Why Exactly Are Bosses Paid More?

Do people really ask this question out loud enough?

Before we get going on this, let me just say that there’s a massive range of management and leadership expertise in the world. If you were to take everyone with direct reports and plot them on a graph from 1 to 100, and then find some way to assess their aptitude (based on their employees’ perceptions, returns, whatever), I bet most bosses would hover around 55 score-wise. Again, it would depend on the specific mix of metrics you’re using, but I’d guess the average score for an average boss would be slightly better than half. Some zeros exist (I’ve worked for 4–6) and some 99s exist (I’ve worked for 1–2). Management is tough. A lot of people don’t want to do it. They do it once and run from it.

And the main reason, logically, that people do it is because it’s the fastest path to more money inside most organizations.

That begs a question: why? Why do bosses inherently get paid more?

First off: they don’t. Good sales guys, top engineers, and long-term, valued individual contributors all make more than standard bosses. Obviously executives do too, but I’d classify “executives” as “bosses” for this discussion. So, oftentimes, middle management bosses aren’t that well-compensated compared to the full gamut of the organization.