Written by Tony Devine
The length of time we spend working for the same company, known as job tenure, has reduced over the years. What are the implications, negative and positive?
I am fortunate to have had long careers with two large and growing global companies. As a consequence I was also able to develop my career without the need to move. I will never know if I could have benefited from more movement but I have often wondered.
- What are the implications of tenure in the workplace?
- What is long tenure and what is considered short tenure?
- Is there a value to staying at a company for a long time?
- Is it better for an employee to ‘hop’ between companies?
- Does moving frequently in our earlier careers imply a lack of commitment?
Google those and you will see that they are popular questions. Research would indicate that age is a factor. There are however lots of other dependencies (gender, industry, education, country, employment protection legislation and more).
Understandably Baby Boomers (those born between 1945 and 1960) who will have been in the workforce for at least 40 years by now have the longest tenure. In most studies they will have treble the tenure of the younger generations, GenZ (born pre-1995) and Millennials (those born between 1981 and 1995).
People of my generation probably wince every time they see statements on Social Media from the person that has just come to the end of an ‘incredible journey’ of two or three years with company X. To be fair, we may each be viewing this through our generation’s eyes and what was perceived to be normal at the start of our journey. When I entered the workforce, the emphasis was still on a ‘pensionable job for life’. Today very few people enter the workforce with such an expectation or even desire that outcome.
The evidence that tenure is decreasing.
Its not just anecdotal. According to OECD.Stat the average EU job tenure (one employer) in 2019 is 10.5 years. It has been quite steady over the past 20 years. Ireland is at 9.4 years. This is perhaps a reflection of a proportionally larger Millennial population than most EU countries.
Ireland’s rate peaked at 10.5 in 2015 and has been going down steadily since then
The US labour market is much more fluid at an average of 4.1 years (US Bureau of Labour Statistics). Labour market ‘fluidity’ is of course great for the recruitment business but potentially disruptive for the employer.
These averages are distorted by the proportion of Public Service employees in the mix. Their tenure is typically double that of the private sector employee.
Hidden within these averages is the finding that the tenure trend in the younger generations is steadily decreasing. In Ireland, the 25 – 54 age group has dropped a full year in the last twenty to 8.1. The rate of decline in the EU 28 is from 9.8 to 9.1 years.
LinkedIn 2020 Global Talent trends report
There is evidence that Millennials are more likely to move than Baby Boomers and GenX (1961 – 1980). Early data from GenZ indicates that they are looking for security of tenure. They will have observed the lack of stability their parents endured. The LinkedIn 2020 Global Talent trends report tells us that Millennials have a 34% shorter tenure than the average of the other generations in the workforce.
The same report tells us that GenZ workers were found to be 135% more likely to be in part-time or contract roles than Baby Boomers and GenX. This finding points to an unfortunate inequity that is inherent in our typical working lives. Those that need job security most, the younger workers, are less likely to have the stability of full-time or permanent roles.
What are the implications of all of this?
On the negative side.
- Organisations are less concerned with employee retention for many mainstream roles. This causes less job security for the individual.
- Shorter job tenures means the onus is more on you to develop yourself.
- Organisations look to hire pre-skilled people and therefore invest less in L&D.
- Frequent movers may not have acquired the learnings and experience required to succeed in the new role or company.
- When employee turnover is high, it becomes more difficult to develop and sustain a consistent culture .
- Constant employee churn will cause hiring and retraining costs.
- The loss of IP and institutional knowledge.
On the positive side.
- As a result of movement between organisations an environment where innovation and creativity can flourish.
- As company loyalty is no longer the societal norm, individuals can feel less constrained in their choice of employer..
- Individuals who have outgrown their role in one company can continue growing their career in another.
- You can quickly learn more about yourself through regular job movements and use what you learn to build your career.
- More talent becomes available to organisations as a result of greater fluidity of labour.
- Organisations can tap into a more mobile workforce to react to fluctuations in their market.
- The GenX and Baby Boomer generations will still be there to complement the movers.
- Movement of talent between organisations can encourage best practice sharing.
Professionals at The Grey Matters Network will typically have had the experience of a number of longer-tenured employers. They can complement other generations who may still be in the steeper career development phase of their working lives.