SOUTHPORT, Conn — January 26, 2021. Only half (51%) of U.S. workers say they have felt comfortable discussing pay with their direct managers during the pandemic, while 41% have not. Far more men (62%) than women (44%) have felt comfortable speaking with their manager about their pay, while Baby Boomers (51%) are almost twice as likely as Generation Z (26%) to be willing to broach the subject. These findings are according to beqom’s 2021 Compensation and Culture Report, which uncovered how employee views of total rewards, diversity and inclusion, work-life balance, transparency, and benefits have changed during the COVID-19 pandemic and what employees expect from their employers in 2021 and beyond.
Of employees who were not comfortable speaking with their manager about their compensation during the pandemic, more than a third (37%) said they’re grateful just to have a job and did not think discussing pay would reflect positively, while a quarter (25%) were nervous it would impact their employment status. While in 2018, 46% of employees said they would share or discuss salary with colleagues, including 56% of Millennials, in 2020, that share dropped to 40% overall, with a significant 13% drop among Millennials (43%).
“In a year like 2020, employees may have in fact been justified feeling uneasy discussing their pay, but the gender and age gaps in these responses should be of concern to employers,” said Tanya Jansen, beqom co-founder and CMO. “This reluctance has the potential to exacerbate gender-related pay gaps and to affect not only the retention of but the lifetime earning potential of Gen Z in particular. Because pay equity perceptions have such a strong influence on retention and employee morale, it’s incumbent upon organizations to be more transparent and communicative with employees around compensation.”
Additional findings from the report show that:
More employees than C-Suite executives took a pay cut during the pandemic.
- More than half (51%) of employees experienced a pay cut during the pandemic, and Gen Z (67%) were the most likely to experience a cut.
- Just 24% of employees say their CEO or executive leadership team took a pay cut during the pandemic.
Less than half of employees would take a pay cut to save colleagues’ jobs.
- A majority (55%) of employees would take a pay cut to avoid being furloughed or let go, with Gen Z (61%) and Millennials (57%) most likely to accept cuts.
- Less than half (44%) would take a pay cut if it meant their colleagues would not be furloughed.
Lack of childcare benefits for working parents led to reduced working hours, less career opportunity.
- Nearly half (47%) of working parents were forced to cut down hours, and thus pay, due to childcare obligations, and nearly two in five (39%) considered leaving the workforce.
- Nearly half (48%) of working parents believe their path to promotion has been negatively affected due to managing childcare during the pandemic.
Employees want to know they’re fairly paid within their specific role above all else.
- When it comes to compensation transparency, employees are most interested in understanding the average compensation for every position at their company (37%), compared to the compensation of every member of their team (21%), the compensation of their CEO and executives (17%), and company compensation by demographic (7%).
- Women (42%) are more likely than men (30%) to want to know the average compensation for every position, while men (22%) are more likely than women (13%) to want to know the compensation of the CEO and executives at their company.
Employers should not underestimate the importance of pay transparency or a DE&I strategy for employee retention.
- More than three-quarters of employees would consider switching jobs if another company offered unlimited paid leave (77%), more flexibility in working hours (76%), or remote work post-COVID (77%).
- Nearly half (48%) of employees would also consider switching jobs if another company had a built out DE&I (diversity, equity and inclusion) strategy, and 58% would consider switching for more pay transparency than their current company provides.
To learn more about beqom’s 2021 Compensation & Culture report and view additional findings, download the full report.