Are Promotions Really Good for Employee Morale?

A new year has dawned and your 2013 resolutions might have included boosting employee morale. Perhaps your workplace morale is a little lacking or you’d like to see more employee engagement. Whatever the reason, you might be considering using promotions to boost morale and make employees just a little bit happier.

Sounds like a great plan, right? Maybe not.

Why promotions might not be the best fix for employee morale
In today’s tough economy, it’s possible your company just can’t afford to give everyone who’s great at your company a higher salary. So many companies choose to give great employees a fancier job title in the hopes this will help retain talent. According to a survey from WorldatWork, about 20 percent of responders gave out promotions without offering any kind of pay increase.

However, if this title doesn’t come with appropriate perks, it might actually cause more problems than it solves. With their fancy job title in tow, your superstar employee might be networking with similarly titled peers and realize that,  given their title, where they fall in your company food chain is not where they would expect to be.

You might have also accidentally given your employee the ammo they need to leave your company behind in the dust. By giving them a fancy job title, your goal was to boost employee engagement and workplace morale. But once they learn a pay raise isn’t forthcoming, this fancy promotion might actually be the tool they use to leverage another job. Now they have a fancy job title to mention in their video resume application to another company.

Ways to boost morale without fancy job titles
The first step before handing out promotions as a lure for increased employee engagement is to ask yourself: can we really afford everything which naturally goes along with this promotion? If the answer is yes, then by all means hand out fancy job titles because you have the raises and growth opportunities to back them up.

Your employee engagement and workplace morale is sure to improve because you’re recognizing good work. More importantly, with growth opportunities on the horizon, more of your talent is likely to stay in the office.

If the answer is no, like it is for many companies affected by the economic downturn, don’t give out job titles like candy on Halloween. Instead, focus on improving employee engagement without artificially raising employee’s expectations.

Work to boost morale by being more available to employees and providing more feedback. The Millennial generation in particular loves feedback in the workplace and many Millennial employees (and indeed employees of all generations) desire a workplace mentor.

To boost morale, you should also consider offering opportunities for learning and growth. Allow employees from your entry-level talent to your all-star players to take classes, gain certifications and learn new skills while on the job. Just because you can’t offer employees a step up in pay or responsibility doesn’t mean you can’t offer them the chance to learn new skills or take on new tasks.

Employees want to be challenged in their job and they want an opportunity to grow in their careers. If you provide these opportunities you’ll boost morale and help your company retain the top employees you need- no fancy job titles required.

What are some ways you can improve employee morale without promotions? Share in the comments!

IMAGE: Courtesy of Flickr by thetaxhaven.