There are two kinds of employees in this world.
Those who work hard, do a good job, and remain loyal to their employer for years and decades.
And then, there are those who actually get paid what they are worth – and oftentimes much more.
Of course, there are some exceptions that prove the rule.
Just like there are people who can beat the market, get by with sleeping 4 hours a night, and charm the pants off anyone they meet.
Hint: NOT you
The rest (i.e. 99.9%) of us have to contend with a simple, yet unpleasant fact of life:
Regularly changing jobs (or at least being open to a job move) is probably THE biggest lever you’ve got to maximize your career earnings and accelerate your chosen path to financial independence.
Job Hopping, Defined
For whatever reason, job hopping has developed a pretty bad rap over the past few years. Hence, a few clarifications are in order.
The kind of job hopping I am talking about here is NOT about changing jobs every six months, chasing down yet another 5% raise, and failing to develop any meaningful skills along the way.
It is also NOT the kind of job hopping that leaves you with a career path too convoluted for even Hercule Poirot to decipher.
No, what I am talking about here is setting clear and ambitious career goals for yourself and navigating the job market in a way that puts YOU firmly in control of your career trajectory.
Think about it this way.
Person A goes through four random jobs in 8 years.
Person B, on the other hand, spends two years as an analyst at Goldman, follows that with an MBA at Wharton, subsequently lands a gig at Bain, and ultimately moves into private equity.
Person A will most likely come across mightily disorganized and opportunistic.
Person B, on the other hand, will be perceived as someone with a ton of momentum, a well-rounded skill set, and highly compelling experience.
To take the argument even further, I’d argue that Person B will be a much more attractive employee versus someone who got comfortable and stayed at Goldman for 6 years, rising to the rank of a senior associate in the meantime.
Guess who will command a premium in the marketplace?
Anyhow, if you aren’t yet convinced about the benefits of job hopping, please do yourself a favour and read my post on why loyalty doesn’t pay.
For everyone else, let’s dive into some concrete tips to use job hopping as a strategic tool to accelerate your career trajectory.
The Best Time To Look For A New Job…
… is when you don’t need one.
Most folks treat a job search as a once-in-a-decade (or at best, once-in-a-couple-of-years) type of event.
As a result, when the time to find a new gig does roll around, they are rusty, unprepared, and too far behind the eight ball to achieve a decent, let alone an optimal, outcome.
If you really want to take control of your career trajectory, you’ve got to look at moving jobs as a constant part of your strategy.
Now, it doesn’t mean you actually HAVE to move jobs all the time. But it does mean staying on top of industry developments. Understanding who is hiring and who is not. Speaking to headhunters.
Most importantly, it means constantly marketing yourself, albeit in a soft way.
Things like meeting up with industry contacts (ideally at a level or two above yours) to understand what they are up to and giving them an update on your own career progress and achievements.
Actually staying in touch with folks who leave your organization, especially if you know they are going places. It’s shocking how few people do this and let those valuable relationships wither and die.
Even more importantly, helping those colleagues of yours who may have been let go.
Not only it’s the right thing to do, but it’s one of the most powerful ways ever to build a lasting connection – while banking a favour you can call in at some point in the future.
Does all of this take time and effort? Sure.
But in a world where your network is your most valuable asset, it’s time incredibly well spent.
On top of that, there are many immediate benefits from being in the “flow”.
For example, understanding what your competitors are up to means you can create more value for your existing employer.
Similarly, connecting other people with opportunities that may not be right for you allows you to quickly accumulate valuabl social capital.
Have A Narrative
I’ve touched on this aspect above, but given how critical it is, let’s explore it in more detail.
When it comes to changing jobs, a lot of people are concerned that any future employer will consider them to be a fleeting, unreliable job hoppers.
But the way to mitigate this risk is NOT to stay in one place and get paid below market for decades and decades.
After all, what’s the point of having an amazing reputation for being loyal if you can’t actually monetize it?
What you REALLY need is a compelling narrative for the job changes you’ve made in the past.
Here’s an example from investment banking.
Perhaps you got your start in a specialized boutique with a focus on M&A.
After a couple of years, you’ve decided to broaden your skill set by working on equity (i.e. IPO) and debt financing transactions. To do that, you’ve moved to a large European bulge bracket.
A few years later, you’ve realized that European banks have structural, long-term challenges (those in banking will understand why) and decided to switch to a US bank instead to enable a more sustainable career in the industry.
All of a sudden, you are no longer being perceived as a tenuous job hopper.
Instead, you come across as someone who is action-oriented, has a firm grasp on their career, is focused on developing their skill set, and also has a good view as to where to deploy that skill set.
Most importantly, you communicate your attractiveness as an employee. The fact that three banks saw you as a high-quality hire puts a very compelling “stamp of pre-approval” on your candidacy.
And if you are smart about how you tell your story, you can make yourself even more attractive.
Saying things like:
“Out of college, I had offers from A, B, and C and ultimately decided to go with B for the following reasons”
“I wasn’t necessarily looking to move, but bank X reached out with a very compelling offer that I couldn’t refuse”
“My boss left to join another bank and decided to bring his top employees with him. I was fortunate enough to have made the cut”
are all great ways to provide subliminal social proof that you are, indeed, a top-notch prospective hire.
Do Not Renege
This is a tricky one.
Some organizations will let you resign. Many others (usually the smart ones) will try their best to keep you – especially if you are good at what you do.
And if they are really smart, they will give you a counter-offer that’s actually BETTER (sometimes, much better) than the job you are leaving for.
It happened to me EVERY single time I moved. The floodgates of corporate generosity would open wide, with promotions, pay increases, and one-time bonuses all on the table.
Oh, what to do? Tough to turn down all that money and possibly a promotion along the way.
I get it – and yet, my strong recommendation is to NEVER renege on an offer you’ve signed (with two exceptions below).
Word travels. People talk. And when they do talk, they don’t have great things to say about someone who strung them along only to walk last minute.
In other words, you may be maximizing the outcome today, but you are surely short-changing yourself tomorrow.
I personally know someone who reneged twice, both times at the associate level.
The first time, he scored a $20k one-off bonus. The second time, he managed to get an early promotion to VP and a top-bucket annual bonus.
And then… the calls just dried up. Why waste your time hiring someone who will just shop your offer internally?
That person is now a Director. The problem is that the bank he is working for is de-prioritizing the line of business he is in.
As a consequence, he is getting paid well below market rates and the promotion to MD is nigh impossible.
The price of those early “gains” for my acquaintance? Being paid about six figures below market every year and being stuck in a dead-end career.
So please, do yourself a favour and do not renege.
One possible exception to this rule is if you are in the waning stretches of your career and this is your last move.
If your current employer counters with a cushy job that you can ride out until you retire, the reputational damage may be worth the risk.
Another possible exception is if your existing employer counters with an offer that is just too good to pass up.
Perhaps it’s a promotion that would take you another 3-5 years to achieve. A spot on the ExCo. A firm steer that you are on track for the C-suite.
It’s very rare, but I’ve seen it happen. The trick here is not to ghost the company you were going to join. Instead, sit down with them, and clearly explain the reasons for changing your mind.
At the end of the day, rational people will understand why you’ve decided to stay – and will be able to articulate your decision internally (keep in mind they’ve got to cover their own backs once you renege).
If anything, you will come away as a high-value target that was just too expensive to snap up.
And finally, here’s the most important job hopping tip of all:
Some folks get so focused on changing jobs that they forget the very first pre-requisite for having a wildly successful career:
Be exceptionally good at what you do.
Now, you obviously need to strike the right balance between doing a good job and making sure as many people as possible know you are doing a good job (note: if you don’t know how to do that, please read this)
Some people fake the former and hope self-marketing makes up for it.
But over time, you will be found out.
Your colleagues, managers, and underlings will know the difference.
External parties you are working with (lawyers, consultants, co-advisors) will know the difference.
Good headhunters, who make a point of cross-referencing your qualifications, will know the difference.
Two years ago, we were looking to add a director-level banker to our team. A strong candidate showed up, with all the right logos on his CV. He interviewed well and was well-advanced in the process.
And then we ran our DD on him.
Another director we knew happened to be in the same associate class with the candidate about seven years earlier. The feedback was negative.
A friendly headhunter who placed the candidate into one of the previous roles didn’t have great things to say either, having collected some negative feedback from his client.
It was an instant no from us. We’ve invested far too much time into building a high-performance team and weren’t going to risk it with a bad apple.
Make no mistake,
job hopping strategic job moves are an important part of your career strategy.
But once you’ve nailed (even if temporarily) your flag to a specific mast, you owe it to your employer to do an excellent job – and leave your team in a better shape than it used to be.
We are now almost 1,900 words into the post – so let’s wrap it up with some negotiating tips.
Job Hopping: How To Negotiate An Offer
I could probably write an entire book on this so let me keep it concise and leave you with the most important advice.
#1: NEVER make the first proposal
There’s nothing but downside here. If your ask is too high, there wasn’t a deal to be done anyway.
But in the vast majority of cases, you will short-change yourself by asking for less than a prospective employer was looking to offer.
#2: NEVER accept the first offer
No one in their right mind starts negotiations by putting their best and final offer on the table. And if they do, you probably don’t want to work for those people anyway.
If you play your cards right, you will be able to drive a truck between the first offer and what’s ultimately in your contract.
#3: NEVER react
This is another big mistake I’ve seen people make. They start engaging before the prospective employer has a chance to lay out the whole package.
The M&A banker in me cringes every time I see this kind of behaviour. It comes across immature, unprofessional, and hampers your ability to negotiate a good deal for yourself.
The BEST thing you can do is to listen to the proposal in its entirety, promise to consider it, and say you will revert in a day or two.
This puts you firmly in the driver’s seat, leaving the prospective employer with all kinds of self-doubt.
Was the offer good enough? Are you contemplating any other proposals?
#4: NEVER be afraid to ask for what you want
In life, not asking for something you want is usually seen as an admission that you don’t really deserve it.
On the contrary, asking for something you want – and doing it in a calm, confident way – is a fantastic way to lay a pretty strong claim to that dream job, promotion or pay increase.
So there you have it.
Be strategic. Be confident. Be open-minded.
Good things will happen – guaranteed.
As always, thank you for reading – and good luck!
About Banker On Fire
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Banker On FIRE is an M&A (mergers and acquisitions) investment banker. I am passionate about capital markets, behavioural economics, financial independence, and living the best life possible.
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