Change is never easy. This is especially true when you are considering a career change - it can be a daunting task at any point of your work life. As the end of the year approaches, many professionals entertain the thought of changing jobs, roles or, lately, even changing professions.
Fadlah Hendricks, head of experience at PPS Financial Advisory
Professionals are no longer staying in the same career for a decade or more – they now job hop, change vocations or opt for new avenues of employment. According to the 2001 book Careers: An Organisational Perspective by AMG Schreuder and Melinde Coetzee, the average person will change careers five to seven times during their working life. The stats also reveal that 30% of the total workforce will now change jobs every 12 months, this means that by the time you are 42 years old, you might have changed jobs 10 times.
Gone are the days when changing careers is frowned upon – in fact, as the world becomes more tech-savvy, it’s almost expected that professionals will look to gain new skills and explore new interests to infuse their passion while adjusting to the career trends of the future. At least one-third of the activities of 60% of occupations could be automated – meaning that globally up to 375-million people may need to change jobs or learn new skills, this is according to a McKinsey report called Jobs Lost, Jobs Gained: Workforce transitions in a time of automation.
However, before you change your job, it is important to think about the reason why you are doing it. Is it to gain more exposure, a salary increase, for a more senior position or better benefits? Whatever the reason, you need to consider the financial impact on your life.
In South Africa, the unemployment rate amongst graduate professionals sits at 7.3% of the total unemployment numbers, according to Stats SA. The importance of making calculated decisions about career changes must be weighed carefully in the context of financial health. Resigning without employment in place can impact a professional’s career and their immediate family severely, as finding new employment has some spending months in the jobs market without success.
Most professionals consider a change to improve their financial prospects and long-term stability - this means that things like company benefits and incentives become very important. According to a survey by Randstad US, 66% of professionals agree that a strong benefits and perks package is the largest determining factor when considering job offers, and 61% would be willing to accept a lower salary if a company offered a great benefits package.
As such, employers are increasingly recognising the value of employee benefits and have been making strides to help professionals make better financial decisions. There has been a growing number of companies offering wellness or mental benefits and other forms of employee benefits in the hopes of boosting productivity, employee health and wellbeing, as well as attracting and retaining top talent.
However, before finalising the decision to move, scrutinise the employee group benefits. Compare your potential new employer’s benefits against your current employer, the amount of life cover or disability cover that is provided. If the group benefits are lower, check whether the salary increase is higher and how this may impact on the amount of money required to attain the same level of cover that you currently enjoy.
In order to make employee benefits possible, employment costs contributed 15% of total expenditure in the formal business sector, this includes salaries and wages, bonuses, medical aid, life insurance benefits, pension benefits, and other employee-related costs/benefits, according to Stats SA. So, it's vital that you weigh up all the options from the salary to company benefits and other obstacles or hidden gems.
Consider the impact on your financial plan and your journey to attaining your financial goals and ask yourself these five key questions:
While a new career and change in scenery may bring about new-found passion and excitement, it’s a step that shouldn’t be taken lightly. You will need a significant amount of thought, consideration, time and investment in order to make this change smoothly - think about your long-term goal and, most importantly, plan for it financially.