Is financial fear preventing you from making a career change? Do you wonder if you have to take a pay cut to leave clinical medicine? How much do nonclinical jobs pay, anyway?
If you feel trapped by student loan debt or the perception that you won’t be able to make a good living as a nonclinical physician, but you desire to pivot into more fulfilling work – this episode is for you.
In this episode of The Career Rx we’ll discuss:
- Myths and fears about pay cuts and nonclinical opportunities
- Why getting an offer before you decide can change your perspective
- Entry level nonclinical careers, and their trajectories
Today’s episode was inspired by this question from a listener: “Is it worth it to take a big pay cut for a position in industry, just to ‘get in’…and then do some time and move on up?”
Let’s have some real talk about whether it is ‘worth it’ to take a pay cut to make the kind of career shift or change that you hope to make – and, whether you have to take a pay cut at all!
By the end of this episode, you’ll have a better understanding of nonclinical salaries, whether the fears around pay cuts are mostly myths, and the tradeoffs you may find in nonclinical career.
In this Episode:
[1:15] Have a question you’d like me to answer on a future episode?
[4:00] Salary numbers don’t reflect your true compensation in a nonclinical job
[5:47] A hematologist, a rheumatologist, and an anesthesiologist walk into a room
[9:00] The ladder of opportunities for promotion in industry
[11:30] What about all that student loan debt?
[13:50] Breaking down some self limiting beliefs
Links and Resources:
TransforMD – a life changing retreat for women physicians who want more from their careers and their lives – it’s time, right now!
LISTEN TO THIS EPISODE:
SUBSCRIBE TO THE CAREER RX PODCAST:
Get every episode on your preferred player…
More for you:
Industry Insider – learn exactly how to land a rewarding nonclinical career without a new degree, connections on the inside, prior experience, or a pay cut
The Branding Rx 18 hours of CME, mastering digital strategies for advancing your career, building your business, and growing your professional brand
The Speaking Rx learn the business of professional public speaking to establish yourself as a thought leader you are, and get paid for your speaking expertise
Thanks for joining me on this episode of The Career Rx!
TRANSCRIPT: Episode 72 – Should You Take A Pay Cut for a Nonclinical Job?
Hey there. I’m Marjorie Stiegler and you’re listening to the Career RX Podcast, where we tackle the important things they don’t teach you in medical school. Like how to treat your career, like the business, it really is, with strategies to accelerate the kind of success that you want, because you deserve a career you love, and a career that loves you back.
Are you ready? Let’s get into it.
Hey, there, welcome back. Today we are going to be talking about money. And whether or not it’s worth it to take a pay cut to make the kind of career shift or change that you hope to make. This is an extremely common question. And I’m going to read a question verbatim that did come in to me from a listener through LinkedIn, which I very much appreciate. So please do keep those coming. But just know I’ve heard this question very frequently in a lot of different formats. So today, I’m going to try to answer the question as it was asked, literally, and I’m also going to try to give some additional context around the other sort of variations of the question that I’ve heard and the some of the questions that underlie the question right there the things that people are thinking that make them ask this question.
So here it is, my listener writes, “is it worth it to take a big pay cut for a position in industry, just to ‘get in’, and then do some time and move on up?” Assuming, of course, financially, this is doable for the individual. So thanks for the question. It’s very common, that people who are considering transitions out of clinical medicine are worried about their finances. And while this might sound like an unreasonable problem, and you might say, well, you can just adjust the your lifestyle, it’s legitimate to be concerned about your finances, especially if you’re carrying significant student loan debt. And you know, many physicians have $200,000 – $300,000 of student loan debt. So I understand entirely, why this is at the forefront of people’s minds, when they’re thinking about, you know, what, in their view is really, can I afford to leave clinical medicine? It’s a really powerful and important question to address. So I’m going to do that today, let’s not feel bad about talking about money.
I also think there were a handful of misconceptions, and different angles, sort of different contexts to consider. So I’m going to put all of that into my episode today, even though this goes a bit beyond what my listeners specifically asked. So first of all, I would like to just offer the possibility that you may not actually have to take a pay cut, my listener asked if you have to take a big pay cut. And I think for many physicians, that’s top of mind, but you may not have to take a big pay cut. And in fact, you may not have to take a pay cut at all. I know a lot of people who transitioned into non clinical work who actually ended up making more than they did clinically.
The reason this is a misconception, I believe, is because it’s hard to find this information on the internet, people will very often search or they’ll use resources like Glassdoor, and they’ll ask Google, and they will look for things like the salary for medical directors or for other roles that they’re not even really sure if they’re using the right terminology or the right job titles. And very often, those job titles might be mixed across a wide variety of industries, really. So you don’t have clear data that’s really looking at apples to apples, it’s all kind of mashed together in one big bucket and so it’s hard to get meaningful data out of those searches. The other thing that’s really important to know is that in industry, salary is often considerably under-represented by those kinds of searches or even by the kinds of quoted salary that might show up in, you know, job posting.
The reason for that is that the nonland Industry often has several other buckets of money that are considerable and much more considerable than they are in academic practice. A compensation structure often includes several other sort of major buckets of money and these are not a cherry on top, these are our core parts of the compensation plan. And that often includes stock units, over stock units as part of an annual bonus, sometimes stock options as well. cash bonuses, which are often a very sizable percentage of your income, and that won’t be reflected on the salary. And then things like a company contribution and match for retirement, which are often, at least in my experience much, much more generous and significant than what a physician might expect to earn in their academic or employed positions, as well as deferred compensation plans and, and other aspects of total compensation.
Without getting into all the details, which of course are going to vary from company to company and roll to roll. It’s just the bottom line here, the take home line here is that if you are searching, and you have a understanding of what the salary is, and to you that feels like it would be a major pay cut, you really only have part of the puzzle in front of you. And it’s really important to figure out the total compensation that you might expect to earn that year. And you might be surprised to see that that sometimes can double that number. And you can really change it very, very dramatically. So I’m just putting that out there as a food for thought to not allow that to limit you. Why not pursue the job that you think you want, get an offer on the table, and then once you know what that offer is in its totality, then you can decide whether or not it’s a pay cut at all.
And whether it’s one that you feel like you want to take. And even just recently, when I think about physicians that I’ve worked with that are now working in industry, one was a hematologist. One was a rheumatologist, I’m an anesthesiologist, you know, many, many people who are specialists who had similar experiences, which is that they find they did not have to take a pay cut at all, though they were expecting to, I’m just putting that out there, every situation is different. And then let’s segue into the second part.
Now, if you are an incredibly well compensated highly specialized physician, and you’re making seven figures a year, yes, you’re going to take a pay cut, you’re almost certainly going to take a pay cut, to move into what will be an entry level position role in industry. But an entry level physician role is not an entry level role in the grand scheme of the company, you’re still going to be well compensated, and you’re still going to come in at a level, that’s likely a leadership level role when you look at all of the people across the company who are contributing. So having said that, yes, if you’re making that kind of money, you almost certainly will take a pay cut.
And also for your consideration, you will almost certainly take a huge cut in your work hours, a huge cut in your stress, a huge boost in your flexibility, your schedule, your autonomy, your work life balance. And if you want to augment your income, then by doing some moonlighting or other things, you will likely have ample time for that. So I think that is an important part of the consideration as well. If you are making big, big money, then you’re likely to take a pay cut, also likely to have a major major shift in the hours that you work, the stress that you work in your ability to do other things. And so that might be part of the equation that you ought to consider.
The third point I’d like to leave you with today is really kind of gets to what my listeners question was about, which is getting your foot in the door, putting in some time and then moving up as she described it, I think that’s really savvy thing to ask. Because, you know, in the clinical world, for most physicians, when you finish residency, and you hit the scene as an attending, whether you’re unemployed or your private practice, or in academics or otherwise, you’re sort of… you’re close to the ceiling, I mean, you will get promotions over time, and they will come with some, you know, financial benefit but it’s not that considerable, probably the biggest jump you’re ever going to get in your life is from that time that you went from residency to an attending or from fellowship to attending.
And then from there, it’s just a small amount of incremental boost, you’re pretty close to the ceiling. For those who are still in sort of an old fashioned model where you have to, you know, either physically buy in or work your way into partnership for a couple of years, then maybe your big jump is when you become partner. But in any case, it’s usually just a couple of years after starting, you know, your first official job as a fully credentialed physician, and you’re close to the ceiling. In industry, that’s like just the opposite because you’re going to be coming in, as I’ve mentioned, pretty close to entry level. Some people I do know have come into industry, maybe one rung above that, but for the most part where you’re coming Is the floor. So although you might take a pay cut, you’re going to be coming in at sort of the bottom and there is an entire ladder, you know, whole rung of opportunities for promotion, for more professional growth, for an opportunity contribute in a bigger way. And for you to learn more, do more, and with all of that also comes considerable opportunity for you to earn more.
So I think it’s a really important question to keep in mind that, you know, whatever you, whatever you might take, when you have your sort of first foot in the door job is just the beginning. And your earning potential is likely to only increase, there’s really a lot of upward mobility. And I think it’s a very reasonable assumption, even an expectation that your compensation will increase over time. So again, why not pursue the kind of role, the kind of job, the kind of career that you want? And when you get some offers, then you can decide in their totality, you know, really stacked up exactly against what you’re earning today… How does it look? Is it something that works for you? And is it something that works for you, especially in light of the fact that it’s probably just the beginning? I think that’s really important to think about. The final note I want to leave you with is that, you know, this is a brave conversation, a lot of people feel really kind of squeamish about talking about money.
And I think it’s one of the things that I know for sure, actually, from from students and from other people who reach out to me all the time, this is one of the big things that holds people back from doing what they want to do or, or from them feeling free to make the decisions, you know, that they that they want to make feeling free from sort of the the jail that surrounds them of their student loan, debt, or otherwise. So money is important, it is also definitely not everything. And so I really do want to put that in it back in your mind. So in addition to talking about the amount of hours that you work, and stress and balance, and family time, and autonomy, and all of that, I think it’s just important to understand that in the range that we’re talking about, it’s going to be okay, right?
The amount of money that you’re going to earn in a non clinical industry role, even at the very, very low end, you’re going to be able to pay the bills, I feel quite confident that for the average physician, with, you know, coming, even coming in with the average massive student loan debt that you have, with your family and your mortgage, and all of that, you know, unless you are really living in an extreme way, or you’ve had some very considerable hardships, I mean, everyone’s different. For the average physician, you’re absolutely going to be able to pay the bills. On the flip side, you’re not going to earn so much to be rolling around in a you know, your own private jet, you’re not going to be making trillions of dollars a year, but you’re going to be making a good living, that’s going to be able to help you tackle all of your financial responsibilities, including your student loan debt, and have enough money to enjoy your life.
So in this space between being able to pay the bills and having your private jet, there’s a lot of variability a lot. And there’s a lot of room for your own personal values. There’s a lot of room for your own personal likes, you know, what is of interest to you, what do you want to do? Are you the kind of person you know who really wants? There are so many different possible jobs, you could have so many different roles, different companies, different ways in which you can be putting your expertise and training as a physician, to make a meaningful contribution to public health to patients to society in general. Or maybe even that bakery, you know, whatever you want to do, there are ways for you to do work that you love that’s meaningful to you, that’s aligned to your personal values of what work means to you, and also what the rest of your life means to you, right? Your family time, your personal time, your sense of balance and autonomy.
This is going to vary from person to person, and there is space for everybody, between not being able to pay the bills and having a private jet. So I would just really, really encourage people if, if the thought of having to take a pay cut is sort of the rate limiting step for you in exploring the different kinds of career options that are open for you. I’m asking you to kind of either put it on the back burner or just break on through that as a barrier. Get the job offer first, then you can always decide whether or not it’s right for you and for your family. Whether it is competitive compensation, I think most likely you’ll find that it is and I think you’ll find that it is has a promising career trajectory ahead of you. But if you find that it isn’t, you can always decide not to do it.
Please don’t let a fear of not earning. You know the kind of compensation that you feel you need be the thing that holds you back because I think that is a self limiting belief. I think it is a misconception. It’s probably not reflective of reality. I would hate for you to make any major decisions about your life and your career in a place that isn’t coming from reality. So that’s my two cents. I hope it helps. And again, if you’ve listened to this episode in its totality, and you are ready to make some kind of a change, I really do encourage you to come and check out TransforMD for the retreat, which is in January, but registration and slots are filling right now. But if you feel like you know, you do love medicine, but you thought your career would be something different than it is today.
Maybe you’re feeling burned out, maybe you’re just feeling bored and underutilized. Maybe you’re feeling like you love what you do. But you also want to continue growing, whatever it is, it’s a wonderful, wonderful event, to really get clear on what you want to do differently and how to go about doing it and getting it done. There’s no time, no time like the present. So please come check it out. Because you don’t need to sit around settling year upon year, with a career that you don’t like, or living up to someone else’s expectations of what you’re supposed to do as a physician. It does not have to be that way.
Don’t let it be that way. There’s so much for you to learn and discover before you make any major decisions. And I understand those are scary decisions. That’s why having a community like you’ll find a TransforMD can be really helpful. So do check it out, www.transforMD.org I’ll put it right there in the show notes. And thanks so much for sending your questions to me. Please keep that up and I’ll keep answering them. Bye for now.
Before you go, please review, share and subscribe to this podcast. Your support makes all the difference and it truly helps this information reach someone who may really need it. Until next time, thanks for listening.