Pay is what Herzberg called a ‘hygiene’ factor – a possible source of dissatisfaction but not a motivator.
Whatever investment bankers tell you, you don’t get high performance simply by paying people lots of money. More important are factors such as job satisfaction, recognition and opportunities for personal growth.
But paying people badly can make them very dissatisfied. It can piss them off. It can convey a message that they are not valued. At worst, it can make it financially difficult for them to do the job, when their pay is less than they need to keep a roof over their heads or feed their families.
So a report from the Resolution Foundation makes for worrying reading.
It summarises the situation on public sector pay in Britain as follows:
“… the picture is similar in education, health and social work, and public administration (which covers most other roles). Indeed, on these projections average real pay in these sectors in 2019-20 would be lower than in 2004-05, meaning over 15 years of lost pay growth. In public sector education, real pay in 2016 was already lower than in 2003 and is now set to fall further, while health and social work could face a further 6 per cent real fall by 2019-20.” (page 4)
You can’t go on paying children’s social workers and other public sector workers involved in child protection less and less and expect it to have no impact. You can have all the recruitment campaigns you want, but you will not retain staff if you keep cutting their pay in real terms.
It’s a simple fact of life – it's not rocket science.