I live in Hawaii and recently heard my large, Hawaii-based employer use the term “cost of labor” when explaining how they derived the organization’s new salary ranges. It’s no surprise that jobs and companies in Hawaii generally pay less than equivalent jobs/companies on the mainland. But when I asked my employer on an all-company call to explain what cost of labor actually is and why Hawaii employers can pay so much less than companies on the mainland, the answer the consultant provided was largely a non-answer.
Can someone explain to me like I’m 5, why is Hawaii’s cost of labor so low compared to the mainland?
(Edit: for clarification, cost of living and cost of labor are different terms, and I’m wondering why the cost of labor in Hawaii Is so disproportionate to the cost of living compared to parts of the mainland that also have high costs of living, such as much of California, NYC, Washington, and so on. The disparity between these two terms seems much more significant in Hawaii)
In: Economics
It’s typical corporate bs jargon. Translation:
“We heard some of you complaining about money. We’ve heard this complaint quite a bit lately and we got worried you guys will start quitting, so we looked at a bunch of stats for our state/locality to see what other people are making. We’re pretty sure you’re not gonna quit with these new ranges because no one else really pays better than these ranges, and we doubt you’re gonna move ACROSS THE OCEAN just for a job. We bet you don’t have the money to live if you wanted to either. Be happy we’re not paying you less “
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