Raises also getting 25% smaller, survey says
Two in five salaried employees didn't get raises in the past year, putting retention at risk as majority of employees are considering changing employers for higher pay.
A survey by BambooHR among 1,500 respondents revealed that the number of employees who didn't get a raise went up to 41% in 2023, higher than the 33% recorded in the previous year.
"For the second year in a row, our study uncovered that employees feel they aren't getting paid enough," said Anita Grantham, Head of HR at BambooHR, in a statement.
Among those who received a raise, they reported that it was also 25% smaller than the amount they previously got from their employer.
Leaving for higher paycheck
The findings come as nearly three in four (73%) respondents admitted that they would consider leaving their current job for a higher paycheck.
In fact, the number of employees who have thought about leaving their company in the last six months to find better compensation increased to 48% in 2023, up from the 41% a year ago.
The findings could indicate a growing level of salary dissatisfaction among employees, with 27% of women and 15% of men expressing frustration with their compensation.
Despite the growing level of dissatisfaction, 58% of employees said they are still content or happy with their current financial compensation.
According to the respondents, it would take a 13.3% pay hike to make them consider leaving their current employer. But this is much lower than the 16.1% pay hike in 2022 that would tempt them away.
"It's crucial for employers to understand these trends to focus on next steps to improve employee engagement and overall retention," Grantham said.
Role of benefits
Meanwhile, more than half (56%) of employees said their employers have introduced new or improved benefits in their organisations.
Experts have long advised that non-monetary benefits could be offered in lieu of salary hikes to boost employee experience retention across organisations.
Only 26% said their benefits have been removed or reduced - with 50% of all respondents saying that employers who can't provide essential benefits should compensate their workers more.
Jeff Ostermann, chief people officer at music outlet giant Sweetwater, previously cautioned employers against cutting benefits in the wake of heightened economic pressures.
"Employers that move to quickly cut benefits may be trading short-term financial relief for longer-term decreases in employee engagement, goodwill and productivity," Ostermann previously told HRD.
"Employees who begin to doubt their employer's support of them may be the first to look elsewhere when a rebound occurs, and other job opportunities present themselves."
