Itching for a Promotion? You May Want to Hold Off for This Reason
- Promotion often means getting a salary boost.
- But higher earners are often first on the chopping block when economic conditions worsen.
Before you chase that higher-paying position, read this.
There are plenty of good reasons to pursue a promotion. For one thing, there's the prestige of a higher-ranking title, and if you work hard, that's something you deserve. Also, getting promoted often means seeing your salary go up. And a higher salary could help you meet financial goals, from building a retirement nest egg to buying a home.
But while you may be inclined to chase a promotion, now may not be the best time to land one. Here's why.
Staying put could buy you more job security
For months, financial experts have warned of an impending recession. The reason is that the Federal Reserve has moved forward with aggressive interest rate hikes in an effort to slow inflation. But as borrowing becomes more expensive, consumer spending can decline. And once that happens, businesses of all sorts may cut salaries in the absence of adequate revenue.
Meanwhile, the higher your rank at work, the higher your salary might be. That's good in theory. But if a recession hits, you may find that the people with the highest salaries get laid off first, since that leads to the biggest cost savings. So in some ways, it could pay to not get promoted right now.
How to protect yourself from a layoff
Sometimes, there's nothing you can do to prevent a layoff. If your company's revenue declines dramatically and it's forced to cut corners, you could end up on the chopping block through no fault of your own.
But if you do go after a promotion with a salary bump, a good way to protect yourself is to keep adding value to your company -- if you become an employee your company can't function without, you're less likely to be forced to leave.
You also may want to do some research to make sure the higher salary you ask for is reasonable given your industry, location, and experience level. You can do some digging at your company as well as online.
Say you make $90,000 and ask for a $15,000 raise, bringing your salary up to $105,000. If most people with your experience level (at your company and others) only earn $90,000 to $95,000, your employer might be quick to let you go if economic conditions impact your company negatively. But if you ask for a $95,000 salary, your employer may have an easier time keeping you.
Be careful with that promotion
Generally, getting promoted is a good thing, and you shouldn't necessarily be scared to advance your career. At the same time, be mindful of the timing of your promotion. If you see economic conditions start to affect your company, you may want to stay where you are a bit longer and ride out that storm.
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