For years, workers have been told that switching jobs is the quickest path to advancing their careers and landing substantial pay hikes—but this career tactic has lost its advantage.
According to a recent Bank of America study, professionals who changed jobs this January received a median pay increase of only around 4%. At the same time, the Atlanta Fed’s Wage Growth Tracker shows that employees who remained in their positions during this period got a 3.5% wage increase.
Moreover, the financial benefit of taking a new job has been steadily decreasing over the years, as employees hold onto their roles and hiring activity stagnates.
“With fewer available positions, the job-change premium—the extra pay boost workers usually get when switching jobs—has begun to shrink across all sectors,” the Bank of America report states.
“This weakening is significant because changing jobs remains one of the most effective methods for workers to secure higher salaries.”
Welcome to the ‘low-hire, low-fire’ economy
The pay increase for job switchers in January is less than a third of the post-pandemic high of roughly 14% in 2022, when companies were hiring workers in large numbers.
In the years following, businesses have reduced their expanded workforces and scaled back hiring, which has flattened the pay increases for job changers.
According to the Bank of America report, the wage gain for job switching was around 9% in 2023, dropping to about 8% in 2024 and roughly 6% in 2025.
Workers who hope the trend of job-hopping pay gains will shift in their favor may have to wait a while; as long as employers keep restricting hiring and employees stay in their jobs, the situation will only deteriorate.
“Looking forward, if the labor market continues to be defined by ‘low-hire, low-fire,’ the job-change premium could shrink even more, restricting how much workers can get meaningful pay increases by switching roles,” the report explains.
Job-hopping replaced company loyalty—and now, workers are ‘job-hugging’
Young workers with low salaries are known to switch jobs to quickly climb the corporate hierarchy. However, Gen X and baby boomers were once promised that loyalty leads to success: by staying at one company for many years, they could demonstrate their commitment and have a better chance at higher titles and salaries. But as benefits diminished and promotions were secured, leaving an employer for better opportunities became common.
According to an ADP report on 2023 payroll data, around 75% of workers left their employers before even getting a promotion. In recent years, Gen Z in particular has embraced this strategy—about 83% of young workers self-identified as “job-hoppers” in a 2023 ResumeLab report. And until recent years, it has been beneficial: in 2023, nearly one-third of Gen Z changed jobs, with 35% making the move specifically to get higher wages, per an H&R Block report.
Despite how much employers may dislike job-hopping, most professionals have adopted it as a valuable career tool. About 41% of workers overall think switching jobs every two to three years is acceptable, while 56% of Gen Zers hold the same view, according to a 2024 Resume Genius report.
However, wage increases have become so small and job openings so scarce that job-hopping’s popularity could wane. Just last month, American employers unexpectedly cut 92,000 positions, and the unemployment rate rose to 4.4%. Meanwhile, AI is automating human work at a rapid pace; since ChatGPT’s emergence, U.S. job postings have decreased by about 32%, according to a 2025 analysis of Federal Reserve data.