If your company does not provide career pathing, it risks talent churn, financial losses, and competitive stagnation.
Work may be a constant of human life, but how we approach work constantly changes. There was once a time when your career influenced who you’d marry (if you ran a bakery, it made sense that both you and your partner had baking skills). Jobs would often pass from parents to children. During the 20th century, the corporate model took over. Now, employees exchanged loyalty for lifelong employment and retirement funding.
But that model has made a radical shift since the 1970s. Economic boom-and-bust cycles created flatter company hierarchies, outsourcing, and less employee career protection. Employees responded by becoming more agile, looking for future prospects at places other than their current employer.
Technology and newer generations have amplified this trend. But don’t blame Gen-Z and millennials. Even people born between 1965 and 1981 want pathways to personal growth, according to Randstad’s research. Career pathing has become a vital part of every competitive organisation.
“People once went to work primarily to earn a salary,” says Tamarin Duncan, payroll and HR platform PaySpace’s Head of HR. “Now it’s about creating something meaningful. So, it’s important that we have career pathing for both our existing colleagues, as well as attracting the right kind of colleagues.”
How to create career paths – There are ample reasons to provide career pathing. Replacing an employee can cost more than a fifth of their annual salary (American Progress). But the cost is often greater: losing valuable employees indicates stagnation and poor culture. According to a Glassdoor study, these factors and competitive pay are the main reasons people quit. A focus on career pathing can fix those concerns.
“Career pathing provides employees with a sense of purpose and direction. When colleagues have a clear understanding of the potential growth opportunities within a company, they are more likely to feel engaged, motivated, and committed to their work. They can see a future for themselves and have tangible goals to work towards, which increases their job satisfaction and reduces the likelihood of them looking for opportunities elsewhere,” says Duncan.
What are the key considerations for career pathing?
Align roles and company objectives – Every employee’s role relates to company objectives. Too often, companies treat them as a passive part of this arrangement. But objectives change, and the skills required for tomorrow are not always the same as today. Career pathing is a synergy between what a company needs and how employees want to improve. That balance leads to more loyalty and job satisfaction, not to mention improved returns.
Change the employee/manager dynamic – HR departments are responsible for providing career pathing frameworks. But it’s a mistake to assume HR runs career pathing. That dynamic instead happens between employees and managers. If managers can only command, not collaborate, they can’t help their subordinates. Leadership and career path training help them grasp employee ambitions. Then they can help make those ambitions a reality.
Culture, culture, culture – Culture is not about what you do. It’s about your impact and how people feel about the organisation. Career pathing has a very direct impact on culture. The more the company knows where it is going and can bring its people along by helping them develop, the stronger the culture will grow. And in tandem, a weak culture usually leads to unhappy employees. Culture is not about a salary, but the value people can add and how they grow.
Always in the future – Career pathing is not about today. What will the business need in the future, and how does it prepare its people to meet those needs in ways that also serve them? What are their goals, and how do those align with the company’s prospects? This dynamic is essential if you want to avoid headhunting. It will help determine competitive pay and signal that you invest in your people. A paycheque never buys loyalty; a sense of accomplishment and belonging does.
Career pathing attracts and keeps the right people for your business strategy, says Duncan
“In a highly competitive job market, potential candidates are looking for companies that offer not only a job but also a long-term career opportunity. When we clearly communicate our commitment to career development and growth, we become more appealing to prospective colleagues who are looking for stability and advancement in their careers.”
This advice is not just for large enterprises. Small and medium organisations, state departments, startups—every type of business benefits from career pathing. It may be a challenge to get started. But career pathing shows that an organisation cares and invests in its people.