Changing jobs frequently can leave you with lower pay cheques
Job-hopping might be a common career strategy for modern day young professionals, but the trend results in lower pay cheques for the workers. Biz week in pics
By Agencies |
WASHINGTON: Job-hopping might be a common career strategy for modern day young professionals, but the trend results in lower pay cheques for the workers, according to a new study.
Researchers at the University of British Columbia have shown that workers who frequently change employers end up earning less than their more stable counterparts.
To find out the effect of career mobility on worker's wages, sociologist Sylvia Fuller of the University of British Columbia looked at data from the 1979 National Longitudinal Survey of Youth, following almost 6,000 workers during their first 12 years in the labour market.
"The past 30 years have seen the erosion of long-term employment, and young people are increasingly told to expect ongoing employer changes throughout their careers," said Fuller.
"However, this research examines the cumulative changes workers make, or are forced to make, and demonstrates that these career moves may not always result in higher earnings," she added.
The researchers showed that by and large any benefits of job mobility accrue mainly in a worker's early career.
Researchers at the University of British Columbia have shown that workers who frequently change employers end up earning less than their more stable counterparts.
To find out the effect of career mobility on worker's wages, sociologist Sylvia Fuller of the University of British Columbia looked at data from the 1979 National Longitudinal Survey of Youth, following almost 6,000 workers during their first 12 years in the labour market.
"The past 30 years have seen the erosion of long-term employment, and young people are increasingly told to expect ongoing employer changes throughout their careers," said Fuller.
"However, this research examines the cumulative changes workers make, or are forced to make, and demonstrates that these career moves may not always result in higher earnings," she added.
The researchers showed that by and large any benefits of job mobility accrue mainly in a worker's early career.
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Fuller and colleagues found that both men and women typically experience considerable mobility during their early careers, although women change employers somewhat less frequently than men.
The study also indicated that mobility can be a wage asset when it is concentrated in the early years of employment and not coupled with layoffs, discharges, employment gaps or family-related leave.
In this case, moderate or even high levels of mobility can lead to equal or better wage outcomes than stability.
Aside from this exception, Fuller found that wage outcomes worsen as mobility rises.
She said that one reason for lower wage trajectories among high-mobility workers is their failure to amass valuable early tenure associated with staying up to five years with an employer. In the first five years of a job, each year of tenure is associated with approximately 2.4 percent higher wages for men and 2.9 percent higher wages for women. However, after five years with an employer, women's gains from tenure plateau and men's begin to erode.
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Fuller also found that high-mobility workers tend to spend a greater proportion of time not employed and, all else being equal, a greater proportion of their job changes are the result of layoffs. The team also discovered that men are laid off or discharged more frequently than women, yet they leave jobs for family reasons less often.
In addition to the negative consequences of unemployment, Fuller noted stigmas associated with discharges for both genders, and for family-related job separations for women.
The study is published in the February issue of the American Sociological Review, the flagship journal of the American Sociological Association.
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