Many Workers Would Quit if They Knew They Were Underpaid

Posted by Viviana Vazquez in CareerJanuary 17, 2022(Last Updated July 26, 2022)4 min read
Key Takeaways
  • A recent study showed that workers of low or underpaid wages believe that other workers doing the same work are making similar incomes.
  • More workers would quit or ask for a raise if they had access to information about other workers’ wages, claims an Economist at UC Berkeley.
  • The Great Resignation movement is about people looking for higher wages or starting their own businesses.
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A recent study, titled Worker Beliefs About Outside Options,​​ shows that low-income or underpaid workers do not have an accurate perception of the labor market and the average wage other workers are receiving for similar work. The study was published by economists at MIT, the London School of Economics, the University of Cologne, and the University of California, Berkeley.


The United States’ Labor Shortages


During the past year, there has been a record number of job openings in the United States, with many leaving their jobs midway through the Covid-19 pandemic. According to the jobs report by the Bureau of Labor Statistics, in November 2021, 4.5 million workers quit their jobs, which outlined a three percent (3%) increase in the quit rate. As of November 2021, there were 10,562 job openings, according to the Bureau of Labor Statistics, continuing what is being coined the Great Resignation movement.



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Although many workers were terminated at the beginning of the pandemic and forced to collect unemployment benefits, others are quitting their jobs in search of higher wages outside of their current roles. The Worker Beliefs About Outside Options study, which was conducted in Germany, confirms the reasons for the Great Resignation movement in the United States.


A Push for Fair Wages in America


During the Sars Cov-2 public health crisis, also known as the COVID-19 pandemic, many Americans decided to separate from their jobs. Some have successfully secured higher-paying positions, while others have decided to start their own small business. Regardless of the reason, the push for more transparent and fair pay has been seen all across the country. 



Image Credit: John Gomez /


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Some states, such as Colorado and cities, such as New York City, are requiring employers to disclose salaries when advertising a job. Other states, including New York, California, and Florida have increased their minimum wage in 2022. In total, more than twenty states have executed an increase to their minimum wage.


How Do I Know If I’m Underpaid? If So, What Should I Do?


Talk to Your Coworkers


If you suspect you’re underpaid, ask your coworkers about their salary or pay. Most of the time, your coworkers will also want to know if they are being paid fairly compared to their peers. If your peers in similar positions are getting paid significantly more than you and have similar qualifications, you are most likely being underpaid. So take note of your coworker’s pay and bring it up to your supervisor during a scheduled meeting.


Research Similar Roles Online


If you are unable to ask your coworkers about their pay, one option is to research similar roles online. You can find salary information based on your position, location, and field by simply conducting a Google search. Some websites, such as Glassdoor and Payscale, will allow you to see specific salary information for a range of positions at specific companies.



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Analyze Your Work and Know Your Worth


According to Labor Department data, inflation hit a 39-year record high in 2021. Last year’s inflation rate was a whopping 7%. This means if you did not receive at least a 7% raise in 2021, your income was worth 7% less than in 2020. Inflation alone was enough of a reason to receive a raise in 2021. 


However, it is also important to know your worth as an employee. Have you taken on more responsibility? Are you going above and beyond for your employer? If you have and have not been awarded a raise, it may be a wise decision to speak to your manager about your pay.


Keep Your Resume Updated


Keeping your resume updated will allow you to easily apply to other jobs. With over 10,000 job openings available, having an updated resume can help you secure the higher-paying job you deserve. Some websites, such as Indeed or LinkedIn, allow you to upload your resume once and notify recruiters that you’re open to work. This will allow jobs to find you, and vice-versa.


Apply, Even If You’re Not Looking


Many career coaches recommend applying to jobs, even if you’re not searching for a new one. This allows candidates to never miss out on opportunities and practice interviewing, in the case of a job separation. By applying to similar roles, you will also be aware of the salary range that is being offered for the work you are doing. This knowledge can help you decipher whether or not you are being paid fairly at your current job.


Have you ever suspected that you were underpaid? If so, how did you go about addressing the issue? Please share your thoughts with us in the comment section below.


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