It seems to be happening more and more. Employees are finally getting promotions they’ve been working hard for, but without one crucial element – more money.
This phenomenon is called a “dry promotion” and it puts employees in a bit of a pickle. Everyone likes to get praise, but is it worth it to take on more work for the same compensation?
“When this happens, the employee takes a look and waits this out based on those criteria,” said Jeff Sokolowski, a practice director at Robert Half management consulting, per WWJ. “What are our pros and cons? Think about why this new opportunity aligns with their personal professional aspirations. Are there ways where there could be maybe non-compensation benefit?”
According to a recent report from WTOP in Washington, D.C., a recent Robert Half survey found that 33% of Gen Z workers were offered a dry promotion in the last 12 months. Additionally, 18% of millennials were offered one, as well as 7% of Gen X workers and 3% of baby boomers. Boomers were more likely to take a dry raise than Gen Z at 83% to 76%.
CBS News noted that women tend to feel greater pressure than men to accept a dry promotion.
Late last year, the Society for Human Resource Management warned that, “while employers may see dry promotions as a sign that they recognize and value their employees, many employees view it differently.”
Citing data compiled by the ADP Research Institute, the SHRM said that promotion strategy is key to employee retention.
“The reasons [for the promotion] matter. If the promotion is a sneaky way to get more work for the same money or it’s a token gesture, it can lead to retention issues,” said James Neave, head of data science at job search engine Adzuna in London, as quoted by the group. “You have to make sure that you aren’t teeing your employees up to leave.”
CBS News said that “like bar that doesn’t’ serve alcohol, dry promotions lack the heady ingredient that most clearly signals how much a business values an employee – money.” Ray Smith, a Wall Street Journal reporter who wrote about dry promotions last month, also told CBS that employees should use these offers as a chance to negotiate.
In that Wall Street Journal article, Smith explained that data suggests dry promotions are a result of companies trying to retain talent with tighter budgets amid economic uncertainty. While some economic indicators in the U.S.
have been positive, inflation is still up and wars in both Europe and the Middle East are contributing to ongoing uncertainty.
Smith’s report said 13% of employers recently polled by compensation consultants Pearl Meyer said they are relying on new job titles to reward employees when money for raises was limited. That’s up from 8% in 2018.
“Consider no-raise promotions a sign of workers’ ebbing leverage now that labor shortages have eased and companies are cutting costs where they can,” he wrote. Dry promotions tend to climb in times of economic uncertainty, executives and pay consultants say. Companies doled out hefty raises just to keep hold of workers when labor was in shorter supply.
Now, some managers are shifting the duties of laid-off workers to remaining staff without a commensurate bump in pay.”
Sokolowski said that dry promotions might be a risk for employers trying to retain talent. However, he also encouraged workers to consider them, along with promises in writing for future pay raises.