Stick with me on this one, first the history lesson.

After nine years campaigning in Britain, Germania, Belgae and Celtic Gaul but prior to crossing the Rubicon, Gaius Julius Caeser, the Governer of Cisalpine Gaul (N. Italy), Illyricum (S.E Europe) and Transalpine Gaul (S. France) increased the pay of his legions. This was the first increase in pay the legions had received in 100-years and it was money that he fielded himself. For the first time in generations a Roman general had locked in support from his troops not only by his dignatas (his private standing) but also via a cash-payment.

As the Roman Civil Wars continued after the death of Caesar, the legions continued to get enormous bonuses. In addition, the practice at that time, after each campaign, was to grant the legions their outstanding pay via their Centurion representatives and land-grants on the latifundia (public land). Given the amount of campaigning that had been on-going since the time of Marius Gaius some soldiers had become reasonably well-off by awaiting for their land-grant, renting that property then joining the legions again to work toward their next land-grant. Those soldiers who didn’t squander their land-grants on wine and women became quite wealthy.

Octavian’s emergence as the political master of Rome commenced when he won over two of Antony's legions with his Caesarean looks and a promissory offer of future bonuses. The legions became ever more demanding about bonuses to be paid and special conditions post campaigning which included Italian rather than non-Italian land-grants (the Classical era equivalent of superannuation). By 36BC Rome was bankrupted through a combination of decades of Civil War, high wages to its scores of legions and the highest grain dole prices ever experienced (due to the blockade by Sextus Pompeius).

Octavian, Antony and Lepidus launched a concerted attack against Sextus Pompeius in Sicily in 36BC defeating him comprehensively and provisioning Rome with his stolen grain earnings which amounted to a staggering sum.

The legions, both his own and those of Sextus and Lepidus who had come into his fold demanded more bonuses from Octavian, which he granted. But this would be the end of the practice. Octavian had an element of the silver horde converted into sestertii and made all of his legions march through a mountain of bagged coin to pick up their bonuses individually, rather than the common practice of pooling money with the Centurion representatives.

This was done to demonstrate his commitment to his initial promise of the bonuses but also to draw a line in the sand. The Roman Army in HIS future would not be given bonuses.

From this point on Octavian (later Augustus) would create a standing Roman Army of 28 legions (a legion comprised of approximately 6,000 men) who would be paid a fixed wage and at the end of 20-years of service retired with a land-grant. This autocratic and centralised law allowed Rome a permanent garrison and expansion force on a fixed budget which would last 500-years in the West and a further 1000-years for the Eastern empire. As an aside when I joined the Australian Army in 1990 I was still able to gain a fixed pension after 20-years of service although the last time large scale land-grants were given in Australia was after World War 1 (the DFRDB or 20-year pension was scrapped in the mid 1990's).

Ok, so what does this have to do with Workforce Planning?

Everyone in the Workforce Planning community is talking about a dearth of talent and rising wages or conditions to attract that talent. Some experts in this place will tell you that wages are not the primary reason why an employee will start and stay with you, there are other reasons. I agree with this ideology but it is also my view that many of these same experts then forget that these other factors all come at a cost, so really should be considered in that light.

Consider the writing from fellow HR.com authors such as Don McPhearson with his insightful The Tailored Workplace Series or Derek Irvine’s I Got More Money in My Paycheck?. Derek Irvine’s piece sits on an ideological platform which I don’t agree with but his thinking is the industry consensus even if it isn’t the actual industry practice.

I consider that wages and conditions have to be considered in a Total Cost of Employee (can I create another NEW acronym – TCE already!). This should include those items you can actually cost and those items you need to cost but are more ethereal (such as flexibility arrangements, a tailored workplace or workforce development strategies). I utilise a similar stratagem when I look at software implementations by completing a Total Cost of Ownership exercise.

The Australian economy is entering its second mining boom in less than five years and already labour constraints in the mining states of Western Australian and Queensland have led to an outright bidding war for skilled (and even unskilled) labour. A recent Courier Mail story covered this in relation to Dalby, a town I visited last year along with Julie Sloan of Workforce Planning Australia. Julie talked Regional Workforce Planning with local business where it is feeling the pinch from 1.8% unemployment and a labour hungry mining and energy sector, where even an unskilled labourer has a starting salary expectation of $80K and upwards.

Now, if you looking for an answer from history, then my example is a poor one as it actually points to the fact that in a constrained labour market, within a free-market framework there is no quick fix. As the market continues to strengthen you are going to see increased competition in Western Australia and Queensland for labour which will only increase the salary and condition expectation of labour attracted to that work. The only successful stop to this trend in recent times was the Global Financial Crisis which halted a significant amount of mining and energy investment in late 2008.

I don’t see another Augustus on the Australian horizon able to constrict the expectations of employees, nor willing to constrain the economy on more economically sustainable lines so if you are an employer (and not making bags of gold) expect to see worse to come in the future.


Agree/Disagree with me? Happy to take comments here or offline via Twitter @gmggranger.