People want good jobs that pay well. They want to work for organizations that fit with their values and abilities. But how often should they change jobs? Wharton Associate Professor of Management Matthew Bidwell drew from a course he teaches, Understanding Careers and Executive Labor Markets, for a lecture on when to leave and when to stay put.

“There’s never a safe answer to whether you should or should not move,” he says, citing a cautionary trend from the financial industry: Analysts who change employers may be serving the same clients and covering the same companies, but every time they move, they’re less likely to be rated a top analyst, at least initially.

It’s true in medicine, too. What makes a surgeon good? According to Bidwell, it’s not just how many operations he or she has performed in total. When surgeons start doing the same procedure in a new hospital, their patients’ mortality rates go up even though they’re doing identical work. “But they’re doing it with a different surgical team,” says Bidwell. “That matters to the outcomes.”
Across all industries, “It can take two or three years to get up to speed,” he notes. “You’re building new relationships and learning the culture.” During this period when a new employee is underperforming, management might wonder why the organization was willing to pay so much for a laggard—and decide against a raise for a couple of years.

In a 2011 career survey of Wharton MBA alumni, “We were able to look back and see how many people moved jobs and how many grew internally,” says Bidwell. “We found that when you move jobs, you get an immediate pay raise, so you would assume changing jobs more means you make more money.” But there’s a catch: You get the pay raise when you arrive, but if you underperform, you’re less likely to get the raises you would have been awarded at your former company.

Bidwell offers advice on when it might be time to change companies and when you’re better off moving up internally: “We’ve found that you’re more likely to be hired into executive jobs if you have functional breadth—and moving firms is one way to get that. So moving to build your résumé is good if it does so by giving you breadth.” In fact, he says, most successful executives have worked for just two or three companies in their careers. They developed the skills they needed through internal promotions, not by job-hopping. —Louis Greenstein

Published as “At the Whiteboard With Matthew Bidwell” in the Fall/Winter 2018 issue of Wharton Magazine.