James Lawson
May 19, 2025
Mind the Gap: What can leaders do to tackle an employee motivation crisis?
As the UK grapples with rising minimum wages and a rebalancing of pay structures across industries, a new challenge is emerging: salary compression. Lower-level salaries are increasing at a faster rate than mid-level roles, resulting in many companies facing critical talent gaps.
This trend is particularly pronounced in specialisms that depend on motivated, capable individuals stepping up into leadership positions. Yet many employees are asking: “Why take more pain for not much gain?”
Why Is Salary Compression a Problem?
Salary compression occurs when the pay gap between lower and middle-tier roles narrows, diminishing the financial incentive to climb the career ladder. While wage growth at entry and operational levels is welcome, especially with the recent increase in the UK’s National Living Wage, it has unintended consequences for middle management recruitment and internal progression.
Those in frontline roles now find that the increased responsibility, longer hours, and heightened accountability associated with stepping into a team leader or middle manager role is no longer justified by the marginal pay increase on offer.
The Impact on Core Functions
In specialisms like logistics and procurement, where workforce continuity, operational efficiency and supplier relationships are key, middle managers are linchpins. They're expected to bridge the gap between strategy and execution, handle people management, maintain compliance, and drive performance. If the pipeline into these roles dries up, businesses risk disruption, disengagement, and underperformance.
So how should companies respond?
Five Ways to Attract and Retain Middle Management Talent
1. Reassess Pay Bands and Progression Incentives
While businesses may not be able to match percentage increases at the lower end, they must ensure middle management pay reflects the complexity and stress of the role. A modest salary uplift isn’t enough when the stakes, and expectations, are considerably higher. Consider:
- Enhanced bonus structures or profit-sharing schemes
- Project completion or milestone-based incentives
- Role-based allowances for out-of-hours responsibilities
2. Offer Clearer Career Pathways
Too often, progression to middle management feels like a one-way ticket to burnout. Providing structured career development plans with transparency around salary progression and promotion criteria can help employees see the bigger picture.
- Highlight future earning potential at senior levels
- Invest in training that demonstrates commitment to long-term growth
- Promote success stories from within the business
3. Improve Work-Life Balance and Role Design
The pressure on middle managers has never been higher, especially in fast-paced environments like logistics and supply chain. Supportive working conditions can act as a counterbalance to financial constraints:
- Delegate non-core admin tasks to free up time
- Provide access to wellbeing resources
- Promote flexible and hybrid working where feasible
4. Recognise and Reward Internal Talent
Employees are more likely to step up if they feel valued. Recognition doesn’t always need to be financial, it could be in the form of:
- Publicly acknowledging team leadership achievements
- Providing mentorship from senior leaders
- Giving middle managers a voice in strategic decision-making
5. Broaden the Appeal of Middle Management
For many in procurement, buying or sales, stepping into a management role should feel aspirational, not like being thrown into the deep end. Showcase how these roles can:
- Influence the commercial direction of the business
- Shape operational improvements
- Lead innovation in supply chain tech or sustainability initiatives
The UK’s logistics and supply chain specialisms are at a turning point. To keep operations resilient and future-ready, companies must reframe how middle management roles are positioned and rewarded. With the right balance of compensation, support, and progression, organisations can reignite interest in leadership and ensure a robust talent pipeline for the years ahead.
If your business is struggling to recruit middle management roles due to wage compression, why not check out our Salary Benchmarking & Skills In Demand Guide 2025 to understand what candidate expectations are when it comes to salary.
