Seek promotion or move company: which is better for my career?

Seek promotion or move company: which is better for my career?

Career Advice / March 11th, 2016

Should I stay or should I go? If you’ve been in a salaried position for more than 18 months this is a question you should probably be asking yourself. We aren’t trying to encourage disloyalty or anything – for many of you the right thing to do will be to stay with your employer for a long time – we are just saying that the statistics suggest it is a question you should ask yourself with the intention of coming to an informed answer. Why? Because the question can have massive long term implications for your career progression, salary, and quality of life.

Risk versus Reward

In case you are scan-reading this, here’s the balance-sheet you need to work on at a glance:

Possible risks of moving regularly:

  • Eventually it may impact negatively on your CV.
  • It can be stressful.

Potential rewards of moving regularly:

  • You could earn as much as 50% more over your career.
  • You can broaden your skill set and experience.

Some of you may have been shocked by the 50% figure. After all, what wouldn’t you do for a 50% pay rise? That would have an enormous impact on your disposal income! However, the fact is that if anything, 50% is actually a conservative figure (Forbes 2014) for the difference between people who stay in roles on average less than 24 months versus those who stay longer. That’s the headline figure that should get you thinking from 18 months onwards about what is best for you. However, that’s not to say you should be blinded by it – there are other considerations in play here.

It’s important to understand what drives the difference in income. Basically, it comes down to the fact that the average move to a new company can be expected to net you a 10-20% pay rise, and gaining the same in internal raises and promotions usually takes much longer than two years. It’s a generalisation, but companies very rarely put the same sort of offers on the table in internal negotiations because they feel that retaining talent shouldn’t cost as much as attracting talent, whilst for the employee it is perceived as more difficult to negotiate aggressively with colleagues than with strangers.

So that’s the situation. Now, does that mean you should go straight to the job boards to search for your next 10-20% bump? Maybe, maybe not. The first step is to consider what your internal prospects are like. How mobile is your company? Do you know other people who have advanced rapidly? Are there many openings above you (or attractive lateral moves, which shouldn’t be underestimated)? What is the company’s policy on promotions? Is your immediate boss supportive of your growth? Be realistic when making this assessment, which means looking for concrete examples. It is very easy to convince yourself to stay put to chase a promotion that may never come, but harder to be fooled if you insist on objective measures of its likelihood and reasonable timeframes. Also, how does your annual raise compare to the local rate of inflation? These days, with 5% annual rises a historical oddity never experienced by millennials, you may discover upon reflection that you are taking a pay cut in real terms every year!

Second, consider your personal circumstances. Don’t go chasing salary increases at the expense of ‘softer’ benefits just because you didn’t stop to consider them. Job moves can be very stressful, a factor which will vary a lot by the personality of the individual involved and the degree of change involved. If you are undergoing a lot of changes or stress currently, maybe it’s worth delaying that move. On the other hand, if you are itching for a new experience or feel you are losing your feeling of role significance at your current job, maybe it is time to update your CV.

Now what about employability? This one comes down to a very fine balance. Consistently changing jobs within short timeframes will eventually make you look like a bad investment to a hiring manager. On the other hand, the right tactical moves will help to really open up your experience and perceived skills and value. Is there a rule of thumb for getting this balance right yourself? No, sorry. This will be the sort of thing for which a mentor or employment consultant will be useful.

Industry Factors and Lessons from Finance and Gaming

When it comes to helping you apply all of this to your own position, it is crucial to note that there are also differences between industries that may impact on you. You can learn a lot by looking at two example industries that are crucial to the European offshore jobs market: finance and online gaming. Financial services has long been a staple of the offshore communities in the Isle of Man, the Channel Islands, and so on. It is a mature market place and it has a very high number of active job seekers, with staff turnover being relatively quick across all of those jurisdictions in this market. Moving between companies definitely offers higher wage potential in the medium term, largely because internal structures are relatively rigid and wage increases are generally low and formulaic.

Gaming, in contrast, has far, far fewer people actively looking for movements within the industry, despite having a huge number of openings, as it remains a growing industry. This has historically been driven by high internal mobility and high base salaries at all of the major operators in the sector. We predict, however, that this will soon begin to change as the industry reaches a certain point of maturity. As companies that were once dynamic start-ups are slowly affected by the systemic demands of having become large organisations, internal mobility may be reduced and more staff may start looking for opportunities outside their existing employer. Watch this space.

It gets even more complicated if you are looking to move between industries. Again, gaming is a good example because it is pulling in talent from many other sectors. The prospects for changing industry will depend on your skillset, of course. A good lawyer or accountant may be able to swap industries for a decent return, if they have a good agency to find the right fits for them, but they may also be better off staying in the same sort of role. By contrast, anyone with serious IT, development, or technical training who has sat in the same industry for years should absolutely consider moving, because eCommerce and eGaming companies will pay well over the odds to get hold of them. Seriously, if you have technical skills contact us, because we have clients who will literally take as many good technical staff as we can find them!

Forward to the Past

One oft-neglected element of the whole equation, particularly in small specialist markets, is whether or not leaving a company needs to be ‘for good’. In most cases, it absolutely doesn’t have to be. Having found a good company with people you get on with is often a good reason to stay there, but if they don’t have the right opportunities for you it may also be a good reason to leave with a view to collecting more skills and then going back again when the time is right. We have plenty of anecdotal stories of individuals who have done extremely well, securing cumulative salary increases of upwards of 50% in just two jobs – one out to a new company, and one back to the old one in a better role! So long as you leave on good terms and don’t burn any bridges, you will probably find yourself at the top of the candidate list if you ever do reapply because there are a whole range of reasons hiring managers like to take returning staff, including ensuring a cultural fit, reduced training times, and lower perceived risks.

Conclusions

So in the end, what should you do? Sorry to sit on the fence, but it all comes down to context. We obviously can’t give you answers in a blog post; all we can do is help you identify and consider what some of the variables might be, so you can then apply them to your own situation. As such, we hope this helps you decide if you should stay or you should go. If you’re really stuck, however, then consider getting in touch with our consultants for a bit of a helping hand. What’s most important, however, is that you ask the right questions at the right times in order to do the best by yourself and your family.

P.S. Sorry if you now have The Clash stuck in your head the rest of the day!