Been At Your Job For More Than 2 Years? You’re Cutting Your Earnings By 50%
A loyal staff is an employer’s dream. They’re committed, enduring — oh, and they keep the company’s costs down. But while dedicated employees are a boss’ dream, it’s a nightmare for faithful workers. Staying at one institution for more than two years, according to Forbes, will slash your lifetime earnings in half.
And 50 percent isn’t an exaggeration. In fact, this figure only applies to workers whose careers last for 10 years. The longer you toil in the workforce, the more money you should expect to lose over your lifetime. So why are loyal employees being punished for their allegiance? Forbes blames the Great Recession.
Once upon a time, employees looked forward to an annual five percent pay raise. But today, in 2014, three percent raises have become the norm — this is because recessions allow businesses to reduce salaries based on market trends. However, this response to the Great Recession was only supposed to be temporary; it now seems to be a lasting impact on the workforce. Adding insult to injury, due to inflation, your three percent raise is “actually less than 1%.” Yikes!
And that’s the reason, according to Forbes, that you should jump ship before becoming a “ride or die” worker. By nabbing a new job every couple of years, you have the clout to haggle for a higher base salary than your previous position.
Bethany Devine, a senior hiring manager in Silicon Valley, explains it best:
“The problem with staying at a company forever is you start with a base salary and usually annual raises are based on a percentage of your current salary. There is often a limit to how high your manager can bump you up since it’s based on a percentage of your current salary. However, if you move to another company, you start fresh and can usually command a higher base salary to hire you,” Devine reveals.
For many who commit to their jobs in expectation of a promotion, Devine implies they will be waiting on their loyal derrieres for quite a while. Because some companies have limits to how many promotions they can have per year, it’ll be difficult for workers to move up the ranks — they’re queued behind co-workers who should have been promoted the year before.
“I have seen many coworkers who were waiting on a certain title and finally received it the day they left and were hired at a new company,” Devine explains.
What do you think is better career mobility? Loyalty or job-hopping?