Job cuts, burnout, too many managers: Is this the end of middle management?

As companies seek to cut costs and create flatter organisational structures, they are culling the ranks of middle managers that traditionally connected senior leadership to the frontlines. 

While the appeal of sleeker organisational charts and potential cost savings is clear, the pivot away from hierarchical middle management has divided leadership experts over whether it represents a strategic streamlining for the modern workforce – or a short-sighted approach that could undermine performance and competitive advantage.

Middle managers face existential threat

Over the past few years, many large corporations have cut costs through mass layoffs. United Parcel Service announced it would eliminate 12,000 middle manager roles to save over $1 billion. Similarly, Citigroup said it would trim 20,000 roles by flattening their management structure from 13 layers to just 8 over the coming years, according to a recent Bloomberg report. Earlier this year, eBay laid off 1,000 workers while Amazon reduced headcounts by 500 at Twitch and hundreds more at subsidiaries like Prime Video and MGM, the BBC reported.

Although anyone from entry level all the way through to C-suite staff can be hit by layoffs, several reports suggest that middle managers are frequently the first roles to be targeted in large-scale downsizing.

However, experts at Korn Ferry worry that middle managers have shouldered a disproportionate amount of job losses. A 2022 Future Forum survey found that middle managers reported the highest levels of burnout at 43 percent compared to other levels of an organisation. Middle managers have had to implement new diversity initiatives, productivity drives, and return-to-office policies in hybrid work environments with less face-to-face interaction, the firm said. The lack of regular in-person interaction has made their roles coordinating projects between direct reports and senior leadership even more difficult.

The case for flatter structures

“It begs the question: ‘Is it really worth cutting costs if the quality of output is suffering? Are we also cutting sales and reputation in the process?'” says Mohammad Osama, co-founder of GCC recruitment firm GRG.

According to Richard Smith, Managing Director at Salt, a management consultancy, “Cutting middle management is right to do if a company has an appropriate decision-making matrix that will enable the firm to move forward with core objectives without increasing the workload on the C-level decision makers unduly.”

However, he cautions that it could, in some cases, lead to “greater efficiency if decision-making bottlenecks emerge due to a lack of leadership capacity.”

While the allure of flatter structures is understandable, April Kearns, Director of People and Culture at Dubai-based PR and marketing agency TishTash, questions the wisdom of relying solely on self-motivated staff.

“Someone once told me that a rolling stone never gathers moss, and it has stuck with me,” Kearns said.

“To spend a lengthy amount of time in a role means that you gain expertise, you experience more and therefore understand how to field and solve challenges without being hand-held, and you’ve nailed the basics, so you are less likely to make mistakes – this is what middle managers bring.”

Osama also highlighted that no matter how self-motivated staff can be, employees “still need coaching, guidance, and mentoring.”

“They also need someone that can make the time to listen to and absorb valuable feedback from those facing on-ground issues at the frontline.”

Another compelling argument for preserving middle management comes from the pivotal role these leaders play in talent retention and employee engagement.

“Middle managers are often those who have the time, energy, and creativity to delight and engage clients,” Kearns said. “[They] also play a crucial role in creating and maintaining company culture – they aren’t the big scary boss, but the big sister or brother that you can rely on to share a problem or a laugh with.”

This need for personal interaction and connection may become even more pronounced with younger generations like Gen Z, according to Osama.

“Gen Z’s do value management interaction time to understand how they are contributing to their employer’s overall goals and ambitions. If anything, this requires more management time,” he said.

The future of leadership

While opinions on the fate of middle management may vary, experts agree on the need for a fundamental shift in how leadership is defined and exercised.

Smith believes that “management as a trait is less and less important, however, the need for effective leadership has never been greater across the MENA region.”

“Even an AI-generated manager in the future won’t be able to provide that human element; that sense of being heard and appreciated by someone,” said Osama. He advocates for companies to thoroughly assess their optimal middle management needs based on delivering quality products and services over the long-term.

Smith, however, believes in a leadership model that empowers teams and individuals with a greater emphasis on autonomy and accountability rather than rigid hierarchies.

“To be effective, these leaders need better autonomy to make decisions – including hiring decisions – and invest in the team that they lead without having to get authorisation on every facet from upper management.”

Some experts place greater emphasis on the importance of focusing on strategy and finance while entrusting operation leadership to those closest to the frontlines.

“Assuming this would be the next level up, are executives not better placed to be focusing on strategy and finances? Do we feel that executives will be able to fulfill the role of engaging, retaining, and growing this pool of self-motivated staff on their own?” said Kearns.

Striking a balance

While the appeal of leaner, more agile structures is undeniable, the experts caution against sacrificing the invaluable contributions of experienced leaders and operational experts.

“The assessment may lead to a ‘right-sizing’ but a complete ‘end to middle-management’ will only ever be temporary as companies realize that it’s not a sustainable solution,” said Osama.

As workforces and workforce priorities rapidly evolve, the precise role and structure of middle management remains in flux. But one trend is clear – the need for nimble, empowering and deeply engaged leadership embedded throughout organisations has arguably never been more critical to attract top talent and consistently deliver for customers.

A 2022 Gallup study on the US workforce found that around 70 percent of employee engagement is influenced by the relationship between workers and their direct managers. As companies grapple with attracting and retaining top talent in an increasingly competitive employment market, the impact of losing those crucial engagement drivers can’t be overlooked.

Perhaps the solution lies in striking a balance – embracing flatter hierarchies while preserving critical middle management roles.

“Irrespective of titles and organisational charts, those with the skill to inspire teams, promote accountability, develop people and drive results from the inside-out are what matter most,” said Smith.

“Jobs and career paths will be more fluid than ever, but that fundamental leadership capability has to be prioritised and cultivated by companies that want to consistently win.”