How to Behave the First Week on the Job

Since this is a book about financial literacy, this is likely your first or second job, and you will need to learn some of the fundamentals. First, you should remember that a job is immersed in a social setting. You have to get along with people—especially your boss and co-workers! Unfortunately, there is no manual for how to do this.

Instead, you have to use your people skills. Listen to your supervisor and do what they direct you to do. Do not question a supervisor’s orders; you will need to earn their trust before you can do that. With your co-workers, be willing to listen and to not be so vocal with your opinions. In the beginning, you are there to learn about the organization and build trust. A know-it-all will not be trusted.

Gossip at Work 

R.I. Dunbar states that “Analyses of freely forming conversations indicate that approximately two thirds of conversation time is devoted to social topics, most of which can be given the generic label gossip” (2004). This gossip is what you need to get connected to in your workplace, and you can find it by making friends at your job. Take co-workers out to lunch or, better yet, go for drinks after work.

When you are with your co-workers, you should listen more than you talk. Your co-workers can tell you things like which bosses are mean, which co-workers will stab you in the back, and which men are sexual harassers. This gossip will also tell you who has power in the organization. For example, often a personal assistant controls access to the President, so it is important to be kind to them.

More than just providing gossip, friends at work also increase your well-being. Remember that work is not just about doing your job but getting along with your co-workers. Modern organizations are built around teamwork, but more importantly, people who report that they consider a co-worker their best friend are much more likely to also report that they love their job.

Insights from Give and Take by Kurzban and Houser 

You not only need friends, though; you also need networks, both inside and outside of work. Adam Grant, a professor of Industrial Psychology at the University of Pennsylvania, talks about the importance of networks in his book, Give and Take:

By developing a strong network, people can gain invaluable access to knowledge, expertise, and influence. Extensive research demonstrates that people with rich networks achieve higher performance ratings, get promoted faster, and earn more money. (2013)

Another way to look at this is that you (assuming you are a giver or matcher) begin by cooperating and then copy your teammate(s)’ strategy from the previous round.

In 2020 women made up 47% of the US labor force. However, analyses of women’s compensation and place in the organizational hierarchy reveal ongoing imbalances when compared with their male counterparts. At the highest level, in 2021 only 41 CEOs of the Fortune 500, or 8.1%, were women. The gender wage gap is a recognized phenomenon that has been widely studied. In 2019 women were making 82.3 cents for every dollar of men’s earnings. Although it has narrowed significantly since 1979, when it was 62.3, the gender wage gap remained relatively stable through the 2010s. This is true when examined across racial/ethnic and occupational categories (highlights of women’s earnings in 2020). Among the many causal factors, researchers have identified a motherhood wage penalty that is variously attributed to productivity differences and discrimination (De Linde Leonard, 2020; Gallen, 2018; Correll, 2007).

For women in the early phase of their careers, there are several considerations that may lead to more positive salary and promotional outcomes. According to Adam Grant (2013), women are not as willing as men to advocate for more money during salary negotiations. Understanding this tendency may help to resist the urge to accept the first offer. It is often prudent to  step back, take an objective perspective, and get some advice from a trusted colleague before responding to a salary offer.

Early career promotions to management are a second factor that women should pay attention to. In a Wall Street Journal article largely based on the influential study Women in the Workplace, reporter Vanessa Fuhrmans explains that it is “…early in women’s careers, not later, when they fall dramatically behind men in promotions…Though women and men enter the workforce in roughly equal numbers, men outnumber women nearly 2 to 1 when they reach that first step up—the manager jobs that are the bridge to more senior leadership roles.” Although companies advance women already in management positions, there is not a similar effort to promote women to that first management position. As Haig Nalbantian, a labor economist at the global human resource consulting firm Mercer explains, companies need to “position women and minorities to succeed in the roles that are likely to lead to higher-level positions” (Fuhrmans, 2019). Senior partner at McKinsey & Co. and contributor to Women in the Workplace, Lareina Yee comments that “[f]ew efforts are likely to remedy the problem as much as tackling the gender imbalance in initial promotions to management” (Fuhrmans, 2019). In early career employment searches, women can choose to seek out companies with a positive record of advancing women. Once employed, they should be proactive in understanding the expectations for promotion into management.

Employment Discrimination

Resources

Well-Being

In 2010, Ben Bernanke gave a commencement address in which he described the “the ultimate purpose of economics”:

[It] is to understand and promote the enhancement of well-being. Economic measurement accordingly must encompass measures of well-being and its determinants…Interestingly, income and wealth do contribute to self-reported happiness, but the relationship is more complex and context-dependent than standard utility theory would suggest. Other important contributors to individuals’ life satisfaction are a strong sense of support from belonging to a family or core group and a broader community, a sense of control over one’s life, a feeling of confidence or optimism about the future, and an ability to adapt to changing circumstances…. Psychological wellness, the level of education, physical health and safety, community vitality and the strength of family and social ties, and time spent in leisure activities.

That is a pretty large list of things that determine your well-being. You will recognize some from traditional economics, while others are from this new view on economics. We can put them in a list to make them a little clearer:

Determinants of Well-Being

• Gross domestic product per capita

• Personal consumption expenditures

• Household income

• Household wealth

• Changes in the distribution of income, wealth, or consumption

• Degree of upward mobility in material measures of well-being

• Indications of job security and confidence about future employment prospects

• Households’ liquidity buffers or other measures of their ability to absorb financial shocks

• A strong sense of support from belonging to a family or core group and a broader community

• A sense of control over one’s life

• A feeling of confidence or optimism about the future

• An ability to adapt to changing circumstances

• Psychological wellness

• The level of education

• Physical health and safety

• Community vitality and the strength of family and social ties

• Time spent in leisure activities

Additionally, the Organization of Economic Cooperation and Development (an association composed of developed nations) has created a Better Life Index comprised of elements that increase well-being.

OECD Better Life Index

• Housing

• Income

• Jobs

• Community

• Education

• Environment

• Civic Engagement

• Health

• Life Satisfaction

• Safety

• Work-Life Balance

What makes you happy? (Maslow’s Hierarchy of Needs)

People often conflate “happiness” with “life satisfaction.” According to Bernanke, researchers define happiness as a transitory emotion that is influenced significantly by your current circumstances, including the weather and even the time of day (2010). On the other hand, they use life satisfaction to refer to a long-term state of contentment and well-being. Psychologist Abraham Maslow captures the conditions that give humans life satisfaction in his Hierarchy of Needs (1943). These are usually portrayed as a pyramid (though Maslow did not initially present it this way) in order to represent Maslow’s contention that each level must be achieved before progressing to the next level. For example, if a person does not have their physiological needs met, they will be focused on those before pursuing safety needs, which is the next step on the pyramid. While most of the needs might seem pretty obvious, I want to point out that the self-actualization need can include things like partner acquisition, parenting, pursuing goals, and utilizing and developing talents and abilities.

It should also be noted that Maslow would later revise and expand his Hierarchy of Needs to include:

• Cognitive needs

• Aesthetic needs

• Transcendence

For Maslow, transcendence included the need to help others and to seek spiritual transcendence.

Other researchers have added two significant ideas to Maslow’s Hierarchy. The first is that the steps are fluid, and the pursuit of various goals can overlap at different stages in our lives. Second, you can achieve high levels of self-actualization, but if the lower needs have not been met, you will be forever trying to find them. The news is filled with stories of stars with wealth and fame who missed the needs lower on the pyramid and had tragic ends to their lives.

What makes you happy? (Ben Bernanke)

I find it pretty amazing that Ben Bernanke, Chair of the Federal Reserve Bank—the bastion of capitalism—would give a commencement address on the economics of happiness. In fact, Bernanke did just that at the University of South Carolina on May 8, 2010 (Bernanke 2010). This is exactly the kind of advice that you are looking for in this book! Bernanke opened his addressed by saying, 

As you might guess, when thinking about the sources of psychological well-being, economists have tended to focus on the material things of life…. This traditional economist’s perspective on happiness is not as narrow and Scrooge-y as you might think at first. There is now a field of study, complete with doctoral dissertations and professorships, called ‘the economics of happiness.’ The idea is that by measuring the self-reported happiness of people around the world, and then correlating those results with economic, social, and personal characteristics and behavior, we can learn directly what factors contribute to happiness (2010).

What gives people life satisfaction is not just material wealth. In fact, although rich people in developed nations self-report that they are somewhat happier than poor people in those nations, people in poor nations report that they are pretty much just as satisfied with their lives as those in rich nations. As a matter of fact, in the United States, real per capita income has almost tripled over the time period 1946 to 1991 but average happiness has not changed at all. This finding is called the Easterlin Paradox, named after the researcher who discovered it.

Similarly, Easterlin also found that as countries around the world get richer (economists measure this as Gross Domestic Product per capita) people do not report being happier. And in comparing rich countries to poor countries, Easterlin also found that once you get above a certain amount of income that satisfies basic material needs, people in rich countries do not report being much happier than people in poor countries (Easterlin, 1974). Additional research on the Easterlin Paradox has shown that even though people in rich countries may be more satisfied than people in poor countries, the increase in happiness due to greater wealth is moderate (Bernanke 2010). Do not forget that rich countries have more leisure time, better health care, often less corruption and other benefits. The explanation for the Easterlin Paradox, according to Bernanke, is that relative wealth is much more important than absolute wealth.

A behavioral economic phenomenon called hedonic adaptation is also at work here (Frederick and Lownestein 1999). Humans are adaptable, and, like lottery winners who seem to return to their base level of happiness within six months, adaptation to any additional income causes us to return to our base level of life-satisfaction. Finally, Bernanke relates what the economics of happiness tells us will give us life satisfaction. Here are some of the highlights from his 2010 address:

• “Happy people tend to spend time with friends and family and put emphasis on social and community relationships.”

• “Another factor in happiness, perhaps less obvious, is based on the concept of ‘flow.’ When you are working, studying, or pursuing a hobby, do you sometimes become so engrossed in what you are doing that you totally lose track of time? That feeling is called flow.”

• “Another finding is that happy people feel in control of their own lives. A sense of control can be obtained by actively setting goals that are both challenging and achievable.”

• “Finally–and this is one of the most intriguing findings–happiness can be promoted by fighting the natural human tendency to become entirely adapted to your circumstances. One interesting practical suggestion is to keep a ‘gratitude journal,’ in which you routinely list experiences and circumstances for which you are grateful.”

You will no doubt see some parallels to Maslow’s Hierarchy of Needs. Maslow spent a lot of time studying exceptional people such as Albert Einstein to see what made them feel fulfilled. His Hierarchy of Needs is a prescription for what will make humans happy—not just an academic study in developmental psychology.

What makes you happy? (Authentic Happiness)

When Dr. Martin Seligman was elected President of the American Psychological Association in 1998, he promoted an initiative in psychology to study what makes people happy along with the traditional subject of what makes people sick. This field of study became known as Positive Psychology. In his book, Flourish, Seligman presents his theory of what makes people happy (2011). It consists of five practices that are memorialized by the pneumonic “PERMA.”

Positive Emotions

Cultivate positive emotions. Pursue activities that bring you happiness and life satisfaction. (We’ve talked about these activities above in the sections on Maslow and Bernanke.) It also means doing gratitude exercises, such as listing three things you are grateful for each day before you go to sleep.

Engagement

Deep engagement in an activity is known as flow. In his 2011 book, Seligman provides a series of questions so that you can determine if you were in a flow:

• Did time stop for you?

• Were you completely absorbed by the task?

• Did you lose self-consciousness?

According to the principles of Positive Psychology, the way to become engaged in your work is to find a career that uses your signature character strengths (see Chapter 1). You can find your Signature Character Strengths by taking the questionnaire VIA Survey of Character Strengths on the Authentic Happiness website.

Relationships

Specifically, we should focus on positive relationships. As Bernanke said, friends and family give us the greatest life satisfaction, and you can practice daily reminders that you are grateful for friends and family. However, it is not just what your friends and family can do to make you happy. Maslow’s revised hierarchy places transcendence at the top. Transcendence is achieved by activities that focus on helping others reach life satisfaction and on pursuing your spiritual virtues. According to Seligman, positive relationships require both the capacity to love and the capacity to be loved.

Meaning

Meaning is belonging to and serving something bigger than yourself. (Sleigman 2011, p. 17). It can be devotion to your family, to a cause, or a spiritual belief. Meaning has both a subjective motivation (the feeling we get) and an objective motivation (that caring for others is an important virtue). Psychologist Vicktor E. Frankl, in his book, Man’s Search for Meaning, claims that our quest for meaning in our lives is one of the fundamental human aspirations (2006). According to Frankl, having meaning in our lives is so important that it can make the difference between life and death. During the Holocaust, Frankl was interned in a concentration camp. He reports in his book that among seemingly equally healthy prisoners in the camp, those who had expressed a belief in a meaning to life or belief in a higher power survived while those who did not see any meaning in life disproportionately perished (2006).

Accomplishment

People, according to Seligman, pursue accomplishment, achievement, success and mastery for its own sake (2011). Some only care about winning, measured by the number of defeated opponents or the amount of money in their bank account. Some, on the other hand, pursue accomplishment to feel competent or to achieve their full potential. In Maslow’s Hierarchy, this is reflected in the Need for Esteem and the Need for Self-Actualization.

Hopefully you see by now the common threads between Maslow, Bernanke and Seligman as to what gives us happiness and well-being. Due to hedonic adaptation, we know that it certainly is not about having more money. Instead, the most important factor for achieving well-being is developing positive relationships and spending time with family and friends.

Bad Habits and How to Change Them

A fundamental tenet of economics is that individuals seek rewards. People do actions and seek to acquire goods and services that give them “utility.” English jurist, philosopher, and social reformer Jeremy Bentham (1748-1832) defined “utility” as “satisfaction.” Bentham was an English jurist, philosopher, and social reformer who invented the philosophy of Utilitarianism. According to Bentham, the fundamental axiom of Utilitarianism is that “it is the greatest happiness of the greatest number that is the measure of right and wrong.” More contemporary economists define utility as “well-being.” The new field of neuro-economics contends that individuals perform actions and seek to acquire goods and services because these activities give individuals a reward of dopamine in the area of the brain known as the ventral tegmental area (Wargo et al, 2010).

In both mice and in humans, habits form by repetition of a certain activity. We do the activity because the dopamine neurons release dopamine, a neurotransmitter, thereby giving us a reward and encouraging us to repeat the action either at the time or later. As we (or the mouse in the maze) repeat the action, it becomes less and less mediated by the ventral tegmental area and more controlled by the basal ganglia, the most primitive part of the brain. Eventually, the basal ganglia takes over the action, and it is no longer mediated by the dopamine reward system. In essence, this is why it is so hard to change a habit, whether it is good or bad. Once an action becomes a habit, it is more closely related to an instinct in an animal than a conscious choice. So, how do we change or extinguish a bad habit? Cassie Shortsleeve, in Time Magazine, reviews the actions that scientists recommend to eliminate a bad habit:

1. Replace a bad habit with a good one. You must keep repeating the good habit, since a scientific study found that it takes an average of 66 days to form a new habit.

2. Reduce your stress levels. A lot of bad habits (smoking, sugar drinks) are used to alleviate stress levels because they give a dopamine feel-good high. Do other things to alleviate stress like meditation or a walk

3. Know the cues that trigger the habitual response, as in having a cigarette after every meal. Try to interrupt the cues.

4. Create for yourself a better reason for quitting the habit. This means creating intrinsic motivation for yourself, such as reminding yourself that you will be healthier without smoking or overeating.

5. Set better goals than just reacting to triggers. If you eat a cookie every time you walk in the kitchen, avoid the kitchen in between meals. Like an alcoholic, you want to throw out the liquor and avoid triggers that will remind you of the habit (2018).

We should note, though, that “addiction” is neurologically different from “habit.” All addictive drugs hijack the dopamine system, not the basal ganglia. It is harder to alleviate addiction than it is to break a bad habit. Unfortunately, we do not have the space here to discuss addiction in detail.

Savings is One Key to Well-Being

In the Atlantic, Neal Gabler cites an annual survey of the Federal Reserve Bank to “monitor the financial and economic status of American consumers” (2016). One survey question asked respondents how they would pay for an emergency expense of $400. Almost half (47%) of those taking the survey said that either they would cover the expense by borrowing or selling something, or they would not be able to come up with the $400 at all. Many experts believe this is due to the credit card debt that Americans have taken on. According to most recent data from the Survey of Consumer Finances by the U.S. Federal Reserve, the average credit card debt of U.S. households is approximately $5,700. At the same time, people’s dependence on credit card debt has been pushed by banks. Last year over two billion credit card solicitations were mailed out by banks and financial agencies.

Chapter 11 talks about savings in great detail, but it’s important to know that having emergency savings can significantly add to your personal well-being. Personal finance experts recommend that you have a goal of accumulating six months of expenditures (mortgage, food, etc.) in a secure bank account. In good economic times, 90% of those who are laid off find a new job within six months. Further, regular unemployment compensation typically only lasts 26 weeks and, depending on which state you live in, ranges from $235 (Mississippi) to $650 (Connecticut). This payment will likely not cover the mortgage, the utilities and food for most of us. A six-month nest egg will dramatically reduce our stress while looking for a new job.