β¨ Read this trending post from Investopedia | Expert Financial Advice and Markets News π
π Category: Career Advice,Careers
π Main takeaway:
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Key takeaways
- A recent study found that dating a manager can increase his subordinates’ pay, but breaking up can reduce his profits.
- The financial and career repercussions last for years, as employees are more likely to leave the workforce and less likely to make strategic career moves after a breakup.
- Workplace romances can also hurt team morale and maintenance, as coworkers may feel favoritism when someone is dating a manager.
When the married CEO of Astronomer, a startup, was seen on camera kissing at a Coldplay concert with his company’s chief human resources officer earlier this year, the fallout from this public display of their relationship was swift β both the CEO and HR director resigned in the following days.
As it turns out, the cost of a workplace relationship β even for those who aren’t executives β can be significant, according to a new working paper from the National Bureau of Economic Research (NBER).
Economists looked at data on couples living together in Finland. They found that while entering into a relationship with a manager increased a subordinate’s earnings by 6%, the breakup cost that person a whopping 18% increase in earnings.
The negative consequences of dating and breaking up with a manager followed the employee for approximately four years after the breakup.
The subordinate was 13 percentage points more likely to leave the workforce after a breakup and less likely to make strategic moves to different companies afterward.
The breakup also had negative effects on others in the workplace. There was a six percentage point decline in retention of other workers at the company when the relationship began. This is because other workers may believe that a subordinate is receiving special treatment for being in a relationship with the supervisor.
βFor example, workers who observe a peer dating a manager may attribute the pay increases we document to nepotism rather than merit, which could undermine morale,β the economists wrote. βSuch perceptions can have broader consequences, including increased staff turnover rates within affected organizations.β
While workplace romances are already on the decline (only 11% of heterosexual couples in 2017 reported that they met as coworkers or through coworkers, compared to 19% in 1995), these findings suggest that people should continue to exercise a great deal of caution when considering dating a supervisor.
A separation from the workplace can affect more than just a person’s feelings, it can affect their future salaries as well.
π₯ What do you think?
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