An HR Glossary for HR Terms
Glossary of Human Resources Management and Employee Benefit Terms
What Is Upward Mobility?
Upward mobility measures the frequency a person changes their socioeconomic status. A high rate of upward mobility indicates a healthy economy, and one of the key factors that drives this economic advancement is job advancement.
What Is Upward Mobility in HR?
In HR, upward mobility refers to the rate at which employees advance into new roles, additional opportunities, and better compensation. This advancement may involve:
- Promotions that offer career growth
- A complete change in role or occupation that benefits a person’s career growth
Why Is Upward Mobility Important in a Job?
The top reason people quit their jobs is lack of career development. As industries grow, organizations must work harder to attract and retain top talent. Offering skill growth and development, increased opportunity, and upward mobility can help employers achieve their retention goals.
In addition, organizations that make upward mobility an element of their employee experience can grow a productive workforce. Employees at such organizations are more likely to do the following:
- Stay with the company for a longer period
- Be fully trained in their company’s procedures
- Possess a growth mindset
- Be part of a strong leadership pipeline
- Feel engaged in their roles
What Role Does Compensation Play in Upward Mobility?
Title promotions are not enough to ensure retention—about 45 percent of employees leave their roles due to insufficient compensation.
Therefore, employers must provide competitive compensation as employees advance in their roles. Since advancements come with more responsibilities, it’s right that employers offer higher compensation.
However, while additional leadership responsibilities frequently lead to additional pay, additional income shouldn’t be restricted to the leadership pathway. Employees with high skill and knowledge in their specialty can provide the organization with as much unique value as employees on a leadership track.
Recognizing the value of all skills helps employees feel they can advance without being forced into leadership roles (where they might inflict their underdeveloped leadership skills on other employees).
Instead of leaving compensation to individual negotiation, organizations can establish salary ranges: compensation categories that provide a benchmark for fairness across the organization and indicate pathways for upward mobility.
Here are common steps to create salary ranges and use them to manage compensation:
- Conduct a job analysis to assess a position’s qualifications, responsibilities, and activities.
- Rank positions using a job evaluation method to determine a position’s relative worth compared to other roles at the organization.
- Create job grades by grouping positions together based on similar worth.
- Execute market research to ensure wages align with similar positions in the marketplace.
Keep in mind, compensation rarely remains static—the rate of pay constantly changes with evolving market conditions. Therefore, employers must consistently tap into current data such as the National Compensation Survey from the U.S. Bureau of Labor Statistics (BLS) and Cost of Living Adjustment (COLA) by the Social Security Administration (SSA)
What Are the Signs of Upward Mobility at an Organization?
Organizations that offer upward mobility generally have the following:
- Talent mobility program: This type of program offers a clear roadmap on how each employee’s role can develop during their employment. It should include learning and development opportunities that push employees to advance in their positions and careers. This program should also note compensation.
- Competitive pay: As discussed earlier, title promotions are not enough to ensure retention. Compensation must be competitive and commensurate with responsibilities. This involves looking at competitors and ensuring your company’s pay remains up to industry standards.
- Long-term employees in evolved roles: It’s usually a good sign when employees at an organization have been around for some time, and it’s an even better sign when they’ve advanced into new roles during their employment. This illustrates that the company values growth and development.
- Mentorship opportunities: Part of creating a leadership pipeline involves mentoring. This may involve using your top talent or members of the leadership team to mentor new staff members and help drive their career development. Mentors can motivate employees to obtain more advanced roles down the line and mentorship initiatives can be a great way to eliminate the divide between leadership and employees.
- Growth mindset: Organizations that champion a growth mindset value employees who embrace challenges, strive to learn, and look forward to developing new skills, all of which can promote upward mobility. They view it as a way to nurture their employees and elevate their competitive advantage.