The Economist: The hidden currency of office life

Key topics:Status drives effort, sometimes more than pay or formal power.Recognition spikes performance, as shown with WWII German pilots.Low-status, high-power roles increase conflict and harmful behaviour..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox every morning on weekdays. Register here.Support South Africa's bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..From The Economist, published under licence. The original article can be found on www.economist.com© 2025 The Economist Newspaper Limited. All rights reserved..The Economist.People care deeply about their relative standings within organisations. Job titles and pay cheques are both pretty good clues to status, but they do not measure everything. Some employees wield influence without power. Others have an important-sounding role and are routinely ignored. Status can be harnessed as a way to motivate. It can just as easily cause pettifogging conflict.As a test of how much status can matter, persuading people to risk their lives for it is a pretty good one. Research by Leonardo Bursztyn of the University of Chicago and his co-authors sifts through data on the performance of German fighter pilots during the second world war, and finds that effort seems to be tied to eligibility for medals.At the start of the war, the Knight’s Cross of the Iron Cross was the gold-standard medal for individual bravery; German aces got them for achieving a quota of aerial victories. But as the fighting continued, and more and more pilots got the medal, its prestige was gradually diluted. So new, higher-status variants were gradually introduced: from the Knight’s Cross with Oak Leaves in 1940 all the way up to the Knight’s Cross with Golden Oak Leaves, Swords and Diamonds in 1944..Read more:.The Economist: Currency risk - the hidden threat squeezing shareholder returns.The study shows that as pilots neared the threshold for winning the next medal on the ladder, their performance spiked, before then falling back again once they had got the award. The status that came from winning the next medal up seems to have justified extra risk.Before anyone rushes to institute a new award for Employee of the Month with Golden Oak Leaves, Swords and Diamonds, the parallels between work and war are plainly inexact. But the pilots’ behaviour is worth reflecting on. The status that comes from public recognition of a valued skill—particularly if the threshold to recognition is high—can be a powerful galvanising force.Status concerns can also affect people’s judgment when it comes to career choices. Specific workplaces have unspoken hierarchies (there is a small and amusing body of research on just how disrespected physical-education teachers feel). But societies also allocate different degrees of status to entire professions.A piece of recent research by Alexia Delfino of Bocconi University and her colleagues looked at the preferences people have when they face a change of careers. The researchers tested whether Italian jobseekers would react differently to the chance to retrain to become either an information-technology assistant or a construction technician. Both are white-collar roles with similar wages and entry requirements, but more jobseekers plumped for reskilling when the option was the job in IT. The perception that roles in construction would be a less good fit and have a lower social status seems to explain the relative lack of enthusiasm for these jobs.Within organisations, status can warp behaviour in positive and negative ways. Status is often associated with helping others; there is a reputational gain from using your expertise to assist colleagues. But status concerns may also limit people’s willingness to lend a hand.In a paper published in 2015 by Sarah Doyle of the University of Arizona and her co-authors, employees in a call centre were surveyed about the colleagues with whom they had the most collaborative relationships. Co-workers seemed most willing to help each other when there was just the right amount of distance between them; not too close in status for the other person to be a potential threat, not too far removed for helping to seem like an odd use of time.Having power without status—traffic wardens, look away now—seems to bring out the worst in people. In one paper, Eric Anicich of the University of Southern California and his co-authors found that people in low-status, high-power roles were more likely to engage in workplace conflict with others. In another study, Nathanael Fast of the same university and his co-authors randomly assigned participants to high-status and low-status roles. Some of them were given the power to dictate tasks that co-workers had to perform in order to enter a prize draw. People in low-status roles were more likely to impose demeaning tasks on their fellow-participants (barking like a dog, say, or reciting “I’m no better than a physical-education teacher” five times).Org charts do not capture everything. Social standing matters, too. To understand the choices people make, check their status.

The Economist: The hidden currency of office life

Key topics:

From The Economist, published under licence. The original article can be found on www.economist.com

© 2025 The Economist Newspaper Limited. All rights reserved.

The Economist

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