Career Development Gaps Frequently Drive Employee Turnover

Employee turnover continues to be driven by preventable reasons that highlight the need for organizations to address core areas of employee dissatisfaction. 

Reasons related to career pathways remained the leading cause of turnover in 2024, according to Work Institute’s annual analysis of tens of thousands of exit interviews across a range of industries. 

After career-related reasons, workers said they left their employer because of personal health and family issues, followed by dissatisfaction with flexible work, management behaviors, and total rewards.  

Workers used to expect a linear career path, but that stepladder model doesn’t exist anymore due to the increase in rapidly changing workplace conditions, said SHRM CHRO Jim Link, SHRM-SCP. 

“Employers have not done a good enough job selling the value of what it is you will learn in the job,” Link said. “I tell people the pathway is not linear. It’s about experiences. We should be letting employees know what each experience — or role — is and how long we expect them to be in that role. That collection of experiences allows you to do whatever next you want to do, whether it’s inside the organization or outside of it.” 

Toolkit: Improving Employee Retention and Reducing Turnover

Career Development Is the Top Retention Driver 

Career-related reasons such as lack of growth opportunities, inadequate career progression, or insufficient professional development remained the leading cause of turnover, according to Work Institute, a research and consulting firm in Franklin, Tenn.   

“This enduring trend highlights employees’ growing focus on roles that meet their immediate professional needs and also align with their long-term aspirations,” Work Institute CEO Danny Nelms said. “Organizations that offer transparent career pathways, growth opportunities, and role alignment are better positioned to retain talent.” 

The importance of career and skills development has surged in recent years, according to data from Mercer.  

“Employees ask themselves, ‘Can I continue to grow in my current role or do I need to change jobs in order to progress?’ ” said Gord Frost, global rewards solution leader at Mercer, who is based in Montreal. “There’s a particular interest in skills development. If my skills are no longer relevant, I no longer have a job. People are looking for an employer that invests in them to help them develop needed skills to be employable in the future.” 

Link said employers must get comfortable letting workers know what experiences they are expected to have at the organization, and the outcomes that are expected from those experiences. “We want you to get this skill and demonstrate it,” he said. “Then get this new skill and demonstrate it, and so on. Then there’s a decision point, and you either stay or go.” 

It’s not surprising that people are unhappy with career development because those expectations are not made clear from the start, and people are not aligned with the organization, Link said. Frost said leading employers are finding ways to link pay and skills development. Some organizations are recognizing people and offering additional compensation for developing new skills, he said. 

“Another leading practice is to go beyond the traditional learning and development program and general professional development and become more laser-focused on what critical skills are most important for the specific industry, company, and role and then develop those skills,” Frost said. “Development becomes less employee-directed based on interests and more employer-directed based on what the company sees as most important going forward.” 

First-Year Turnover Is the Costliest

Attrition during a new hire’s first year accounts for roughly 40% of all turnover, according to Work Institute, and underscores the need for robust onboarding, tailored support, and early-stage engagement strategies. 

Early-stage turnover is also the most costly, as organizations fail to regain any return on investment from the departed employees, Nelms said. 

A lack of work/life integration is the top reason given for first-year turnover, Work Institute found, as flexible scheduling and hybrid work models are increasingly important to new hires. 

“Turnover in the first year is usually a case of unmet expectations and what employers are capable of delivering,” Link said. “I think this will be a source of tension for the foreseeable future. There is an expectation from some people that the same flexibility that they had during the COVID crisis years should be in the workplace. But the workplace may value in-person attendance and real-time collaboration. The way to address this is with as much specificity as possible and being abundantly clear about expectations from the outset.”  

Nelms said employers can mitigate first-year turnover with tailored strategies such as conducting continuous feedback and stay interviews; creating structured onboarding processes with regular check-ins; providing a realistic job preview during the hiring process; offering flexible work arrangements; providing benefits such as mental health support and child care assistance; and equipping managers with the tools and training to support new hires.   

Managers Are Key 

Managers directly shape the employee experience. Yet, management-related turnover hit a six-year high in 2024, the Work Institute study found. 

Toolkit: Developing Management

“Managers hold the single most significant influence over employee retention,” Nelms said. “They shape the day-to-day experiences of their teams and directly impact engagement, performance, and intent to stay. Despite their critical role, many managers are increasingly burdened with additional responsibilities that detract from their ability to focus on their primary role, which is leading, coaching, and supporting their employees.” 

Link said the dissatisfaction with managers is not a surprise. “Overall, no organization is doing a fantastic job at the middle-manager level, in skilling, preparedness, or even the wellness of managers themselves,” he said. “There is a real need for upskilling and reskilling of middle managers to get them up to speed on the critical issues of the day, including turnover.” 

Manager enablement and improving people managers’ skills are a top HR priority, Frost said. “These are people who often are very good individual contributors but may not have any experience managing other people,” he added. “Leading HR teams are providing more tools for managers to be better and investing more in manager training. I’m also starting to see more employers using AI to assist managers with those moments that matter,” referring to the touchpoints in an employee’s journey that can impact their engagement.    

Link said there is an expectation that managers should have all the answers, and they often “get it from both ends” when they do not.   

“Just admit that it will be hard navigating the middle,” he said. “Build a middle-manager awareness training program. Provide resources. Train them on implementing AI. Train them on implementing wellness. There are many areas to build awareness on that help them be better managers.”