In the past, navigating a corporate career meant taking calculated steps to climb the corporate ladder. For the most part, this traditional view of career advancement is outdated. Following the downsizing that occurred in the 1980s and early 1990s, workplace loyalty began declining. Today, people have different values and priorities. They won’t hesitate to change jobs for a pay raise, more flexibility or a better work-life balance.
With job security a thing of the past, non-linear career paths are the future. Let’s look at a few reasons why employees are opting not to climb the corporate ladder.
Non-linear careers are becoming the norm
While climbing the corporate ladder used to be the norm, non-linear career paths are more common. One reason is that people are working longer. If you want to remain in the workforce for 50 or 60 years, you need to find satisfying roles to avoid burnout. Also, following the pandemic, more people are prioritizing flexibility and autonomy over salary and a fancy job title. Plus, job hopping is less stigmatized than in the past. Workers, especially Millennials and Gen-Z, are more likely to change jobs to meet their needs. Finally, the workplace is constantly evolving. With AI transforming the world of work, many future jobs don’t even exist today. To remain competitive, learning new skills and embracing change will be critical for employees who want to survive and thrive.
Employees and managers struggle with burnout
According to research from a Harris Poll survey done on behalf of The Grossman Group, more than 75% of employees and 63% of managers feel burned out or ambivalent in their current position. The findings reveal that the biggest driver of burnout is constant change, along with high turnover and excessive work. “These findings are a wake-up call. Clearly, employees are not okay and yet that’s often not recognized by senior leadership or the frontline leaders whose job it is to support and engage their teams,” said David Grossman, founder and CEO of The Grossman Group, a Chicago-based leadership and communications consultancy. When employees are already stressed and overwhelmed, the last thing on their minds is taking on additional responsibilities.
Employee engagement is at an all-time low
Employee engagement in the U.S. dropped to its lowest level in 11 years, based on Gallup’s latest report. That means that more than two-thirds of American employees are either not engaged or actively disengaged from their jobs. The situation in the U.K. is even more dire, with Gallup reporting that 90% of employees are either not engaged or actively disengaged. The ripple effects of employee disengagement have serious consequences across the organization, including increased absenteeism, higher turnover and decreased motivation. When employees are disengaged, they are more likely to display a lack of initiative, enthusiasm and commitment. These individuals also tend to feel detached, which gives them little incentive to climb the corporate ladder.
Dry promotions are more common
Dry promotions, also known as quiet promotions, refer to employees receiving a new job title or more responsibility without a pay raise. As budgets tighten, these no-raise promotions have become more common. In a recent poll by Pearl Meyer, a compensation and leadership consultancy, 13% of employers said they are using new job titles to reward employees, up from 8% in 2018. Unfortunately, dry promotions disincentivize workers because they feel undervalued by their employers. Instead of fostering loyalty, promotions, in general, tend to do the opposite. As employees climb the corporate ladder and become more marketable, they are more likely to leave the company. An ADP report revealed that 29% of people quit within a month after receiving their first promotion. Had they not been promoted, only 18% would have left the company.
Management roles are less appealing
For decades, many employees have aimed to climb the corporate ladder. Now, research by Visier shows that only 38% of individual contributors aspire to become people managers. When broken down by gender, the succession problem is even more stark. Forty-four percent of men are interested in management positions compared to only 32% of women.
These were the top five reasons cited by the study:
- Expectations for increased stress and pressure (40%)
- The prospect of working longer hours (39%)
- Happy in their current role (37%)
- Lack of interest in leadership responsibilities (30%)
- Potential conflicts with interests outside of work (28%)
People are redefining success at work by prioritizing work-life balance. Also, a new trend called “unbossing” is gaining momentum. With tech advancements and economic uncertainty, more companies are eliminating the middle management layer. In turn, employers hope to decrease bureaucracy, cut costs and boost innovation. A recent example is Amazon, whose CEO Andy Jassy is calling for an increase in the ratio of individual contributors to managers by 15%. Other companies that are embracing this trend include Bayer, Citigroup and Salesforce.
With job security a distant memory, climbing the corporate ladder seems less attractive than it once did. Many top-notch employees have no interest in managing others or focusing on work they find less fulfilling. Instead, they prioritize fulfilling work, work-life balance and their own well-being. That doesn’t mean these individuals aren’t ambitious. Their idea of ambition has simply evolved along with the world of work. If promotions have lost their appeal, it’s time for companies to find other ways to motivate and retain employees. Things like meaningful work, flexibility and autonomy can go a long way in retaining motivated individual contributors who embrace a broader definition of success.