In today’s unstable economy, nearly three-quarters of Americans struggle to make ends meet as inflation far outpaces raises and bonuses. Against this backdrop, compensation has arisen as the paramount concern for job seekers, eclipsing career growth and work-life balance, which had remained top priorities for the past six years, according to a recent Achievers Workforce Institute (AWI) report, which aims to identify data-driven insights, including job hunting motivators.
However, this increased focus on compensation comes with friction as companies struggle to retain their top talent in a time of decreased budgets and limited resources. Amidst this economic turmoil and shifting employee priorities, the job market stands at a crossroads, teetering on the brink of another transformative moment. It’s time for employees to lean into the opportunities presenting themselves and reimagine what work means for them.
A ‘Great Reimagination’
The findings from the AWI report, which was based on a survey in November 2023 of 3,800 employees and 1,450 HR professionals from Australia, Canada, the U.K., and the U.S., paint a stark picture of the challenges facing the modern workforce. A staggering 65% of employees still have one foot out the door, leaving only a mere 35% sure they will stay at their current job for the entirety of 2024. Does that sound familiar?
While compensation might be the biggest driving factor motivating employees to job hunt right now, stability, flexibility, belonging, and fulfillment still heavily influence retention. Maybe that sounds familiar, too?
What would it take to recruit or retain you?
Data shows that higher salaries do in fact retain employees. For example, employees who are able to live comfortably on their current salary are almost twice as likely to have a strong sense of belonging at work than those who are struggling to meet day-to-day expenses.
However, while job hunters hope for greener grass on the other side, economic constraints continue to hold businesses back from meeting these business and employee demands. As these issues continue to mount, we’re seeing mass layoffs, budget cuts, and consolidations, and what that means for employees is that they will likely start to see companies get more creative in alternative means of compensation.
For example, forward-thinking companies will start to include intangible benefits like recognition, professional development opportunities, and cultural alignment as part of their total compensation package. These intangible benefits are part of an emotional salary, the non-economic compensation that combines with a monetary salary to ensure fulfillment at work.
While technically these benefits are intangible, their benefit is not. An emotional salary can lead to an increased sense of belonging, esteem, and self-actualization at work. In fact, when surveyed, employees who receive salaries below the local market rate but that were recognized at least monthly by managers and colleagues were 33% more likely to say they are not planning to job hunt in 2024, showing intangible benefits with a truly tangible impact on attrition costs.
What needs to happen
While traditional forms of compensation remain important amidst economic challenges, intangible benefits like job stability, belonging, and resilience are invaluable.
Just as they would with salary at a new job, employees and job seekers should advocate for and negotiate intangible benefits as part of their compensation packages, especially as companies reduce bonuses. By recognizing the value of intangible currency, employees can feel empowered to navigate the job market or renegotiate their contracts with confidence and resilience.
It’s unclear what 2024 will hold for the job market. However, it’s important to emphasize that compensation extends beyond mere dollars and cents. By embracing the intangible imperative, employees and employers can chart a course together toward greater resilience, fulfillment, and prosperity.
Hannah Yardley is the chief people and culture officer at Achievers.
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