How Common Are Bad Bosses?

• Date: 01 January 2020
• Published date: 01 January 2020
• Author: Benjamin Artz,Andrew J. Oswald,Amanda H. Goodall
• DOI: http://doi.org/10.1111/irel.12247

How Common Are Bad Bosses?

BENJAMIN ARTZ, AMANDA H. GOODALL and

ANDREW J. OSWALD*

Bosses play a fundamental role in workplaces. Yet, almost nothing is known

about an important and basic question in labor economics and industrial relations.

Are the right people promoted to be supervisors, team leaders, and managers?

The infamous Peter Principle claims that incompetent bosses are likely to be all

around us, but is that true? This article provides the first statistically representa-

tive international estimates—taking comparable data on thirty-five nations—of the

extent to which employees have “bad bosses.”Using a natural measure, the arti-

cle calculates that approximately 13 percent of Europe’s workers have a bad boss.

Such bosses are most common in large organizations, in organizations without

employee-representation committees, in the transport sector, and where workers

themselves have no supervisory responsibility. Last, the article offers a practical

finding as a potential aid to human resource training and hiring. Contrary to

media portrayals, bad bosses are rated least bad on “respect for workers”and

worst on their ability to get the job done. Lack of competence, not lack of consid-

eration, appears to be the key problem.

“In a hierarchy, every employee tends to rise to his level of incompe-

tence.”

—Laurence J. Peter in The Peter Principle.

“Is there some reason my coffee is not here? Has she died, or some-

thing?”

—Miranda Priestly in The Devil Wears Prada.

JEL codes: J28, I31, M54.

*The authors’affiliations are, respectively, University of Wisconsin, Oshkosh, Wisconsin. E-mail:

artzb@uwosh.edu; Cass Business School & IZA, City, University of London, London. E-mail: amanda.

goodall.1@city.ac.uk; and CAGE Research Centre and IZA, University of Warwick, Coventry, UK. E-mail:

andrew.oswald@warwick.ac.uk. For helpful discussions in this general area, the authors are grateful to Mar-

ina Halac, John Heywood, Lilian de Menezes, James Oswald, and Bert Van Landeghem. For helpful com-

ments, the authors are grateful to the editor Chris Riddell, to two referees, and to Aaron Schat, Marina

Halac, John Heywood, Lilian de Menezes, James Oswald, and Bert Van Landeghem.

INDUSTRIAL RELATIONS, DOI: 10.1111/irel.12247. Vol. 59, No. 1 (January 2020). ©2020 Regents of the

Universit y of Calif ornia. Published by Wiley Periodicals, Inc., 350 Main Street, Malden, MA 02148, USA,

and 9600 Garsington Road, Oxford, OX4 2DQ, UK.

3

Introduction

Movie and media representations of bad bosses are widespread yet are bad

bosses common or rare? This article provides what we believe to be the first

statistically representative cross-country estimates. We use data on 27,000

randomly sampled workers across thirty-five European nations. Our analysis

creates a new boss quality measure. We average across bosses’strengths and

weaknesses in seven different domains (providing help, being respectful, giv-

ing encouragement, etc.). We then calculate for each boss whether, in total,

negative ratings outweigh positive ratings. An unweighted “net”calculation

of this kind seems a natural approach. Other metrics are possible, however,

so we also provide a graphical way (see Figures 1 and 2 later in the article)

to allow readers to see the implications of choosing different boss quality

thresholds than the one emphasized in the article. Overall, the article finds

that 13 percent of employees have a bad boss. Bad bosses are most common

in large organizations, ones with no worker-representation committee, and in

the transport sector. We also observe that employees who supervise others

tend to assign higher ratings to their own boss. As a validation check,

although not necessarily as a causal statement, we show that workers have

greater job satisfaction levels in organizations in which assessed boss quality

is high.

Bosses self-evidently have a pivotal role in workplaces and in the workings

of the economy. Nevertheless, there is little knowledge about whether the right

people are typically selected (although it is known from sources such as Doh-

men [2004] and Cappelli and Conyon [2018] that performance ratings as an

employee affect the probability of promotion). This article offers new evidence

on that question. Later results also offer indirect support—consistent with work

by Jones, Kalmi, and Kauhanen (2010); Artz, Goodall, and Oswald (2017);

Lazear, Shaw, and Stanton (2015); and Hoffman and Tadelis (2018)—for the

influence of supervisor competence.

Peter and Hull (1969) became famous for the idea—now known across the

world as the Peter Principle—that managers and supervisors are routinely pro-

moted to one level too high, relative to their abilities, within organizations

(Barmby, Eberth, and Ma 2012; Lazear 2004). Recent Gallup data reveal,

moreover, that half of U.S. employees say they have left a company because

of a bad boss (Harter and Adkins 2015; Herrera 2018). Today there are also

concerns about stress and psychological ill-health in workplaces (Bryson,

Forth, and Stokes 2017; Clark 2005; Jones, Latreille, and Sloane 2016). If bad

bosses are indeed widely spread across organizations in the modern world,

there is a considerable amount of evidence that this can be expected to have

deleterious effects on employee well-being and workplace performance (Artz,

4/ B

ENJAMIN ARTZ ET AL.

Goodall, and Oswald 2017; Bryson, Forth, and Kirby 2005; Bryson, Forth,

and Stokes 2017; Lazear, Shaw, and Stanton 2015; Tepper 2000). Hence, these

intellectual issues are significant ones in industrial relations, labor economics,

and related parts of social science.

Currently, there is a significant lacuna in the research literature. There are

no published papers—to our knowledge

1

—that assess in an internationally

consistent way the rarity or commonness of “bad bosses.”This study is a cau-

tious attempt to provide estimates.

2

It uses the 2015 European Working Condi-

tions Survey (EWCS). Broadly, the article finds that, although a non-negligible

number of bosses—approximately one in eight—can be classified as bad, the

data are not as gloomy as might be expected from the picture painted by the

Gallup survey information or any near-literal interpretation of the Peter Princi-

ple.

The background to this study is a familiar one. Supervisors and managers

can have profound effects upon employees and on the ways in which organi-

zations operate. Certain human resource management (HRM) practices and

high job satisfaction are believed to be positively associated with organiza-

tional performance (B€

ockerman and Ilmakunnas 2012; Bryson 2004; Bryson,

Forth, and Stokes 2017; Jiang et al. 2012; Oswald, Proto, and Sgroi 2015;

White and Bryson 2013). A contrasting negative leader perspective studies

the effects of bosses’bad behavior, most commonly through work on “abu-

sive supervision”(Tepper 2000) and “destructive leadership”(Einarsen, Aas-

land, and Skogstad 2007). Bad bosses can have a major negative impact on

workers. Hoel and Beale (2006) study workplace bullying in Britain. Bender,

Heywood, and Kidd (2017) found some evidence that supervisors’race and

gender may affect how workers of the same race and gender are treated in

the workplace. Green (2010) and Green and Tsitsianis (2005) discovered

greater intensification of work and reduced task discretion. Jones, Latreille,

and Sloane (2016) documented some possible effects on productivity from

employees’psychological health. This study also linked to conceptual work

on “expert leadership,”including by Goodall (2012) and B€

aker and Goodall

(2018). The quality of one’s immediate boss is empirically both a key deter-

minant of job satisfaction (Artz, Goodall, and Oswald 2017; B€

aker and

Goodall 2018) and individual performance (Lazear, Shaw, and Stanton

2015).

1

After searches on the Web of Science and Google Scholar.

2

It should be mentioned that a stream of work by economists Nick Bloom, John Van Reenen, and col-

leagues tackles certain related issues for the manufacturing industry, although with different methods.

How Common Are Bad Bosses? /5