Position-Specific Promotion Rates and the “Fast Track” Effect

Abstract

Some positions within a firm consistently lead to promotion with a higher probability than other positions at the same hierarchical level. Therefore, serial correlation of promotion rates is not indicative merely of individuals with high innate ability, but it is also a feature of organizational structure. I describe these positions as “fast jobs” and present a model in which jobholders acquire human capital in these jobs that is more valuable at the next level. Data from a financial services firm confirm that workers in fast jobs are younger than other workers at the same level, and that transfers from fast to slow jobs are common. Thus, the process of grooming workers for advancement is analogous to more aggressive up-or-out systems. This deliberate grooming of some workers for advancement has income inequality implications, as it may reinforce the effect of small biases or small differences in early apparent ability.

Citation

Clemens, A. (2012), "Position-Specific Promotion Rates and the “Fast Track” Effect", Polachek, S.W. and Tatsiramos, K. (Ed.) Research in Labor Economics (Research in Labor Economics, Vol. 36), Emerald Group Publishing Limited, Leeds, pp. 77-107. https://doi.org/10.1108/S0147-9121(2012)0000036007