Career paths: a key consideration in
Career paths provide employees the opportunity to enhance their skills and knowledge, earn promotions and/or transfer to different positions within an organization. Differing slightly from the vertical ascension of a career ladder, career paths offer lateral moves to gain experience and insight into various functional or product areas of an organization.
In today’s competitive labor market, a career path is an important consideration: seven in 10 employees who leave their current job perceive no career advancement opportunities within that organization. Establishing career path opportunities can have a direct impact on organizations by:
- Improving employee performance: External hires receive significantly lower performance evaluations in their first two years on the job compared to internal employees shifted into similar roles.
- Lowering hiring cost: External hires have higher exit rates and typically receive 18 –20% more compensation than internal hires.
- Reduce turnover: Deloitte’s “Talent 2020” survey found that when employees were asked to indicate the top factors that would cause them to look for new employment in the next year, lack of career progress topped the list.
- Attracting Gen Y: Generation Y, or Millennials, are the least likely to be interested in pay increases and most likely to be interested in learning new skills. Research suggeststheyvalue career paths more than any other generation.
When trying to improve their workforce’s career path opportunities, organizations must consider the tradeoffs betweenbifurcating orcollocating business lines when making location decisions. Colocation may require talent markets to support a broader range of skill sets and a larger organizational scale, but lower turnover and higher employee engagement are often the unfortunate tradeoff.
To understand more on this topic, contact Business Consulting. Our team is dedicated to ensuring clients achieve success in their location strategy and investment decisions.