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1. Government and schools sit under enormous political pressure to keep salaries low, as part of a larger agenda to 'drown it in a bathtub'. This pressure keeps school salaries so low relative to the amount of responsibility and regulation that one has to be a bit crazy to choose teaching as a profession. Universities get to take their choice of the PhD students they produce; their hiring problems are more a problem of funding than worker supply. And the military I know little about.

2. Businesses need to ensure that their workers are focused on product quality over internal politics. That's a failure of culture, full stop. These internal politics, if not focused on individual salaries, can instead focus on project head count, building fiefdoms, etc. In short, if you fail to manage internal politics, you'll have these problems regardless of whether employees know what they're getting paid.

3. Yeah, capitalism's a bitch, huh? Funny how all of the 'power of free markets' rhetoric dries up as soon as it's turned back around...

Somewhat more seriously, this mainly shows that you need to peg employee salaries to a minimum of market rates, so that they aren't unhappy when that new market-rate hire comes on, and then go above this minimum based on performance. It's not that hard.




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