You're assuming that everyone wants a path forward. Some of us value stability and security.
If someone told me "if you come work for us, you'll be employed for life and guaranteed at least a cost-of-living adjustment each year, but you'll never see a promotion even once", I'd take it in a heartbeat.
> Except for the employee who has zero path forward at the company.
Not if you destigmatize it. They weren't a good fit for that particular role, or they didn't have the right skills yet. That doesn't mean they have no path upwards.
Why do you "need a path forward"? If staying at your current position indefinitely is how you can best contribute, what exactly is the problem? Up-or-out is a silly, outdated paradigm that may have been suited for Cold War militaries but certainly not for civilian companies today.
Except for the employee who has zero path forward at the company.