PayScale’s 2015 Compensation Best Practices Report (CBPR) noted two primary reasons people quit their jobs last year: personal reasons (family, marriage, health, school, etc.) and “seeking higher pay elsewhere.”
A new baby, health challenges, a desire for more education, or a partner’s great new job across the country are all common catalysts for making a job change, it’s true. And generally speaking, that decision is completely unrelated to the employee’s work conditions (and therefore outside of the employer’s control).
However, the same can’t be said when an employee quits for more money. And according to the CBPR, money is the main reason people leave medium and large companies.
Money matters
Since the beginning of time, human beings have had to work and have sought meaning in their work. That’s why it takes more than a healthy paycheck for employees to be happy on the job and why all the talk about how money doesn’t motivate employees to higher performance rings true.
However, it would be a mistake to conclude that if more money doesn’t make employees work harder, money isn’t central to employee job satisfaction. Money still talks. Money confers value, and the right money makes less-than-ideal work situations tolerable, at least for a time.
Plus let’s face it. An employee may love his boss, his job tasks, his coworkers, and most all conditions of his employment, but if he’s not making enough money to meet his financial goals, he’ll eventually move on for greener pastures. He has to. Employees will also say yes to that next gig when their current compensation is too little for the effort the job requires.
Survey says …
But what about all those surveys claiming people quit jobs first and foremost for reasons unrelated to compensation, and therefore money is far less important than we think?
Well, to that I say “no way.” Here’s why.
First, does anyone truly believe advancement opportunities are unrelated to the desire for more cash? Pulease.
Second, a rotten boss, boring job tasks, awful coworkers, stress, etc. are all good reasons people want and will begin exploring job openings, and when those employees reflect on their decisions, these are most likely the reasons they’ll cite.
But wait. No matter how much an employee wants a new job, he or she probably won’t accept another offer until the money is right. And that makes compensation a significant factor in the decision-making process nearly always, regardless of the official survey results.
Half of employees view their job as a “temporary growth opportunity”
Now that the economy is picking up, more people have quit their jobs than in the past six years. In fact, a recent Jobvite survey found that “50 percent of employed job seekers see their current position as a placeholder” and that 61 percent rank compensation as “the biggest impact on [their] decision to take a new job.” This is particularly true for younger workers.
The moral of the story? Now more than ever, employers can’t afford to believe workers don’t care about money and won’t quit in pursuit of it. What’s more, whether compensation is a primary driver of voluntary turnover, a related factor, or a crucial concern is of less importance than the fact that it’s an inherent part of the mix.
Get your employees’ pay right with PayScale’s Insight Expert.
As an HR leader, I agree that employees do leave for more money. While it may not be the only reason or even the primary reason, if we are not providing the pay an employee believes they are worth, they are going to look elsewhere. Money does talk. If we want to retain good employee we have to show them the money.
I have to agree with you. In my current position, I am grossly underpaid – even for non-profit standards. To the tune of 40-60% underpaid — and that is after fighting for 2 months to get a 9% (HUGE!) pay raise. I LOVE my job. I LOVE my coworkers, my boss, and our company culture that genuinely encourages a work-life balance. And those things truly have been a serious part of why I have stayed for so long, because I did put a monetary value on them. However, I am getting married soon. I plan to start trying for a… Read more »
Money is the number one motivator for me when deciding whether to stay in a position or look elsewhere. I was recently promoted and offered .6% above the 80% of market rate minimum required by my company despite my track record as a high performer. I started looking for a higher paying job the day I was told my new promotion salary was not negotiable. For 3k more, my current employer could have had my loyalty but in choosing to reward my high performance with .6% above the bare minimum, they have communicated their opinion of my value and I… Read more »
I love my boss, my co-workers and the majority of my job. I am the bread winner of my family and realized that I clearly have not been able to show value to my boss as it has been shown to me through my pay. It’s always fine until you have another mouth to feed, then you are backed into a corner and after cutting expenses and surviving off your savings for a year…you hope that being a top three employee would save you. It has not, my kid doesn’t care about my job perks or benefits, my pension or… Read more »
Look at all of the non-monetary reasons sites in the comments. What is the common denominator? YEP, money!!
I’m sure people leave for a variety of reasons but the most constant and main reason people leave when you remove the bogus altruism – is compensation. As one person noted, we need to be able to pay the bills. Most of the positions I’ve held I would have stayed much longer or NOT left at all if the pay was more adequately. And this even when I didn’t like my boss very much or had co-workers who were nightmares. I show up to work to work hard in return for a living, not for a social rewards or other… Read more »
Money is 100% the reason why I am currently job searching. I live in San Dieo, CA and bring home $2400 a month after taxes. Yikes! I have a master’s degree and work 10.5 hour days a a social worker to the more than 100 clients on my caseload. I don’t mind working hard, and I love my job. However, putting in 100% is hard when I realize that each paycheck, despite the grueling hours I put in, I’m making about $10 per client. I’ll try not to let the door hit me on the butt as I run towards… Read more »
100% agree with this. you can complain all you want about all the other issues at your job but very few people will ever leave for less money. So that to me means it is all about the money.
I am currently looking at taking another job. I love my current job and am glad to stay there. My job pays me very well and I have really good benefits. I get great job reviews, am very productive and I am really happy there. But I would leave for 15% more money. Even if that meant commuting more or doing something that wasn’t as enjoyable as my current job. Especially if the benefits are similar. To throw another twist into this. If I got a job offer for 15% more, but my current job offered me 10% more to… Read more »
This is not your best research & publication PayScale. I am a bit disappointed in you frankly. Quality longitudinal studies have clearly demonstrated that pay is NOT a common reason people leave their current employer.
It is frequently stated; however, when you look at different measures of satisfaction then measure over time which employees stay vs. quit it’s clear that pay is not fundamental driver.
Drawing the conclusion that because employees rarely leave for less the reason they are leaving is pay is very mislead.
Self-serving ‘research and publication’ from a site who’s sole purpose is to track and provide salary data. While money may be the ultimate reason people cite for leaving, it’s not the one of the top reasons people begin looking. It’s the push/pull scenario…money may be the pull but the push (lack of development opportunities, conflict with boss, lack of recognition etc.) is the reason why people are open and receptive.
Usually by the time an employee leaves an organization, it is because the are so fed up with a series of long-standing frustrations that no amount of money would get them to stay. However, to explicitly say that the reason you are leaving is because your boss is a jerk, your co-workers are lazy, and the company is unreliable burns bridges, and will not endear you to another company if stated in the interview process. However, it is perfectly socially acceptable to just say you are leaving for more pay. This is why the author thinks decisions to leave are… Read more »
I was starting to change my mind about your organization from my initial distrust to one of potential client. Such is no longer the case. This article is incredibly misleading and unnecessarily inflammatory, and unfortunately, ignorant or dissatisfied people (which covers about 99% of the workforce) will read it and believe it at face value. Citing your own published research to push your own services is understandable, likely biased, but understandable. However, you just made my job that much more difficult with the headlines that play to everyone’s natural believe that they are significantly underpaid and they don’t even adequately… Read more »
My 24 years of experience tells me that most “underpaid” employees are actually paid appropriately. At every company for which I have worked, as big as $10B and as small as $4M, there was one constant – the rock stars got paid and below average performers did not. That is not to say those people are lazy or slow, in my opinion most are just in the wrong roles given their talents. That may be a function of their own choices or management’s, but it happens either way. My current employer is experiencing high growth (25%/year for 4 years) and… Read more »
Money has never been my main reason for why I stay or leave a job. With that said money does come into play as it relates to how I feel I am valued. If my company has a good year financially and I am given a 1% raise or no raise at all I am going to feel like what I do has no value to my employer. I may not be seeking a job but if a headhunter calls me after this occurs they would have a good shot a stealing me away from my current job. You could… Read more »
The problem with money is that many employees don’t think they ever make enough. You give them a raise and they come back looking for more. And, I think you’ll find that a lot of people who leave for more money find that the grass isn’t always greener, and that while they may be making more money, they aren’t happy at the company. I know this happened with several people. Yes, money is important, and companies should pay a competitive wage. However, some people value other factors more than money. I’m currently at a job where I’m making $5,000 less… Read more »
My Reasons to leave would be: Money (average pay for first job after graduating for my major from my university I went to was 70k some years ago), yup I’m in the 50ish-k range. I took the job cause it was a few months before I was I done finishing school and needed/wanted a job. Better retirement benefits would be another reason, low matching 401k, c’mon, a lot of people or a fair number of people I’d guess don’t even invest in them, so make it better those of us who do. I like my coworkers and supervisor. They’re good… Read more »
Money matters. However, Job Satisfaction, Working Conditions and Engagement would still top the list in my opinion. Money can’t buy engagement. It is the job itself that has to be satisfying rather than the monetary benefit.
Hi Crystal, I would definitely changed my job for more money, nice article.
I know this article is about a year and a half old but I find this is spot on in my experience. I’ve been losing employees left and right due to salary. All have given exit interviews and have stated they enjoyed working here, enjoyed what they do, enjoyed even their boss but they weren’t getting paid enough to pay their bills. Time after time this has been a recurring issue and yet I still cannot convince the powers that be to raise the salary range. It is a struggle and it’s frustrating not just for me but for the… Read more »
I quit my job a year ago when I started to invest the money in binary options trading. It works great for me, because I know how to do it properly. Give a quick look at this article http://u.to/H6VlDw and in the other sections you can see scam reviews which are usefull, too
I do not agree, look at http://www.artofmanliness.com/2013/01/30/how-to-quit-a-job-without-burning-bridges/
I’m in the exact dilemma this article is describing. I’ve been with my company as an intern and love what I do and the people I work with. The CEO recently made me full-time—except somehow, I’m getting paid $5 less per hour for 40+ hours/week than when I interned part-time (to the CEO, it’s a pay raise from my part-time salary even though my hours have essentially doubled). According to my research, I’m getting paid half the average market salary for my position. I’m doing what I love and I don’t want to leave, but I’ve quickly realized that even… Read more »
I love my current boss. I have lunch with coworkers and talk outside of work. My job is really easy, and non stressful…I really love it here at 15.00 an hour . I just got offered 17.00 at another company with more potential for Growth. It is so hard leaving… But the desire to grow and further my potential pulls me to leave. I believe as you self improve your skills and further develop you get offered more pay. Even that 17.00 is a start to moving towards 25 , 35 hey why not 40 an hour. Those that want… Read more »