Wages and salaries are just part of total rewards. Insurance, vacation time, bonuses, and working conditions are other important forms of compensation. Each of these costs the organization something. But there are other attributes of jobs -- less easily measured in dollars -- that employees value. These can include colleagues, company reputation, and even job titles. At the margin it is possible to imagine a tradeoff between a higher salary and a job title. In fact, some have argued that some firms offer titles in absence of raises where salary budgets are slim. When thinking about job titles as a way to save on compensation costs, it doesn't take long to consider job title inflation. Although the anecdotal evidence makes title inflation appear real, the author hasn't found much research on the ever-expanding inflation in titles. The author concludes that more research in this area are required.
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Hallock, Kevin F., PhD. "Titles as Compensation." Workspan 57, no. 1 (01, 2014): 12.