Half of Workers Would Take a Pay Cut for Job Security

Amid layoff anxiety, just over half of employees say they would take a pay cut in exchange for greater job security.

Fifty-four percent of employees say they would accept a pay cut in exchange for greater stability in their employment, while 61% would be willing to give up at least one aspect of their compensation or workplace experience for more stability, according to a recent survey of 1,020 U.S. employees by careers site Monster. Of those, 26% would accept a pay cut of up to 5% and another 28% would accept a reduction of 5% or more, including 11% who would accept a pay cut greater than 10%.

The finding is notable given the financial pressures many employees are facing — and suggests just how significant job security has become amid heightened anxiety over layoffs.

“At first glance, it’s surprising that more than half of employees would take a pay cut considering our recent data shows they’re struggling to keep up with the rising cost of living,” said Vicki Salemi, talent strategy advisor at Monster. Separate recent data from Monster found that 93% of respondents said their pay falls behind rising costs and 41% of workers were worried about job security. Other research also suggests that employees are feeling significant financial stress. For instance, according to MetLife, financial confidence among employees is at its lowest level since 2012, with just 53% of workers saying they feel in control of their finances.

But looking at the bigger picture, Salemi said, the data suggests employees may view the financial impact of losing their jobs as more detrimental than the financial sacrifice of accepting less pay. 

“Their income and benefits are tied to their employment, so maintaining employment can take precedence even when they’re already feeling financially crunched,” she said. “It underscores how important job security has become to workers.”

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Importance of Job Security Amid Layoff Fears

The results suggest that job security has become one of the most important factors in the  workplace, with many employees willing to trade higher earnings, flexibility, bonuses, or benefits for greater confidence that their job will last. 

Workers are willing to give up more than pay for job security, according to Monster. About a quarter of employees (26%) would accept reduced bonuses or incentives, 26% would give up workplace perks or benefits, 23% would sacrifice workplace flexibility, and 17% would accept higher health insurance costs in exchange for greater job security.

“Workers are clearly anxious about job security and pay,” Salemi said.

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Recent research from INTOO and the Harris Poll found that more than 60% of employed Americans are experiencing layoff anxiety, up significantly from 2019. That anxiety can both affect employees’ mental health as well as reverberate through behaviors and attitudes that impact the workplace.

“When employees feel layoffs could happen at any time, it creates a constant undercurrent of stress that can lead to distraction, disengagement, and hesitation to fully invest in their work,” Mira Greenland, chief revenue officer at INTOO, a Los Angeles-based global career development and outplacement firm, told SHRM recently.

That anxiety can also shape how employees think about their jobs and career security.

“Layoff anxiety is having a noticeable impact on how employees think about work, stability, and their future careers,” she said.

Employer Role

The finding that employees would give up some of their earnings for greater job security has implications for employers, Salemi said, notably that job security may be one of the most important levers in employers’ arsenals for keeping and attracting talent.

“Compensation is more than just salary for employees. Job security has become part of their overall compensation package,” Salemi said. “This creates an opportunity for employers to provide greater job security and a positive employee experience. This means supporting employees in a healthy environment, paying them what they're worth, offering competitive benefits packages, flexibility, and providing opportunities for career growth, upskilling, and development, as well as communication about the stability of their job if they're anxious about potential layoffs.”