One trend among millennial’s these days is something called “job hopping”.
Maybe you’ve heard of it. Essentially it’s when workers find a job, stay for a short amount of time (usually 1-2 years) then “hop” to another job.
It usually makes sense for those people who are in search of a quick path to a higher salary.
Studies back this up, showing that workers who left their jobs for a new one, generally saw their wages increase more than those that stayed.
It is likely favored more among millennial workers due to one big factor: pensions (or a lack thereof).
Gone are the days where companies offered pensions to employees where the longer you stayed, the higher the ultimate payout was.
This huge benefit was a major reason why many in older generations stayed with the same company for a long period, or sometimes their entire careers. (My dad has worked at the same company for 30+ years, though strangely enough he does not actually have a pension…)
Without pensions tying workers to the same company, there’s been less of a reason for employees to stay, especially if the wage growth isn’t as quick as many would like.
My own company has a pension plan, however, it is only for those grandfathered in. Employees hired in the last decade do not get access to it… Bummer!
Job hopping isn’t for everyone though.
There are several benefits of staying with your company that can be just as good for your career in the short and long term.
Clear Growth Path
When you stay with the same company for a longer term, you can often see a clear growth path. It may be tougher to see at smaller companies, but it’s doubly true if you work for a large company.
The people who stay longer will usually have seniority there, simply because they know how the company runs, the processes and procedures and likely have a wide array of experience to dole out to new comers.
With this natural progression, you can essentially plan out several years in advance exactly what roles, skills and experiences you need to learn and develop to get to where you want to be.
Typically (hopefully?) you’ll have a mentor or several within the company, to help give you honest feedback along the way, and help you to get to the position you want to end up in.
To be clear, you can still do all this while job hopping, it will likely just be harder. Finding a new job is a very time intensive process. To do this every year or two can be a huge drag on your mental capacity and take time away from learning other skills that could help out your career.
It can also be tougher to know exactly what your future growth path will be. Sure you can naturally figure that out depending on your profession, but your success is dictated on what jobs are available, and who is offering them.
Another huge benefit to staying at the same company is stability. Now, obviously, you’ll need to tailor this one to your own situation. If you work for a failing company (Sears anyone?), this is anything but stable.
Make sure you stay aware of how your company is performing to be sure you aren’t riding the Titanic into the sea.
That being said, for most financially healthy companies stability is a big perk. You know that your job will be there, you know the management, coworkers, customers (potentially), all leading to one less massive thing for you to worry about.
In the chance of a recession, job stability at any company may be perilous. Some are saying we’ll have one soon, (if you know exactly when, be sure to let me know 😉 ).
When it does inevitably happen, and job cuts occur, who do you think a company will let go of first?
The person they know is a good employee they can rely on who contributes and has gotten things done consistently over a long period? Or the newcomer they just recently hired and have little to no information on?
During times of an economic slow down, it could be beneficial to opt for stability instead of job hopping.
With pensions a thing of the past, many companies have turned to other forms of compensation to entice employees to stay for certain periods.
One way they do this is through their retirement funding. Specifically through the employer match of a 401k. Many employers that offer a 401k will also offer a “match”. This means they will match a percentage (I’ve seen anywhere from 1%-10%) of your own contributions that you put into the 401k.
If you aren’t already, make sure you are contributing this at the minimum! This is free money people!
However, some companies are tricky. To entice employees to stay longer, some employer contributions will have a “vesting period”. This means that if you leave before the vesting period is completed, you actually will not receive that match.
Vesting periods can be anywhere from 1-5 years.
To give an example, a company may match your 401k contributions by 5%. However, for that match to vest you need to stay for 3 years.
If you decide to job hop and leave before 3 years at the same company, you would not receive any of the match you’d been getting since you started there.
This can sometimes be significant money that people miss out on. In that above example, say you made $50,000. A 5% match would equal $2,500/year. If you worked two years at the company then left, you’re leaving $5,000 on the table, of pre-tax money.
Doing this early in your career you’d also miss out on all the compounding returns too which can be a serious amount of money.
If you do decide to job hop anyways, ensure you know what you’re giving up in employer match, and use that to negotiate a higher salary/sign on bonus at your new company.
Some other benefits to staying longer at a company can be specific to certain companies or industry’s.
A common one is an increase in the amount of paid time off (PTO) days. The longer you stay at a company, the more days off you are given and can accrue.
Who doesn’t love more days off?!
Some companies will offer other perks for staying for a certain number of years, usually milestone years like, 5, 10, 15, 20 etc.
For instance, my company offers a bonus for each of those milestones you reach.
One of my friends works for a smaller company. Every employee that stays with his company for 20 years gets a two month paid sabbatical in which they get to choose anywhere in the world they want to go and all travel/lodging expenses are paid for…
Sounds pretty sweet right!?
Obviously I’ve ignored the benefit of pensions throughout this post, but the reality is they still exist out there. Some companies still offer them and if you work as a teacher or federal/state employee you may have one as well. This is a huge reason to stay with a specific employer.
I’m sure there are some other benefits I’ve missed, and many more that are company specific, but the point is that it isn’t always a bad thing to stay with the same employer.
Are You A Job Hopper?
I’ve been with the same company for over 4 years now… ever since graduating college. Though I haven’t especially felt the need to leave, I do realize that I most likely could be paid a higher wage elsewhere.
The reason I haven’t left? All those bullets listed above. This isn’t to say I’ll never leave, just that I have thought about and realized there are multiple ways to build a career.
Not all of these reasons for staying with your company may apply to you own situation.
For some, it may actually be better to find a different company that pays better or offers you different challenges.
Many people like their company but think they are underpaid which is why they look to leave elsewhere. Before you do that, check out this post from Millennial Money which will help you to ask for a pay raise!
If you truly like where you are at, but would leave anyways if they say “no”, what’s the worst that could happen?
Make sure to do your research within your company to ensure you know the benefits of staying long term, plus any other benefits that may be out there that you aren’t taking advantage of.
Sometimes staying with the same company is the right move!
Have you job hopped before? What were your reasons for leaving your company? Does your current company offer any benefits for staying? I’d love to hear your thoughts in the comments!
14 thoughts to “Job Hopping? Don’t Forget About The Benefits Of Staying With Your Company”
My company has been removing things that encourage loyalty. I suspect it’s because so many people join and stay thirty some years but getting new people is like pulling teeth. Still at 12 years I have a few extra vacation days and a luncheon every five years.
Oh really? I would think that would be counterintuitive, no? Wouldn’t your company want to keep the people as long as they can since finding people is tough and costly?
That is a great piece. I’m an example of how staying put can work. I only held one adult job in my life for over 30 years. I had eight job offers made to me before I graduated as an engineer, times were good, and I chose the one company that had not hired an engineer in a few years but had many older engineers. I reasoned they would promote and retire leaving me a great career path. That did happen and I went from entry level to the VP and GM of that company during my career. Some of the advantages were an eight minute commute, one house my whole career, becoming the face of the company in our state and in DC, an unbeatable network of business, industry and political friends and frenemies and so much institutional knowledge that even after I early retired they still call me back for consulting gigs which sometimes I do and sometimes I turn down. I never had the stress of starting over and work felt like home. When I left it was all hugs and parties and retirement dinners and I really felt I had made a difference in many people’s lives as they had made a difference in mine.
Thank you! Your story is a perfect example of how someone can stay with one company and become massively successful. Congrats!
I enjoyed this post. All things being equal, I prefer to keep everything simple and stay as long as possible. I’ve worked for three companies in my life (not counting two internships where I was not paid) – one a grocery store while in high school (not sure if that counts for purposes of this discussion as it was only part time), one where I worked part time while in college and then continued on full time after I graduated (9+ years total, 5 of them full time). And now the present small company where I’ve been for a little over two years. I enjoyed the stability of having that 9+ year job, but luckily I left just before the Titanic was boarding 🙂 . I was no longer enjoying it there and it was becoming a burden where I didn’t look forward to coming in every day. I knew the company was struggling but truthfully never knew how bad it really was. I started my new job during the summer and my previous company went under about 3-4 months later.
Where I struggle and what I dread is writing resumes and cover letters. Maybe it’s just my personality but I have a difficult time expressing/selling myself and explaining to people what I can bring to the table. Naturally, this leads to not even wanting to get involved in the job seeking process. As you might imagine, interviews are a major challenge and probably an impediment for me in attaining a higher salary and/or a better job.
My current job is fine. It’s nothing special but I make a decent enough living. I’m thankful that it was there when my previous job became a burden. I’d say my income is very average. Honestly probably below the median in the area where I live. But I live very modestly and manage to save at least 50% of it.
So the bottom line is I value stability and comfort, even though I realize I’m probably costing myself money. There is no 401(k) offered at my small company, but I’m not sure I would be able to successfully make the switch to another employer who offers one. I’m a great worker and would be of value to most employers, but getting them to believe that and actually get a new job is my biggest challenge.
Thanks Brian! Seems like you hit the timing perfectly on leaving that job!
I’m with you on the applying for jobs though, the experience of going through that my senior year of college is not one I’d like to replicate. There is nothing wrong with valuing stability, just as long as you are ok with your current benefits and are alright with not hopping around for the higher salaries
It’s always a tough call to stay or to go. Tech workers seem to go every 3-5 years, or they stay for a long time. Excluding my military service, I have been at 2 companies; 2 years and over 13 and counting. One never knows what tomorrow may bring, but it’s a good idea to keep flexible to do both. I have changed positions within my company several times in these years, and that helps keep me and the work fresh. I still like to remind folks to practice interviewing skills as those are crucial. One never knows when your company may go from good to bad. Things happen, and the economy can change. Actually, it’s those thoughts that got me into fire. If companies can not, or will not, provide security, than it’s up to us to provide it for ourselves. FIRE is a way to do just that.
Totally agree here with all this. FIRE is a great security blanket! I do think keeping up to date on interviewing skills is essential as well, no matter whether you plan to stay with your current company for a while
Great points here. A good friend of mine kept job-hopping all through his twenties and thirties. While he did make more money at each new company, his PTO time was always reset to about 2 weeks. So I was always wanting to go on big trips and he never had enough time off. To me, more time off is worth more than its weight in money.
Totally agree! I had thought of that as well, as my friend just had the same thing happen to him when he took a new job. While some companies will allow you to negotiate time off, many won’t and that is a huge negative in my opinion
This one really has me thinking. On the one hand, you can honestly get bigger raises by moving around some. Maybe every 3-5 years at most I’d recommend. But then, to your point, you miss out on years of accruing experience in a single environment. That knowledge often can get you on a fast track to promotions.
Maybe hop around in your 20s, but be sure to plant some solid ground for a long-haul stay by your late 20s, early 30s. Just my own two-cents, based on my own experience with jobs of 1 year, 5 years, 3 years, then my latest current stint of 13 years.
That’s a good point, perhaps that’s what your early 20’s are meant for, hopping around to build your base salary higher. I definitely agree that eventually you’d want to settle down with a company to get more stability (especially more so if you have a family and kids)
I did some job hopping in my late 20s for good reason; it wasn’t the money. I wanted more technical work experience that the job I left didn’t offer. It was a good move for me. In my early 30s, I had enough working to make other people rich. I quite a good job and became an entrepreneur – started my own business.
Best move I’ve ever made even though there were several years not making much money at all. After I quite my job, I did have enough saved to travel extensively while much younger. Way more than a two week vacation. I wouldn’t trade the experience and joy of traveling for a few extra bucks today.
Hey that’s a good point and one worth considering. If your current company does not offer the type of job or experience you are after, it is very worth it to move on elsewhere.
Definitely jealous of you quitting your job to travel and start your own business! I’ve had the thought that I’d love to do that someday as well