Definitely, salary compression issues cause big problems and the worst part is that they cause the worst retention issues with the most tenured, most valuable employees who have knowledge of your company or codebase that can’t be replaced. Making sure that they’re not taken advantage of is what encourages a lot of people to job hop. That’s worse for employers, but it’s also arguably worse for employees who actually like their jobs, when compared to a situation where their compensation would keep up with the market. If you like your job, switching companies every 1-2 years to keep up with market introduces risk and many people would be happier if their comp just remained competitive.
(Shameless plug I work at a company that has a product for creating compensation bands which is a good buffer to salary compression. link if this would be helpful: https://www.aeqium.com/)
