Why employee loyalty can be overrated
Job interviews are an opportunity to see allegiances shift in real time. A candidate will usually refer to a prospective employer as “you” at the start of an interview (“What do you want to see from someone in this position?”). But occasionally the pronoun changes (“We should be thinking more about our approach to below-the-line marketing. Sorry, I mean ‘you’ should be”). That “we” is a tiny, time-travelling glimpse of someone imagining themselves as the employee of a new company, of a fresh identity being forged and of loyalties being transferred.
Loyalty is seen as a virtue in most situations: among friends, family and football fans. Employee loyalty, however, is more complex. It is more transactional. Friends don’t give each other performance reviews or fire each other for cost reasons. It is less reciprocal. A worker can feel attachment to a company and a company can feel precisely nothing. (Which is why people often feel more loyal to team members and individual bosses than to their organisations.) And too much of it can impose high costs.
Wage bumps and careers are built on people changing jobs. According to the Federal Reserve Bank of Atlanta, which tracks wage growth in America, in April job switchers were being paid 7.6% more than a year earlier; job stickers were being paid only 5.6% more. A little promiscuity on the part of other people can help those who choose to stay where they are. A paper by Nathan Deutscher, a Treasury official in Australia, found that higher rates of job-hopping in local Australian labour markets were associated with faster wage growth both for workers who switched jobs and for those who did not. Loyalty is nice; so is bargaining power.
2023-06-08 08:48:58
Article from www.economist.com