This Is Why I Don't Give You a Job

A Hungarian named Andor Jakab wrote a very sharp article,
and the Hungarian online comments exploded.

Translator’s Note

In 2011, a Hungarian named Andor Jakab posted an article
called Tőlem ezért nem kapsz munkát (the link is now dead).

Later because the article had so much impact—tens of thousands of likes on Facebook—
he translated it into English himself, here:
This is why I don’t give you a job

Although it’s been several years since Andor Jakab posted that article,
and the article might be a bit extreme…
the points it makes are still thought-provoking.
The translation follows:

This Is Why I Don’t Give You a Job

I could hire 12 employees and pay each one 760 euros after tax, but I won’t.
First, you’d get to work in a great office in my company.
Second, we don’t do telemarketing, nor are we a scam company.
Your job is real work, and it also requires high professional standards from you.
You will work eight hours a day, five days a week.
I’ll hire you legally and pay all your taxes and social security.
I could hire 12 people for this kind of job, but I won’t.
Let me explain why.

I Won’t Hire Women

The reason is simple: women have babies.
And I don’t have the right to ask whether she wants to have a child.
Even if I could ask, and she answered,
theoretically she could lie to me, or change her mind later.

Don’t get me wrong—I have no problem with women having children.
I was born this way, and so were my own children.
I won’t hire women because: when she gets pregnant,
she has three years of maternity leave, and I can’t fire her.
If she has a second child, that’s a total of six years of leave.

Of course, the work still has to be done,
so during this long maternity leave I have to hire another person to do her work.
But I can’t fire her during her maternity leave, and I can’t fire her after she comes back either.
So I can only fire the person who was doing her work the whole time.
And when a female employee finishes her maternity leave,
the law requires me to raise her salary to the level her current position deserves.
I also have to give her back the annual leave from those maternity years.
So when she comes back to work, she’ll have another 2 to 4 months of paid annual leave.

I Also Won’t Hire Employees Over 50

It’s not because I have anything against these most experienced employees.
I won’t hire them because they’ll soon reach protected age.
Then I’m trapped by them, just like I’m trapped by female employees.
In the protected age, you can’t fire them.
So I still have to pay full salary, even if they do poorly or just okay work.
I can’t fire these legally protected employees, but somebody has to get the job done,
so I still have to hire another person.
I have no problem with the law protecting them, but I won’t hire them.

I Will Only Hire Men Aged 25 to 30

Hiring them is actually pretty risky too.
Because without a just reason (like my own income being insufficient, or me not liking their work attitude—these aren’t just reasons), I don’t have the right to fire them.
If I fire them directly, I’ll very likely end up in court, and they’ll very likely win.
But this risk I can accept.

You Get 730 Euros, but I Have to Pay 1572 Euros

| Your after-tax income ||| Your pre-tax income ||| What I have to pay ||| Ratio |
|————–|||————–|||————|||——|
| € 185 ||| € 238 ||| € 306 ||| 165% |
| € 227 ||| € 306 ||| € 393 ||| 173% |
| € 322 ||| € 458 ||| € 589 ||| 183% |
| € 408 ||| € 612 ||| € 786 ||| 193% |
| € 479 ||| € 765 ||| € 982 ||| 205% |
| € 570 ||| € 917 ||| € 1178 ||| 207% |
| € 760 |||€ 1223 |||€ 1572 |||207%|
| € 950 ||| € 1529 ||| € 1965 ||| 207% |

This is based on the latest 2011 data from the salary calculator at www.nettober.com.
As you can see, my company has to pay 1572 euros to afford your 760 euro income.
The only way to bring down this nearly 2x ratio is:
I pay you less salary.
But I won’t hire you with a smaller salary,
because I think less than 760 euros makes it hard for you to live with dignity.
You’d feel depressed, unhappy, and that would affect you, my company, and even me.
So I won’t hire anyone with a lower salary than that.

Only Hungarian Laws Are This Stupid

tax-chart

The chart above is from Deloitte.
As you can see, the country takes away more than half of your salary.
I paid over fifteen hundred euros, but you can only get less than half of it—that’s just stupid.
Not to mention people who earn minimum wage enjoy the same good healthcare as you.

I also think a 35-year-old employee should have 25 days of annual leave per year.
That means someone has to complete the month of work corresponding to that annual leave.
So if I need 12 employees’ labor, I have to hire 13 to cover for the leave.

Despite All the Difficulties, I’m Still Willing to Hire You

I’m a brave entrepreneur. Entrepreneurs all have to embrace risk.
So I’ll sell my house and live in a rented room.
I hope my house can sell for a high price of 90000 euros,
then I can bravely start my company.
If in the end my startup fails (startups basically always fail),
well, I’ll be strong and not cry :)

My company will provide services that satisfy clients, and a good office space is essential.
I’ll hire 13 people, because I need 12 people’s labor (one is to cover annual leave).
The 14 of us (including me) will work in a 158-square-meter well-furnished office.
Because rent is about 10 euros per square meter, plus 3.5 euros per square meter for equipment,
the spending on office space is 2133 euros per month.

Based on Calculation, My Monthly Expenses Are as Follows

Monthly expenses this large sound pretty scary right?
Whether it’s low season, high season, summer when there’s not much business, Christmas when there’s not much work to do,
no matter how much profit we make, my monthly expenses are this much.

On average, our company can provide at most 1000 hours of service per month.
So to break even, I need to set the service price at:
25627 euros / 1000 hours = 25 euros/hour.
But breaking even isn’t enough—I also need to make a profit.

I’m not a very greedy person—after all, making money is hard.
To keep around 20% profit margin, my pricing will be 30 euros/hour.
That means with VAT it’s 37.5 euros per hour.
I don’t care about that little bit of change, so customers buying our service pay 37 euros per hour.

Of these 37 euros, 7 euros go directly to the country, and the remaining 30 is our income.
I’m an optimist.
Our marketing will explode in the market, and my plan is flawless.
We’ll definitely sell 1000 hours of service every month.
Business is booming, all employees work hard, and I’m very satisfied.

So my company’s monthly income would be 1000 x 30 euros = 30000 euros.

After expenses, the company’s profit would be 4373 euros.
I’ll pay myself a pre-tax salary of 2446 euros, including other parts the company has to spend 3144 euros.
After tax I can get 1521 euros, basically twice my employees’ pay.
So minus my salary, the company’s profit (pre-tax) is 1229 euros.
Plus corporate tax is 122 euros, local business tax is 600 euros (charged at 2% of total company income).
In the end, only 507 euros remains in the company account each month.

Looking at it this way I can earn 1521 euros myself each month, but don’t forget,
to start the company I sold my 90000 euro house.
I also have to rent a room (at least 300 euros rent per month),
otherwise I’d have nowhere to live…
I’m usually pretty frugal and don’t spend money randomly,
my wife also works and earns money.
I don’t even have much time to spend money,
because I’ll work harder than my employees,
12 hours a day, including weekends.

This way I can save 900 euros per month,
and after 100 months I can buy another 90000 euro house.
So I need about 9 years to get my money back.
After 9 years I won’t need to tighten my belt to live—
no rent to pay, no need to save a lot of money.
I can live a European life.

With these considerations—I hope you can understand—I’m not very keen on selling my house to start a company.

But for 4 Reasons, I Absolutely Won’t Start a Company This Way

There are illegal competitors operating out of small rooms providing the same service, but they only charge 9 euros per hour.
They only take money without keeping books, not to mention paying any VAT.
They don’t have to be responsible either. No guarantor, nominally they do nothing, nominally they’re not even a company.
They don’t need to rent offices or hire accountants.
They only need to work 5 hours a day, and they can earn 1000 euros.
They’d also laugh at my 760-euro-per-month job, because my employees have to arrive on time, complete work on time and at the required quality and quantity,
and can’t deceive customers (if my employees deceive customers, they’d get fired).
Competitors will also slander my company.
I’ll be branded as greedy, a black-hearted businessman,
after all it looks like others price the service at 9 euros while I want 37.
I’ll become the enemy of the kind Hungarian people,
while my “honest” competitor’s price is only a quarter of mine.
Many employees come to my company just to learn business secrets and steal customers.
They’ll solemnly promise “same service, quarter the price”.
After stealing enough customer resources, they’ll also intentionally mess up their work, so that I propose to fire them.
Then they sue me in court, saying I illegally fired them, and they win.
Meanwhile, they’re also making money off customers I worked hard to negotiate with.
And, they’ll also register fake accounts on major forums, saying they used to work at XX company,
where the service was not only expensive but also low quality.
All these complaints above have no practical effect—no one will care what happens to me.

Basically this is the reason I won’t hire employees.
And I think those experienced entrepreneurs
will also refuse to hire employees for these reasons.
So this is why more and more people can’t find jobs,
the economy gets more and more sluggish, and tax revenue gets smaller.
Good jobs get rarer and rarer, social welfare gets worse and worse.
Eventually our social safety net will become as bad as a concentration camp.

Only When These Conditions Are Met Will I Hire You

I can fire you anytime I want
If VAT is lower, only 20%, best 15%
If the country “only” charges 30% personal income tax
If high income no longer means high tax
If the country fights corruption effectively, instead of punishing legitimate companies

Unless these conditions are met, I won’t hire you as an employee.
Unless the country eliminates corruption in every aspect, I won’t start a company, and so I won’t provide job opportunities.

(End)