2008 and 2009 have had surprising results when examined for executive turnover. While the United States went into recession back in December 2007, and most of the world suffered from the growing credit/financial crisis, overall executive turnover levels followed a declining trend as we moved through 2008 and 2009.
- For 2008 CEO turnover declined nearly 10%, CFO turnover declined 14% and overall C-level (as defined by Liberum Research as board of directors, CEOs, CFOs down to corporate VPs) turnover declined nearly 15% as compared with 2007 totals.
- The number totals continued to decline even more precipitously for 2009. CEO turnover declined 27%, CFO turnover declined 36% and overall C-level turnover declined 30% as compared with 2008’s already low levels. The numbers would be even more stark if compared with 2007.
The declines in executive management took place while overall unemployment in the United States and Canada continued to increase as we moved through 2008 and 2009. By the end of 2009 with the recession statistically over, the United States had, according to the U.S. Bureau of Labor Statistics, an overall unemployment rate of 10% one of the highest rates for the last few decades.The continuing declines in executive turnover were seen both on a quarterly and annual basis. Public companies, unless forced to by business events or scandals, have shown a reticence to make changes in their top executive ranks as the leaders of those corporations have made efforts, and in many circumstance extreme efforts, to tightened their belts, lower expenses, inventories and overall employee levels within the lower ranks of corporations. We expect that once the economy begins to truly recover, the level of executive turnover will begin to rise.
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