What about “The job market for their skillset sucks (as so many do), is unlikely to improve any time soon, and the person needs a job.”

Why the shitty judgemental attitude? You’ve never been laid off, have you? You have a very unrealistic outlook on life.

Seems to me you should just come up with a number you’d like to pay, and offer that. If nobody is interested, or nobody you’d want to hire, raise the rate you offer. Don’t worry about what other people are doing, name the rate that works for you.

Don’t worry about “underpaying”. Whatever you’re paying people locally takes the local economy into account. You need to pay local people enough to get them to work for you instead of someone else, and that’s going to depend on the local cost of living, the job market, and the financial situation of the workers.

If you’re dealing with people working remotely, their local economics may be wildly different from yours. A person in rural Arkansas probably has a lower cost of living than someone in an urban center. A wage that would be a waste of time to someone local may be a very good wage indeed in Arkansas.

Let the candidates decide for themselves.

That may mostly fall into your categories a) and c).

It’s an easy problem for HR to address IF there is sufficient data. If not, I go with the probabilities. Way overqualified means, in my experience: a) abrasive to work with; b) book-qualified but no practical skills; or c) interpersonal concerns (creepiness towards co-workers, etc.) preventing the person from holding the position one would expect.

Not that this theoretical stuff will help you much with your real life problem, of course. For that I’d agree with katydid – just do the simplest thing and don’t worry about it.

The concept of outsourcing is to do labor arbitrage and how would you know the competitive wage in many locations? Typically, in offshoring, providers compete for your business. You seem in a twist about your own motivations. Good! (I say this because I think the impulse to offshore is rational but not a good thing for the world, certainly not for local workers.) At least for long-run effects, offshoring drives down wages (but adds to a competitive pressure in the providing country, thus causing their wages to rise somewhat—note what’s happening in India and China: India is not offshoring some work to China as India wages rise)and makes waged workers all the more vulnerable. But for your short-term needs, either find cheap labor to do the task at hand, or establish a price below which you do not want to go on ethical grounds—and don’t worry about someone being overqualified. After all, it’s a short term proposition, you can monitor quality, and end it with little notice. You might offer an incentive for high-quality work performed within certain timeframes, sort of like standard construction contracts that earn bonuses based on the number of days the work is completed in advance of the contract delivery date.

With offshoring, it probably only makes sense if you have a recurring need, can establish performance metrics that don’t require hands-on supervision, and the relationship is sufficiently important to justify the time and effort is takes for you to monitor and deal with distance management.

My (unsolicited)advice? Hire locally since your need is temporary in nature. It’s not worth the grief you’ve already expended!

Seriously, one of the many reasons I’ve been in the process of changing careers is the overqualified demon. I worked in the computer industry for 10 years, and after about 6 I started hearing that I was overqualified for the positions I wanted. Problem was, I didn’t want to move in either direction that the standard “career path” wanted me to move – into programming, or managing. I was happy where I was, breaking things and finding out why, then leaving it for someone else to pick up the mess I made.

After a while, though, the only people doing the jobs I wanted to do were entry level lackies, people who wanted to move into programming or managing, so I was extremely overqualified in comparrison. It was cheaper to hire someone else and replace and train someone new in a year, than it was to hire me – even when I seriously cut the rates I was looking to work for. (Well, plus the mentality – people had a hard time believing I was truly happy doing the job.)

Add in offshoring, and it was just time for me to say “I give up” and chase another career.

Which, I suppose, is a long way of saying, if you continually come upon being overqualified, it might be time to leave that particular job for another.

You can presume a cost of living based on published rate, but considering how the US gov’t calculates the poverty line, how could you trust information on cost of living in a remote culture (without resorting to catcalls of cultural imperialism on your part)?

Though it might seem like I’m harping one only one half of your point, but the overqualification portion smacks of ridiculous arrogance, or bad managerial skills. You offer a position, you offer a wage/rate. If your interviewees have the requisite skills and accept the rate, they are perfectly qualified. You actually bear a burden as labor management to ensure that is the nature of employment relationship. Most employers exploit any number of extraneous skills or attributes (willingness to work additional hours without compensation, assuming duties not described in the initial agreement, etc.) without comment or additional negotiation, and only bother to notice when it doesn’t work to their favor (their highly qualified employess are “bored” as noted by a commenter above, for instance, because they can’t manage them or the work product).

Though your margins may be next to non-existent, or the profit/value you extract through your employee relationships might not be strictly monetary, you can probably pretend you aren’t exploiting labor. But you are (and I’m not being sarcastic or saying you are an exception—we all do it to one degree or another if we have employees), it is your job to maximize that relationship, not theirs (they are trying to minimize their exploitation). If you aren’t getting good value, it’s on you.

Regarding this latter point, the potential employees don’t know that I won’t pay people in similar situations less than what I already pay others. (I would if the person lived in a country with much lower cost of living. Thus my inquiry about outsourcing.)

I added the parentheses a few seconds after I posted the initial entry so if you were reading this through an RSS feed that picked it up immediately then the post you got may not have contained that additional note.

Also, I didn’t mean any insult nor was I underestimating your ability to come up with simple calculations. It’s often human nature to make situations more complicated than they need to be and god knows that I’ve jumped through all kinds of unnecessary hoops when a simple solution was staring me right in the face.

Regarding this latter point, the potential employees don’t know that I won’t pay people in similar situations less than what I already pay others

The above seems to indicate you are willing to pay a fixed minimum regardless of location (unless you want to qualify situation to mean location, not job situation, which I took it to mean).

You mentioned some ‘sites’ without qualifying if they used workers inside the US or outside, and didn’t make clear if your interest in cost savings was absolute or relative (meaning you want to reduce your labor cost in total, or simply on a per unit basis). If your current scale is only marginally more than minimum wage ($8—which might be a lot to an undergraduate, but isn’t considered a living wage in most metropolitan areans), it’s a material question, since legally there isn’t any way for you to reduce labor costs past a certain point without offshoring.

I don’t know what your experience with temp or outsourced professional labor is, but in the areas I’ve worked, temp labor has always comes at a premium to full-time hourly rates, for several reasons: it is on-demand, which means your total labor expense may be reduced, but your hourly rate increases; you are moving all your payroll tax and insurance liability to the outsourcing firm (are you charged back tax and benefit costs on your budget?), and; in most cases, you are expecting to receive specialized, highly skilled labor that will be more productive.

Even if you are offshoring, there’s a carrying cost from the firms, and they are competing against well paid labor in metropolitan areas, meaning they can advertise a rate that is competitive in their markets, but still might seem dear to you.

I’m still not clear on what you are saying: that labor isn’t as cheap as you’d like it, or it’s discomforting that this insufficiently cheap labor pool is awash in highly skilled workers forced bargain their value away, and creating a frustrating management problem of them not being able to degrade themselves for perfectly rationalized monkey work?

This is absolutely an hourly wage issue. It’s wonderful to watch people tie themselves up in knots (or not, at all) about labor exploitation.

If you don’t think this is the case, answer this: where do you derive your sources of income? Shifting your costs to external markets deflates your local labor market. Once we’ve quashed the evils of minimum wage and dried up any possibilty of sustaining work, you can brings those data entry contracts back—by then, all those MAs will have learned to not put their advanced degrees on their resume, and you won’t have such a thorny problem.

If you haven’t budgeted the amount yet, but you have an existing worker who is already doing acceptable work for an an acceptable rate, you take the hourly wage you’re paying that worker divide it by that worker’s output to get a unit price per item that you’re paying.

Linking this to an acceptable error rate is crucial to keep people from submitting poor work and gaming the system, but this would be already be within the system in the status quo (I hope).

The advantage of this scheme is that it neutralizes the “overqualified” issue. If someone can’t apply their “overqualifications” to do the work better, you really shouldn’t be paying them more than someone who isn’t overqualified. If they can apply their advanced skills and do the job quicker, the task may become very worthwhile for them. They put their skills to use and are compensated in line with their increased productivity, and you get your work done for the same price (and maybe quicker) as if you would have hired plain unskilled labor.

99 – When I talked about the possibility of lower wages I made it clear that I was talking about people in places with a lower cost of living. I don’t know how you missed this bit. The meaning of the word outsourcing is not restricted to country borders. The rates I pay right now are in compliance with university rates for undergraduate research assistants.

Thanks, JR, for elaborating on that point. I tried to make it in the last paragraph, but maybe didn’t dwell on it long enough.