Exploring variables impacting on employee willingness to accept lower pay for a preferred employer attribute

Abstract

We explore the trade-off between “preferred employer attribute” (PEA) and “willingness to accept less pay” (WTALP), finding salary, generational and for-profit versus nonprofit effects on WTALP. Study 1 reports on interviews with 23 professionals about the employer attributes they found most attractive. Three PEAs emerged: people, organizational purpose (purpose), and opportunity for growth and development. Unprompted, interviewees also mentioned willingness to accept lower pay (WTALP) in exchange for attractive job qualities. Study 2 surveyed 129 employees to explore further the PEA-WTALP tradeoff, controlling for gender, race, and salary level before testing for the impact on Generation (Z, Y, X, Baby Boomers) on WTALP, and separately comparing WTALP for-profit versus nonprofit employees. Growth and development PEA was most preferred by 67% (n=86), while 42 respondents selected purpose (n = 34) or people (n =8) PEAs. Regression analysis for the growth and development PEA-WTALP group showed that higher salary level, and Generation Z were associated with higher WTALP. In addition, surprisingly, employment at for-profit firms was associated with higher WTALP. This is the first empirical study measuring scaled levels of WTALP and testing for specific PEA-WTALP combinations. We conclude with future managerial and research implications.