Most Brits don’t think they are paid ‘what they are worth’ but asking for a raise pays off
Most people don’t believe they’re being paid what they think ‘they are worth’ to do their current jobs. And, perhaps unsurprisingly, the longer it’s been since they last received a pay rise, then the more inclined they are to feel this way.
CIPHR polled 1,005 British adults to discover more about how employees perceive their pay. The findings reveal that
In fact, less than half (41 per cent) of workers consider their salary to adequately reflect their job role and experience.
The other half (44 per cent) think they’re being paid less than they should be, and one in six (15 per cent) can’t decide one way or the other, according to new data shared with City PM today.
By comparing whether employees agree or disagree with the idea that they are paid ‘what they are worth’ to the last time they received a pay rise, the results appear to show a direct correlation between the two, a survey by HR software provider CIPHR found.
Those that have waited over a year for a salary increase, are more likely (67 per cent) to be dissatisfied with their earnings. While the majority (60 per cent) of those who received a pay rise within the last six months think the opposite.
Senior management vs non-management staff
Notably, people occupying senior management positions, such as owners, CEOs, CFOs and C-level executives, are more likely to feel adequately rewarded for their efforts, with the majority (64 per cent) agreeing that they are paid ‘what they are worth’. Two-fifths (40 per cent) of them report getting a pay rise in the last six months.
Not so for non-management staff, however, who make up around 64 per cent of survey respondents. They are among the most likely (48 per cent) to think they’re underpaid and the least likely (33 per cent) to have had a pay rise within the last six months.
While an employee’s perception of what they earn can be shaped by numerous different factors, such as job title, organisational role, and experience, for example, it can only really be quantified in monetary terms.
Around £45,000 seems to be the sweet spot for most, which is significantly higher than the national average, according to the Office for National Statistics, the median annual pay for full-time employees in the UK is £31,461.
Nearly half (48 per cent) of people earning an income of over £45,000 think they are being paid ‘what they are worth’. On the flipside, 46 per cent of those earning less than £45,000 don’t think they are being paid ‘what they are worth’.
Asking for a pay rise
Given that around two-fifths (38 per cent) of employees say they haven’t had a pay rise in over a year, and around the same number (43 per cent) say they haven’t requested one in over a year, it’s easy to question why so many people have accepted the status quo? It does perhaps illustrate the maxim: if you don’t ask, you don’t get.
Workers at smaller companies – with 26 to 50 employees – seem the least likely to request a pay rise, with only 50 per cent having done so within the past year, compared to 55 per cent of those at larger organisations with over 251 staff.
Women also seem less likely than men to request a pay rise, with only 54 per cent compared to 60 per cent having asked their employers for a raise within the past year. When it comes to getting one, slightly more women (63 per cent) than men (60 per cent) actually got a pay rise.
To find out how many people were successful in negotiating a salary increase, CIPHR compared the last time employees requested a pay rise to the last time they received a pay rise.
A third (33 per cent) of the employees who requested a pay rise within the last month, got one in the last month; two-thirds (68 per cent) of the employees who requested a pay rise within the last six months, got one in the last six months; and three-quarters (77 per cent) of the employees who requested a pay rise within the past year, also got one in the past year (most – 54 per cent – around the same time they asked for one).
The majority (63 per cent) of respondents that say they haven’t requested a pay rise in over a year, haven’t got one in over a year. Only a third (37 per cent) bucked this trend. So, perhaps for employees, it does pay to ask.
It certainly pays to be prepared, said Gwenan West, head of people and talent at CIPHR: “Before you even contemplate asking for a pay rise, ask yourself ‘why’. Do you feel undervalued? Are you paid significantly less than the market rate? Have you taken on more responsibility?”
“What’s the worst you could be told – no?”, added HR consultant Courtney Thompson-Ayerst, implementation team lead at CIPHR.
“Having an open discussion is always the best way to approach a pay rise. Many employees look outside of their organisation as a form of negotiation, which can sometimes end in the wrong outcome. When, in fact, all that was needed was a simple conversation with their employer.”
Annual pay rise was 8.8 per cent
Across all respondents who report receiving a pay rise in the past year, the average increase was 8.8 per cent (the median pay rise was 3%). The average pay rise for those that were awarded one over a year ago, was nearly 3 per cent lower, at 6.2 per cent, the median pay rise was 2 per cent.
People working in the arts, entertainment, or recreation (77 per cent), manufacturing (71 per cent), HR (70 per cent), finance and insurance (69 per cent), legal services (67 per cent), and retail (67 per cent), were among the most likely to report getting a pay rise in the past year.
Claire Williams, director of people and services at CIPHR, said: “There’s no denying that people’s perception of their own value in the workplace is closely linked to the financial package they receive. This has obvious implications for employers. Workers that feel undervalued or underpaid can have a negative impact on productivity, employee engagement, job satisfaction, morale and so much more.”