How Much More Money Would You Need to Be Happy at Work?
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What is the main topic discussed in this episode?
and how they may affect your finances and portfolio. Listen at schwab.com slash Washington Wise.
What headline finding about raises and workplace happiness opens the episode?
Here's your Money Briefing for Friday, December 1st. I'm J.R. Whelan for The Wall Street Journal. Yesterday, we discussed what's making workers so grumpy these days. Today, we're looking at what would bring people happiness at their job. For many, that might be a raise. But just getting a bump in salary might not be enough.
If you look at what employers are planning for next year, on average, they're expecting to increase workers pay for non-union employees by about 4%. Nobody's going to turn down that amount of money, but people said that they would need a 50% raise in order to feel happy and less stressed.
How much of a pay bump do employers plan versus what workers say they need?
We'll talk to Wall Street Journal personal finance reporter Joe Pinsker after the break.
This episode is brought to you by Charles Schwab. Decisions made in Washington can affect your portfolio every day. Washington Wise from Charles Schwab is an original podcast that unpacks the stories making news in Washington. Listen at schwab.com slash Washington Wise.
Money can buy a lot of things, but can it buy happiness at work? Wall Street Journal personal finance reporter Joe Pinsker joins me. So, Joe, as the competition for workers has heated up over the past couple of years, many employers have bumped up salaries. Has that made workers happier?
If you look at what employers are planning for next year, on average, they're expecting to increase workers' pay for non-union employees by about 4% next year. That's according to a survey from the consulting firm Mercer. Nobody's going to turn down that amount of money, but...
What did the Empower survey report about the 50% raise claim?
It's also interesting to compare that percentage to a number that came from a recent survey from the financial services company Empower. According to their survey, people said that they would need a 50% raise in order to feel happy and less stressed.
50% raise to be happy?
Yeah, it's quite a bit. It's probably not something that's going to come anytime soon, but that's the number that, on average, people would point to.
Yeah, I can understand how that would make people happy. How do those numbers break out in that survey?
So if you look at all of the respondents to the survey overall, their median salary was $65,000 a year. And the median response for how much money they said they'd need to make in order to be happy was $95,000 a year. And it's interesting, the survey also breaks down the responses by income bracket. And at each bracket, people are always saying a bit more than what they currently have. So even among the highest earners who were surveyed, they had a median income of $250,000 a year.
How do desired salary targets vary across income brackets in the survey?
Their median response for how much money they'd need to make to be happy was $350,000 a year.
So if people get a raise, that's nice, but it's never enough?
That's one way to interpret this, certainly. And anyone who has seen their pay go up over a period of time can recognize the ways in which, yeah, it's certainly better, but it's also something that you get used to. So we often focus on trying to make more money, but I was talking with a happiness researcher named Elizabeth Dunn, and she was saying that we might be better off directing more of our energy towards focusing on the best ways to use the money that we already have. There are ways we can change what we spend on and change how we save that are demonstrated to make us happier by lots of research. And so that might be a better place to start paying attention.
So the happiness might not just be handed to us. There actually is a bit of legwork on the part of the person who is trying to achieve happiness.
It's about making more of what you already have than focusing on what you don't.
So you've taken a look at several studies that actually measured the impact of certain amounts of money on people's happiness. What were the results?
Yeah, there's a good amount of research showing, maybe unsurprisingly, that there is a link between having more money and being happier. One study that came out last year found that people who randomly received $10,000 tended to be happier and in a measurable way for at least six months after they got the money.
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:01–0:28
2
What headline finding about raises and workplace happiness opens the episode?
0:28–1:10
3
How much of a pay bump do employers plan versus what workers say they need?
1:10–2:15
4
What did the Empower survey report about the 50% raise claim?
2:15–3:18
5
How do desired salary targets vary across income brackets in the survey?
3:18–6:03
6
What does research say about the effects of receiving large, unexpected sums on happiness?
6:03–7:26
7
How might focusing on spending and saving improve happiness more than chasing raises?
7:26–8:00
Speakers
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