What is upward mobility?

Upward mobility measures the frequency with which an individual changes his or her socioeconomic status. A high rate of upward mobility indicates a healthy economy, and one of the major factors driving this economic advancement is job advancement.

What is upward mobility in human resources?

In human resources, upward mobility refers to the rate at which employees obtain new roles, additional opportunities, and improved compensation. This advancement may include:

• Promotions that provide career growth
• A complete change in role or occupation that benefits an individual’s career development

Why is upward job mobility important?

One of the biggest reasons people leave their jobs   is lack of career development. As industries grow, organizations must work harder to attract and retain top talent. Offering skills development and growth, increased opportunities, and upward mobility can help employers achieve their retention goals.

In addition, organizations that make upward mobility an element of their employee experience can develop a productive workforce. Employees in such organizations are more likely to do the following:

• Stay with the company for a long time
• Be fully trained in your company's procedures
• Have a growth mindset
• Be part of a strong leadership pipeline
• feel engaged in your roles

What is the role of compensation in upward mobility?

Promotions in positions do not help employees retain jobs – around  45 percent of employees  leave their jobs due to inadequate remuneration.

Therefore, employers should offer competitive compensation as employees advance in their roles. Since advancement comes with greater responsibilities, it makes sense for employers to offer higher compensation.

However, while additional leadership responsibilities often lead to additional pay, additional income should not be limited to the leadership path. Employees with high skills and knowledge in their particular field can provide as much unique value to the organization as employees on the leadership path.

Recognizing the value of all skills helps employees feel they can advance without being forced into leadership roles (where they might impose their undeveloped leadership skills on other employees).

Rather than leaving compensation to individual negotiation, organizations can set pay ranges: compensation ranges that provide a benchmark for fairness across the organization and a path for upward mobility.

Here are the general steps for setting pay ranges and using them for remuneration management:

• Conduct a job analysis to assess the qualifications, responsibilities, and activities of a position  .
• Rank positions using a job evaluation method to determine the relative worth of a position compared to other roles in the organization. 
• Create job grades by grouping positions together based on similar value  .
• Conduct market research to make sure  salaries are in line with similar positions in the market.

Keep in mind, compensation is rarely static – pay rates constantly fluctuate with changing market conditions. Therefore, employers should consistently  use current data such as the National Compensation Survey from the U.S. Bureau of Labor Statistics (BLS)   and the Cost of Living Adjustment (COLA) by the Social Security Administration (SSA)  .

What are the signs of upward mobility in an organization?

Organizations that offer upward mobility usually have the following features:

• Talent mobility programs:  This type of program provides a clear roadmap on how each employee's role can evolve over the course of their employment. This should include learning and development opportunities that motivate employees to advance in their positions and careers. This program should also take into account compensation.
• Competitive pay:  As discussed earlier, a promotion in position alone is not enough to retain employees. Compensation must be competitive and commensurate with responsibilities. This includes looking at competitors and making sure your company's pay remains in line with industry standards.
• Long-term employees in evolving roles:  It's usually a good sign when employees have been working at an organization for a while, and it's an even better sign when they've progressed into new roles during their employment. This shows that the company values ​​development and growth.
• Mentorship opportunities:  Part of building a leadership pipeline involves mentoring. This can include using your top talent or members of the leadership team to mentor new staff members and help advance their career development. Mentors can inspire employees to pursue more advanced roles later on, and mentorship initiatives can be a great way to bridge the gap between leadership and employees.
• Growth mindset:  Organizations that foster 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 see this as a way to nurture their employees and increase their competitive advantage.