Over the past week I’ve been running a four-part series of reels on Instagram called What Went Wrong With the Corporate Ladder. The response has been much bigger than I expected, which tells me this conversation is hitting a nerve with lots of people out there.
Instagram is great for testing ideas, but there’s only so much you can cover in a 60-second video. So over this issue and next week's I'll explore these ideas in more depth. This week I’m looking at what happened to the corporate ladder and why career progression feels so different today. Next week we'll turn to the harder question: what can we actually do about it?
If video format is more your thing, here’s some of the content I shared on Instagram… otherwise, read on!
The corporate ladder is a quaint relic
Without turning this into a history lesson, I need to give a little context around the whole concept of the corporate ladder for everything that follows to make sense.
It emerged after World War II, during decades of economic expansion when large organisations needed people to stay for years, or sometimes entire careers to support progress and innovation.
Knowledge was valuable, but unlike today it was difficult to capture. Processes lived in filing cabinets, and relationships and details often lived in people’s heads. Experience accumulated over time and companies had a strong incentive to retain it.
The ladder was one way they did that. Employees were rewarded with promotions, higher salaries and greater responsibility. In return, organisations kept the institutional knowledge they depended on. Climbing the ladder was a two-way exchange of value, and an important part of how companies preserved capability and created continuity.
For many people, it worked remarkably well. For decades, many of us entered the workforce with the implicit understanding that this was how the corporate world worked.
Post-WWII conditions are gone
The problem is that the conditions which created the ladder no longer exist.
Over the past decade or so, technology has steadily reduced the amount of knowledge that needs to live inside individuals. Companies have undertaken projects to digitise records and knowledge, and new systems capture processes that once depended on experienced managers. And now, AI is beginning to capture expertise that previously took years to develop.
At the same time, organisations have spent decades redesigning themselves. Management layers have been removed in the name of efficiency, while outsourcing and offshoring moved work outside traditional corporate structures. Then there are the various management philosophies like agile, which encouraged decisions to move closer to frontline teams rather than travelling through multiple levels of management.
Many of these changes have delivered real benefits around agility, autonomy and all those other corporate buzzwords we love to throw around. Technology has removed unnecessary administration and increasingly, much of the grunt work we used to delegate to younger people entering the workforce.
However, cumulatively these factors have fundamentally altered the shape of organisations.
The traditional corporate ladder has gradually become more like a pyramid. There are simply fewer management roles than there once were and more people competing for them. The further up you go, the steeper it seems to get. If you’re not careful, you’ll slide right off and land on your backside.
I think this helps explain why so many capable people are looking outside corporate for the next stage of their careers. The workforce most of us entered no longer exists.
A change in incentives
While thinking about this, I found myself wondering about some bigger picture changes that have been happening over the last few decades.
The people who climbed the corporate ladder over the past 40 years and who are now retired or close to it haven’t lost their influence over the corporate world. Many also became investors. Through superannuation and other investments, millions of ordinary workers now own small pieces of the companies they once worked for. The vast majority of that influence sits with older people, as they’ve had longer to accumulate assets.
That creates an interesting tension. As employees, we generally want higher wages, more opportunities and greater job security. As shareholders, we want companies to become more efficient and generate stronger returns.
Those incentives and interests rarely point in the same direction. Labour is one of the largest costs for most organisations. Reducing management layers, outsourcing work and using technology to improve productivity can all increase returns for investors, even when they reduce career opportunities for employees.
Nobody sat down and designed this outcome. It emerged gradually as technology advanced, financial markets expanded and companies became increasingly focused on shareholder returns.
Yet the effect is becoming difficult to ignore.
Many younger workers entered the workforce expecting careers that resembled those of their parents or mentors. Instead, they find themselves competing inside organisations with fewer leadership positions, flatter structures and growing pressure to do more with less.
We can hardly be surprised that so many people feel frustrated. Meanwhile, we continue to give career advice based on a model of work that’s slowly disappearing. And most importantly, we continue to judge ourselves against that model.
Developing new skills and building strong relationships still matter, but the environment those skills operate within has fundamentally changed.
Before we can have an honest conversation about the future of careers, we first need to acknowledge that the corporate ladder was never permanent. It was a product of its time. The question now is what replaces it?
I’ll explore that question next time. If the ladder isn’t coming back, what should we be building instead?
One thing I’m thinking about this week
Over the past couple of weeks I’ve been on the warpath about bad faith arguments. As a professional communicator, there is absolutely nothing that frustrates me more than any argument in the bad faith family (whataboutism, tu quoque, appeals to hypocrisy).
Recently you might be seeing more discussion around AI’s environmental impact. Raise concerns about the industry’s water or energy use and someone will inevitably respond, “What about meat production?” or “What about the textile industry?”
It sounds like a reasonable rebuttal, but unfortunately it misses the mark. It’s usually designed to deflect from the original point of discussion.
Here’s the cold hard truth. Questioning AI’s environmental impact does not require every other industry to have solved theirs first. We can scrutinise multiple industries at the same time. In fact, we probably should.
Add to that, scrutiny is the same as hypocrisy. Most of us rely on systems we can’t realistically opt out of. Many of us eat meat and all of us wear clothes. It’s not realistic for us to go and live on a farm and wear a burlap sack.
At the same time, we can still ask those systems to improve. We still expect companies to reduce waste, improve safety or lower emissions, even if we continue using their products.
Emerging industries have an opportunity that older industries never had. They can learn from decades of environmental mistakes instead of repeating them.
And I want to close out with another related point.
I’ve seen remarkably similar talking points (“but the meat processing industry”, “but the textiles industry”) appearing across multiple content creators over a short period. That may simply reflect people repeating an argument they’ve heard elsewhere. It may be something more organised. I don’t know for sure, but having worked in public relations for the past two decades, I have my suspicions.
Either way, it’s a useful reminder to pay attention not only to the argument itself, but also to where it originated and whose interests it serves.
Remember… good debate engages with the issue that has been raised. Bad faith debate tries to change the subject.
Things I’ve made (and you can buy)
If you enjoy my content and would like to support my work, here are a few things I’ve created.
🛒 Track Changes On Shop - Coffee mugs for corporate rebels
📖 Do Give Up Your Day Job - Guide to corporate exits and transitions to self-employment
On the ground in corporate, the picture of efficiency we've gained from digitization is pretty mixed. This is one of the great differentiators between companies that have been able to adopt AI smoothly vs those struggling to do so. A lot of companies have poor or absent process documentation, old and poorly designed databases, and a lot of knowledge still living in "meat lockers" as one of my coworkers memorably described it. Then there is the perverse incentive of digital tools -- the easier it is to work, the more work is generated.
I see the truth in your point about the ladder becoming more of a pyramid. I think this has a lot of implications for people's job satisfaction. With a pyramid, more people are mid or low level corporate drones. They don't have much real decision making power or visibility into the true levers of what and why is getting done by the company. They are just expected to take tasks and complete them. I think this is fine for some personalities, who want a job that asks only specific things of them and returns a reliable paycheck. But a lot of people (I'm people) need a bit more ownership in what they're doing day to day.
Interesting take. I usually feel like boomers just pulled it up behind them but your right about the flattening. Lots of companies are openly discussing the removal of middle management and the movement of c-suites “closer to the front line.” Too bad all our opportunities for more money and responsibility are in the middle lines being erased. Curious what your thoughts are on the replacement.