Forget career loyalty, moving on is the way to better pay

EMPLOYEES who remain loyal in their jobs receive smaller pay rises than those who show disloyalty by moving on, a report has found.

It appears workers who move jobs benefit from a “disloyalty bonus” that awards them higher pay increases than those who remain faithful to their bosses and choose to stay put.

Research conducted by the Resolution Foundation found that, for the first time in more than a decade, pay growth hit 10 per cent for those switching jobs.

By contrast, workers who remained in their posts last year received a pay rise of just 2.5 per cent, said the think tank that campaigns to improve the standard of living for families with low to middle incomes.

Nominal pay growth for people who moved jobs in the past year hit 11 per cent in early 2018, its highest level since the early 2000s, said the report.

Stephen Clarke, senior economic analyst at the Resolution Foundation, said: “As the Bank of England decides whether or not to raise interest rates, the evidence on the key issue of pay pressure is decidedly mixed.

“For those moving jobs, pay growth has hit 10 per cent for the first time in over a decade.

However, for the vast majority of workers who didn’t move jobs in the last year, pay is still struggling along at just 2.5 per cent – barely higher than inflation.

“Despite this growing ‘disloyalty bonus’, young workers in particular seem reluctant to make the move.

“While overall pay growth remains weak, interest rate hawks may take the view that, bad as it is, this is still as good as it gets. Those holding off on rate rises may take the view, however, that recent small upticks in pay pressure mean that things can only get better.”