Ninety-three percent of professionals are willing to leave jobs for a salary increase of 10 percent or more - report
Employers giving pay increases just to keep up with cost of living may end up losing employees to other firms offering higher pay for the same positions, finds research from Robert Walters, an international specialist professional recruitment group.
The Robert Walters annual Salary Survey Guide 2024 shows the top reason for pay rises has been to support employees with the cost of living (67 percent). The average increase is only 3.5-4 percent, however – barely enough to keep up with inflation or the rising cost of living.
The survey also finds that 81 percent of professionals in Canada say they will be seeking a new role this year – with the leading reason being for better pay. In fact, professionals moving to a new company can secure a 15 percent increase, for the same role that they currently do. On average, a professional can secure a 10-15 percent pay increase for the same job role in a different company – with this increasing to as much as 20 percent for in-demand roles or scarce talent.
The 2024 salary guide highlights a pressing concern: the average pay increase of 3.5-4 percent barely edges past Canada's latest inflation rate of 3.1 percent. These findings underline a stark reality – despite pay rises, employees won't significantly improve their financial standing by sticking it out in their current roles. As a result, the most viable path to securing a higher salary in the upcoming year for many involves switching jobs.
Compensation top priority for employees
“Combining this data with the fact that two thirds of professionals (63 percent) prioritize compensation over anything else – including career growth, a change in profession, or even conflicts with management – we can expect to see an imminent shift in the job market in the new year,” says Martin Fox, managing director of Robert Walters Canada.
“This is a wake-up call for employers in that they need to be proactive and responsive to the changing needs and expectations of their employees to retain them. Employees are showing a high level of dissatisfaction. The research emphasizes how vital it is for employers to conduct thorough market research.”
Fox says employers need to be aware of inflationary concerns and ensure their compensation strategies remain competitive and well adjusted to the economic conditions.
“Employers also have to be aware of the attraction of opportunities with competitors. The survey indicates that professionals are increasingly open to leaving their current organization for a salary increase. In fact, 93 percent of professionals expressed openness to leave for a salary increase of 10 percent or more. So, employers need to evaluate their compensation packages to retain talent. This can be done through regular market research and benchmarking.”
He adds that compensation is not just about pay. “Employers need to offer a robust benefits package that is tailored to the needs of their people and workplace culture. As well, open communication and a proactive approach is crucial.
To help counter the concerns about pay raises, many employers have increased investment back into workplace culture, the office interior, and benefits, says the report.
On average employers are spending around 20-30 percent of an employee’s total salary on benefits. Wellbeing remains a top priority, with 46 percent of professionals willing to stick to a lower-paying job if it offers a better workplace culture, rather than switching jobs solely for better pay.