‘That’s why people are always job hopping’: Worker issues PSA how a 2-4% salary increase is a ‘cost-of-living adjustment,’ not a raise

A user on TikTok has gone viral and sparked discussion after sharing a video about wage increases.

In a clip with over 911,000 views as of Saturday, TikTok user Kyyah (@kyyahabdul) lays out her argument as to why minor increases to wages may not be as good as they initially seem.

“A 2 to 4% salary increase is not a raise,” she says. “That’s what we call a ‘cost-of-living adjustment.’”

@kyyahabdul If you are going above and beyond at wrk and you only got a 2% salary increase…don’t be afraid to assess your options #corporate #corporatetiktok #corporateamerica #careeradvice #careertiktok #careertok ♬ original sound - Kyyah Abdul

While the phrase “cost-of-living adjustment” is most often applied to Social Security payments, the idea behind this phrase is consistent.

Essentially, prices tend to rise over time due to inflation. That means that if someone was paid $50,000 for two years in a row, the actual value of that $50,000 would be less the latter year as prices have gone up. A minor increase in wages, which Kyyah refers to as a “cost of living adjustment,” is meant to combat that decrease in value.

Kyyah continues her explanation of the differences between different kinds of wage increases in her TikTok.

“The next step above that is a ‘merit increase,’ which means they’re paying you for the performance that you had in the past year,” she details. “That generally ranges anywhere from 5 to 9%.”

Finally, she gets to what she considers to be a proper “raise.”

“A real raise and promotion is going to be anywhere from 10 to 20%,” she says. “And that’s why people are always job-hopping because companies think these little 2 to 4% salary increases mean something.”

“With the cost of inflation, I’m sorry, 2 to 3% ain’t gonna cut it if they want to keep talent,” she concludes.

In the comments section, many users agreed with Kyyah’s idea, though some users quibbled with the percentages given.

“2 to 4% is a loss against inflation,” noted a user.

“My year end was today and my whole department got a 2% ‘merit increase’ … like inflation was 9% last year that’s a DEMOTION,” claimed a second.

“10-20% raise is a cost of living adjustment this year,” alleged a third.

These comments reference last year’s record inflation.

According to the Federal Reserve, “policymakers generally believe that an acceptable inflation rate is around 2 percent or a bit below.” If inflation was truly 2%, a 2% raise would be a fitting cost-of-living adjustment.

However, inflation has recently skyrocketed above 2%. According to CNBC, which cites data from the U.S. Bureau of Labor Statistics, “inflation closed out 2022 with a 6.5% annual reading, as measured by the consumer price index.”

Based on this data, a proper cost-of-living adjustment would be around 6 to 7%.

TikTok users voiced their frustration with minor wage increases from employers in Kyyah's comments section.

“I got a 1.6% salary raise but my rent increased 26% so idk what they thought that 1.6% was doing,” shared a commenter.

“I love my job but I got ‘exceeds expectations’ the last two years in a row and got 2%,” recalled a second.

“I got 1% on a Exceeds Expectations this month,” shared a further TikToker. “I’m looking elsewhere tonight.”

We’ve reached out to Kyyah via email.

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