Tuesday, November 5, 2024

Pay Compression

 Most employees already suspect they aren’t paid a fair salary. Only 37% of employees believe they’re paid fairly by their employer and nearly half believe they could make more money right now simply by switching jobs, according to a new survey by Employ’s 2022 Job Seeker Nation Report.


Making more money by switching jobs is a consequence of pay compression. Employees have deemed more valuable by other companies, driving up new hire wages across the market. This is prevalent in the tech sector (and others).


Companies want you to leave, get experience at other tech firms and come back with a broader knowledge base. Oracle is a primary example. I have heard of a worker who is on her 5th stint with Oracle, each time earning substantially more $$$ that previously earned.


If you are looking to for a new job, you need to understand pay compression. Do not get caught up in the idea that it is a supply / demand issue. That is a small component.


If you have a question about pay compression, please send me an InMail.


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