My husband, a type A man with a low tolerance for mistakes, needed just one corporate-management job to realize he never wanted to do it again.
I could have saved him the time, having observed him at home. His attempts to administer direction to our four-year-old follow a highly predictable sequence of events that culminates in a spectacular explosion—one that our four-year-old counts on.
That he ever had a choice between staying an individual contributor and becoming a manager is unusual, research from Kellogg’s Nicola Bianchi suggests. Instead of a single track, careers tend to follow one of two separate ladders that only rarely intersect. Today, Bianchi explains how the ladder on which you find yourself can make a big difference in your salary and responsibilities. Plus, we hear from Kellogg’s Victoria Medvec how to be less fearful in our negotiations.
A fork in the ladder
In research with Lydia Cao, Benjamin Friedrich, and Kieu-Trang Nguyen, Bianchi examined detailed personnel records from dozens of firms to compare these two career tracks.
After analyzing the data, several facts came into focus.
Individual contributors dominate the workforce, comprising about 82 percent of the average employee base. And they earn, on average, substantially less than do managers in comparable roles, are promoted less often, and see slower pay growth.
Once you’re on a path, you tend to stay there. In any given month, only about 0.5 percent of individual contributors switch to the managerial track. Those transitions are linked to higher pay and faster pay growth.
“When you just look at the descriptive characteristics of the careers of individual contributors, they look very, very different from the careers of workers who would end up becoming managers,” Bianchi says.
But firms play a role. The researchers observed a lot of variability in how different organizations utilize—and pay—individual contributors, relative to managers.
Firms where managers stay close to the work tend to pay individual contributors more, run flatter managerial ladders, and employ more highly skilled technical workers. In contrast, firms with a hard line between the tracks show the opposite pattern: steeper pay divergence between individual contributors and managers and a more-rigid set of duties for each.
Most strikingly, those two ladders turn out to be a hidden engine driving pay gaps between workers of different genders and races.
“We see that there is a higher probability of a woman or a minority worker being assigned to the individual-contributor career ladder,” Bianchi says. “And when we compute how much this difference in assignment contributes to the overall pay gap, we see it’s a sizable share.”
Read more in Kellogg Insight.
