Rate Cut Rumours...

[d000hg]

my 2c

You are in business to maximise your profits. If you earn 400 a day and have expenses of 300, your profit is 100 per day.

A 5% cut to the rate will reduce your profit to £80 per day.

They aint giving you a 5% cut, it's a 20% cut.

Well if you must stay in 5* hotels...

[Xenophon]

Sorry to hear that.

But in these troubled times it could have been worse. Might be the best way to look at it?

Cheers fella.

Yeah, I agree. I was expecting a lot worse.

The pessimist/realist in my suggests that this may not be the only cut though. I can see this being repeated when they realise they need to save more money...

[cojak]

A new contract because of a 5% cut seems pretty extreme. Or did you mean "look for a new contract 'cos you ain't getting renewed"?

No - I meant "accept the cut but jump as soon as the next contract appears"

[Mich the Tester]

Cheers fella.

Yeah, I agree. I was expecting a lot worse.

The pessimist/realist in my suggests that this may not be the only cut though. I can see this being repeated when they realise they need to save more money...

...are they on a government dripfeed too?

[Xenophon]

my 2c

You are in business to maximise your profits. If you earn 400 a day and have expenses of 300, your profit is 100 per day.

A 5% cut to the rate will reduce your profit to £80 per day.

They aint giving you a 5% cut, it's a 20% cut.

Thanks a million.

[Xenophon]

Yes, very fly, The first thing my manager said was "well RBS & HBOS are all getting 15% drops as well"

5%-15% at RBS...

[Xenophon]

...are they on a government dripfeed too?

Yes indeed.

Majority owned, etc...

[Ravello]

Sorry to hear that Xeno.

FWIW, I'd take the hit and keep an eye out for other opportunities. To my mind, unless someone has got an alternative already in place it's usually worth taking the reduction and searching whilst still in contract.

By the looks of things that's what you've decided already, but from a pure geeky maths view, if you left and were benched for only a month you'd have to work for something like 19 months to make up for the lost revenue:

Assuming £500p/d current rate (no idea what you're on, but this keeps the maths easy) for the same reason, assuming 20 working days in the month:

before reduction
500*20 = £10k

after reduction
475*20 = £9.5k (£500 less per month)

If you walk
500*0 = £0 (£9.5k opportunity loss)

New contract comes along at original rate of £500p/d, back to £10k per month, it will now take 19months for the extra £500 per month to make up for the £9.5k you missed through walking...

[BrilloPad]

Cheers fella.

Yeah, I agree. I was expecting a lot worse.

The pessimist/realist in my suggests that this may not be the only cut though. I can see this being repeated when they realise they need to save more money...

IMO too pessimistic by far!! You know took I 15% cut at end Nov? A few left as they could just not afford it! They come from "up north" (where the f**k is that?) so have large travelling/accomodation expenses.

You and me live in London so can can afford to take a few cuts : others will go long before us!

Chin up old bean!

[EternalOptimist]

Thanks a million.

I was trying to cheer you up by telling you how bad things really are