2022 Hourly Workers Compensation Expectations Report

CareerPlug is on a mission to help employers hire and develop the right people. As a part of this mission, we conduct original research throughout the year that analyzes both hiring and retention trends. 

Businesses of all sizes have been dealt many blows in the last few years and the labor market has undergone some major changes. By now, you may have heard of the “Great Resignation” or even experienced record levels of turnover within your business. 

Employers are more motivated than ever to keep hard-working employees around, but sometimes this can be a challenge! If you’re like us, you are probably curious as to what employees are looking for and what role compensation plays in employee retention

That’s why we asked hourly employees to tell us what they think about their current compensation and what they expect in future pay. We’re pleased to present our 2022 Hourly Workers Compensation Expectations Report. We hope that it can help employers better understand employee expectations, so that they can improve retention efforts and become a better place to work.  

Who took this survey? 

It was important for us to get an even distribution of industry data for this report. We surveyed 502 hourly workers spread evenly across 11 different industries

We also got a fairly equal distribution of experience level ranging from entry-level to senior. 

How satisfied are hourly workers with their current compensation?

We asked employees to rate their satisfaction with their current compensation on a scale from 1 to 10. 

The answers we received were fairly evenly dispersed. Roughly one-third of employees reported being unsatisfied with their current compensation. The same amount reported being moderately satisfied, and by a slight majority, 38% of employees said they were very satisfied with their current pay. 

hourly workers compensation satisfaction

By another relatively slim margin, the majority of respondents (26%) have received a raise in the last 12 months. However, 21% of employees said that they have never received a raise — of that percentage, most were entry-level employees. The rest of the answers were as follows:

  • 19% of employees have received a raise in the last 1-2 years.  
  • 17% of employees have received a raise in the last 2-5 years.  
  • 16% of employees said that it has been more than 5 years since their last raise.  

Additionally, 26% of employees surveyed said that their income is not enough to cover all of their living expenses and 27% of employees said their income is enough to cover living expenses — but not much else. 

Most hourly workers are looking for higher pay whether they’re satisfied with their current pay or not. 

Here’s where the data gets interesting. While over one-third of the employees who took this survey said they are satisfied with their current compensation, most hourly workers reported that they are looking for higher pay regardless. 55% of all employees are currently seeking or will be seeking new employment in order to get a pay increase in 2022. 

employees that are seeking to increase their pay

64% of those workers seeking an opportunity for a pay raise said they would stay at their current job if their employer gave them the compensation they were looking for. This number suggests that offering raises is a strong employee retention method. 

That said, when you consider that 36% of those employees seeking higher compensation wouldn’t stick with their current employer even with increased pay, it becomes clear that there are likely other factors influencing their decision, such as dissatisfaction with something else: the employer, the role, the industry, etc. 

How much of a raise are hourly workers seeking?

It’s clear that offering increased compensation may help you keep your hourly employees around, but how much are they looking for? 

The table below shows how much of a raise hourly employees seeking new employment would like to receive. As an employer, you may want to use compensation resources on Indeed and Glassdoor to see how the compensation for your roles compares to other similar jobs. 

desired pay increase for hourly employees

It’s worth pointing out that those who have gotten a raise in the last 12 months are the least likely to seek new employment in order to get a pay increase in 2022: 52% said they are not seeking new employment in order to get a pay increase. 

In contrast, 60% of employees that last received a raise 2-5 years ago are currently seeking or planning to seek new employment. 

Many hourly workers are considering new industries or fields. 

Of the employees who said they are considering leaving their current job for higher compensation, 67% said they planned to explore new industries or fields. 

One staggering statistic we found is that 91% of healthcare workers seeking a raise said they would explore new industries or fields!  This is yet another surprising stat that might indicate factors other than compensation could be an issue. 

We all know the healthcare industry has seen record levels of worker burnout and nearly 1 in 5 healthcare workers have quit their jobs as a result of the pandemic, so it’s not entirely surprising that our survey found evidence that the healthcare industry could face more retention challenges in 2022. 

You can see in the graph below that many other industries also reported they would explore new fields to get the pay increase they’re after. 

hourly workers that are willing to explore new fields for a pay increase

Benefits are just as valuable as compensation when it comes to employee retention. 

When it comes to employee retention, compensation isn’t the only way to show employees that you value them. Offering competitive benefits can be just as effective, and our data backs this up. 

The majority of employees said that they would accept benefits over a pay increase, but it should be noted that those who are more satisfied with their pay are more likely to accept additional benefits. 76% of employees that are very satisfied with their pay said they would accept additional benefits instead of a pay increase. 

Still, 53% of employees that are unsatisfied with their pay said they would accept additional benefits instead of a pay increase from their current employer. This suggests that an increased investment into benefits could help in retaining about half of employees who otherwise feel their compensation is lower than they’d like.

employees are willing to except benefits over a pay raise

Health insurance and more PTO were the top benefits that employees said they would accept instead of a pay increase. The chart below shows how the other benefits stack up. We recommend incorporating these types of competitive benefits for your employees if possible. 

types of benefits workers want

Compensation satisfaction and pay transparency  

One thing that can have an effect on employee compensation satisfaction is whether or not they feel that they are paid fairly compared to coworkers and others in the industry. 

Based on our research, we can conclude that someone who makes less than $10/hour can have a similar perception of fairness as someone who makes $25/hour or more. Feeling like you are paid fairly compared to your coworkers is relative, which strengthens the argument for pay transparency within organizations.

percentage of people who feel they are paid fairly to their coworkers

It’s worth noting that those who are satisfied with their compensation are more likely to feel that they are paid fairly to their coworkers and others in their industry. However, over half of workers (55%) either said they weren’t paid fairly or didn’t know how much they made compared to their coworkers

compensation satisfaction and the perception of fair pay

Breaking this info down across industries gives us an idea of which industries have better pay transparency practices. Pay transparency can involve things like including compensation on job postings, sharing with employees how you calculate compensation throughout the organization, and being open about how much all your employees are making. 

Pay transparency within every industry is a major stepping stone to achieving more pay equity.  Pay equity means compensating employees the same for similar work, regardless of race, gender, disability, LGTBQ or other protected statuses. This is especially important in hourly roles that have been historically undervalued and underpaid because of the race and gender of the people working them. 

Key takeaways 

When it comes to hourly workers, compensation satisfaction varies. However, whether those workers are satisfied or not, most are still seeking an opportunity to increase their pay. Many of those seeking to increase their pay are willing to leave their current field to do so. 

This research points to a few different actions that you, as a business owner, can take to improve employee satisfaction and retention. This includes finding out how your compensation compares to others in the same industry, offering competitive employee benefits to supplement compensation, and implementing more pay transparency in your workplace. 

Hourly workers often take on some of the most important (and stressful) jobs in the labor market. They’re a vital part of a business and the economy. As a business owner, learning more about their expectations will ultimately help you hire and retain employees and become a better place to work. 

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