Does Your Average Employee Tenure Matter? (New Data!)

I keep getting told by folks who tend to know way more than me that employees ‘today’ don’t care about staying at a company long term. “Tim you just don’t get it, the younger workforce just wants to spend one to three years at a job than leave for something new and different.” You’re right! I don’t get it.

BLS recently released survey data showing that the average employee tenure is sitting around 4.1 years.  Which speaks to my smart friends who love to keep replacing talent. I still don’t buy this fact as meaning people don’t want long term employment with one organization.

Here’s what I know about high tenured individuals:

1. People who stay long term with a company tend to make more money over their careers.

2. People who stay long term with a company tend to reach the highest level of promotion.

3. People who tend to stay long term with a company tend to have higher career satisfaction.

I don’t have a survey on this. I have twenty years of working in the trenches of HR and witnessing this firsthand. The new CEO hire from outside the company gets all the press, but it actually rarely happens. Most companies promote from within because they have trust in the performance of a long-term, dedicated employee, over an unknown from the outside. Most organizations pick the known over the unknown.

I still believe tenure matters a great deal to the leadership of most organizations.  I believe that a younger workforce still wants to find a great company where they can build a career, but we keep telling them that is unrealistic in today’s world.

Career ADHD is something we’ve made up to help us explain to our executives why we can no longer retain our employees.  Retention is hard work. It has a real, lasting impact on the health and well-being of a company. There are real academic studies that show the organizations with the highest tenure, outperform those organizations with lower tenure.  (here, here, and here)

Employee tenure is important and it matters a great deal to the success of your organization. If you’re telling yourself and your leadership that it doesn’t, that it’s just ‘kids’ today, we can’t do anything about it, you’re doing your organization a disservice. You can do something about it. Employee retention, at all levels, should be the number 1, 2, and 3 top priorities of your HR shop.

5 thoughts on “Does Your Average Employee Tenure Matter? (New Data!)

  1. Good post Tim! As a Gen X, I can tell you myself and the vast majority of my friends moved around a lot early in our careers, due to money, impatience with progress etc etc. Then most settled down with a company and have gone on to have a steady career. So I’m with you, people eventually realise moving around too much doesn’t lead to salary increases or the job satisfaction they were looking for. (I’ve only anecdotal evidence by the way).

    In my role in HireUp, an employee referral and internal mobility tech, I can tell you clients are constantly looking for ways to increase retention rates, through better quality hires (referrals) and better career pathing (internal mobility) so tenure certainly matters.

  2. i have to push back on this one –
    1. People who stay long term with a company tend to make more money over their careers.

    Countless studies over the past 5 years shows that people changing jobs at the 3-5 year mark, have much higher lifetime earnings than those that stay at the same company.

    Simple Reason – Stay at the current employer, be an outstanding employee and get a 4% end of year raise every year.
    Be an outstanding employee, change jobs, and get a 10-15% bump at the new employer.

    i’ll even cite one that has a cool chart to visualize it.

    • These studies are very position and industry-dependent, and the one thing they aren’t showing is promotion. When you run analysis on c-suite and tenure, you find most organizations promote from within to the highest levels, giving tenure more importance. You can play the game of moving and getting more money only for a certain amount of time, and then you’ll be capped out and less likely to move up, because “you didn’t put in your time” with the one organization you truly want to stay with.

  3. Interesting thoughts Tim. This does seem to be a repeatable topic about each generation as they come into the workforce and develop. In my head it seems as if this was very typical detail of how we Gen X ‘ers were perceived early on, all of us were aloof, weren’t loyal, had no goals and just looking for the next best thing. Looking for career growth, salary growth, stability and making a difference span across generations and often changes in priority for individuals as our working time matures. As our world evolves, media has been able to create more noise around the understanding/categorizing of generational “norms”. Don’t get me wrong, understanding the motivation of generations can lead to production management of teams but can’t wait until the emerging generations are saying the same thing about the newbies coming in.

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