Klarinet Archive - Posting 001255.txt from 1998/04

From: "Edwin V. Lacy" <el2@-----.edu>
Subj: Re: Pay analysis of Full-time Orchs
Date: Wed, 22 Apr 1998 19:03:45 -0400

On Wed, 22 Apr 1998, Jonathan Cohler wrote:

> Now in most businesses (such as software and publishing with which I am
> familiar) the average tenure of an employee is more like two or three
> years. These businesses consider a recruiting cost of 10% to 20% of the
> annual salary to be reasonable.
> [much snipped]
> So by this logic the orchestra should be willing to spend roughly
> $20,000 to recruit a second clarinet player.

The problems with this line of reasoning include the following:

1. An orchestra is not like "most businesses." In your business, you can
figure your costs including personnel recruiting, add in your desired
profit margin, and set your prices so that the bottom line works out. An
orchestra cannot do that. Typically, orchestras earn less than half their
total annual budget from sales of their "product" - (sales of tickets to
concerts). The remainder must be made up from donations from individuals
and businesses, and a pittance from governmental agencies. A few realize
a little from permanent endowment funds.

2. The cost of recruiting is only one of the expenses facing orchestras.
There are expenses for hiring soloists, rental or maintenance of a
performance facility, rental and purchase of music, and dozens of others.
In "most businesses," a figure such as $20,000 can be allotted for
recruitment costs, and the assumption will be that the employee chosen
will add more value than that to the company's balance sheet. It doesn't
work that way for orchestras.

Certainly orchestras should employ sound financial planning and budgeting,
and too many have not and have gotten in trouble as a result. However,
probably a more useful exercise would be to compare such expenses among
orchestras rather than comparing orchestras to companies which sell
refrigerators, television sets, automobiles, or computer software
services.

Ed Lacy
el2@-----.edu