As recession looms, CEO turnover steadies
CEO turnover leveled out in October after a period marked by a high rate of departures in the healthcare industry.
The number of CEOs across industries fell 4% from September to October, according to a recent report from Challenger, Gray & Christmas. That’s likely good news for healthcare organizations that may be bracing for a recession in 2023 and need stability at the leadership level to helm through financial difficulty and uncertainty.
Compared to 2021, the numbers are even better––October 2022 saw 71 CEO changes from their roles, down from an astonishing 142 in October 2021. So far in 2022, there have been 1,040 CEO exits, down 8% from the 1,133 CEOs who left their posts through October 2021, the report found.
The report comes as many major organizations have recently announced huge layoffs as part of cost-cutting measures, as many are bracing for a recession and a challenging financial operational environment in 2023.
“At the moment, the labor market is still tight, but companies are preparing for a recession. The leaders who are in place now are the ones companies have chosen to lead the company in at least the short-term,” Andrew Challenger, senior vice president of Challenger, Gray & Christmas, said in a statement.
This is especially true for the technology sector, in contrast with healthcare jobs, which have been rebounding in recent months.
“Job cut announcements are rising and hiring plans have slowed as we conclude 2022. The Technology sector is seeing the bulk of these layoffs, and it is also where we are seeing a lot of CEO changes, but generally speaking, companies are holding onto their leaders,” Challenger said.
Earlier this year, trends pointed toward healthcare CEOs leaving their roles at a rapid rate, with many top executives taking part in the Great Resignation. In fact, in the first half of the year, the rate of CEO changes was record-breaking since Challenger, Gray & Christmas began tracking the data in 2002.
However, healthcare is not among the top industries with CEO changes. Technology and the government/nonprofit sector had the most turnover this year.
The findings come as hospitals and health systems are facing billions in losses this year thanks to declining revenue, higher costs, staffing shortages and high inflation rates.
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."