Should a CEO’s Job Be Precarious?

Should a CEO’s Job Be Precarious?

On the face of things, it seems like a great time to be the chief executive of a major American business: median CEO compensation at US public companies is high and rising, and a high-performing executive can command a sizable pay package. At the same time, however, average CEO tenure has been on the decline as boards have become more willing to fire CEOs who fail to live up to shareholders’ high standards for performance.

At the Wall Street Journal earlier this month, Vanessa Fuhrmans and Joann Lublin observed that CEOs of major companies were being forced to resign under investor pressure at an unusually high rate this year. The reasons for this churn are numerous: Activist investors have become more numerous, powerful, and demanding, pushing for major changes not only in financial performance, but also in company culture, talent strategy, and other aspects of a CEO’s job to which shareholders used to take a more hands-off approach. Ethics scandals have become more likely to lead to the demise of a CEO as well. Beyond that, competition has stiffened in many industries and the pace of change has accelerated to the point that even star CEOs are challenged to keep up.

Bloomberg View columnist Matt Levine has a hard time feeling sorry for these “embattled” CEOs, however, considering the kind of money they earn “The job should be terrible!” he writes, “That’s why you’re getting paid so much!”

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Study: Older Employees Job-Hop Just Like Millennials

Study: Older Employees Job-Hop Just Like Millennials

SHRM’s Dana Wilkie passes along a new survey showing that Americans between 55 and 65 are “hopping” from job to job nearly as frequently as millennials:

The survey from Namely—HR Mythbusters 2017—found that the median tenure at a job for workers between ages 25 to 35 was 1.42 years; the median tenure for those between ages 35 to 55 was just under two years; and for those between ages 55 to 65, it was 2.53 years. …

The findings reveal that “HR teams are up against a trend of shortening tenures,” the survey authors wrote. “For those that have focused primarily on retaining Millennial employees, it’s time to broaden perspective. Companies should consider what retention incentives they can offer employees at all stages.” For instance, flexible work options may appeal not just to Millennials, but to older workers.

The stereotype of millennials as uniquely flighty and disloyal is rooted more in myth than fact: In fact, a study released in April showed that millennials were no more likely to job-hop than members of Generation X were at the same point in their careers.

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