Does your job title matter?
Does your job title define your position within the business or has it become irrelevant to what you do on a daily basis? There have been many conflicting opinions in recent years when determining the real value of having a job title. Research has indicated that an employee’s job title can affect a number of different things – from an employee’s mental health to a measurement of one’s self-worth within the workplace. Years ago, job titles were used to represent an employee’s specialisation and level of seniority. Today, many companies use job titles as an outlet to reflect their brand. Some companies even choose not to have job titles to reinforce their flat organisational culture.
How significant is a job title?
Through our experience working with candidates, we have noticed that candidates often go for the job with the better title and not necessarily a better pay or remuneration package. In fact, BambooHR stated that 1 in 5 employees would prefer to receive a promotion with a higher title without a 3% raise, rather than getting a raise without a promotion. This is because the evolvement of a job title can be perceived as a means to calibrate an employee’s value-add to the organisation and a way to gauge career advancement. To many, having a better job title is synonymous to success and therefore more deserving of respect and status from colleagues and external stakeholders. An impressive title can offer employees a psychological boost as a result of the recognition their employers have on their efforts and hard work.
Job titles also allow stakeholders including colleagues and clients to be able to determine an employee’s level of experience and contribution to the business. This can be especially useful when a company is growing rapidly and employees need to know each other’s responsibilities in order to work better together. Research conducted by compensation consultancy Pearl Meyer & Partners found that 80% of companies use job titles to signal where the employee stands within the corporate hierarchy and more than 92% use job titles to define an employee’s role.
Why are job titles straying from the conventional?
Many technology firms employ innovative job titles as a means to reflect their progressive work environment where skill is valued over tenure. Flexible titles are also perceived to support innovative and out of the box thinking. To name a few, Apple calls its service technicians ‘geniuses’, Google calls its HR managers ‘Chief Happiness Officers’, Disney calls its engineers and multimedia experts ‘imagineers’ and AOL calls its analysts ‘digital prophets’. Unconventional job titles allow companies to tap into their creativity thereby allowing employees to take ownership of their roles and better engage with the company. Research published in the August 2014 issue of the Academy of Management Journal has identified that employees were less stressed and burned out when they were allowed to create their own job titles.
Are job titles important during candidates’ job search?
During a candidate’s job search, getting a job title right is of pivotal importance. This is because employers use applicant tracking systems (ATS) to fine comb through CVs within a database to identify possible matches based on key phrase recognition such as job titles. However, ATS systems are currently unable to understand creative job titles in the absence of an industry standard algorithm. As such, high-quality candidates may find themselves excluded in the automated screening process or may not appear in a recruiter’s Linkedin search. We recommend that for candidates to maximise their chances of landing a highly coveted role, they would have to include generic job title terms in their CV in order to be detected by the ATS. If the candidate’s previous employer assigned a job title that may not be widely recognised, they might want to consider substituting their job title for a more industry standard version.
Our thoughts and observations
Based on our experience, job titles are not as relevant as it used to be. The nature of jobs are constantly evolving with the advent of the digital age. However, not all titles are changing at the same pace as the business is going - with some companies hiring into roles where the job specification has been fluid but the job title has not. Job titles can often be misleading or unclear as they may relate to different responsibilities from organisation to organisation. For example, a Chief Risk Officer (CRO) at a start-up would have a different set of responsibilities to a CRO in a global big 4 bank.
Based on our experience recruiting candidates, we have observed that millennials (born after 1980) are not entirely motivated by job titles in comparison to older generations. Research has showed that 92% of millennials believe that businesses should not be solely measured on profits alone. Deloitte has reported that 95% of millennial employees classify work/life balance as a determining factor for them. On average, millennials would prefer to forego $7,600 in their annual salary and work instead for a company that provides them with a better environment. This hugely differs to candidates in the past whose key motivation was financial stability and the prestige of the company they work for. There has been a paradigm shift in what applicants look for in their next role. Millennials today look for a workplace that aligns with their own values and one that fits within their approach to life.
For our clients who have implemented unconventional titles, we have gone the extra mile and connected the abstract titles to the position at hand – making it easier for candidates to assess their suitability for the role. In saying that, we do agree that employers setting the right job title could help attract the right candidates. The focus on hiring the right candidate should however move away from purely job titles. Very often, the similarities between occupations such as the required knowledge, skills and competencies can indicate a much better fit.
Our two recommendations to candidates
- Job titles should not influence candidates’ decision. Instead candidates should have a clear understanding of the job requirements. Think of long term career progression, pay, work perks and work culture. These aspects have more tangible benefits than a fancy job title.
- Job titles should not be over-relied on; especially when unconventional. Employers look beyond a job title in a candidate’s CV. It is becoming more common for hiring managers to go through the candidate’s previous training and experience rather than relying solely on the job title. We advise our candidates who are looking for their next role to expand more about their specific accomplishments and job duties if their titles do not accurately reflect their responsibilities.
We can help
If you are a candidate looking for your next opportunity or a client looking for your next talent, we can help. Feel free to contact us on 02 8251 2100 for a confidential discussion.