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It's pretty safe to say that your employer will never fully appreciate your contribution until after you leave. At this point, they will realize that your contribution isn't quite as easy to replicate as they thought, leading to productivity losses that they will have to pay a lot more to replicate. Of course, they could have just given you a moderate raise and saved more money than they ended up spending. A certain part of this is misreading the relationship, overestimating the hold they have over you, and thinking that you'll just stay if they match whatever offer you get elsewhere, not realizing that by the time you've gone through the effort of applying to and interviewing for other jobs, it's far more likely that you'll just take that to try something new.
This boss was confident that their subordinate wasn't going to leave, constantly brushing off and discrediting their years of experience and accomplishments. It was only once they told their boss they were leaving that their boss started to panic and trying to get them to stay.
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