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Commission-Based Selling on the Rise with Declining Jobs

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With the number of sales jobs falling fast in the current U.S. job market, commission-based selling jobs seem to be the only sales jobs employers have to offer these days. Many salespeople, especially those involved in the mortgage industry, made great fortunes before the recent mortgage meltdown. Now, however, many salespeople are struggling to find stable jobs, and many have been forced to accept commission-only sales jobs, which can be very difficult to find success with in a failing economy.

With the recent decline in the U.S. job market, sales professionals have taken a significant hit.

The nation’s unemployment rate is rising, and as a result salespeople’s jobs are disappearing along with many others.

The upside, or downside, depending on how you look at it, is that 100% commission-based sales jobs are on the rise.

In past years, when the economy and job market were seeing better days, many salespeople were able to multiply their job earnings by working for a base salary along with commission on top of that. This meant that even if a salesperson had a bad sales month, he or she would still be able to take home a paycheck and hope for better earnings next month.

That paradise is now lost.

In today’s steeply declining market, an alarming number of sales employers have been reduced to only offering 100% commission-based sales jobs simply because it affords them zero risks.

So what does this mean for out-of-work salespeople or soon-to-be-out-of-work salespeople? Well, according to some experienced salespeople, not much.

A former underwriter and sales manager, whom I will call Jennifer, from an Orange County residential mortgage company, Pacific Residential, was laid off due to the mortgage meltdown at the beginning of this year.

Along with the rest of the mortgage industry’s salespeople, Jennifer made a small fortune when the industry was booming in 2005 and 2006; but when the slowdown came late last year, she saw her career’s entire industry start to disintegrate before her very eyes.

Since January, Jennifer has been in search of a new job that utilizes her sales, marketing, managerial, and leadership skills. To date, she estimates she has sent out approximately 300 resumes.

“Almost immediately after I started posting my resume online and applying for sales jobs, I began receiving a flood of offers for 100% commission-based sales jobs,” Jennifer says.

According to Jennifer, a number of insurance, advertising, and marketing companies have called her, praising her for being so qualified and asking to see her for an interview.

The catch would come when Jennifer asked if the job was 100% commission, which was followed by a reluctant “yes” from the caller. All of the employers who have called Jennifer have smoothly danced around the fact that the jobs they are offering are 100% commission-based. What are they trying to hide?

“No one is going to make money in a job like that until he or she has built a client base, which can take at least six months to establish,” Jennifer explains. “That’s going to be very difficult in today’s market. If it were that simple, we would all be working in 100% commission sales jobs.”

On the other hand, some may argue with Jennifer that 100% commission-based selling is a tremendous opportunity for aggressive salespeople. This is true -- but if no one can buy in such a declining economy, it probably won’t matter how good a salesperson someone is.
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