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In today’s big story, Corporate America doesn’t seem interested in bringing back the middle managers it’s spent the past few years kicking out.
What’s on deck:
But first, we’re managing just fine.
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The big story
Middle managers’ new reality
Missing: Open positions for middle managers.
Corporate America’s push to flatten organizations isn’t going away, and it’s put middle managers on the endangered species list, writes Business Insider’s Aki Ito.
Data Aki collected from workforce analytics provider Revelio Labs shows hiring for white-collar jobs is bouncing back with one noticeable exception: middle managers. According to Aki’s analysis, employers are advertising 42% fewer middle-management positions than they did in April 2022.
A hiring slump is one thing — Aki has covered the ongoing white-collar recession extensively — but the diminishing need for middle managers could be a new reality for the role. Companies keep touting the benefits of shrinking the distance between leaders and people on the front lines doing the work.
If anything, it could get even worse. Elon Musk and Vivek Ramaswamy have already signaled plans for significant layoffs via the new Department of Government Efficiency. Their strategy includes only keeping the minimum number of staffers needed for departments to function effectively, which might spell more trouble for middle managers.
In the meantime, recovering middle managers are left fighting for anything they can get.
In desperate need of work, some people are heading further down the corporate totem pole, applying for entry-level jobs.
That’s led to an interesting dynamic. Applicants are trying to appear less qualified over fears their senior-level experience might scare away recruiters of lower-level jobs.
As Aki points out, things could eventually turn around for middle managers. The downsides of fewer middle managers — burnt-out supervisors, fewer mentors for young employees — are already coming to light.
The clock is ticking, though. The middle-management culling is largely impacting people in their late 40s to 50s who are starting to eye retirement. That age demographic, which is prime Gen X, is already dealing with challenges around personal finances.
If their struggle to find work continues, limiting their ability to save, it could further strain a system already having a hard time helping retirees who didn’t save enough.
News brief
Top headlines
3 things in markets
- Risks in the private markets could become very public. A note from Rosenberg Research warned of the growing leverage in the $14 trillion market, which includes investments in startups, real estate, and direct lending. Fund managers “are resorting to an ever more creative array of temporary fixes” which is “increasing the interdependence and circular lines of credit between parties in the system,” the note said.
- A longtime Tesla investor isn’t sold on it getting a Trump bump. Ross Gerber disagrees with the widely held belief that the close ties between Elon Musk and President-elect Donald Trump will benefit the EV giant. Gerber, whose fund has been selling down its stake in Tesla since late last year, told BI problems around Tesla’s tech can’t be fixed by Musk’s new friends in Washington.
- Thanks for the memories, small-cap stocks’ rally. The surge in US small-cap equities following Trump’s win doesn’t have legs, according to some market experts. Adam Turnquist, LPL Financial’s chief technical strategist, said small-cap revenue growth has been disappointing, especially compared to the S&P 500.
3 things in tech
- Five factors behind Netflix’s totally awesome, very good year. Netflix emerged as the clear winner of the streaming wars this year, boasting a soaring stock and forecasting billions of dollars in profits. Strategies like pushing into live sports and overhauling film leadership helped push it to the top of the streaming game.
- Buying Twitter? Bad move. Owning X? Not a bad idea. When Elon Musk bought Twitter for $44 billion, an analyst called it, “One of the most overpaid tech acquisitions in the history of M&A.” Two years later, it’s looking like it could be a steal. Musk used the platform, now called X, to train his xAI venture that’s valued at $50 billion. It was also the focal point for his advocacy for Donald Trump, whose reelection sent Tesla’s stock and Musk’s personal wealth soaring.
- We drove the Chinese EV Ford’s CEO loves. Jim Farley, Ford’s CEO, didn’t want to give up his “fantastic” Xiaomi SU7, despite the fact it was made by a rival car company. BI’s reviewer took it for a test spin in China to see what the fuss was about, and said it was one of the best-handling Chinese EVs he’d driven. Impressive for a company that hadn’t made a car before this year. Just don’t expect to get it outside China, unless you’re Jim Farley.
3 things in business
- An origin story with a deadly twist. Brothers Roy and Ryan Seiders launched the wildly successful drink cooler brand Yeti — a business now worth $3.5 billion — out of their father’s backyard. But years ago, the shocking murder of their business partner triggered a succession battle that nearly stopped the company in its tracks.
- How hard is home buying? See it to believe it. American homeowners are older, wealthier, and less likely to have kids than ever before, according to data from the National Association of Realtors. These nine charts show just how bad the affordability crisis has become.
- Automaker CEO departs, effective immediately. Stellantis CEO Carlos Tavares has stepped down, the company announced on Sunday, and its shares fell by more than 8% on Monday. The automaker, which owns Chrysler, Jeep and Maserati, saw its profits shrink and stock slump dramatically this year.
What’s happening today
- First Lady Jill Biden unveils 2024 White House Christmas decor.
- DEA hearing on proposed rescheduling of marijuana.
- Oxford’s word of the year is announced.
The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Grace Lett, editor, in Chicago. Ella Hopkins, associate editor, in London. Spriha Srivastava, UK bureau chief, in London. Jack Sommers, deputy editor, in London. Amanda Yen, fellow, in New York. Milan Sehmbi, fellow, in London.
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