December 13, 2024
Instead of a pay raise, employers compensate employees with new job titles.
A dry promotion is when an employee receives a promotion and takes on additional job responsibilities without a pay raise.This trend has become more common as companies react inflation and steady profit growth.
According to a Pearl Meyer study, 13% of companies reported giving to workers new jobs without salary increase in 2023
“We’ve all heard and felt so much turmoil in the labor market over the past few years, and much of the focus has been on the combination of compensation and flexibility in this war for talent,” said Rebecca Thoman, vice president of the survey business unit at Pearl Meyer.
Thoman says companies are increasingly dependent on job titles capture and retain workers. According to the data, 54% of companies surveyed leverage job titles to attract prospective employees, a 35% increase from 2018.
In addition, studies show that women are more often affected by this phenomenon 2024 Women in the Workplace Report showed that women were more likely stay in jobs without a raise, while men are more likely to leave for higher paying jobs.This often leads to women assuming more job duties without compensation.
Eric Anicic, an associate professor of management and organization at the University of Southern California’s Marshall School of Business, says companies are becoming more strategic about incentivizing employees, but he suggests dry promotions aren’t sustainable.
“These types of things can be motivating for certain types of employees, but over time, organizations run the risk of burning out their employees,” Anicic said. USA Today.
Anicic advises workers who accept dry promotion require a commitment from their employer to review compensation within three to six months.Employees should also negotiate benefits such as time off and flexible working hours.Anicic also suggests that higher titles can make an employee more marketable. He advises workers to use their titles to look for a new job with better compensation.
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