According to Forbes, on average, staying employed at the same company for over two years will plummet your lifetime earnings by about 50%. Let’s look at how to get that other 50% in this article.
Many employees believe having a job means receiving a pay raise yearly. Unfortunately, this is not always the case, as many companies don’t offer real annual raises; instead, they offer a “cost of living raise.” This is meant to keep pace with inflation; however, it rarely does. It’s not considered that an employee may increase their value to the company each year through experience and higher productivity, which is not rewarded. Few employees are rewarded monetarily for a company’s growing earnings or financial success. This disconnect between a company’s and an employee’s success is bad for business. Many companies once rewarded employees with profit-sharing plans, stock options, pensions, and bonuses; those days are gone.
Instead, they offer more amenities, such as more time off or more flexibility in your schedule. If you don’t receive a high enough yearly raise, you lose money due to inflation. In the past, US inflation was about 2% annually on average before 2020, and the average salary raise received was about 3.1%, meaning your total raise was only 1.1%. However, the US inflation rate is currently 6.4%, so you lost money if you did not get a 6.4% raise over the past 12 months. This is a loss of your income buying power in goods and services. How far your earned income goes with rent or a mortgage has been hurt the most in the past three years, along with groceries being up double digits. Most companies raised their prices and earnings but did not raise their existing employees’ incomes. Most of the employee raises came from those who switched jobs for higher pay.
While some industries may offer higher raises, such as software, where raises can range from 7-10%, it’s still nothing compared to what you could get by simply switching jobs. Working your way up the corporate ladder is not the best way to make more money unless you plan on making it to the top, such as CEO, CFO, or CTO. Instead, switching companies can make more significant gains in your income.
Why Switch Jobs?
While getting a pay raise may seem the best way to increase your income, switching jobs could be the better alternative. It allows you to increase your salary and expand your skillset and network significantly. When negotiating a salary, it’s essential not to give a number first and instead ask their budget for the position. Here are some great reasons to look for another position instead of sticking with your old job.
Switching jobs could result in a 15-35% salary increase or even double your salary. For example, you could change careers and receive a 50% salary increase, going from $50,000 a year to $75,000 a year, and then receive a 5% salary increase from $75,000 to $78,750 with a good yearly raise. While job hopping may be unfavorable, there are ways to do it safely without hurting your career.
20 Reasons to Switch
- Better salary: If unsatisfied with your current salary, you can look for jobs offering better pay. For example, if you are a software engineer, you can look for jobs at tech companies that provide higher salaries.
- Better benefits: Some companies offer better benefits than others. If you want better health insurance or more vacation time, you can look for jobs that offer these benefits.
- More flexible work schedule: If you need more flexibility in your work schedule, you can look for jobs that offer remote work options or flexible schedules. For example, if you’re a parent, you may need a job that allows you to work from home or adjust your schedule around your children’s needs.
- Better work-life balance: If you feel like your current job is taking up too much of your time in commuting and energy, you can look for jobs prioritizing work-life balance. For example, you may want to look for a job with fewer working hours or less demanding deadlines.
- Growth opportunities: If you want to grow your career, you can look for jobs that offer opportunities for advancement or skill development. For example, you may want to look for a job with a company with a strong mentorship program. Growing companies also provide better opportunities for growth and advancement than stagnant and declining ones.
- Better company culture: If you don’t fit in with your current company’s culture, you can look for jobs with a culture that aligns more with your values. For example, you may want to look for a job with a company that prioritizes the things you see the most value in.
- More fulfilling work: If you’re unsatisfied with your current job and don’t feel it’s meaningful, you can look for more fulfilling careers. For example, if you are passionate about making money, you may want to look for a job in sales or finance.
- Better work environment: If you don’t like your current work environment, you can look for jobs with better facilities, friendlier people, or a better atmosphere. For example, you may want to look for a job with a company that has a modern office space or promotes a positive work culture.
- Better commute: If your commute is too long or stressful, you can look for jobs closer to home or allow remote work.
- More challenging work: If you’re bored with your current job and want more of a challenge, you can look for jobs that require more complex tasks or higher-level skills.
- More autonomy: If you want more control over your work, you can look for jobs that allow for more autonomy. For example, you may want to look for a career in management where you can have more input on decision-making.
- Better work relationships: If you don’t get along with your coworkers or feel like you don’t have a supportive team, you can look for jobs with better work relationships. For example, you may want to look for a job with a company that has a strong team culture or values collaboration.
- More creative freedom: If you are in a creative field and want more freedom to express your ideas, you can look for jobs that offer more creative freedom. For example, if you’re a graphic designer, you may want to look for a job with an agency that allows for more experimentation and innovation.
- More opportunities to travel: If you love to travel and want to incorporate it into your job, you can look for jobs that require travel. For example, if you are a consultant, you may want to look for a job with a firm requiring frequent client site travel.
- A more flexible schedule: If your current job requires you to be at your desk during specific hours, finding a new job with a more flexible schedule can help you better manage your work-life balance. For example, you might look for a job that allows you to work from home, autonomy for your schedule as long as you get the work done or a compressed workweek.
- More job security: If your current job is unstable or uncertain, finding a new job with more job security can help you feel more confident and secure in your career. For example, you might look for a job in a more stable industry, with a more established company, or with a more secure financial outlook.
- More competitive compensation: If you feel like you’re underpaid for your work, finding a new job with more competitive compensation can help you feel more valued and better compensated for your skills and experience.
- A better fit for your values: If your current job doesn’t align with your values or priorities, finding a new job that better aligns with your values can help you feel more fulfilled and satisfied in your career. For example, you might look for a job with a company that prioritizes customer experience, employee compensation, or shareholder value.
- Growth opportunities: If you feel like you’ve hit the ceiling in your current position with no room for advancement, consider finding a new job that offers growth and career development opportunities. This could include promotions, training programs, or mentorship opportunities.
- Geographic location: If you’re looking to relocate, changing jobs can be an opportunity to find work in a new city or region. Going to where the career opportunity is can be one of the best things you do for your career,
Conclusion
In conclusion, changing jobs can significantly impact your work life and overall career trajectory more than just counting on a fair raise yearly that compensates you for the increased cost of living and your growth in value to a company. It can bring new opportunities, challenges, and learning experiences, improving your financial situation and job satisfaction. However, it’s essential to carefully consider the reasons for changing jobs, research potential employers and job offers, and weigh the pros and cons before deciding. By taking the necessary steps and being proactive in your career, you can achieve your professional goals and enjoy a fulfilling work life.