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Understanding What Influences Job Decisions: Is Money All that Matters?

Sector: Financial services, Health, Energy, Government, NGO, Consumer goods, Digital and technology, Education, Retail, Media

Team: Owain, Edward, Umar, Eugene

Partner: Oliver Wyman

Literature review

Understanding What Influences Job Decisions: Is Money All that Matters?

Working with Oliver Wyman, we developed a framework that outlined what, beyond extrinsic rewards like pay, employees value when choosing a job.

The Challenge

Governments and firms regularly grapple with the question of how to attract particular employees to their shores, to different sectors of the economy, or to their workplace rather than that of a competitor. Research intensive firms might want to attract the best scientists. Often just as urgently, there might be a critical need for low-paid employees in sectors in which local citizens are reluctant to work, such as fruit picking in the US and the UK. Or there may be a need to encourage citizens to take up private-sector roles in countries where the public sector is particularly attractive, such as in parts of the Middle East. When considering how to encourage people to move into new roles or locations, governments and firms often focus on extrinsic rewards — the pay, benefits or even visa facilitation that can influence an individual’s decision. But a growing range of research shows that these extrinsic rewards are only part of the picture. Together with the global management consulting firm Oliver Wyman, we set out to explore the other factors that should be taken into account.

The Approach

We first conducted a wide ranging literature review, examining the academic research on labour market decision-making. We then applied the lessons from this review to numerous real world case studies, including examples of how nation states and large firms have adopted new approaches to attract and retain employees in specific sectors. Our aim was to understand the relative weight that should be given to different factors. And to understand what their relative importance and interactions might be.

The Result

The evidence showed that extrinsic rewards should indeed be given due weight, but only as one of three lenses that encapsulate the motivations of individuals and groups to be interested in particular jobs. The evidence also demonstrated that two other lenses — intrinsic motivations and cultural values — are critical factors that are often overlooked.

Figure 1: The three lenses shaping labour market decisions

© Oliver Wyman

Intrinsic motivation is the sense of meaning and purpose that an individual derives from undertaking a role. It explains why some people choose to do something principally because of the meaning and pleasure they derive from it, rather than doing a better-paid job. Cultural values are the set of implicit societal rules and guidelines that open up and shut down career paths by implying that ‘people like me’ do (or do not do) ‘jobs like that’. These values go beyond factors that affect any individual’s motivation, and they explain why certain professions are more or less attractive in different countries: becoming a civil servant, for example, is held in much higher regard in some countries than others.

This framework, set out in a joint publication between CogCo and Oliver Wyman, has relevance for countries and firms looking to hire around the world. In the UK, it remains the case that certain professions are closed off to individuals from certain backgrounds or genders, not because they are legally prohibited, but because individual choices are shaped by cultural values. For example, women undertake 79 percent of jobs in healthcare and social work but just 23 percent of roles in transportation and storage. We believe that building this wider perspective into new policies and programmes can help open up opportunities for individuals who might not have previously considered particular roles.

"The CogCo team is world class. They bring extensive and deep experience in the behavioral science discipline, and perhaps even more importantly, bring a rare practical sense in solving even the most complex of behavioral science problems. It is a pleasure and a privilege to work with the team."

-Abhishek Sharma, Partner, Oliver Wyman

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Interested in working with us?

Get in touch at info@cogco.co

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