Yes, people really do quit jobs for more money


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.

 

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21 Comments

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  1. 1
    Sean Hodge

    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.

  2. 2
    Underpaid Ass. Director

    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 family by the end of the year. The 2.5 hours I commute DAILY to work, combined with the incredibly low pay, has me backed into a corner. I have no choice. I have to go elsewhere. I literally cannot afford a normal life unless I am paid more. Period.

  3. 3
    Wanda Miller

    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.

  4. 4
    HR Guy

    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.

  5. 6
    Scott B

    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 usually about money, and generally only money. Money is often a symptom or side effect, put pretty rarely the primary cause. If it were, few people would stay at any job more than a few months, and would be constantly talking to recruiters in order to cross the street to chase a few more dollars.

    Other times, and far less often, the level of pay is just not meeting the employee’s basic needs, which evolve over time. Smart employers, if they can, try to make sure their pay is competitive so at minimum they can meet those basic needs for most of their employees. But sometimes this does not happen. Commenter #2 is a clear example of this. For commenter #2, it seems clear that their pay no longer meets their basic needs, which have evolved over time and have finally reached the point where they have to seek another job where the pay does meet their needs, despite the fact they love the job, their boss and their co-workers.

    I agree with Sean Hodge that the article has missed the mark, and that concluding that because employees often leave for more pay, it must be the reason they are leaving is very misleading.

  6. 7
    Paula

    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 tell the story.

    Since people with roles in compensation, like me, are likely to be the ones who will get to deal with the repercussions of people reading this and are also the people to whom you would like to sell your services, this strategy seems like it is destined to be ineffective.

    So, you made my job much more difficult and for what?

  7. 8
    Tony

    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 we have hired primarily recent graduates, so our turnover is slightly higher than industry norm. On every voluntary departure we ask ourselves, “Was that a performer we will miss?”. In two years we have not had a single employee we wanted to keep leave for money. In fact almost every employee we missed left for the first reason cited in this article, they had a significant other that took them elsewhere.

  8. 9
    Computer_Geek

    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 say that it wasn’t the money but paying someone the going rate is important and make them feel they are valued. I may not even need the pay raise but it tells me that they care.

  9. 10
    Leigh

    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 than at my previous job. However, I’m respected, my work is respected, my knowledge is respected, and I don’t dread getting out of bed every morning and going to work.

  10. 11
    Money Talks

    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 intangible return. I’ll admit my wife is a little different (workplace comfort carries more value) but when money is tight or there are big bills to pay, income – or lack thereof – comes back into the limelight.

    To the HR people: money does matter and it matters a lot to most of us. In fact, it matters most to the rain-makers, that is, the highly motivated employee that goes the extra mile. It will also impact talent retention, morale, and draw new talent in the form of positive referrals. I’m now being heavily recruited by a company that is known in my industry for paying exceptionally well. This company has excellent retention and employees readily give referrals (which is how I got the call). Generally the most talented people I my industry climb over each other to work for this company. Customers also like doing business with this company because customer like companies who take care of their employees – it says a lot about the kind of care that they can expect. Lastly, I can’t tell you how relieving it is to ask for a compensation level that will take my family to the next step financially and the HR person on the other end say’s “No problem! We can do that.” Nothing sucks the energy and happiness out of room faster than an HR manager starts acting like a salesman and pitching “the total package”. My experience is a rigid HR policy for compensation means the following red flags: this company is in financial trouble (and/or) a bunch a cheap-skates (and/or) expect to have raises frozen at the slightest slow-down (and/or) pay-cuts (and/or) layoffs. If I could go back in time, and when HR pushed back on fair compensation, I’d walk out and not look back.

  11. 12
    claire mephem

    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 feel I have no choice but to look elsewhere.

  12. 13
    Madeline Veergo

    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 my desire to finally earn the bump in salary. Today she’s hungry, today she wants to eat and if I can’t afford to give her enough food, that’s on me. I need to suck up and remove my golden shackles and start looking for a job that pays a little bit better.

  13. 14
    Kiara

    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 a higher paying company with less stress 🙂

  14. 15
    Chris

    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 stay. I would stay with my current job. It isn’t just about the money, but the money is a major factor.

    Point in Life: Experienced Professional

  15. 16
    Steve

    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 people.There’s maybe one who could pulling his weight better.

    I feel like I’m going beyond the minimum required, there’s been no talk of raise with graduating, with being there over a year, no mention of a raise from management. I could ask but shouldn’t you recognize the value of your employees? One job I had while I was in school, raises were pretty regular. It makes you feel appreciated. I think prices in the work cafeteria that has a relationship with my company have gone up at least twice (or more) possibly since I’ve gotten there. 3 of my coworkers who were there when I started have already taken better paying jobs (I assume and one did mention an increase) elsewhere. You want keep people, give them raises and be competitive with other companies.

    A better work life balance would be better (this partly my bad, as I’m someone who feels the need to put in more) but also there are times where it’s required too and doesn’t always feel like you have much free/personal time as you ought to have.

    Workload, the place I work is understaffed I would say. There’s more to do, never can completely clear my queue. Always a balancing act, trying to provide the attention and work where it needs to be.

    Right now I’m considering a job opportunity a former employee I worked with has made me aware of. There’s also another job I’m trying for, not as much money as the one just mentioned but I think this other one has a super great retirement plan…

  16. 17
    hrquest.ca

    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.

  17. 19
    Frustrated Hiring Supervisor

    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 whole team.

  18. 20
    marie

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