Salary, once a taboo topic in the workplace, is now being shared openly in offices and on social media among a younger generation of workers.
Empowered by the tightest labor market in decades and incentivized by skyrocketing inflation, employees are embracing transparency, discussing their pay in the hopes of getting raises for themselves — and their colleagues.
Nearly 42% of Gen Z workers and 40% of millennials have shared their compensation with a coworker or other professional contact, according to a March study of 2,449 American adults conducted for Bankrate by YouGov Plc. That’s significantly higher than Gen Xers (31%) and more than double that of Baby Boomers (19%).
Pay transparency rules have gained traction across the U.S., with laws in New York City and Rhode Island expected to join disclosure requirements in several other states later this year or next. But many younger workers, who have significantly less wealth than their parents had at their age, aren’t willing to wait.
Hannah Goodbar, a 25-year-old programmatic supervisor at an advertising firm in Chicago, said she and her colleagues have always been open with each other about their finances.
In early January, a coworker who was recently promoted said she was offered $10,000 more for the same role Goodbar had held since last year. Goodbar and another colleague waited to receive a similar bump, but by March nothing had changed. HR said they would have to wait for their review toward the end of the year to be considered for a compensation boost, so they began hunting for other jobs.
By early April, Goodbar informed her employers that she had another offer on the table. Within days, the company countered with a $20,000 raise. She accepted the counteroffer, which boosted her salary by 29%.
“I was like, ‘All I wanted was the $10,000, but now you guys have to pay me $20,000 more or else I’m leaving,’” Goodbar said.
Wage Leverage
Workers are more confident than ever about asking their bosses for more money, according to LinkedIn’s Workforce Confidence Index survey. And for good reason: the number of job openings hit an all-time high in March, with nearly two open jobs for every unemployed person.
The median wage in April grew by 7.2% for people who switched jobs and 5.3% for those who stayed in their roles, according to the Atlanta Fed’s Wage Growth Tracker, which tracks the three-month moving average.
“Inflation right now is really increasing the urgency for younger workers to bring up the conversations,” said Bankrate’s Sarah Foster. “Thanks to the Great Resignation, for the first time in a lot of these younger workers’ lives, they have the leverage to seek out the pay that they want.”