Promotions have become increasingly difficult to secure, particularly in the tech industry where promotion rates have dropped by 25%. Companies across all sectors have been promoting fewer employees than in previous years. According to data compiled by Workday, in 2023, companies across every industry promoted fewer employees than they did the previous year. This trend is expected to continue, with a recent survey by Mercer, an HR consulting firm, revealing that companies expect to promote only 8% of employees this year, down from 10.3% last year.
The reasons for this shift are multifaceted. High interest rates and slower economic growth have forced companies to tighten their belts. However, the primary reason appears to be that companies can afford to be more selective because hiring rates for high-salaried employees are at some of the lowest levels seen in a decade. This allows employers to be more stringent without risking an immediate exodus of staff.
Even when the job market begins to heat up again, promotion rates may not recover to 2022 levels for some time, if ever. Tech companies are currently restructuring to flatten their organizations by eliminating roles for middle managers. The aim is not just to cut costs, but to encourage teams to make faster decisions. In this new structure, there are fewer senior-level positions for employees to be promoted into.
For employees, this is a tough new reality to accept, especially for Gen Zers, who have come to expect frequent advances up the corporate ladder. Despite these challenges, it’s important for employees to continue developing their skills and demonstrating their value to their employers. While promotions may be harder to come by, they are not impossible to achieve.
Read more: businessinsider