Salary Is the #6 Reason People Stay

Here’s something that surprises people: salary is the number six reason people stay at a company. The top five have nothing to do with money.

So why am I writing about compensation? Because while pay may not be what keeps someone, being underpaid is absolutely what makes them go.

Pay at or Above Market. Full Stop.

Let’s say you feel like you’re getting a deal on Bob, because Bob makes less than market rate for his accounting role.

Here’s what happens: Bob finds out. He always finds out. And if you don’t correct it, he leaves. You probably won’t see it coming until the resignation letter is on your desk.

That’s not a deal. That’s a countdown.

The other thing that has changed: we used to tell clients to run market studies every three years. Now I’d say every three months. The market moves that quickly, and a number that was competitive last quarter may not be today.

When we place someone, we run a market rate study for you. For our ongoing clients, we’ll do that across all your positions so you know exactly where you stand.

Benefits Matter to 70% of Workers

Benefits matter to about 70% of the workforce. Which means roughly 30% — often second wage earners covered on a spouse’s plan — don’t need them.

Do the math on that. If you don’t offer benefits, your candidate pool is 30% of what it could be.

I understand benefits are expensive, and plenty of small companies genuinely can’t carry them yet. That is a real constraint. Just go in with clear eyes about what it costs you on the hiring side, and weigh it deliberately.

Three to Four Weeks of PTO Is the New Normal

Here’s a shift that would have been unthinkable 20 years ago, when pay was everything and vacation was an afterthought: a lot of people now — especially younger employees — are more interested in time off than additional pay.

The majority of newer companies offer three to four weeks of PTO a year. That is what candidates are looking for.

So if you’re still offering 10 days, I’d reconsider. It may be quietly costing you the ability to compete for talent, and you’d never know it — candidates don’t usually tell you why they took the other offer.

The Bottom Line

Compensation isn’t what makes someone love working for you. But your people need to know their pay, benefits, and time off are enough — and that you value them enough to get it right.

Get compensation to a place where it isn’t the reason anyone leaves. Then the top five reasons are what you get to compete on.

Not sure whether your pay and PTO are actually competitive? Grab a free 30-minute session with one of our HR experts, and let’s take a look.