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Employees Who Stay In Companies Longer Than Two Years Get Paid 50% Less
Forbes ^ | 06/23/2014 | Cameron King

Posted on 06/23/2014 12:08:26 PM PDT by SeekAndFind

The worst kept secret is that employees are making less on average every year. There are millions of reasons for this, but we’re going to focus on one that we can control. Staying employed at the same company for over two years on average is going to make you earn less over your lifetime by about 50% or more.

Keep in mind that 50% is a conservative number at the lowest end of the spectrum. This is assuming that your career is only going to last 10 years. The longer you work, the greater the difference will become over your lifetime.

Arguments for Changing Jobs

The average raise an employee can expect in 2014 is 3%. Even the most underperforming employee can expect a 1.3% raise. The best performers can hope for a 4.5% raise. But, the inflation rate is currently 2.1% calculated based on the Consumer Price Index published by the Bureau of Labor Statistics. This means that your raise is actually less than 1%. This is probably sobering enough to make you reach for a drink.

In 2014, the average employee is going to earn less than a 1% raise and there is very little that we can do to change management’s decision. But, we can decide whether we want to stay at a company that is going to give us a raise for less than 1%. The average raise an employee receives for leaving is between a 10% to 20% increase in salary. Obviously, there are extreme cases where people receive upwards of 50%, but this depends on each person’s individual circumstances and industries.

(Excerpt) Read more at forbes.com ...


TOPICS: Business/Economy; Society
KEYWORDS: companies; employees; salaries; wages

1 posted on 06/23/2014 12:08:26 PM PDT by SeekAndFind
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To: SeekAndFind
...the inflation rate is currently 2.1% ...

Right.....

2 posted on 06/23/2014 12:13:42 PM PDT by jeffc (The U.S. media are our enemy)
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To: SeekAndFind

If you stay in the same job longer than 7 years they can hire someone new at less money.

Our economy does not reward longevity.


3 posted on 06/23/2014 12:13:46 PM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: SeekAndFind

In the 1980’s I was a 20-something. I was earning about 10% less than the engineers doing the same job who had been there 20-plus years. I figured this was due to the awesome retirement program. But I had to be there 10 years to vest and you had to stay for some number of points, which I can’t recall. They were composed of your age and years of service. But to get the maximum you’d basically have to have started at 20-something and stayed 30 years. By the 1980’s it was impossible to stay that long and they would lay you off depending on where you stood in the retirement system, meaning if you weren’t “connected” you wouldn’t get the maximum points. So, the engineers who stayed were screwed.

Now the same is true of salary shrinkage, but there is no defined benefit retirement plan. (Unless you’re in government. Then, not only is retirement a good plan, with medical, but they can’t or won’t lay you off. You can be a dead man at work and they won’t fire you.)


4 posted on 06/23/2014 12:16:59 PM PDT by Gen.Blather
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To: SeekAndFind

If you hop every 2 years, you will soon be unemployable.


5 posted on 06/23/2014 12:17:46 PM PDT by pas
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To: pas
If you hop every 2 years, you will soon be unemployable.

This.

Yes, a few well-timed moves is the best way to boost your salary.

No, you can't jump to a new job every 2 years without leaving the impression that you never get anything done and can not be counted on.

Worse, you can give the impression that you are always just one step ahead of being found out for incompetence.

6 posted on 06/23/2014 12:20:27 PM PDT by SoothingDave
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To: SeekAndFind

Job hopping is a great way to increase your wages, but the cost is life stability. It’s hard to get roots when you switch jobs all the time, since eventually that will mean switching towns, states, maybe even countries. Not to mention the fact that as you keep increasing your price tag you keep increasing what they expect. Nope, I’m very OK making less money without moving or working overtime.


7 posted on 06/23/2014 12:20:48 PM PDT by discostu (Ladies and gentlemen watch Ruth!)
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To: pas
If you hop every 2 years, you will soon be unemployable.

Unless you are a Software Engineer -- Then it may be very beneficial in terms of experience and salary to change jobs every 2 years.
8 posted on 06/23/2014 12:22:22 PM PDT by the_boy_who_got_lost (Real men scare liberals)
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To: pas

Not any more. 2 year is maximum. If you are not able to move within your company then it is time to move to another. It is up or out. Anyone stagnating is just lazy.


9 posted on 06/23/2014 12:27:25 PM PDT by CodeToad (Arm Up! They Are!)
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To: SeekAndFind
While I'm surprised at the only two years, I'm much less so at the conclusion. Very talented people job hop because they can. Others job hop to stay one step ahead of their chickens coming home to roost.

In general, recruiters are targeting the same set of job hoppers with attractive offers which have to be attractive to get the job hoppers to take them.

During the worst of the Obama recession, some friends and I put together a serious proposal to rent some of the glut of vacant office space and charge people a nominal fee to work for us so they would have the prestige of a job and an office cube from which to be recruited.

We debated about the deception such a plan would entail and, in the end, decided not to go forward with it for that reason.

10 posted on 06/23/2014 12:35:18 PM PDT by Vigilanteman (Obama: Fake black man. Fake Messiah. Fake American. How many fakes can you fit in one Zer0?)
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To: SeekAndFind

Yes, I tried this lousy advice once.

I moved from a job where I was respected and had friends, to a job where my boss was an idiot (thought degrees Rankine and degrees Kelvin were the same thing, went through three textbooks that showed he was wrong, and still thought they were the same) and a crook (stole, and used, patented designs from his previous employer).

I learned that if you are only working for the money, it is unlikely the you will be happy with your job.


11 posted on 06/23/2014 12:37:30 PM PDT by kidd
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To: SeekAndFind

No one got a 3% raise this year where I work. A few of us got 2.5%.

No. This isn’t amusing. Not in the slightest.


12 posted on 06/23/2014 12:38:12 PM PDT by Dead Corpse (Tri nornar eg bir. Binde til rota...)
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To: jeffc

It is if you leave out gasoline, utilities, food, entertainment, and automobiles.


13 posted on 06/23/2014 12:41:43 PM PDT by Blood of Tyrants (Haven't you lost enough freedoms? Support an end to the WOD now.)
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To: pas
If you hop every 2 years, you will soon be unemployable.

lack of commitment = gubmint sistance

14 posted on 06/23/2014 12:42:00 PM PDT by showme_the_Glory (#DELETE *.* GOV)
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To: SeekAndFind
There is an old saying...

There is a big difference between 10 years of experience, and 1 year of experience 10 times.

What is not factored into the equation is the value of your personal network that gets developed over time. You establish a reputation when you are a long-timer at a significant company. You learn how the organization works, and if the company is large enough, how the entire enterprise works.

Nobody can do that in a series of 1-2 year hops.

-PJ

15 posted on 06/23/2014 12:48:10 PM PDT by Political Junkie Too (If you are the Posterity of We the People, then you are a Natural Born Citizen.)
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To: SeekAndFind
"But, the inflation rate is currently 2.1% calculated based on the Consumer Price Index published by the Bureau of Labor Statistics."

Man, has this guy been brain washed or what? What freaking planet has he been living on?
Get a brain and get out the house once in a while Cameron King!

16 posted on 06/23/2014 12:53:24 PM PDT by StormEye
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To: the_boy_who_got_lost

The worst thing a software guy can do is become the world’s authority in a technology only one company in the world cares about.


17 posted on 06/23/2014 12:54:49 PM PDT by DManA
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To: SeekAndFind

If these raise percentages cited apply to both public-sector, and private-sector jobs, then it looks like the private sector is not giving raises at all. ?


18 posted on 06/23/2014 12:57:17 PM PDT by NEMDF
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To: Dead Corpse

I believe that no one where I work has gotten a raise in the past 3 to 4 years.


19 posted on 06/23/2014 12:58:52 PM PDT by NEMDF
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To: jeffc

I read that if food and fuel were added back into the calculations for the CPI, inflation would be well over 10-12%. Can’t find that now.


20 posted on 06/23/2014 12:59:11 PM PDT by carriage_hill (Peace is that brief glorious moment in history, when everybody stands around reloading.)
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To: SeekAndFind

Hubby got a letter from the company at the end of 2013 that there would be no raises for any employee during 2014. As a digital design engineer he could make more money someplace else, but he’s relatively happy where he is, so he stays. Started with the company September 10, 2001.


21 posted on 06/23/2014 12:59:19 PM PDT by Roos_Girl (The world is full of educated derelicts. - Calvin Coolidge)
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To: SeekAndFind

A lot of the comments here will be totally invalid in 5-10 years. Companies don’t want permanent employees. They want temps, contractors, etc to do a specific piece of work then leave.


22 posted on 06/23/2014 1:00:16 PM PDT by DManA
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To: driftdiver
Our economy does not reward longevity.

An argument could be made it rewards longevity too much. It forces businesses to lay off older workers when they are paid much more than younger workers of comparable contribution. There are many exceptions but in general pay should actually start declining at some point to track output.

23 posted on 06/23/2014 1:06:29 PM PDT by Reeses
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To: SeekAndFind

The old rule of thumb was that you should stay with your new company twice as long as you were at your old company.


24 posted on 06/23/2014 1:09:03 PM PDT by Andy from Chapel Hill
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To: pas
Maybe now but in the 80’s and early 90’s I job hopped in Silicon Valley often for a 10% jump in pay. Actively recruited and chased by many companies, they made it too hard not to jump. Two years was an eternity.
25 posted on 06/23/2014 1:09:09 PM PDT by mad_as_he$$
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To: jeffc

Well, somewhere between 2.1 and 21.0, I think.


26 posted on 06/23/2014 1:16:40 PM PDT by RipSawyer (May the force be with you against the farce.)
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To: SeekAndFind
In my 30 years of working for someone other than myself, I changed jobs twice (once because I didn't want to relocate when the company moved to another city, and the other time because I got engaged to someone across the country).

Both times I took a hefty pay cut to make the change... but more than caught back up after a few years with my new employer.

So, I think performance has a lot to do with it.

27 posted on 06/23/2014 1:19:12 PM PDT by Cementjungle
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To: kidd

I have known printers who were fired because they could not do work that was beyond the capabilities of the equipment that their idiot bosses insisted they do it with. It was like demanding that someone haul five tons on a half ton pickup truck. At times I took trouble calls on new machines and found that the only trouble was that the equipment, which was new, was not built to do what the customer was trying to do and I was told that the salesman who sold it said that it would do it.


28 posted on 06/23/2014 1:25:11 PM PDT by RipSawyer (May the force be with you against the farce.)
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To: SeekAndFind

That is in a growing economy, and applies most to people in the very earliest part of their career.

For established workers in a contracting economy, keeping your job is task #1.


29 posted on 06/23/2014 1:25:25 PM PDT by Born to Conserve
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To: Vigilanteman
During the worst of the Obama recession, some friends and I put together a serious proposal to rent some of the glut of vacant office space and charge people a nominal fee to work for us so they would have the prestige of a job and an office cube from which to be recruited.

We debated about the deception such a plan would entail and, in the end, decided not to go forward with it for that reason.

Similar plans have been discussed among IT forums since the beginning of the H1B slaughter took off after Y2K.

There is nothing deceptive about a trade association, or a consortium, or free-lancers sharing office space, or even sharing virtual office space for zilch.

What is deceptive and economically destructive is the practice of IT recuiting (or third-party recruiting or staffing in any industry) for dozens of different reasons.

30 posted on 06/23/2014 1:43:08 PM PDT by meadsjn
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To: SeekAndFind

Not true at the place where I’m in my 36th year.


31 posted on 06/23/2014 2:06:43 PM PDT by G Larry (Which of Obama's policies do you think I'd support if he were white?)
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To: CodeToad

Maybe at a low skill job. People in my field are still fairly useless after 2 years. 5 years is a minimum to be competent, and if you moved up after 5 years, your career would be in the hands of the guys that that actually know what they’re doing.


32 posted on 06/23/2014 2:19:17 PM PDT by OA5599
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To: meadsjn

That was my argument but I got outvoted.


33 posted on 06/23/2014 2:37:10 PM PDT by Vigilanteman (Obama: Fake black man. Fake Messiah. Fake American. How many fakes can you fit in one Zer0?)
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To: jeffc

A pound of Oscar Mayer sliced sandwich meat went up $.50 last week.


34 posted on 06/23/2014 5:11:55 PM PDT by Tax-chick ("Cynicism is a far greater spiritual danger than naivete." ~ Stephen Webb)
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To: SeekAndFind

Last place I worked at,we got no raises at all for about the last 10 yrs.


35 posted on 06/23/2014 5:29:50 PM PDT by oldtech
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To: DManA

That’s more of an indicator of the economy than anything else. Temporary/indirect arrangements don’t allow for much long-term planning and disincentivize offers based on competitive advantage. More permanent/direct arrangements, in general, resolve these issues while starting with a higher level of trust of the person doing the work.


36 posted on 06/23/2014 10:20:54 PM PDT by setha (It is past time for the United States to take back what the world took away.)
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To: DManA
A lot of the comments here will be totally invalid in 5-10 years. Companies don’t want permanent employees. They want temps, contractors, etc to do a specific piece of work then leave.

If I was 23 and not 63, I think I would buy a nice camper and just go wherever the best jobs were. With computers and cellphones, one can stay linked to people who matter, all while not spending money on Stuff that doesn't really matter.

Yes, it may sound bleak, but I've put up with enough job lunacy that becoming a job nomad sounds good.

Companies don't want long-timers. In technical fields, this is deadly, letting expertise waltz out the door, sometimes to a competitor. Curiously, they still expect loyalty.
37 posted on 06/23/2014 10:36:13 PM PDT by Nepeta
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To: Nepeta

Many employees today are part-time or temporary. What I have noted is Management continues to see them in the same light they would a full-time employee. Companies have failed terribly in that respect.

As we know how an employee sees full-time work verses part-time is vastly different. Management however has not changed their approach with the change of the workforce.

We just had 5 employees give notice....a new Manager, who obviously does not know how to manage a workforce, was all they needed to walk. Intimidating employees never works but if they’re part-time they’ll simply walk....a full-time worker would be more inclined to wait and see.


38 posted on 06/23/2014 10:48:32 PM PDT by caww
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To: SeekAndFind

After reading all the comments, I’m extra glad that I’m not in the rat race anymore.

Retired in 1999 and have loved every minute of it.


39 posted on 06/23/2014 10:55:46 PM PDT by Graybeard58 (If any man love not the Lord Jesus Christ, let him be Anathema Maranatha. 1 Cor 16: 32)
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To: Graybeard58
I've had a change in outlook toward the workplace environment. in general. I will put out exactly what they pay me for. If they want the use of my ‘additional skills’ I bring with me then pay for them!

I recently watched a woman assume the managerial duties of our department....the more she took on the more the rightful dept manger handed her.....and this without compensation. This went on for about a year.....she gave notice this week.

I have well noted that in today's workforce exceeding your responsibilities is rarely going to advance you in any measure....but it wasn't this way before companies determined it was cheaper for them to roll employees.

40 posted on 06/23/2014 11:07:19 PM PDT by caww
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To: caww
Many employees today are part-time or temporary. What I have noted is Management continues to see them in the same light they would a full-time employee. Companies have failed terribly in that respect.

People are not interchangeable. Character counts. In some companies, nobody much cares about the quality of the product going out the door, and they actually coerce employees to pass product with substandard quality. I knew an outfit that claimed cGMP compliance that would re-run analyses 15 times to finally get one that would pass. Testing into compliance...is fraudulent.

Some people will cave to pressure, some will not.

I watched a guy who was responsible for flashpoint test of reaction vessel rinsings. Most of the other technicians required about 4 dilutions to read the point where the organics could go down the sewers without being a fire hazards, but David's samples ALWAYS passed on the first try! Some dark night, the sewers of Dayton will explode.

Character, reliability, honesty, knowledge...it all counts.
41 posted on 06/24/2014 12:09:48 AM PDT by Nepeta
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To: setha

I don’t think it’s a workable model. I think they are being pushed into it by the idiotic policies of the Federal Government. Just one more of the “unintended consequences”.


42 posted on 06/24/2014 7:16:40 AM PDT by DManA
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To: carriage_hill

Shadowstats is worthwhile. They put things in the 5-6% range.

http://www.shadowstats.com/alternate_data/inflation-charts


43 posted on 06/24/2014 7:20:00 AM PDT by FreedomPoster (Islam delenda est)
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To: Nepeta
Even after they fire you.

Curiously, they still expect loyalty.

You're fired. We'll give you some money if you sign this 10 year non-compete contract.

44 posted on 06/24/2014 7:20:01 AM PDT by DManA
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To: FreedomPoster

Thanks.


45 posted on 06/24/2014 9:16:38 AM PDT by carriage_hill (Peace is that brief glorious moment in history, when everybody stands around reloading.)
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To: DManA
Right. It's utter B.S. I stayed at a consulting firm for a whopping three months before I decided I wanted to get out of that corporate, political environment. They expect you to have loyalty but don't really care about you beyond your being a cog in the machine. I was reading another article about this same thing, and they recommended using other job offers to negotiate a higher salary at your current job. But that's a terrible idea--and for precisely the reason you mentioned: they want loyalty, NOT people looking to change jobs every single year. If you're going to leave (and you should if your workplace sucks), just go, man.
46 posted on 10/28/2014 1:40:34 PM PDT by soupertramp
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