The Economics of "Doing What You Love": Considering a Personal Story of Sacrificing Money for Happiness

The Economics of "Doing What You Love":

Considering a Personal Story of Sacrificing Money for Happiness 

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I interviewed a 24 year old woman named Saraphie. Saraphie grew up in Santa Rosa California. When she finished middle school, her parents took out loans to send her to Rio Lindo Adventist Academy, a boarding school in Northern California. At boarding school, Saraphie worked on her school’s cafeteria staff and as a janitor in her free time to make ends meet. In her summers, she worked as a lifeguard. After high school, Saraphie traveled to Portland to attend Lewis & Clark College. She chose Lewis & Clark because of Portland: because she had heard that in Portland it was easier to get a job. To pay for her education, Saraphie took out student loans. While in college, she also worked as a barista and served as a resident assistant. After spending 4 years earning a bachelor's degree at Lewis & Clark, she worked as a reading specialist at Lindamood-Bell. In 2015, at the age of 23, she was hired by Catlin Gabel as a 5th grade teaching assistant. She stills works at Catlin. Aside from being a 5th grade teaching assistant, she also helps out in the Lower School’s after school care program and coaches basketball.  

Saraphie, despite the time and effort she puts into her job, earns a relatively low income. She earns $14.50 per hour, and works 5 days a week from 7-9 hours a day. She told me candidly she earns $20,880 per year. For her level of education, Saraphie earns very little. According to the National Association of Colleges and Employers, the average salary of a 2014 college graduate is $48,707. Saraphie, who graduated in 2014, earns barely 42% of the salary of a fellow 2014 college graduate. The latest US Census Data I could find (from 2008) reveals a general per capita income of $26,964, which Saraphie earns 77% of. However I seem to look at it, Saraphie seems incredibly underpaid.

What strikes me is that Saraphie earns $14.50 per hour, which is 40% higher than Oregon’s $9.75 minimum wage. If Saraphie considers her salary barely livable and it’s almost 1.5x Oregon’s minimum wage, I can’t help but consider if our minimum wage is reasonable. Not to mention Oregon’s minimum wage is unusually high compared to our federal minimum wage of $7.25. I thought the purpose of minimum wage was to be the lowest possible livable wage, but after talking to Saraphie, it seems like it’s not living up to it’s purpose. As the graph below shows, it seems that minimum wage is worryingly low compared to what it “should” be (in terms of productivity, which has continued to increase over time). Additionally, as indicated by the graphs below about CPI over time, if the cost of living is increasing, it seems logical that minimum wage should increase in accordance.  

She doesn’t quite have a position on taxation: she claims she enjoys public goods and services, but also is frustrated by her high taxes. Her stance on government taxation is that if the US wants to grow the middle class, it should tax it less. In the graph on the left, one can see that as time has passed, the middle class has shrunk. She’s torn because she feels like taxing Americans with similar incomes to her own is counterintuitive, but she also recognizes the need for individuals to help support the government and all it has to offer. She’s frustrated by the rise in taxes over time (evident in the graph on the right).

As we’ve learned from our analysis of the 6 economic principles: all choices have costs. Saraphie, because she loves kids and teaching, chose to teach. However, this choice came with a cost. Saraphie, by choosing to be a teacher at a private school, settled for earning a lower income than she could've otherwise. She told me she’s happy with her decision to teach at Catlin and acknowledges the opportunity costs. The graph below shows the sacrifice private school teachers make in terms of weekly pay. Compared to non-teacher college graduates, public school teachers, and the general working population, private school teachers evidently earn less money. Though public school teachers are typically paid more and receive more benefits, Saraphie explained that there are inherent costs of being a public school teacher: including less flexibility, larger class sizes, and less say in the school’s administration. Plus, small schools like Catlin attract teachers who value community and relationships.

Although Saraphie enjoys her current job, she also has worries for the future. Because of her low salary, she’s struggling to save for retirement. She explained to me that Catlin puts 2% of each employee’s salary in a retirement fund, and matches whatever the employee contributes. Saraphie said she’s trying to put 6% of her salary in every year. And although that seems like a small fraction of her pay, I realize how much of a commitment that is for her. She explained that she knows the importance of saving, and will sacrifice the short term for the long term. I thought that was pretty wise, but also easier than than done. I assume it’s difficult to find excess money for her to save, so I’m impressed by Saraphie’s sacrifices and saving habits. Though she saves 6% of her salary each year and envisions her retirement being in a very long time, she still worries if she’ll have enough money saved up to provide for her future. Basically, she believes her current salary is liveable, but not sustainable. I thought that was a fascinating insight.

When Saraphie explained to me her economic hopes and fears, I wasn’t too surprised when she said her hope was “not to have to worry about money”. However, what struck me were her fears. Her first fear was a fear of not being able to help. I know Saraphie not just through Catlin’s basketball program, but through my little brother, who had her as a teacher last year. I’m pretty sure she is one of his favorite all time teachers. She’s also an incredible basketball coach. Bottom line, she’s super nice and has dedicated her current career towards helping others. Teaching and coaching seem to be pretty selfless jobs, considering their high level of committed paired with their notoriously low salaries. When she said her fear was not being able to help others, I was surprised. She’s constantly helping others! We quickly moved on to her other economic fears, but this interaction made me think about how “helping” others doesn’t have to just be monetary. Her second fear was equally thought provoking. She said that she feared not being able to provide for a potential family. That saddened me. She explained how with her current salary, she can barely provide for herself. She talked about how she’s always wanted to have a family and raise children of her own, but right now it just doesn’t seem realistic. Wow, I thought. I realize that a career is much more than a career: it almost seems to be the foundation of your life. A career gives you your salary, and although I hate to say it, a salary really influences your life choices. It’s crazy to think that although Saraphie is doing great work as a teacher, her career is standing in the way of her personal hopes of having a family.  

Saraphie sees herself as belonging to the lower middle class. She grew up in a middle class family, and believes she is financially worse off than her parents. But, she added, she feels she is more emotionally well off. She enjoys her profession and feels as if she’s figuring out life without as many complications as her parents. This brings up the age old debate of money vs. happiness that I still don’t quite know the answer to. Hearing first handedly from Saraphie about her experience earning 20k a year as a 5th grade teaching assistant, it seems like she’s really happy, but earns barely enough to make ends meet.

Saraphie chose the path of personal happiness over money, and I’m interested in seeing where she’ll end up. She told me she still doesn't know if she wants to pursue teaching as her profession. Considering she's just 24, I think she's still has plenty of time to reconsider her career. I think it’d be fascinating to follow up with her in a couple of years and see where she is, how her long term goals have influenced her choices, and if she believes she can earn a sustainable income doing something she enjoys. 

And on another note, in a country where we highly value education and at a school where we highly value teaching, I’m at a loss for why teachers are paid so low. Teachers have notoriously low salaries, and it seems like if we want the brightest and best entering teaching fields, the jobs shouldn’t be monetarily valued so low. But, on the other hand, if we want teachers who really like to teach, maybe low pay just ensures that they’re not just in it for the money. Hmm. The second argument seems a bit flawed, but I’d be curious in further researching some questions about teaching that came out of my interview with Saraphie, including:

1. How is teacher pay calculated? Particularly at school like Catlin. (I looked at Adolfo’s profile of our 8th grade history teacher and saw he makes 3x Saraphie's salary)
2. How do employers justify paying teachers so little?
3. What is the theory as to why teacher’s salaries are so low?