Middle management has traditionally served as the crucial link between strategic leadership and operational execution within organizations. However, in contemporary business environments characterized by technological advancements, economic pressures, and organizational flattening, the role of middle managers is evolving rapidly. This research aims to examine the economic implications of middle management, focusing on how organizations can maintain efficiency while simultaneously fostering employee engagement in leaner structures. The study investigates strategies to optimize managerial functions, evaluate cost-benefit trade-offs, and enhance the motivational and performance outcomes of teams under reduced hierarchical layers. By integrating perspectives from Human Resource Management and organizational economics, the research seeks to provide actionable insights for transforming middle management into a dynamic driver of both productivity and employee satisfaction. This research explores the evolving role of middle management in organizations adopting leaner and more efficient structures. It examines how companies can reduce managerial layers to improve cost-effectiveness without compromising employee engagement or organizational performance. The study focuses on balancing economic efficiency with human-centred management practices, emphasizing the need for empowerment, adaptability, and communication among middle managers. By analysing modern trends influenced by automation, AI, and agile frameworks, the research highlights how strategic transformation of middle management can enhance productivity, motivation, and sustainable growth in dynamic economic environments. The researcher in their research study aspires to inform organizational policies that balance economic efficiency with human capital development, ensuring sustainable growth in an increasingly competitive business landscape.