Research: A record number of American directors resigned

Managers of companies and organizations in the United States are leaving their positions en masse. According to a new report from Challenger, Gray & Christmas, more than 1,400 senior men and women have resigned from corporate America this year through September. This is nearly 50 percent higher than at the same time last year and the highest number ever measured in the first three quarters of a year.

Challenger, Gray & Christmas specializes in coaching corporate executives, and since 2002 has been tracking the number of directors resigning from U.S. companies and organizations that have at least ten employees and have been active for at least two years. Researchers do this based on news reports, press releases, and documents issued by the Securities and Exchange Commission (SEC), the supervisory authority.

Government and non-profit sectors top the list of departing CEOs. This year, more than 350 senior men and women have left their positions there. This represents an increase of more than 85 percent compared to last year. The outflow is also significant in the technology sector, with more than 140 people leaving boards.

The exact reason for all these departures remains speculative. More than a fifth of the cases relate to retirement. The other reason mentioned is, for example, to seek new opportunities elsewhere. But no clear explanation was given for nearly a third of departures.

Andrew Challenger, of Challenger, Gray & Christmas, thinks he has an idea why so many managers are quitting. “Businesses are preparing for economic changes in the coming months. With increases in labor costs and interest rates, companies are looking to new leaders.

Alexander Kearse, of consultancy Gartner, was not surprised by the numbers. He points out that during major moments of uncertainty such as a crisis, in this case the coronavirus pandemic, there is always limited turnover of managers. These managers then often remain in their positions longer due to a sense of responsibility. But it also means that after the pandemic ends, more drivers will leave. “Many observers, myself included, had been anticipating this increase in director turnover post-pandemic, and it appears that it has finally happened.”