Extra Status and Extra Stress: Are Promotions Good for Us?

Abstract

Promotions ordinarily involve higher wages and greater privileges; but often they also increase responsibility, accountability, and work hours. Therefore, whether promotions are good for workers' well-being is an empirical question. Using high-quality panel data the authors estimate pre- and post-promotion effects on job attributes, physical health, mental health, and life satisfaction in an attempt at answering this question. They find that promotions substantially improve job security, pay perceptions, and overall job satisfaction in the short term, and that promotions have short- and longer-term effects on job control, job stress, income, and hours worked. Despite these large effects on job attributes, however, promotions have negligible effects on workers' health and happiness. Only mental health seems affected, with estimates suggesting significant deterioration two years after receiving a promotion. Thus, the authors conclude that the additional stress involved with promotions eventually outweighs the additional status, at least for the average worker.