More Employers Are Turning to Job Titles to Attract and Retain Employees
Workspan Daily
May 12, 2023
Key Takeaways

  • A significant uptick. Pearl Meyer’s survey found a 35% increase from 2018 in organizations utilizing job titles to attract prospective employees and a 10% increase in using job titles to retain key employees.  
  • Increasingly leveraged as a reward. The survey also found a 74% increase in the utilization of job title elevation as another way to reward current employees.  
  • Not a long-term strategy. Experts caution against employers relying on elevated job titles as a strong retention option unless they are backed up by a pay increase. 
  • The value to the employee. Improving the job title of an employee is a form of reward, and the survey found 16% of organizations are giving employees autonomy to have a say in what their title is and how they're represented externally. 

While compensation remains a key ingredient in attracting and retaining top talent, organizations are sweetening the pot by utilizing job titles for current and future employees. 

Pearl Meyer, a compensation advisory firm, recently published a survey that found 54% of employers polled are leveraging job titles to attract prospective employees — a 35% increase from 2018. There has also been a 10% increase (27% to 37%) in organizations applying titles as a way to retain key employees.  

The 2023 Pearl Meyer “Job Titling Practices Survey” includes information from more than 400 public, private and not-for-profit organizations, and shows a substantial shift in the data from the previous survey conducted in 2018 (the firm does a job titling survey every four or five years).  

The survey also found an increase from 30% to 38% in the use of a job title to determine eligibility for some compensation programs, and one-third of those surveyed use titles to reward current employees — a 74% increase from the previous survey.  

“We have all heard about and experienced so much turmoil in the job market over the last few years, and much of the emphasis has been on a combination of compensation and flexibility in the war for talent,” said Rebecca Toman, vice president of the survey business unit at Pearl Meyer. “Our data indicates that companies are increasingly reliant on job titles as an important component of their talent strategy.” 

Not a Long-Term Strategy 

Susan Sandlund, managing director and leadership practice lead at Pearl Meyer, said that job titles are practical tools for employers and compensation professionals. Although, she cautioned against employers relying on them as a strong retention option unless they are backed up by a pay increase. 

“This data may indicate some employers are recognizing that in the absence of large compensation increases, they need to offer something to key employees,” Sandlund said. “I see this as a somewhat positive development in terms of recognizing there are rewards beyond pay that have meaning to individuals.  

“However, I would counsel organizations to likewise focus on career development opportunities and keep a close eye on maintaining a positive corporate culture. These elements are proven retention tools.” 

Regarding job titles’ impact, a report at details the reasons why job titles are important from a job applicant point of view — mainly because “understanding job title importance can help you better negotiate in a new position and help you get the compensation that you deserve,” according to the research.  

Another report on the importance of job titles, from Admired Leadership, outlines several reasons why titles can play a positive role within an organization’s culture. 

Toman said that for employers looking to attract and/or retain talent, unconventional or unique titles also are a way that employers can stand out in a competitive market.  

“Even though we've seen some layoffs, it's still very much a candidate's market, with record low unemployment, lots of vacancies, job shortages,” she said. “So unique titles are one way that organizations can differentiate themselves.” 

Pearl Meyer’s survey asked organizations if they use job titles to recognize and reward employees when funds are limited, with 13% indicating they are doing it -— up from 8% in 2018. 

“We do believe organizations are using it more to help when they may not have the ability to give a higher raise or a bonus,” Toman said, warning that, as always, it comes down to the total rewards package, so compensation has to be competitive, job title creativity aside.  

What’s the Value of a Title?  

Toman said that a title can convey something special about what it's like to work in a company, mentioning the “genius” title given to Apple service tech employees at retail stores. Also, she said an internal writer could be a “word wizard,” while an accountant could be designated a “numbers ninja,” and a communications pro could be an “ambassador of buzz.” 

“The applicant here gets the feeling that it is probably going to be a fun place to work, with an interesting culture,” Toman said. “This sounds more appealing than the other job that is titled ‘service technician.’” 

Another interesting finding in the research is that 16% of organizations are giving employees autonomy to have a say in what their title is, and how they're represented externally. 

“It's great when companies can use these titles that are unique as long as they really still convey the nature and level of the work,” Toman said, cautioning organizations about inflating titles, for example, making them sound like it's a bigger role than it is.  

Overall, Toman said their research found that titles are more important in 2023 than they were five years ago.  

“The fact that employers are using titles more in their talent strategy reflects a new mindset in a competitive marketplace," she said. 

Editor’s Note: Additional Content 

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