Fact of the Week: Companies 10 Years Ahead of the Curve Advertising Job Openings With New Titles Invest 63 Percent More of Their Revenue Into R&D

Caleb Foote September 30, 2019
September 30, 2019

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Source: Enghin Atalay and Sarada, “Emerging and Disappearing Work, Thriving and Declining Firms,” June 2019, Society for Economics Dynamics, 2019 Meeting Paper No. 484.

Commentary: As technology changes the nature of jobs, the language we use to describe them changes too. A new study makes use of this phenomenon to analyze a database of 5 million job advertisements that appeared in newspapers from 1940 to 2000, calculating when a job title first came into use. Researchers found that companies advertising new job titles an average of 10 years before they became commonplace invested 63 percent more of their revenue into R&D, saw sales grow 9 percent faster, and survived 3.6 years longer. This suggests companies that capitalize on recent innovations significantly outperform their competitors, despite the risks associated with less-proven developments.