People management skills, employee attrition, and manager rewards : an empirical analysis

How much do a manager's interpersonal skills with subordinates, what we call people management skills, affect employee outcomes, and are managers rewarded for having such skills? Using personnel data and surveys of employees about their managers at a large, high-tech firm, we show that survey-measured people management skills have a strong negative relation to employee turnover. A causal interpretation is reinforced by research designs exploiting new workers joining the firm and manager moves. However, people management skills do not consistently improve non-attrition outcomes. Better people managers are themselves more likely to receive higher subjective performance ratings and to be promoted