CEO turnover ticked up during the first month of 2023 to its highest rate since May 2022, according to a new report from global outplacement and business and executive coaching firm Challenger, Gray & Christmas.
The number of CEO changes at U.S. companies rose 12% from December 2022 to January 2023, when 112 changed roles. Despite that jump, January’s total is still down 10% from the 125 CEOs that departed their positions in January 2022. However, January’s total is the highest rate of CEO turnover since May 2022.
Overall, January often has a high rate of turnover compared to other months, with an average of 116 CEOs leaving their posts during the month since 2002. September typically has the second-highest rate of CEO turnover, with 110 on average during the month.
“January has the highest number of CEO exits on average than any other month, as companies assess their previous fiscal year and make plans for the future,” said Andrew Challenger, leadership expert and senior vice president of Challenger, Gray & Christmas.
Hospital CEOs are leading the way in turnovers for the start of 2023, with 23, or 21%, of all CEO exits announced in January. In fact, January was the highest total for the sector behind August 2018, when 24 CEOs exited.
“Hospitals and Hospital Systems have undergone incredible challenges over the last three years as the pandemic raged, burned out health care workers, and pushed resources to the limits,” Challenger said. “Some of these leaders themselves are likely burned out as well, while others are moving to different Hospitals to execute skills they’ve gained during those difficult times.”
The turnover comes as hospitals and health systems are facing major financial challenges stemming from the COVID-19 pandemic, high inflation rates, staffing shortages, supply chain constraints and more. Many hospitals and health systems operated with negative margins in 2022. Many workers in the healthcare space also participated in the Great Resignation during the pandemic, and CEOs were no exception. Though, the rate of turnover did fall to its lowest rate since 2017 during the second half of 2022.
Behind healthcare, the government/non-profit sector saw 18 exit, while the technology sector announced 17 CEO changes. Most CEOs (35) retired in January and 16 stepped down into other positions in the company, such as a board member or other C-level role. Ten CEOs found new positions within the organization, in a new company within the organizational structure or in a new unit or division, and two had their position eliminated during January 2023.
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."