after inflation required $10.90) ($1 after inflation required $8.74) ($1 after inflation is $6.77) ($1 after inflation is $3.29) ($1 after inflation is $2.01) ($1 after inflation is $1.52) ($1 after inflation required $1.18) |
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Year
1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 |
Inflation Rate
0.60% -6.40% -9.30% -10.30% 0.80% 1.50% 3.00% 1.40% 2.90% -2.80% 0.00% 0.70% 9.90% 9.00% 3.00% 2.30% 2.20% 18.10% 8.80% 3.00% -2.10% 5.90% 6.00% 0.80% 0.70% -0.70% 0.40% 3.00% 2.90% 1.80% 1.70% 1.40% 0.70% 1.30% 1.60% 1.00% 1.90% 3.50% 3.00% 4.70% 6.20% 5.60% 3.30% 3.40% 8.70% 12.30% 6.90% 4.90% 6.70% 9.00% 13.30% 12.50% 8.90% 3.80% 3.80% 3.90% 3.80% 1.10% 4.40% 4.40% 4.60% 6.10% 3.10% 2.90% 2.70% 2.70% 2.50% 3.30% 1.70% 1.60% 2.70% 3.40% 1.60% 2.40% 1.90% 3.30% 3.40% 2.50% 4.10% 0.10% 2.70% 1.50% 3.00% 1.70% 1.50% 0.80% 0.70% 2.10% 2.10% 1.90% 2.30% 0.80% 1.60% 1.70% |
Fed Funds Rate
NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA NA 1.25% 2.50% 3.00% 3.00% 2.50% 4.00% 2.00% 2.00% 3.00% 3.38% 3.75% 4.25% 5.50% 4.50% 6.00% 9.00% 5.00% 5.00% 5.75% 11.00% 8.00% 6.50% 4.75% 6.50% 10.00% 12.00% 18.00% 12.00% 8.50% 9.25% 8.25% 7.75% 6.00% 6.75% 9.75% 8.25% 7.00% 4.00% 3.00% 3.00% 5.50% 5.50% 5.25% 5.50% 4.75% 5.50% 6.50% 1.75% 1.25% 1.00% 2.25% 4.25% 5.25% 4.25% 0% 0% 0% 0% 0% 0% 0% 0.25% 0.75% 1.50% 2.50% 1.75% 0.25% 2.00% 2.00% |
Expansion Business Cycle
(GDP Growth) Aug peak Contraction (-8.5%) Contraction (-6.4%) Contraction (-12.9%) Contraction ended in March (-1.2%) Expansion (10.8%) Expansion (8.9%) Expansion (12.9%) Expansion peaked in May (5.1%) Contraction ended in June (-3.3%) Expansion (8.0%) Expansion (8.8%) Expansion (17.7%) Expansion (18.9%) Expansion (17.0%) Expansion (8.0%) Feb peak. Oct trough (-1.0%) Expansion (-11.6%) Expansion (-1.1%) Nov peak (4.1%) Oct trough (-0.6%) Expansion (8.7%) Expansion (8.0%) Expansion (4.1%) July peak (4.7%) May trough (-0.6%) Expansion (7.1%) Expansion (2.1%) Aug peak (2.1%) April trough (-0.7%) Expansion (6.9%) April peak (2.6%) Feb trough (2.6%) Expansion (6.1%) Expansion (4.4%) Expansion (5.8%) Expansion (6.5%) Expansion (6.6%) Expansion (2.7%) Expansion (4.9%) Dec peak (3.1%) Nov trough (0.2%) Expansion (3.3%) Expansion (5.3%) Nov peak (5.6%) Contraction (-0.5%) March trough (-0.2%) Expansion (5.4%) Expansion (4.6%) Expansion (5.5%) Expansion (3.2%) Jan peak (-0.3%) July trough (2.5%) November (-1.8%) Expansion (4.6%) Expansion (7.2%) Expansion (4.2%) Expansion (3.5%) Expansion (3.5%) Expansion (4.2%) Expansion (3.7%) Jul peak (1.9%) Mar trough (-0.1%) Expansion (3.5%) Expansion (2.8%) Expansion (4.0%) Expansion (2.7%) Expansion (3.8%) Expansion (4.4%) Expansion (4.5%) Expansion (4.8%) Expansion (4.1%) March peak. Nov trough (1.0%) Expansion (1.7%) Expansion (2.9%) Expansion (3.8%) Expansion (3.5%) Expansion (2.9%) Dec peak (1.9%) Contraction (-0.1%) Jun trough (-2.5%) Expansion (2.6%) Expansion (1.6%) Expansion (2.2%) Expansion (1.8%) Expansion (2.5%) Expansion (2.9%) Expansion (1.6%) Expansion (2.2%) Expansion (2.9%) Expansion (2.2%) Contraction (-6.5%) Expansion (5.0%) Expansion (3.5%) |
Resources for Tables
Adapted from, https://www.thebalance.com/u-s-inflation-rate-history-by-year-and-forecast-3306093
Fiscal calculator, https://inflationdata.com/Inflation/Inflation_Calculators/Cumulative_Inflation_Calculator.aspx
Adapted from, https://www.thebalance.com/u-s-inflation-rate-history-by-year-and-forecast-3306093
Fiscal calculator, https://inflationdata.com/Inflation/Inflation_Calculators/Cumulative_Inflation_Calculator.aspx
