Switching Companies May Earn You More Money
Loyalty to one employer is no longer the best strategy for most workers, at least in terms of earnings. People who “job hop” and switch companies end up earning higher salaries than those who stick around.
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Forbes contributor Cameron Keng did some digging around and concluded that, in general, employees who switch companies every two years make about 50 percent more over their lifetimes. That means the loyal employees are making 50 percent less. And Keng informs us this is a conservative estimate.
One contributing factor is the current trend among employers to give a 3 percent raise to employees every year. Underperformers may receive less, and even overperformers are generally offered less than 5 percent.
Pay freezes and low caps on salary were supposed to be temporary measures to keep companies in business during hard times. However, now employers are maintaining these policies as the norm. This hurts the loyal employees and rewards “job hoppers.”
It is no longer a terrible thing to have four or five jobs on your resume over the course of 10 years. It is survival.
Keng uses the case of Jessica Derkis to illustrate how job hopping is a much better career strategy than loyalty to one employer:
Jessica Derkis started her career earning $8 per hour ($16,640 annual salary) as the YMCA’s marketing manager. Over 10 years, she’s changed employers five times to ultimately earn $72,000 per year at her most recent marketing position. This is approximately a 330% increase over a 10 year career. Derkis’ most recent transition resulted in a 50% increase to her salary.
Own Your Career
Be loyal to your career, not to your specific job at one employer. At any job, you hone your skills over time. After a couple of years, you will likely command a higher salary at a new employer; your new salary will reflect experience and skill sets.
Best practice is to learn all you can on any one job. Craft a new resume highlighting your highest-level skills, and apply for positions that require people with such training and proven ability.
Remember to leave on good terms. Say, “Thank you for the opportunities, I have found another position that I can’t say ‘no’ to.” When possible, line up people at your former employer who will give you a good recommendation.
Tell Us What You Think
How often have you changed jobs? We want to hear from you! Leave a comment or join the discussion on Twitter.