The Promotion Paradox: Is This Retention Strategy Backfiring?

Promotions, typically seen as milestones that boost an employee’s position within a company, might actually be pushing people out the door, according to payroll-services provider ADP’s new Today at Work survey. The report reveals a staggering 29% of employees quit their jobs within a month after their first promotion. In contrast, the departure rate for those who weren’t promoted stood at 18%.

These employment trends, observed from 2019 to 2022, show how a significant wave of workers transitioned between jobs during the pandemic. The Wall Street Journal reports that the data suggests that promotions might be a precursor to an employee’s exit, which poses a challenge for employers who traditionally viewed promotions as a tool to build a loyal and successful team.

The post-promotion periods, which are the weeks and months after a promotion, are the most important for ensuring that employees feel supported and fulfilled in their new roles, according to The Wall Street Journal. However, it’s reported that companies often fall short in providing the necessary training and assistance — a lapse that can also push an employee to seek other opportunities.

Promotions have also been found to increase employees’ confidence, which in turn could prompt them to seek opportunities elsewhere. Interestingly, workers in jobs requiring minimal training, such as in the warehouse and hospitality fields, as well as those in roles demanding advanced degrees, were found to leave at notably higher rates post-promotion. These trends, however, seem to be stabilizing, with recent Labor Department data indicating a slight decrease in job-quitting rates, The Wall Street Journal reports.

With the rise of hybrid and remote work models, managerial roles are becoming more challenging. Managers are often caught in a tug-of-war between upper management’s expectations and their team’s desire for autonomy. More companies will probably need to hone in on investments that better support employee transitions into promoted roles — ensuring that they provide the necessary tools and infrastructure.

As the demographics in the workplace continue to change in the coming years, companies will need to reevaluate their strategies to retain their top talent. Promotions, while traditionally seen as a tried-and-true retention tool, might now be a double-edged sword that gives talented employees courage to find new opportunities elsewhere. It will be important for employers to adapt and ensure that promotions foster loyalty and promote success.