Promotions Got a Boost in 2021

​Promotions are on the upswing as the economy continues to rebound from the ravages of the COVID-19 pandemic.

New data from LinkedIn shows that promotions among professional workers in the U.S. shot up 9 percent in 2021 from the previous year's abnormally depressed levels and was 0.9 percent above 2019 levels. The analysis of 47 million active U.S. profiles on the site revealed that promotions had fallen 7.4 percent in 2020 as the pandemic raged.

"The world was upside down in 2020, with employers trying to figure out if they are still in business and employees trying to figure out if they still have jobs," said Juan Pablo Gonzalez, senior client partner and global sector leader of professional services at Korn Ferry. "It is not surprising that promotions were put off, and it wasn't the best time to ask about a promotion. While we're still not out of the woods, organizations have begun to stabilize and there are a number of people who are up for promotion whose promotions were deferred," he said.

Niki Ramirez, SHRM-CP, founder of Phoenix-based small-business consultancy HR Answers, added that in addition to the pent-up demand for promotions, there is also a desire to promote high-performing, ambitious employees and a need to backfill positions that were vacated during 2020.

"As employers came out of crisis management mode, many business leaders realized that 2020 was not as bad as they thought it would be, outside certain sectors," said Sarah Hawley, CEO and founder of Growmotely, an Austin, Texas-based marketplace platform for remote workers. "The increase [in promotions] over 2019 probably comes from employers being more aggressive after a year of constriction. Companies are experiencing growth and have decided to hire more and promote the people they have."

Some industries offer far greater promise for career advancement than others, LinkedIn found. Data shows that top industries for promotion include product management, marketing, project management, accounting and human resources.

Promotion Equity

The problem of inequity in promotion between remote and in-person workers has risen to the fore as more organizations decide to implement hybrid work arrangements, which combine onsite work with remote work. Some experts say that remote workers—however productive—could suffer from a lack of in-person collaboration and networking with colleagues and managers, negatively impacting promotions.

"Managing performance between onsite and remote workers creates interesting dynamics and challenges that fall on leadership," Gonzalez said. "If some employees come to work and some don't, there is the potential that the onsite employees' work will be more visible to their supervisor."

Hawley believes that the hybrid work experiment is flawed, creating division within a company's culture and making it challenging to maintain equality among differing sets of workers.  

"The most important thing to do as a leader is to fairly evaluate whether somebody is meeting the objectives and outcomes in their work," she said. "The work should be evaluated the same way, regardless of where they do the work. Some managers may still carry the bias that seeing people come in at 9 a.m. and leave at 6 p.m. [means they] are doing more work than someone working from home, but I think we've seen that isn't necessarily the case."

Ramirez recommended having an annual, future-focused professional development conversation with each employee that is separate from their performance evaluation. "I believe that when we are trying to create a system in an organization that provides for equity, we have to have a way to discover who would like to be considered for a future promotion, if possible. This conversation is even more important now, with the possibility that a part of your workforce is remote. Managers must be very intentional to create an opportunity for all employees, including remote workers, to voice their desires and work with them to create a plan for professional development that makes sense."

Hawley suggested that leaders ensure everyone participates equally in team functions and managers make an extra effort to be intentional and consistent when communicating with those not in the office.

Title Change or More Pay?

For some, an upgraded title and new responsibilities are the more valuable parts of the promotion. For others, higher compensation is the desired aim. But if the promotion doesn't offer significantly more money in 2022, the raise is in essence a pay cut due to rising inflation.

Average pay increased 4.7 percent in 2021 to over $31 per hour, but the consumer price index climbed 7 percent year-over-year in December, resulting in a 2.4 percent decline in pay in 2021 for the average employee, according to the Department of Labor.

"Yes, costs are going up and money doesn't go as far," Gonzalez said. "But pay levels have gone up as well, to counter labor scarcity. That labor cost has been passed on to the prices of goods and services, resulting in a pay increase not going as far as it did a couple of years ago. In a noninflationary environment, one's pay raise wouldn't be as high. So, it's circular."   

Job seekers in this hypercompetitive labor market are demanding higher compensation, Ramirez added. "Inflation is a concern, and for employers to make good decisions about pay and benefits they need to dial in to benchmark survey data, look at local cost-of-living data and be as savvy as possible when creating an attractive package for employees and job candidates," she said.

Gonzalez noted that while promotions often have higher pay attached, providing more compensation shouldn't be the reason to promote someone. "Increasing someone's salary in order to keep them in the organization should not equal a promotion into another job that the person is not ready for," he said. "Employers take a serious risk when they start changing how they get the work done to match pay levels."           

Ramirez said that when leaders are trying to make decisions about title changes and promotions and whether to link those decisions to more compensation, they need to let benchmark data drive the compensation decision based on the role's duties.

"A single-note arms race on pay isn't the solution," Gonzalez said. "Just paying more money is not distinctive. Employers should work toward promoting an employee value proposition [EVP] that addresses other needs, such as challenging and rewarding work, great co-workers, and culture. A superior EVP allows an employer to stand out in the marketplace and ultimately help to retain the people they need."