Younger workers, including Gen Z and millennials, see significantly higher pay increases when switching companies than do those in older generations, according to a report from Bank of America Institute.
That's often because older workers are in higher-paying roles, where they are more likely to be rewarded for their loyalty.
How much of a pay increase can you expect with your next job offer? It might depend on your age.
Gen Z workers who joined a new company had about four times the wage growth of those who stayed put, according to a Bank of America Institute analysis comparing median pay in the first quarter of 2026 with a year earlier. Millennials who switched got about twice the pay increase of those who stuck with their employer.
But the job-switching premium has largely dropped away for older workers. Gen Xers and baby boomers tended to experience greater wage gains by staying at their company, the Institute said.
Job-hopping used to be the surest way to a raise. That's still true if you're early in your career, but the payoff is shrinking for everyone. For older and higher-paid workers, staying put now often pays more than leaving.
The gap reflects that many young people start at the bottom of the career ladder, with more opportunities for quick advancement. They may be moving from part-time to full-time jobs or moving into roles that use skills they built in school or training programs, said Joe Wadford, an economist at Bank of America Institute. Older adults tend to already hold higher-paying jobs, where loyalty is rewarded because they bring more sought-after expertise or experience.
Younger workers may have more incentive to seek out higher wages, given that financial pressures tend to ease as Americans age, Wadford said. Older adults—especially those who own homes—may be somewhat shielded from cost-of-living increases, and are able to prioritize finding a remote or flexible position, he said.
Younger people need to out-earn fast-rising expenses, Wadford said. "They're taking on more financial responsibilities like buying a house, buying a car, maybe even starting a family," he said.
Still, the labor market has been tough for all generations. Many employers have kept their workforces the same size. With job growth flattening, companies are less likely to have to compete for talent and offer higher compensation, Wadford said.
The gap between switchers' and stayers' pay is the smallest in seven years, and Gen Z switchers' raises have fallen about 20 percentage points since 2022, the Institute said. For Gen Xers and baby boomers, pay bumps from taking new jobs are largely gone: those who stayed saw steady raises, while those who left saw pay stay flat or slip.
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