The Costs of Job Hopping

June 23, 2009 by  
Filed under Money and Behavior

job_hopperThis month’s Money Magazine featured a few stories of the unemployed looking for work. Experts were brought in to give advice on what the job seekers were doing wrong and how they could improve their prospects.

One story was about a 45-year old auditor who went from $215k to zero with no job offers. The expert advising him quickly identified a flaw on his resume: he was a job hopper. More specifically, he had worked for eight different employers since 1986. That was a red flag that needed to be explained. I agree.

When we interview lateral attorney candidates (not new grads) at our firm, one of the first things I notice is how many different jobs the applicant has had. Call me old school, but I still value loyalty, consistency, and endurance in employees. A series of one-year or two-year employment stints suggests to me that one or more of those qualities may be lacking.

Over the years, I have become am aware of folks who have worked a job just long enough to buy a new kitchen appliance, then quit. I know of others who quit a job to go on a vacation. That reflects a certain job-hopping attitude that has real costs. Let me see if I can name a few:

1. Job-hopping bothers prospective employers. See above. Yes, it sounds so web negative 1.0 to complain about employees with short-attention spans but believe me, it’s an issue with a lot of us. Some employers will just assume that someone who cannot hold a job more than a year or two is an incurable troublemaker.

2. Job-hopping creates benefit gaps. If you depend on an employer’s health insurance benefits, each time you change jobs, there is likely to be a gap in coverage. Sometimes you can fill that gap but it’s more money out of your pocket.

3. Job-hopping impairs retirement saving. Most employee-sponsored retirement plans have a waiting period before you can enroll. Some plans have vesting provisions which cause short-timers to lose most if not all of the employer’s contributions. Perhaps the worst damage is caused by those job-hoppers who liquidate their retirement accounts at each departure (probably to live on). After taxes, penalties, and too many mornings at Starbucks not looking for work, that money goes quickly. Starting over at ground zero on retirement savings is not a good strategy.

4. Job-hoppers lack the experience factor. Someone who has been in the workforce for ten years – with six jobs – does not in my mind have ten years of experience (unless it’s flipping burgers or changing tires). I would much prefer a candidate with in-depth experience at one or two jobs.

5. Job-hoppers don’t engender employer loyalty. If conditions deteriorate in a small business, the veteran employees are more likely to be in a better position at downsize time. The boss may think that the job-hopper is fond of short employments and will pass the pink slip in that direction accordingly. In the workplace, what goes around, comes around. Similarly, a short-timer is less likely to be promoted or given a key assignment.

So readers, am I right on this? Or can you  turn this around on me and tell us how job-hopping can be a good thing.

Full disclosure: Mr. ToughMoneyLove has had three different employers in 36 years as a working adult.

Photo credit: crowdive

Feed Mr. ToughMoneyLove

FREE UPDATES: If you enjoyed this, please subscribe to receive the newest hard truth from Mr. ToughMoneyLove automatically by RSS feed (what is RSS?) or by spam-free Email.

  • Banner


18 Responses to “The Costs of Job Hopping”
  1. No Debt Plan says:

    I think it depends on if the jobs were contracts or full-time perm from day one. Contracts would be understandable. Two and a half years is a short period of time over a 20 year time frame.

    I will have been with my current employer for 3 years as of this August. I’m hoping to eventually move cities in two years, which would give me 5 years total. I think that’s a decent amount and shows stability — plus I have a reason to hop with the move (rather than hopping around the same city).

  2. L says:

    As a young professional, I disagree, at least initially. Sometimes you have to work 2, 3, even 4 jobs to gain enough experience to land the upper-level position many professionals desire. I’ve been out of college for 6 years and have worked two full-time jobs for about three years each and a handful of part-time jobs. The first full time job was a decent position with limited advancement opportunities, but I stuck it out until something more appropriate in my field came available. Now I’m ready for a job change that I consider a large step upwards. At this rate, I’ll be through my third or possibly fourth job in 10 years before I land the position I’m really gunning for.

    I think that each job can only teach you so much. Sure, changing positions every 6 months is a red flag, but two-four years? Surely not.

  3. Jenn says:

    Wow. I’m not that old (40), but L’s response makes me feel ancient.

    Working is a two way street. Each job can only teach me so much? What about your learning curve? Are you really up to speed so that you’re a fully contributing employee for 2 years? After the expense to train you, you’re going to leave an organization because you’re ready for a large step upwards?

    Is it me, or does this seem selfish?

  4. L says:

    Jenn, I can certainly see your point and yes, perhaps my attitude can be viewed as selfish. My perspectives are just that, mine. But the regrettable fact of the matter is that when you’re young and starting out in the workforce, not to mention female, your intelligence and enthusiasm gets taken advantage of, particularly in medium-sized companies where there are limited advancement opportunities and you are grossly underpaid. Everyone needs to pay their dues, yes it is true, and training IS a significant cost to any employer, but I view it more as self-preservation and ambition than selfishness. I’d like to think I’m doing meaningful work and making a difference, but I’m not going to stick it out somewhere I feel limited/miserable/my options are exhausted because they were kind enough to hire me and might be inconvenienced by my departure.

    What’s wrong with being selfish?

  5. richgirl says:

    It’s a good thing you put in the “small business” caveat because in my experience working in large corporations, the opposite of #5 is true. People who have been at the same company for many years are too expensive to keep and are often the first ones to get the axe in tough times. I’ve watched three rounds of layoffs already, and most of the people who were laid off had been at the company 20 years or more. So much for valuing institutional knowledge or loyalty. The experience has taught me that there’s NO such thing as employer loyalty.

  6. Rick Beagle says:

    What a bunch of cow pucks. Here is my advice that I would submit in lieu of the nonsense listed above:

    1) You owe a business absolutely nothing beyond working your hours to the best of your abilities.
    2) If a better job presents itself, think the matter carefully over night; if in the morning, it is still a better job, give your notice – but even that is optional.
    3) Whatever the next job requires, do. If they need for you to start tomorrow, start packing up your desk. In an age where layoffs are immediate, realize that you too are not bound to give a two weeks notice. It may be frowned upon in polite company, but by and large it has zero bearing on your ability to get that next job or even to return to the job you left.
    3) Make sure that you make a few friends at each job and provide references for each other willingly and as often as necessary.
    4) If you are lucky enough to find a job that provides you everything that you wish for in a job, keep your skills relevant, your savings well padded, and your resume up to day. You never know when the winds of change will blow through your little slice of heaven.
    5) As richgirl stated in her post, those of us who have been around the longest (and make the most) are sure fire targets for layoffs regardless of how loyal you have been (remember all those lost weekends?) or how important you are to the company.
    6) The older you are the more difficult it will be to get a job, so as your years increase, increase your savings accordingly, and for goodness sake, keep your skills sharp and up to date..

    7) Businesses need people, not the other way around. DO NOT ALLOW any company or person to abuse you just because they have were lucky enough to hire you.

    Rick Beagle

  7. Rick: As I said in the article, you are exactly the kind of employee that I as a small business owner would do my best not to hire. The suggestion that an attitude and bitterness such as reflected in your comment has nothing to do with your ability to get another job is so ludicrous that I am surprised you would even put it into words.

  8. Rick Beagle says:

    Mr. ToughMoneyLove,

    I am quite certain that you will never have the need to hire me, but thank you for the thought. However, what you read as bitterness, I provide as a pragmatic alternative to the sugar coated rainbow that you peddle.

    The messenger has given you the view from the battlefield, do not blame him for a market place more concerned with maximizing profits than the manner in which success is achieved.

    Rick Beagle

  9. PT Money says:

    I contend he never would have been making the $215K had he not been a hopper. And as an auditor, I can tell you that hopping is more common amongst our ranks than most professions. Loyalty is done. Follow the money, work hard, and get out. They owe you nothing and you owe them nothing.

  10. PT Money: What an awful way to view your job and your future. Follow the money? To what end – more money? According to your attitude, the employer is free to to treat you as a disloyal drone until money intervenes and provokes you to become a better paid drone in a different job. Sad.

    • Ty Griffin says:

      I didn’t spend 30,000 per year with a university to make a someone like you rich. If you suck at managing your small business that stunts my growth. I will not put my financial future in some company’s hand.

  11. Nancy says:

    I’m actually struggling with this right now. I’m a programmer. We tend to switch jobs a lot. Part of the issue is we are constantly getting lured by other companies who don’t care if we’ve been at a place for fewer than two years…

    Some of the coders I’ve worked with were offered jobs while still in college, and they even skipped getting their degrees.

    I suppose you would never hire any of us. 😉

  12. AnnJo, Seattle says:

    I’m looking to hire right now and just reviewed a resume a couple of days ago, showing frequent job changes (every two to three years). It was definitely a red flag for me. Following up, I spoke with one of the candidate’s former employers (off the record – this is a fairly small community and I know half of the woman’s former bosses personally), whose strongest memory of the candidate was that she had given two weeks notice while the boss was out of town, a few days into a two week vacation. Nasty.

    Contrast this to the one month notice I received from the last person in the position (who also waited until I was back from vacation to give it), and the three months notice I received from the one before, who was retiring, both of whom received sizable “thank you” bonuses when they left.

    While I might still hire this job-hopper candidate if I literally can’t find anyone better, my loyalty to her will pretty much be limited to signing her paycheck until I CAN find someone better. My willingness to pay for extra training beyond the minimum necessary will be zero.

    Maybe Rick Beagle’s and PT Money’s experiences of employer lack of regard are self-created. Like Mr. TML, I dread the idea of having such “chip-on-the-shoulder” employees to contend with, and if you think employers can’t read such attitudes, think again.

    Ironic that Rich Beagle, whose closing is “Peace,” sees the employment relationship as a battlefield and counsels callousness and hostility.

  13. Revanche says:

    As a relative young’un, I’ve put in almost ten years at two employers since high school, and personally have trouble with the idea of job hopping.

    I can see both sides of the coin: no employer/manager wants to sink resources into a practically temporary employee, but neither should an employee blindly trust that the employer has his or her best interests at heart. Not every employer is going to reward loyalty, in fact, many are known to use up and discard loyal employees. The reality of the marketplace is that both sides are looking for someone who fits their needs and, at times, the agendas are mutually exclusive. Other times, a good employer finds a great employee, treats them well and engenders further loyalty.

    I think that the relationship between the individual and the employer makes a huge difference. I knew that my last employer had no real loyalty to me, and would more than willingly vilify me should I leave of my own accord. It makes absolutely no sense to stay loyal to a company that wants to use you up and discard you at will. At the same time, I had an opportunity to learn skills in a troubled workplace that would serve me well in making the leap into management. In that situation, the choice to stay was a conscious, practical matter, not one of emotion and trust (loyalty). Had it been loyalty, I would have felt quite betrayed by the two years of unwarranted harassment, and an eventual layoff of the entire office. As things stood, I understood that it was a learning experience I chose, their business practices were poor, but my choice to stay was mutually beneficial for the duration. One could argue they didn’t deserve the fruit of my labor, but I was getting paid, and I was learning, so what benefit is to be found in bitterness?

    The next job situation may or may not be a repeat of the situation: you can’t blindly trust that your employer will take care of you – that’s not what they’re in business for, but nor should you be close-minded to the possibility that you may find a good employer who does offer more than just a paycheck and benefits. Some jobs will be that way, the key is learning how to identify them, and being prepared and able to walk when necessary.

  14. MMM says:

    Rick Beagle…I completely agree with you. You owe the company nothing. I’ve worked at a lot of “crude” business places before and have come to the realization that almost none of them have your best interest in mind, so why should you have theirs?! Times are so tough right now that one reason to change jobs so many times is for better opportunity(money). No, I’m not a greedy money-hungry person, I am quite the opposite, but I do need enough money to pay my bills and if another company is going to offer me more then I’ll probably take it. It’s nothing…..personal. My current job is a wonderful place to work with a lot of benefits and I feel more loyal to them than I do to any place I have worked before.

    I agree that Mr. ToughMoneyLove is painting a sugar coated rainbow. I am in the real world here and I can see that the world is different than it used to be. People used to be hired for their knowledge and loyalty and would stay at companies until they retired but this is now an out of date notion. Everyone is out for themselves. I think the only reason Mr. ToughMoneyLove feels the way he does is because he is a business owner himself and is looking for a good candidate but I don’t think you can entirely base this off of how many jobs someone has had without hearing their reasoning.

    I don’t believe PT Money or Mr. Rick Beagles views on employers lack of self regard are self-created either. I’ve been there and I know exactly what they are saying. You must be completely blind if you can’t see the crudeness in the workplace right now by BOTH employers and employees.

    So maybe you say our ideas are callous and ludicrous but what’s really ludicrous is someone who likes to sugar coat the reality and live in a fantasty world….now that’s ludicrous.

  15. N says:

    As a recruiter for a medium sized company, I can tell you that job hopping is a red flag for most positions outside of the most entry-level roles.

    The hiring process itself can be expensive and time consuming, so most managers try to hire individuals looking for long-term careers. We will typically avoid the resume of the job hopper and instead, look for tenure and progressive experience.

    It may not be so much about loyalty (after all this is business), but the cost of replacing personnel and training the reaplacements.

  16. Poet says:

    Companies are not loyal but expect employees to be loyal. I worked for a company and when my parents became ill and I had a death in the family, I did not get any support from my employer.

    But I had relocated to another state for the job and on the weekends I would drive 8-10 hrs. to visit my family. Eventually, to protect my own health and safety, I resigned that position.

    But prior to resigning tried to stay with the company by appyling for positions in the same state where my family lived but was rejected. There was no other option but to resign and find another job. Where was the employer loyalty???

  17. Paulkao says:

    I agree. Frequently job-hopping has much adverse consequece.As far as myself concerned, I have changed 3 different jobs.And I find I gain nothing but doubt and time-wasting.

Speak Your Mind

Please leave a comment and tell us your version of the hard truth...

You must be logged in to post a comment.