I'm currently reading "The Joy of Work" by Dennis Bakke, who was the CEO of AES for a number of years... in it he makes the point that compensation is rarely the most important factor for people.

Based on his own survey, he said that the most important factor to people is whether they get to use their skills and talents to make a meaningful impact.

If your people would leave their jobs for a 5% pay increase, you have hired the wrong people, or build the wrong kind of company!