Stepping Sideways to Step up: Lateral Mobility and Career Advancement Inside Organizations

Abstract

Although internal labor market theory emphasizes promotions as the main form of mobility within organizations, many internal job moves take people sideways into jobs that are at the same hierarchical level as the one that was left. Despite the prevalence of these lateral moves, however, we have little evidence on what role they play in workers’ careers. We argue that lateral mobility can facilitate subsequent career advancement by allowing for the development and demonstration of new skills and can, therefore, help those who would struggle to be promoted from their current job to develop their careers further. We establish empirical evidence on the implications of lateral mobility using eight years of personnel data from a large U.S. healthcare company. Our analyses show that those employees who move laterally are more likely to be subsequently promoted and achieve substantially higher pay growth than a matched sample of employees. We also find that lateral moves are more likely to be undertaken by those who have spent longer in the job but have lower performance than those who are promoted. This pattern of results suggests that lateral mobility provides an important avenue for career growth as people who step sideways in organizations are more likely to subsequently step up. This paper was accepted by Lamar Pierce, organizations. Supplemental Material: The online appendix and data files are available at https://doi.org/10.1287/mnsc.2021.03746 .

Exploring the moderating effects of perceived alternative job opportunities and work experience on the relationship between job satisfaction and turnover intentions: A study among educators in Lebanon

“…Additionally, Mobley et al (1978) and Lambert et al (2006) found that job satisfaction has a significant impact on turnover intention and perceived job availability is also associated with turnover intention. If an organization fails to offer substantial prospects for internal development, employees who aspire for personal growth may proactively seek alternative opportunities in the external job market (Bidwell & Keller, 2024;Jiang et al, 2023).…”