If you recall, DH’s company has been having money flow issues and isn’t sure it’s going to last through March. Employees had to take about a month long 10% paycut in order for them to make payroll at the end of 2016 (they’re back at full pay now). It’s also highly dependent on government contracting work which could mean lots of money or very little money over the next few years depending on how/if money is allocated to the DoD. (The DoD does a surprising amount of life-saving research– it isn’t all weapons.)
The guy who recruited DH to the company just quit the company in order to take a job in a more stable company at a lower salary with no benefits (they do reimburse ACA claims and they’re in a state with its own exchange program and individual mandate so Trump won’t make the exchange go away).
He has a SAHM wife and two small children. He needs the stability more than he needs the larger paycheck.
The company CEO called DH to make sure he wasn’t going to follow suit and also leave. It would have been a good time to ask for concessions if there wasn’t a worry about the company going under in a couple months.
DH has a wife whose job has high stability and doesn’t really need a paycheck at all (we’d have to cut down on education/retirement saving and some luxuries, but we’d be fine). That means he can stick with a job that has a high salary and high flexibility but at any point in time could go under in the next three months. Heck, he could cut down to part-time contract work at any point in time and he would be ok. I provide that ability. Our heavy retirement saving these past few years means that we could even cut down retirement savings and we’d be fine. Being massively risk averse, ironically, means we can take more risks because with my job security and our savings these risks are measured risks.
But most people don’t have that kind of financial independence. That means that when a company does something like temporarily cut pay by 10% they’re going to lose good people who need that stability. Breadwinners from single earner families may be less likely to leave a stable job (I assume– I haven’t read research) but when that stability disappears they may be more likely to seek a new position so as to not have to deal with an unemployment spell. At least, that’s the case with DH’s colleague.
As for what this means for the company– it’s a small operation and his role was important. They won’t be hiring to replace him any time soon. But that won’t be important if they go under in March. So we’ll see what happens.
I’m just glad that we’ll be fine no matter what that is.
What determines when you or (if applicable) your partner changes jobs? Could you handle a lengthy unemployment spell?
Grumpy Rumblings (of the formerly untenured) 
February 6, 2017 at 8:08 am
A scenario like this one is always what I first think of regarding single vs dual-earner households: the pressure on any one earner is much lower if the partner also works. This enables people to take risks, to take time off to get additional training, to leave a toxic situation. I admit, I think I will never understand the mindset behind one spouse leaving work to become a SAHP.
February 6, 2017 at 8:12 am
Occasionally when I’m overwhelmed with work (like now) I think how nice it would be to (keep the kids in school and) putter around all day as a kept woman. #2 is really good at that, but I know in my heart of hearts I would get bored and start making trouble of some sort.
February 6, 2017 at 8:22 am
I think I’ve mentioned before that we’re in a similar spot – academia and a startup, and all of our affordability is based on my income. We’re also willing to live with the instability. For us, the biggest factor is that DH works 100% remotely; his entire team is remote. He was/is willing to work for quite a bit less pay, given that perk.
February 6, 2017 at 8:26 am
That’s pretty much our situation, though DH is making more pay than he would be locally since the boss is based in a high cost of living area and we’re in a low cost of living area, so there’s a lot of room between what he’d be making locally there and locally here. (He’d be making more if he moved to a high cost of living area, but not enough for us to, say, buy a house there.)
February 6, 2017 at 10:19 am
For us, it is my husband’s health insurance that is keeping him from quitting his job – that and the 4 weeks of vacation he gets. I also get insurance through my job but it is a managed care organization and does not include the hospital that provides all the care for my daughter, who is medically complex.
February 6, 2017 at 10:23 am
Health insurance is so important.
February 6, 2017 at 2:05 pm
My husband’s job definitely made it easier to quit a few years ago, but since things worked out such that I’m almost replacing my previous income, money alone wouldn’t mean I’d have to go find another full time job if he lost his. But the health insurance question might. I’ve never tried to buy myself insurance, but suspect I’d fall into a middle risk group (asthma, but otherwise healthy), and therefore wouldn’t expect any bargains. This is why the existence of the ACA made it easier for me to decide to go out on my own. For the first time, I felt like it would be possible to handle the insurance side of things if my husband lost (or left) his job.
February 6, 2017 at 5:09 pm
So glad to hear you’re replacing most of your income!
With asthma you might be uninsurable… it doesn’t take much. Though I’m sure CA would have something.
February 7, 2017 at 1:33 am
Health care is the biggie. Autocorrect made that “bogie” and I’m not sure that’s wrong.
I was the one who quit last. I quit a stable and medium-high paying (but hair on fire stressful) job for a high-risk, medium low-stability, med-high paying job. It’s worked out well for us so far but I’m always aware my job could go away on not a lot of notice and we couldn’t do without my salary for long. (Where long = 2 years of normal living.) PiC almost has to stay at his job because it pays well, has amazing health benefits which I always need, and great vacation. It’s lucky he currently has an amazing boss to go with it or this equation wouldn’t seem so rosy.
After we raid our more liquid savings for another abode, we’d only be able to last a year without more income if we didn’t cut retirement savings but I think things would have to be pretty bad for us to consider that. We’d probably go to part time daycare to cut costs there first, assuming that I didn’t find another full time job that’s as flexible and good for my health as this one. Honestly I should not still be getting feelings of panic when I think about this job going away but I do. Most probably because I still haven’t come up with a business of my own that would replace my income.
Blogging hasn’t brought in the big bucks and I don’t know why! /sarcasm
I could stand to spend less time blogging and more time on Income Replacing Activities.
February 7, 2017 at 7:18 am
No, this time autocorrect isn’t wrong at all.
February 7, 2017 at 9:21 am
I love this! Well not that your husband’s boss quit, but that your husband has this flexibility. If we combined our finances, we could live on either of our incomes just fine, though we would have to reduce savings somewhat. With only one of us out of work and hypothetically combined finances, the unemployed person would never need to find work again for income reasons, which is part of why we weren’t comfortable fully combining finances.
February 7, 2017 at 4:23 pm
That makes sense. I suspect that might be some of #2’s motivation as well. She’d prefer not to work if she were independently wealthy, but also wants to contribute to the household.
February 7, 2017 at 9:47 am
We’d be okay on one income, but that doesn’t mean we want to. Thinking back, I actually have never officially quit a job (unless you count mastering out of grad school). Much of this is because my jobs have been short-term contract jobs, and I just didn’t reapply after the contract was up or moved on to another position. My husband has worked the same job since I met him. We look around some and consider trade-offs, but we both like our jobs well enough to stay unless we find something truly superb. Thankfully, our jobs are really stable. We definitely have taken the stability trade-off for lower pay. I think this is our risk-averse nature coming out.
February 7, 2017 at 10:01 am
Same here, actually. I’ve never quit a job because all previous jobs have been contract term-limited. Even my high school job was a summer job.
February 7, 2017 at 11:55 am
I am glad you have that stability. We definitely don’t. I have always been the one providing the foundation for whatever financial security we have – when I leave a job or lose one, I have to go straight back to work ASAP. Which accounts for the long list of relatively short-term and variously crappy jobs I’ve had. Our emergency funds combined would not cover a full year of our hideously inflated living expenses. At least we both HAVE e-funds now!
We are looking into making a fairly drastic change of residence for the purpose of expense stabilization. Since in order to retire we need to maintain something close to this income, and the only place we can really maintain this income is in this @%&$#! city, something has to give.
February 7, 2017 at 3:13 pm
:(
February 7, 2017 at 12:32 pm
My husband’s job is the more stable job. The stability in mine is much less so than it was when we were in southern California, but the instability is generally predictable since I work on long duration projects (5+ years) and I know when they are ending and when my role is ending. The one I’m working now is unique in that it is less predicable for a variety of reasons.
He will only change jobs if he doesn’t get tenure (mid career feedback was very positive) or if I lobby for a move to a different geographical location that make more sense for us as a family (unlikely). I really like my current set up and will only change jobs if my job ends and I don’t get another project lined up.
We could survive unemployment for quite some time (on the order of 2 years, maybe more), but to do it indefinitely would require changes (and probably impossible on just mine, but that isn’t a situation where we’d stay here). I still feel this is not a very stable situation, and would prefer that we could maintain all expenses on a either of our salaries, indefinitely. That just isn’t realistic in this market.
February 7, 2017 at 3:12 pm
We can’t afford a house on one salary in your market either. :(
February 7, 2017 at 5:32 pm
This is a huge part of why we would rather stay in a condo than buy a house. We prefer to base expenses only off of salary and not including bonuses and it would take both salary and bonus from both of us to be able to afford a house.
February 7, 2017 at 4:50 pm
I guess I’ll represent for the single adults! I don’t have a fallback income so would definitely have to get back to work if my job went away. I could get by on 6 months out of my current savings; with unemployment I could last a year, and if I added a roommate I’d get by even longer. I’m pretty employable and I could afford to take a big paycut if I had to – I’ve saved enough for retirement that I could stop and I’d be okay, and I have been prepaying my mortgage and could cut that back too, if things were tight. I’m aiming to retire in my mid-50s but health insurance will be the huge wildcard (or bogie) that will probably dictate if I can retire early or if I have to keep a job just for the benefits.
So far I’ve changed jobs when I’ve decided it’s time to move on. Networking has been the key for every single job I’ve had – the last time I applied cold to a job, I found the ad in the paper and it was 1997.
February 7, 2017 at 4:52 pm
Networking is awesome.
Precautionary savings is so good to have.
February 7, 2017 at 10:24 pm
I think the biggest reason I’m so downright militant about not only getting my MD/PhD is that my mom was a SAHM until about 3 years ago. Dad had a ton of pressure on him to stay healthy and able to do his job-thankfully, he chose the very stable job of STEM professor with tenure and college tuition benefits for offspring. Still, anytime he so much as had a cold, Mom freaked-because what the hell was she going to do. Fast forward a few years, Mom and I both get our MS degrees, and she is now a director at an engr company, with her own financial independence. Dad is still the primary breadwinner, but she can support herself and arrange for care for grandparents, and that feels good.
And now I’m utterly determined to get both degrees, with no debt, and hopefully enter the relatively stable but grant dependent academic track, or, worst case, go into private practice. ;) (Or Industry, when lab sucks just that much more…today was not a Good Science Day). I get a lot of cultural pressure about not being married with babies, but I’m so aware of Mom’s experiences that I really don’t want to be in a position with dependents until I can support myself and the offspring solo, if necessary.
Ironically, my sister, who was insulated from a lot of the anxiety, is moving towards the ‘supportive partner/stay at home wife’ track, because, “I like having a man to take care of me”. I can already see her fiance thinking ahead to the extra pressure he will have supporting a family mostly solo. But then, they voted for Trump, so I can’t say I feel all that sympathetic to their plight.
February 14, 2017 at 4:18 pm
That must be a great feeling :)
I bought my house alone (would have loved to not, but $ and relationship at the time did not allow any other option). Which financially, is definitely a good thing. I can afford it technically alone but definitely a stretch.
Recent and sudden changes at his company have prodded him to job search more seriously so we’ll see.
My boss returns form parental leave next month and I think having her back will help me clarify the path her for the next couple of years and figure out when I should make my next move (which would be $$ driven). That said I really do like what I do and it would need to be compelling and I would still need enjoy the work and not take on too much stress.
Could we handle long unemployment – nope we live in a super high COL country and city and have a mortgage (not that rent is really much cheaper). We have income insurance (because unemployment benefits here are stupid and useless and so basically everyone needs private insurance to CYA) but it’s never 100% replacement, usually more like 50-80%.
May 28, 2018 at 1:09 am
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