Hi, I’m Patrick, I write about the job search. After graduating from Cornell, I became a content lead at UBS where I helped professionals at Fortune 500 companies understand their stock options, salary, and benefits. When I’m not writing about the hiring process, I write novels for teens. Find out if you should ask for a raise or look for a new job to make the most possible.
Has company loyalty died yet? Employees reported a steady decline in company loyalty throughout 2021, falling to just 65% in 2022, according to an Energage survey. Professionals seem to be moving laterally instead of moving up, changing jobs for higher salaries. But is this actually in their best interest? Or is it an easy way out?
Yes, changing jobs usually results in a salary increase. But so does asking for a raise. According to a Payscale survey, 70% of professionals who asked for a raise got one. While notions of company loyalty may sometimes be naive, it’s still in a company’s best interest to reward and retain employees. If your experience has increased, so have your skills, which should merit a higher salary. Even if you had a bad quarter, your salary should still increase with inflation–If you don’t ask for a raise at work, your salary is actually going down. So if asking for a raise is expected, why don’t more professionals ask for a pay bump?
People are afraid of asking for a raise… so they just don’t. While the job search is a pain, plenty of professionals would rather get a root canal than ask for a raise according to a 2017 survey. Studies show that professionals are far more motivated by pain avoidance than reward. While it may seem irrational that people would spend hundreds of hours searching for jobs just to avoid a sweaty awkward meeting with their supervisor, it’s human nature. So should you ask for a raise or look for a new job to maximize your lifetime earnings?
It’s true that your salary will almost certainly go up when you land a job. But not because the new employer is more generous–Job-seekers are more likely to look for a higher salary and ask. Professionals feel more confident that they can get a higher salary with a new title. The Outsider Effect raises their standards in negotiation, which in turn raises their salary. Is the higher salary at a new job just correlation instead of causation then? Not exactly.
Companies set salaries for new roles based on the current market rate. This means the salary for a new hire is automatically adjusted for inflation and demand, while current employees’ salaries are not. Getting a new job almost guarantees that you’ll start at the market rate. Doesn’t that sound easier than having to prove that you deserve the market rate?
But finding a new job takes time: 3-6 months, on average. Busy professionals will likely need even more time to find a new job since they’ll have less time for interviews and applications. Busy job-seekers could go months (or even years!) without a raise. Even if they land a 20% raise at their new job, they’ve at least 10% of their salary by staying at the same salary while inflation eats their paycheck.
In short, professionals should learn how to ask for a raise at work before looking for a new job. Even if rejected, you should continue to ask for a pay bump while you search for a new job. It’s easy to dismiss your chances of getting a raise and jump straight into the job search, especially if you’ve been told no before. But by not asking, you throw away your very high chance of at least getting a pay bump to the market rate. Worse, you give in to a climate of fear. The bottom line: asking for a raise and landing a new job will probably increase your salary. Why not do both?
Whether you choose to ask for a raise or look for a new job, salary negotiation is always stressful. At Pathrise, our mentors handle the entire negotiation process. On average, we increase fellows’ salaries by 10%-20% through negotiation alone. We’ve never had an offer retracted from negotiation. Learn more about our newest initiatives to optimize negotiation in our manifesto.
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