Workers Rarely Jump Ship Over Pay Alone

By Deb Perelman  |  Posted 2007-06-29

Workers Rarely Jump Ship Over Pay Alone

It may come as a surprise to many executives, but workers arent leaving their jobs just because they are not happy with their pay, according to the experts.

Unless the gap between what an individual is making and the market valuation of their role is particularly wide, a higher salary might be the perk that sweetens the deal, but, in all likelihood, salary issues alone wont instigate a job change.

"I know for some people, its all about the money. Maybe their spouse has good coverage, so its not the benefits theyre looking for and they dont mind a long commute so they can just go for the best pay. But assuming a market rate is being paid, its not the primary reason people leave," said John Estes, vice president of the recruiting firm Robert Half Technology.

Research drives Estes argument home. In an analysis of 19,700 post-exit surveys and 3,179 comments for PricewaterhouseCoopers Saratoga Institute, released June 1, researchers found that the reasons employees left their previous job were strikingly different from what most executives believed them to be.

"Because in third-party exit interviewing, employees tell them things they dont want to tell their employer because they dont want to burn a bridge. Almost 90 percent had left for reasons other than pay, yet nine out of 10 managers believe that money was the reason people left," said F. Leigh Branham, a consultant in Overland Park, Kan., and author of the report.

Click here to read why some IT executives bounce from job to job.

Eighty-eight percent of departing employees cited reasons other than salary concerns for leaving their jobs, including that the job or work environment was not what was promised or expected, or that they did not feel challenged. Other reasons cited were a lack of feedback and coaching, feeling that their work was undervalued and being burned out or seeing no possibility for career advancement within the company.

Even more alarming, according to the Saratoga research, was the finding that the real reasons for an employees departure rarely got back to their managers or bosses. Although 93 percent of companies did exit interviewing, only 30 percent of those companies ever reported the results to line managers and executives.

"Why? I believe its because the exit interviewers intuitively understand that the reasons given are superficial ones, provided to avoid burning a bridge, preserve the possibility of a good reference or avoid an unpleasant situation," said Branham.

Neill Hopkins, vice president of skill development at CompTIA, an IT trade association, puts it more simply.

"If youre happy where you are working, would you leave for a 10 percent raise? No. If you werent happy, would you leave for 5 percent? Yes," Hopkins told eWEEK.

Next Page: Other factors matter more than pay.

Workers Rarely Jump Ship

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"Especially if you were going to a company that looks after their workers better than [your] last one did, and gives [employees] a robust suite of benefits. Those are the organizations youll see hanging onto their employees," Hopkins said.

Recruiters, managers and even worker bees have always focused long and hard on the dollar-value of a job. Managers and CIOs fret that they cannot afford what the best and brightest can be paid elsewhere. Recruiters try to convince management that offering higher salaries will pay off in the form of higher-quality talent. And IT professionals hope they will be able to negotiate decent salaries. But, according to the research, when employees are happy, salary is rarely a deal-maker or a deal-breaker.

Job happiness, cultural fit and the potential for growth are everything, despite the emphasis managers put on salaries.

Forrester Research puts its money on what it calls "cultural alignment" as a key ingredient to workplace happiness and retention.

"Compensation plays a role, but cultural alignment plays a bigger one, more than previously reported from either side. Candidates and employees may not be thinking of it as a cultural concern because its hard to define and distill down, but these differentiators come into play when theyre weighing job offers or another organization tries to lure them away," Samuel Bright, an analyst at Forrester, told eWEEK.

Bright argues that people often confuse a job that has great perks with a workplace that has a great culture, when theyre not the same thing.

What will happen to the "IT Cowboys" who have always been so indispensable in so many corporate IT departments? Click here to find out.

"They look at telecommuting, generous benefit packages or work-life balance, but if you offer perks without the cultural background behind it, people are resented for taking advantage of them," said Bright.

Bosses that throw perks at departing employees arent necessarily focusing on the wrong thing, argues Bright, but certainly they are offering the perks for the wrong reasons.

"As IT leaders get frustrated managing issues of recruiting and retention, theyre often throwing clay against the wall to see what sticks. But theyre not appealing to their workplace culture. Its more like bribing employees to stay around," said Bright. "Upping perks in name alone or perks that dont fit with the culture may stop the bleeding, but over time theres a real disconnect."

Instead, companies should identify the perks that most appeal to the employees who stay as well as study the real reasons departing employees are moving on to other jobs. By identifying the positive and negative aspects of its work environment, a company stands to improve its marketability to new hires while increasing its likelihood of retaining current employees who might be swayed by a better offer.

"This is not to discount compensation, but not to overrate it either," said Bright.

Check out eWEEK.coms Careers Center for the latest news, analysis and commentary on careers for IT professionals.

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