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Why the Purge of Middle Managers Could Backfire
Layers of management help bigger bosses get stuff done. Their loss will come back to bite companies sooner than they realize.
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We’ll miss them when they’re gone.
Middle managers are on the chopping block at Uber, Intel, Coinbase and other companies. Top executives seem to view them as unnecessary speed bumps on the highway to innovation, and rank-and-file workers love to gripe about layers of bosses who do, what, exactly?
It’s hard to think of another role that gets so little love from both ends of the org chart.
Just give it a few years. We’re underestimating the often-invisible work of people who enable higher-ranking leaders to delegate and get the most out of front-line employees.
So, I’m calling it now: When we realize what’s been lost, middle manager will be the hottest job out there. And filling the void won’t be easy.
The Georgetown University Center on Education and the Workforce projects U.S. businesses will face a shortage of 2.9 million managers in 2032. This is by far the biggest anticipated shortage among major job categories. Nurses and teachers are second and third with projected shortages of 611,000 and 362,000, respectively.
“Management is sort of a unique category in that there isn’t a single pipeline that gets you there,” says Madeleine Adelson, a policy analyst at the Georgetown center and co-author of its report on skills shortages. “That can work both for and against it.”
Who wants to be the boss?
Good managers can come from a range of educational and professional backgrounds, which creates a large pool of potential candidates. But to be a boss, you first have to want to be a boss. We’re in a job market where even graduates of top M.B.A. programs—traditionally America’s boss factories—are struggling to get hired.
Plus, taking on managerial duties too often amounts to a “dry” promotion that brings no additional pay and less security. Raising your hand for middle management right now feels like volunteering to be laid off the next time your employer decides to become more “nimble.”
“I figured this could come one day,” says Alex Butterworth, who was a senior legal counsel at Uber until he was laid off this month as part of the company’s reduction of small-team managers. “I was like, ‘At some point, there’s going to be layoffs and I might get caught.’”
He didn’t mind the risk because he has ample savings, no dependents and a second income stream as a restaurant investor. Now that the ax has fallen, though, Butterworth isn’t sure he has the stomach for another stint in corporate America’s vulnerable middle. His job search will target general counsel positions at startups.
At the top, he figures, a solid performer’s results are evident. In the middle, it can be hard to shake the Dwight Schrute-esque caricature of a manager who was shunted into some do-nothing role where he can’t cause too much damage.
“You do have individual contributors who got promoted to manager and have no idea how to actually manage, and are absolutely slowing things down and causing problems,” Butterworth says. “But it’s not easy to get rid of the right people, and when organizations don’t have the time or the patience, they just take a sledgehammer to the organization and put the pieces back together later.”
The AI factor
Much of the job panic around artificial intelligence is concentrated at the entry level, but AI threatens the middle ranks, too.
“The key thing is, what are the tasks that a manager does?” says economist David Deming, dean of Harvard College. “A manager doesn’t produce any output, but they often coordinate the allocation of resources, and that coordination function can actually be done decently well with some technological tools.”
He cited chatbots like Claude Tag that can be embedded in the workplace messaging app Slack as an example. Some of the basic questions people have always asked their managers can now be answered by AI agents.
“It moves everything faster, just the general questions that you may have,” says Suzana DelliSanti, Salesforce’s executive vice president of global talent acquisition. “My Slackbot will be in Slack along with my employees.”
Salesforce, as Slack’s parent company, is an early adopter. But other businesses see an opportunity to accelerate work by using AI to do some of the orchestration typically performed by middle managers. This was the essence of the rationale laid out by Coinbase CEO Brian Armstrong when the company said in May that it would lay off 14% of its workforce and eliminate “pure managers.”
But what makes sense on paper can also overlook the effect on morale and, eventually, productivity.
Middle managers often act as informal therapists for their direct reports. The good ones are attuned to what motivates people on their teams and who works well with whom. They also serve as executive whisperers, translating the goals and strategies from bosses on high, while also acting as buffers for those higher up the ladder, sparing executives the headaches of petty issues.
Leaders who expect AI to free them to concentrate on major initiatives will ultimately inherit the personnel dramas and small decisions that deputies used to take off their plates. They may also find their grand plans don’t get executed when there are no rallying forces at the team level.
Get ready for the in-demand middle managers’ comeback tour in a few years’ time. The only question is, when companies realize they cut too deeply, will there be enough bosses willing and able to step up?
Write to Callum Borchers at callum.borchers@wsj.com
