In the Article
Organizations are facing a growing leadership gap driven by three forces: experienced leaders retiring, entry-level roles disappearing, and a lack of structured succession planning. The result is a weakening leadership pipeline at every level.
To stay competitive, organizations must take a proactive approach to succession planning by:
- Protecting and rethinking entry-level roles
- Capturing institutional knowledge before it’s lost
- Building leadership pipelines across all levels
- Making development part of the culture
- Using AI to accelerate—not replace—leader development
Companies that invest in developing future leaders today will be the ones positioned to grow through uncertainty tomorrow.
The biggest threat facing business today is not Artificial Intelligence or even the pace of change. No, the biggest threat facing business today is the missed opportunity to invest in developing the next generation of leaders equipped to guide your organization through unprecedented change.
Think about this: every single day in 2025, 11,400 Americans turned 65. And by 2030, the entire baby boomer generation will have turned 65 and be eligible to walk out your door and retire. These boomers take with them the knowledge, expertise, and the confidence to lead through uncertainty.
At the same time, companies like Microsoft and Salesforce are setting the example that smaller organizations are following, of replacing most entry-level job opportunities with artificial intelligence. While they’re saving costs, they’re cutting off the leadership pipeline—accelerating the leadership gap most organizations aren’t prepared to fill.
The two questions every senior-level executive and board of directors should be asking right now are: Who is going to lead our company in the next five to ten years? And what are we doing now to get these future leaders ready?
These are not future questions—they are the questions defining today’s leadership gap.
While executives are busy automating the present, they are quietly destroying the future. The entry-level roles being eliminated today aren't just jobs — they are the first rung of the leadership ladder. Combine that with the mass exodus of experienced leaders eligible for retirement, and you have the perfect storm creating a massive succession gap.
Why Is Lack of Succession Planning A Perfect Storm for a Leadership Gap?
A perfect storm occurs when multiple independent challenges converge all at the same time, creating a combined impact far worse than any single factor would produce on its own.
That is exactly what is happening in today's workforce, creating a succession gap that poses a far greater threat than artificial intelligence to the long-term success of your organization.
Storm System One: The AI Layoff Wave
In 2025, AI was directly responsible for nearly 55,000 layoffs in the United States, according to consulting firm Challenger, Gray & Christmas — part of a staggering total of 1.17 million job cuts that year, the highest level since the Covid-19 pandemic. As of April 2026, over 92,000 tech workers have already been let go, bringing the cumulative total to nearly 900,000 since 2020.
Some of our largest and most influential companies lead the charge. Citigroup expects its headcount to drop by roughly 20,000, saying automation and AI-enabled systems will allow it to run with fewer employees. UPS announced massive cuts under its "Network of the Future" initiative. Paycom laid off more than 500 employees after automating payroll functions — and told those workers directly that their roles had been replaced by AI-driven systems.
But here is where the real issue and why this is so concerning. It's the entry level that is disappearing fastest. Entry-level job postings dropped 7% year-over-year between August 2024 and August 2025, while senior-level postings actually increased by 4%. Big Tech companies reduced new graduate hiring by 25% in 2024 compared to the year before. In San Francisco alone, more than 80% of "entry-level" jobs now require at least two years of experience.
This shift isn’t just reducing headcount—it is accelerating the leadership gap by removing the very roles that develop future leaders.
Storm System Two: The Great Retirement
At the very same moment companies are cutting the front door to leadership, they are losing the senior talent they have spent decades developing.
The baby boomer generation — born between 1946 and 1964 — represents one of the largest and most experienced segments of the American workforce. And they are retiring in record numbers. Between 2024 and 2030, 30.4 million baby boomers will turn 65. Currently, one in four U.S. workers is a boomer, meaning as much as 25% of the entire workforce could retire within the next eight years.
And while artificial intelligence can replace the labor, it cannot replace the wisdom, experience and critical thinking skills needed to lead in these companies. Boomers are the people who know how things actually work and have seen the company through some of their most challenging times.
They are the institutional memory, the relationship holders, the culture carriers, and in many cases, the leaders who have been holding organizations together for decades. They are also the leaders best qualified to be developing this next generation.
As this talent exits, it leaves behind a widening succession gap that experience alone cannot quickly replace.
Storm System Three: Critical Lack of Succession Planning
With so many Baby Boomers turning 65, and many announcing their retirements, you would think there be a major focus on succession planning. But there’s really isn’t.
While 86% of leaders believe succession planning is critically important —only 14% think their organization actually does it well. And less than 35% of organizations have a formalized succession planning process at all.
A full 65% of companies don't even have a succession plan for their CEO, let alone for the middle managers, top sales performers, technical experts, and culture carriers who are equally essential to organizational survival.
The financial consequences of this gap are already being felt. Gallup estimates that poorly managed leadership transitions have erased nearly $1 trillion in market value across S&P 1500 firms. Unplanned CEO departures lead to an average 20% stock drop. And 50% of leadership transitions fail within 18 months when proper planning hasn't taken place.
Not to mention the impact on employee and customer retention, productivity and overall moral and culture due to constant leadership disruption and turnover.
The result is a succession gap that organizations recognize—but are not structurally prepared to solve.
Storm System Four: The Lack of Focus On Developing Leaders
There is a pattern in how companies have historically produced great leaders. They have been mindful, intentional, and required training and development of future executives. Entry level jobs were how the most successful leaders got started in their career or companies.
Taking an entry level job used to mean, you do the low level jobs to cut your teeth, get experience. Your given the room to make mistakes, you learn, go to training, and you work with a mentor. Slowly developing skills, experience, critical thinking and the connections.
These young hires would roll up their sleeves and learn how the business actually functions — through training, experience and spending time watching and talking with current successful leaders.
Then, slowly, they move up. By the time they reach a leadership position, they understand the organization from the ground up, and they have the critical thinking skills to run the company. Time and resources have been invested in getting them ready for a leadership position.
CEOs like Doug McMillon of Walmart started by unloading trucks. GM's Mary Barra began on the assembly line at 18. Hewlett Packard Enterprise's Antonio Neri started as a call center agent. These are not feel-good stories. They are evidence of how leadership pipelines are supposed to work.
AI is disrupting that model in ways most organizations haven't fully recognized yet. When entry-level roles disappear, so does the traditional pathway that grows future leaders.
Less than 18% of leaders today feel they are effective at achieving business goals, and 82% of managers entering positions have received no training or mentoring at all. Combine that with the lack of succession planning and you realize why less than 14% of organizations feel prepared to address future leadership gaps, and 9 out of 10 Human Resources Officers say their leadership pipeline is not ready.
Succession Planning Is Not Just About the CEO
One of the most important things to understand about the succession gap is the depth of it. This is where the succession gap becomes most dangerous. No longer is succession planning just about the CEO, or limited to the C-Suite. You need to be creating a culture of succession and create leaders at every level of your organization.
Because in today’s marketplace there is little that you can control, but the one thing you can – the quality of your team – is your greatest asset in turning uncertainty to competitive advantage.
Think about the people in your organization who, if they walked out tomorrow, would leave a hole that couldn't easily be filled. It might be your top salesperson who has relationships with your 20 biggest clients. It might be your operations manager who knows exactly why the system works the way it does — and what will break if you change it. It might be the team leader who somehow keeps everyone together when things get hard.
These are not people who show up on most succession plans. But they are precisely the people whose departure can quietly unravel an organization.
The data is clear: 77% of organizations already lack sufficient leadership depth across all levels. And without the entry-level pipeline feeding in from below, and experienced leaders draining out from the top, the middle is being hollowed out faster than most companies realize.
Five Strategies To Close The Leadership Gap with Succession Planning
The good news is that the succession gap is not inevitable. It is a choice — it can be easily closed with the right strategy, commitment, and leadership.
- Stop treating entry-level as expendable.
Entry level roles are not just a cost to be cut. They are the seed corn of your future leadership. Eliminating them today guarantees a leadership drought tomorrow. The World Economic Forum is direct: without an influx of early-career talent, organizations face weakened succession plans, stalled knowledge transfer, and cultures that struggle to renew themselves. - Capture institutional knowledge before it walks out the door.
Every organization has knowledge that lives in people's heads, not in any system. As boomers retire, that knowledge disappears unless there is a deliberate process to transfer it. Mentoring, shadowing, documented processes, and knowledge-sharing programs are not soft initiatives — they are business continuity strategies. - Build leadership pipelines at every level.
Succession planning cannot be limited to the C-suite. Every critical role — from middle management to top performers to technical specialists — needs a development plan and an identified successor. Companies with strong succession plans see 30% higher leadership retention and are 60% more likely to outperform their competitors. - Make growth everyone's responsibility.
Culture is the foundation of succession. When an organization values development, mentoring, and internal mobility at every level — not just on paper, but in practice — the leadership pipeline builds itself. Employees who see a clear path forward are more likely to stay, grow, and invest in the success of the people around them. - Use AI as a development accelerator, not a replacement.
The companies getting this right are not choosing between AI and people. They are using AI to make their people more capable, more efficient, and more ready to lead. The goal is not to replace human development — it is to accelerate it.
We are living through a workforce transformation unlike anything in modern history. The leadership gap is already forming. The only question is whether your organization will be caught in it — or whether you will take action to invest in a leadership bench strong enough to leverage it.
Frequently Asked Questions About Succession Planning and Closing the Leadership Gap
What is causing the leadership gap in today’s workforce?
The leadership gap is being driven by a combination of retiring senior leaders, fewer entry-level opportunities, and a lack of structured succession planning. Organizations are losing experienced talent at the same time they are weakening the pipeline that develops future leaders.
Why is the leadership gap a bigger risk than AI?
Artificial intelligence can replace tasks, but it cannot replace leadership judgment, experience, and decision-making under uncertainty. The real risk is not automation itself, but the loss of the leadership pipeline needed to guide organizations through change.
How does eliminating entry-level roles impact future leadership?
Entry-level roles are where leadership development begins. When organizations remove these positions, they eliminate the early experiences, mentorship, and skill-building that prepare individuals to take on leadership roles later in their careers.
What is the biggest mistake companies make with succession planning?
Most organizations treat succession planning as a C-suite exercise. In reality, the leadership gap exists across all levels. Failing to develop leaders in middle management and key roles creates instability that impacts execution, culture, and long-term growth.
How can organizations start closing the leadership gap now?
Start by protecting early-career roles, capturing institutional knowledge, and building leadership development into everyday operations. Succession planning should be an ongoing process, not a one-time initiative tied to executive transitions.
What role should AI play in leadership development?
AI should be used to enhance development, not replace it. Organizations that use AI to support learning, improve decision-making, and increase efficiency will strengthen their leadership pipeline rather than weaken it.
