Overall, firmspromote 8.9 percent of employees, while new hires make up a muchlarger portion of positions being filled, at 30.2 percent. (Photo:Shutterstock)

Workers who get passed over for a promotion while their teammember advanced are more apt to quit than workers in other teamswhere no promotion occurred, according to The ADP ResearchInstitute's 2019 State of the Workforce Report: Pay, Promotionsand Retention.

The inaugural benchmarking report for pay and promotion practices among employers with 50 ormore workers found that teams where a promotion occurred experiencea turnover rate of 13.3 percent, while teams without a promotionhave 12.3 percent turnover.

Related: 3 employee turnover myths

“Employers should consider the effect of promoting individualteam members and the retention strategy for key team players,” theauthors write.

Overall, firms promote 8.9 percent of employees, while new hiresmake up a much larger portion of positions being filled, at 30.2percent. However, for management positions, firms promote moreinternally than they hire externally — 17.2 percent of managers arepromoted, while 15.6 percent are new hires. For the C-Suite andother top positions, 21.5 percent are internally promoted and only12.5 percent are new hires.

“Employers can compare their rate of internal promotion againstnational and industry benchmarks to determine the health of careerdevelopment programs, learning and development and the cost oflosing high potential front-line workers,” the authorswrite. “In addition, externally hired managers are more likely toincrease total compensation costs.”

The report also found that employee turnover variessignificantly with demographic factors. Not surprisingly, monthlyturnover rates for older employees are relatively lower compared toworkers in younger age groups: the overall turnover rate for those65 and older is 2.2 percent, while turnover successively increasesacross younger age groups to 8 percent for those age 25 years orless.

What may be surprising is that turnover rates are very similaracross genders, with males leaving their jobs at a rate of 3percent per month and females at 3.5 percent per month overall.

“Employers can compare employee turnover against national andindustry benchmarks split out by age and gender to pinpointorganizational issues,” the authors write.

Another key finding: on average is takes 6.6 years for women tobe promoted to their first management promotion, while on averageit take 7.3 years for men. However, as women move up managementlevels, there is a steep decline at the third level of management,with women hitting the proverbial “glass ceiling” at the fourthlevel.

“While less than half of one percent of all American workersreach the three highest management tiers, the under-representationof women is problematic because these elite positions have anoutsized influence on corporate policy and culture,” the authorswrite.

“The average wages of job holders in these fourth-levelmanagement positions is also 40 to 50 percent higher,” they write.“Considering that these leadership positions typically requirecandidates with substantial job tenure and mentoring, short-termfixes will be challenging.”

Read more: 

• IBM can predict when employees are planning toquit
• More professionals prefer promotions toraises
• How the right employee benefits can drive employeeretention