Employers: It’s time to pay attention to your underpaid staff! Employees are ‘willing to walk’ as the path to more money may finally be here!
Yes, I believe both employers and employees are aware that the economy is improving, with GDP growth increasing and the unemployment rate falling. And, while things for the average American could still be better, it seems that there are some signs that these improvements will soon begin to translate to positive changes in the salaries of the middle class.
One significant piece of evidence that salaries are poised to improve is the number of people willing to say goodbye to their current employer. A recent survey from Glassdoor.com showed that 35% of workers said they’d look for a new job in 2015 if they don’t receive a pay increase from their current employer. And while those under 35 and those making less than $50,000 are more inclined to leave their jobs, they aren’t the only ones open to changing the way they think about their salary in 2015. The survey also found that 31% of those making over $100,000 per year would look elsewhere for work if they don’t get a raise, along with 36% of those between the ages of 35 and 44. Those are substantial numbers that would have been unthinkable during the Great Recession!
What exactly does all this mean? Well for one, many of those people who will move on if they don’t get a raise will not actually have to quit, as nearly half of those in the survey also said they expect a 3-5% pay increase this year. But if they do choose to leave, they are more confident in doing so in 2015 as nearly half of those surveyed feel they could find equal or better employment within six months, which is the highest level of employee confidence since 2009. Add in the fact that in 2015 nearly 60% of employers expect to increase hiring and it seems clear that not only will more people be hired this year, but also those who are already employed will have more salary leverage than they have had in a long time!
How should employees handle this positive information? I suggest that if you have had a stagnant pay rate for many years, 2015 may be the time to have the ‘raise conversation’ with your boss. Pick the right moment though, and broach the subject in a thoughtful and non-confrontational way. Don’t just say, “I need a raise or I am out of here!” If your company had a strong quarter, or there is new hiring happening, this probably means your company is in a position to invest more in their employees. Do not be afraid to ask your boss what plans are being made for reviews and/or raises in 2015. Be sure to express your interest in “moving forward” with the company, and give them some time to respond before seriously engaging in a search to find a new position.
And employers, if you do not respond to this approach, or you refuse to have a meaningful conversation with your employees about a raise within a reasonable period of time, then you can be certain your most valuable people will begin to look at what their options are at other companies!
Each situation between employers and employees and their salaries, now and future, is unique; there are no blanket rules or strategies I can cite, but it’s clear that if you – the employee – have been thinking about asking for a raise or changing jobs, the positive improvements as of late have given you the most leverage and opportunity that has existed in years!
Not all employers are going to offer raises on their own; often the employee will still need to ask, but this is not a conversation to be afraid of anymore. And if current employers won’t ‘play ball’, good employees should join the trend and consider ‘walking away’ in 2015, because they will not be alone!
Karen Rae Horwitz
Karen Rae is President of JobGiraffe, formerly Paige Personnel Services, where she has guided her company through up and down economies for more than 20 years, advising both employers and job seekers on employment trends and challenges, and the strategies to meet them. She can be reached at KRH@JobGiraffe.com.