Companies Do Not Care About Staff Loyalty (Anymore)

How many people do you know that have been with their current employer for more than 10 years? Well according to the US Bureau of Labor Statistics it’s actually 29% of people, which sounds suspiciously high until you consider that a vast majority of this group are made up of workers on the verge of retirement, which is important to remember for later.

Amongst all workers in the US the median was just over 4 years.

In fact multiple studies have suggested that full time workers that stick with their employers for more than two years on average get paid FIFTY PERCENT LESS.

This is an unbelievably large gap, ESPECIALLY when you consider that the average of the loyal working group will be drastically inflated by senior executives and the c suite who tend to have more tenure. In plain English, for regular Joes like you or me, this 50% figure is likely understated.

So why aren’t companies stopping this? Surely having to pay tens of thousands of dollars to advertise a position, interview candidates, onboard new staff, train them and wait for them to get up to speed with their new role is not sustainable if it has to be done over and over again every 2 years… right?…

Well you would think so, but there are a few reasons why companies don’t care about employee loyalty… anymore…

Comments

 

I have worked in the recruitment/ HR industry nationally and globally for the past 8 years. This video is very accurate. HR departments and leaders will spout their narrative around talent that give you the impression they care. They don’t. The clue is in the word “resources”. And the cheaper that resource the better.

 

 

Employer: Don’t like it? Leave
Employee: I’m leaving
Employer: Unbelievable! Why?
Employee: I don’t like it
Employer: This is a great job

 

I was born in the 80’s and was taught at an early age that loyalty was a thing of the past. The longest I have ever spent at a job was 4 years. I’ll take it one step further and teach my son that a two week notice is also a thing of the past.

 

“Employers are going to screw you… So screw them back!”
Sounds consensual to me

 

After working for almost 12 years now there’s 2 things I’ve learned. One is to work hard enough to get through the day and stay out of trouble but don’t strive for anything more cause working to try and be the best of your peers will most likely go unnoticed or unappreciated. And the other is don’t think just cause you’ve worked for one company for a good amount of years and gained a bit of experience means your invulnerable. You can still get replaced easily or fired at the drop of a hat if needed.
The move away from internal promotions is so true, I’m over qualified for my role but they won’t let me move any farther because then they’d need to hire 2 people to fill my spot in order to move me to a more senior role. Instead they just hire external, which is ironic because they are going to loose me anyhow at this rate and need to fill those roles anyhow.

 

Companies want to hire a 25 year old with 35 years of experience and pay them like an 18 year old.
The description for the bank manager is so true. I work at a bank and had always thought highly of the bank manager role but after 6 years I realized they just make sure customers aren’t upset with the bank and to make we hit their sales goal.
Each time I’ve left a position after 2-3 years I’ve seen a jump in 20-40% of my salary. It just makes sense especially when career progression inside a company is never concrete and 2% increases YoY only adjust for inflation.
I’ve always enjoyed smaller businesses than larger ones, they really value your work, constantly getting offers from big companies and just laughing , especially over the last few years , same companies too. Can’t keep staff around aye?
Side note: if anyone comes around your office wanting to create a “skills matrix” or wanting to “document risks” it means ya’ll about to lose your jobs. I speak from experience 😅
At the hospital where I work in I/T, when senior tech folks leave it often hits hard. They leave with 5-25 years knowledge you just can’t get back. BUT management seems to thrive on putting out fires and making themselves seem overly important. I’d say these last two decades have been decades of lost leadership and poor management–and workers have been paying the price by staying unfortunately.
Hell, this is even true in small companies, the trades, and family businesses. I worked for my old man, as a laborer, apprentice, then carpenter. Started when I was 12, worked for him for 20 years. He promoted everyone past me, hired people and placed them over me, and kept me on a shovel or jackhammer. All of the easy/ prestigious work went to people who he recently hired. I started moonlighting in my mid twenties, working for the competition. Immediate promotion to foreman. Went into business, did a bunch of other things. Now I’m competed for by multiple companies that want me to run concrete pours or handle mid sized projects. The mentality I have adopted is that I’m a stray cat, or a mercenary. I’ll come and stay with you, for the food, but I can and will leave when I wish. The second I don’t like something…. I am gone. Build enough skill and connections that people trust you to handle things, and then you can call the tune.
Don’t forget that the employer also expects you to have a perfectly-written resume, write a custom cover letter for their position, pass numerous interview phases that take close to an hour (or more) each, wait for weeks for an answer, and possibly even do free work to “prove” you can do the job even though you already have a fat portfolio to prove that, and then they turn you down anyway. Every single job can require 5-10 hours of work, sometimes more, when you probably won’t even get hired because they went with an internal candidate and could have just saved you all that time and effort by just hiring the internal candidate in the first place.
This is very true. I was in a company that I thought valued their employees loyalty. 13 years of service and then out of the blue outsourced the job. We didn’t even get a farewell or thank you. HR just spoke to us that the company is letting us go. Sad reality.
I once had an amazing manager who got everyone’s back and bought lunch every week for the staff. He was liked and respected by clients and staff… every quarter the performance was up and we were profitable. For his 25 year anniversary, the large multinational company we worked for gave him… a book stand, engraved with the company’s name. 😂 what a joke
After spending years being told i’d be replaced by machines, i went back to school to become an Electrotechnician. Basically, i repair/install/maintain the machines who were supposed to replace me now. Best decision of my life even if it was partly motivated by spite.
Unfortunately, values like loyalty and dedication mean nothing in today’s business world. It’s cheaper to hire a new employee, at a lower salary , and fire an existing employee being paid more. Corporate loyalty is now a myth.
Was has always pissed me off is the fact that you need so much experience for a lot of ENTRY level jobs. Even some internships which is mind boggling. I’m only 22 yrs old and I’m expected to have 10 years of experience. 😂

Being a Law Firm Partner Was Once a Job for Life. That Culture Is All but Dead.

The investment-bank model

When David Greenwald returned to co-lead Fried, Frank, Harris, Shriver & Jacobson LLP in 2013 after a turn as a top Goldman Sachs in-house lawyer, the Wall Street firm was dragging. Revenue had fallen 17% since 2007 and competitors were picking off its lawyers.

One problem, he noticed, was that partners were notoriously lax about turning in their timesheets, which meant clients weren’t always getting billed. The slips were costing the firm $6 million a year.

Mr. Greenwald realized the firm needed to operate less like a law firm partnership and more like the investment bank he’d just left, if it wanted to survive.

He closed underperforming Asia offices and created a finance committee. All partners had to turn in plans for how to expand their businesses. Partners were paid more on merit than seniority, and could no longer see how much each of their peers made.

And Mr. Greenwald told partners to submit their timesheets every week or risk a fine.

Average profits for equity partners at Fried Frank have doubled since 2013, to more than $3 million last year, according to the firm. Gone is the egalitarianism that marked Mr. Greenwald’s early days at the firm: Fried Frank’s highest-paid partner makes 13 times its lowest-paid.

“We’re all on the path from being small partnerships, in which everyone can get in a room and debate and make a decision, to by necessity having to centralize a lot of the decision-making in a group of people or an individual,” Mr. Greenwald said.

That journey from partnerships to profit machines has made some lawyers very wealthy. At the 15 most-profitable law firms, top partners bill on average $1,655 an hour and their rates are rising faster than inflation, according to legal analytics company Bodhala.

At the nation’s 100 largest firms, average equity-partner profits have doubled since 2004, to $1.88 million last year, according to American Lawyer. Eight firms average more than $4 million.

“We’re making much more than anybody who doesn’t save lives deserves,” said David Boies, the litigator who broke off from Cravath in 1997 to launch his own firm. In his best years, Mr. Boies has paid himself $25 million, a spokeswoman confirmed.

Pity the associate

As firms compete to keep profits rising for those at the top, lawyers further down the ladder are sometimes getting left behind. Promising associates who could once expect to be named a partner within seven or eight years are waiting 10 years or more.

Firms have created new steppingstones along the way to appease them—and keep them grinding.

One newly promoted partner at a big firm said he was shocked to learn he would have to spend a year as counsel, an increasingly popular interim title. The firm told him it was to prepare him for the bigger change of being partner. “I wouldn’t be a cynical lawyer if I didn’t think there were other profit-motive reasons,” he said.

Another popular stop-off is “non-equity partner,” the title held by those 560 Kirkland lawyers not invited to the California retreat. They earn a salary rather than sharing firm profits.

In 2000, 78% of partners held equity in their firms, according to American Lawyer’s ALM Intelligence. Last year, 56% did.

At Kirkland, junior partners compete each year for a few coveted slots in the equity-earning partnership, many billing more than 2,500 hours a year to try to set themselves apart. Given how much of the day’s work isn’t billable, that can require working 80 hours or more a week.

At elite New York firms, a two-tiered system was once unthinkable. Partners were partners. In the past year, however, cracks have emerged at two of them.

Simpson Thacher’s leaders told partners in April that they plan to start naming non-equity partners. It is hard not to see the move as a response to poaching by Kirkland, which has lured away more than a dozen Simpson lawyers since 2016, most of them associates and counsel that Kirkland made into partners.

“If the firm won’t be loyal to you,” said David Lat, a longtime lawyer and legal blogger turned recruiter, “why should you be loyal to the firm?”

Willkie Farr & Gallagher LLP, a 131-year old firm that was home to a future U.S. Supreme Court Justice and two New York governors, made a similar announcement this spring when it rolled out a two-tiered partnership. Its leaders said the move is intended to reward promising young lawyers earlier and make the firm more competitive in recruiting.

“It was getting harder to tell associates, ‘stick around for 10 years and see what happens then,’ ” said Willkie’s chairman, Steven Gartner. “They wanted more certainty and wanted it sooner.”

Making partner doesn’t just take longer. It takes hustle. A few decades ago, partner titles were handed out largely on the basis of being technically proficient. Now, being a business generator is a crucial component.

Janice Mac Avoy, a Fried Frank partner, said when she earned the partner title 23 years ago, the business model was “wait for the phone to ring” and do a good job for the client on the other end.

When a partner suggested a lawyer being considered for promotion had great contacts and could generate new business, she recalls a fellow partner saying, “You know that’s not an appropriate consideration.”