Hello, and welcome to Financial Face-off, a MarketWatch column where we help you assess your financial decisions. Our columnist will give his verdict. Tell us if you think you’re right in the comments. And please share your suggestions for future financial face-to-face columns.
The job market is hot and so are salaries. People leave work in record numbers, often because they have gotten a new concert at a better salary. About 40% of people who have changed jobs said they got a 10% or more increase in their new business, an April survey by tax advisory firm Grant Thornton found. Meanwhile, salaries are generally rising as employers seek to attract talent, and new state and local laws require companies to be more transparent about salaries.
This whole talk can make you think about your own salary and whether you should ask for a raise or try to find a new job with a higher salary. You may be wondering how your pay compares to your co-workers. One way to research is to share your salary information with your colleagues.
So, should you tell your co-workers how much money you make?
Why it matters
Information is power, and when it comes to salaries, having more information can help you make sure you get paid fairly.
If you are a woman or a person of color, statistics suggest that you are unlikely to make as much money in your lifetime as a white man. Long-standing gender and racial wage gaps are fueled by a number of factors, such as discrimination, occupational segregation (where certain groups are overrepresented in lower-wage, low-income fields), and the fact that women often they leave the labor force or work fewer hours than men, therefore. they can take on care tasks.
Some companies have pledged to conduct pay equity audits in the wake of the 2020 protests against racial injustice, but some have dragged their feet to make payroll information more public.
There are indications that younger workers are beginning to ignore the workplace taboo on talking about pay. Nearly 42% of Generation Z workers (ages 18 to 25) and 40% of millennials (ages 26 to 41) “have shared their salary information with a co-worker or other professional contact.” compared to 31% of Generation X (42 to 42 years). 57) and 19% of baby boomers (aged 58 to 76) found a national Bankrate survey in March.
However, wage transparency remains the exception, not the rule.
“From now on, wage transparency mandates in the United States vary from state to state, and a large majority of the public sector is missing or often misunderstood,” said Scott Bonneau, vice president of Global Talent. Attraction to the job search site. Indeed.
“In fact, the secret about wages is so embedded in the national psyche that most employees don’t discuss their salaries with co-workers,” Bonneau added. “The open discussion on pay is protected by law, but 63% of people have never asked a co-worker about their pay, according to a recent survey by Indeed.”
Yes, share your salary information, but only if you can answer yes to these statements:
1) I have a productive reason to want to share my salary information with my co-worker. (If you do it to brag or complain, don’t do it).
2) If I find that a co-worker with similar work experience and work earns more money than I do, I have a plan for what I will do with this information and I am in a position to make a positive change for myself. (Having information and being powerless to use it is not helpful. If you want to increase this, make sure you have improved your trading skills and researched compensation for your position in other companies.)
3) Finding out that a co-worker with a comparable resume earns more or less money will not affect my ability to work with that person. (If you know that your employment relationship can’t support this disclosure, it’s best not to risk it).
Keep in mind that pay transparency between co-workers is a different animal from pay transparency during the hiring process. During the hiring process, knowing exactly how much a position pays can prevent applicants from wasting their own time and employers ’time, because they won’t apply for jobs that don’t fit their salary needs, he says. Charles Lehman, labor economist. and board member of the National Career Development Association.
“The more information you can share, the better the job market works,” Lehman said. However, once you’re in an organization, talking openly about payment can, at worst, cause jealousy, hurt feelings, and lose team morale.
On the other hand, trusting a coworker can build trust and even reduce competition, which can free up employees to focus on achieving the external goals of companies rather than wasting energy on wondering what they earn their office mates.
“Sharing pay can build that equitable culture, and it can be hard to have it when everyone is hiding what they do,” said Marie Zimenoff, CEO of Career Thought Leaders, an organization that trains professional trainers and other industry professionals.
You can love your job and you can love your boss, but your job will never love you. A company may say it treats its employees as a family, but companies exist to make money, point by point. There may be times when you need to defend yourself and make sure your business pays you fairly. Sharing salary information can have implications not only for you, but for the entire organization.
“What organizations say they can afford and what they pay for may be different,” said Shelley Piedmont, career coach at Career GPS, LLC. “By sharing your salary (and other negotiated compensation), you are helping yourself and your colleagues, especially women and people of color, to better understand the organization’s salary dynamics and to better defend yourself.”
Is my verdict the best for you?
This is a personal decision and should not be taken lightly. You may be surprised to find that you feel more excited than expected if you start researching co-workers’ salaries.
Too, “[k]Please note that some companies prohibit talking about payment during business hours or while using company devices, so be sure to check your company’s policy to protect yourself when talking about salaries with co-workers. Bonneau said.
Carefully consider your relationship with the partner with whom you are considering sharing salary information. Research suggests that there are different outcomes, sometimes detrimental, depending on whether employees learn salary information “vertically” (when employees learn their managers ’salaries) or“ horizontally ”(when we learn our colleagues’ salaries).
Don’t follow this path if you’re being pressured by a co-worker or if you’re missing out on the broader context of how compensation works in your organization. It’s not just about wages: some companies reward workers with cash bonuses, overtime, flexible hours, and other less tangible benefits.
Case in point: Grant Thornton’s survey of job changers I mentioned earlier found that in addition to a better salary, workers also took on new jobs because they offered a better work-life balance. family life, opportunities for advancement, benefits and greater autonomy. More than a third (34%) “said their new job offered a better ability to balance work and personal commitments,” according to Grant Thornton.
“[S]obtaining salary information usually works best when it is treated as an exercise in gathering information; The biggest benefit for everyone comes from understanding how your work is valued in the marketplace, “said Bonneau.” However, it is easy to become a comparative or competitive exercise, which can undermine the confidence needed to people feel safe choosing to share this information “.
One final note: it’s okay to challenge workplace rules now at a time when employees are in high demand and, in theory, have mastery of management. But there are also times when you can’t afford to risk losing your job and pay, and maintaining that security can be more important than pouring beans on your paycheck.
Tell us in the comments what option you should win in this financial confrontation. If you have any ideas for future financial face-to-face columns, please email me.