Why do Fresh Grads Job Hop? Is it Simply because They are Underpaid?

Fresh graduates, some call them the Millennials are widely known as the job hopping generation. According to Gallup, 21% of millennials have changed jobs within a year and they are the least engaged employees in an organization.

It’s pretty challenging to hire a fresh graduate that will stay long in a company. What are the reasons that lead them to job hop? In a 2016 Job Happiness Index report (a survey by JobStreet.com and jobsDB), fresh graduates in the Philippines, Hong Kong, Thailand, Singapore, Malaysia, Vietnam and Indonesia were asked to rate their happiness level at their current jobs.

Fresh graduates in the Philippines came up tops in the happiness scoreboard, followed by Indonesia and Thailand. Fresh grads in Malaysia, Hong Kong and Singapore seemed neither happy nor unhappy with their jobs, while Vietnam scored lowest on the job happiness spectrum.

The survey further revealed that the respondents were happiest with their job location, colleagues and company reputation.

The respondents were then asked how they expected this to change in the next 6 months, and to rate the top factors that would increase their job satisfaction.

Fresh grads in Indonesia were the most optimistic about the future, followed closely by the Philippines and Vietnam. Respondents in Thailand and Malaysia were moderately optimistic, while Singapore and Hong Kong didn’t seem to expect much change to happen in the near future.

Despite this difference in their outlook, all respondents across the board agreed on the top two factors that would make them happier at work: “salary increase” and “new job”.

It would be totally understandable for someone who’s been in the same job for 5 years, but for fresh grads to be feeling this way is a major cause for concern. If fresh grads are looking to jump ship for higher pay, does that mean they’re being underpaid to begin with, or that they’re expecting too much?

Let’s take a closer look at the situation. We recently highlighted findings from “2016 Salary Increase Trends for Employees in Asia Pacific” which found salary raises to be out of synch with inflation, resulting in lower increase in real terms. This is further supported by a report by Mercer highlighting low wage growth due to high inflation, and double-digit turnover rates for almost all countries in Asia Pacific.

Perhaps fresh grads are being underpaid after all? Tough economic times and business competition do indeed impact their salary. But fresh graduates can’t just play the blame game here. With more and more fresh graduates coming into the workforce each year, competition will be stiff as employers’ expectations will be higher.

Ultimately, it boils down to what are the employers’ needs and what can the fresh grads offer and vice versa. It works both ways. To get the best talent with the right attitude, the employer will also need to meet the fresh grad’s expectation. If needs and wants are fulfilled, the best talent will most likely stick around for the foreseeable future.