Magazine article HRMagazine

HR Salaries: Stuck in Neutral

Magazine article HRMagazine

HR Salaries: Stuck in Neutral

Article excerpt

Like most U.S. workers, HR professionals enjoyed limited gains in compensation during 2012.

Another year of subpar job creation effectively stunted any substantial growth in compensation during 2012. This trend is widespread among industries and job classifications, and it applies to most HR professionals' paychecks as well.

Overall, median total cash compensation for HR positions rose an average of just 2.4 percent in 2012, according to the 2012 General Industry Human Resources Compensation Survey Report-U.S. by Towers Watson. Total cash compensation includes base salary combined with variable forms of compensation, such as bonuses and incentives.

Top HR executives with labor relations skills earned median total cash compensation of $299,100 in 2012, up 5.8 percent from 2011. Top HR executives without labor relations backgrounds earned an even bigger bump in pay. Their median total cash compensation was $254,000 this year, an increase of 20.1 percent from 2011, according to Towers Watson's data.

Outside of the HR executive office, professional/technical recruiters earned median total cash compensation of $71,700 in 2012, up 10.3 percent from 2011. HR employees in the compensation and benefits generalist/multidiscipline job category earned median total cash compensation of $101,400 in 2012, an increase of 3.6 percent from 2011.

Many of the HR job levels in Towers Watson's survey saw minimal change in median total cash compensation during 2012 compared with the previous year. For instance, the "professional master level" in benefits realized an average increase of 1.3 percent; the "professional specialist level" in recruitment with generalist/ multidiscipline skills earned an average increase of just 0.1 percent; and the "senior manager level" for employee development/training with generalist/ multidiscipline duties experienced an average decline of 2 percent in median total cash compensation.

A Different Tack

Given the lack of overall movement in paychecks, a new approach to compensation may be in play for U.S. employers, says Laura Sejen, global practice leader for rewards at Towers Watson in New York City.

"There is a growing body of evidence that there is more value in taking a total rewards approach to compensation," Sejen says.

Greater emphasis on short- and longterm incentives, health care and retirement plans, and career development should all be in play when employers prepare compensation packages for new or existing employees, Sejen explains.

The receipt of short-term incentives, including bonuses tied to performance, varied in 2012. For top talent management executives, 81.8 percent received short-term incentives in 2012, and 81.2 percent of top compensation and benefits executives earned them this year.

On the nonexecutive side of HR, 40.6 percent of recruiters for support/ hourly staffearned short-term incentives this year, while 47 percent of professional/ technical recruiters and 48.8 percent of labor relations HR professionals received these incentives in 2012.

One-time payouts have become popular for employers that cannot afford companywide salary bumps, says Donna Rogers, SPHR, owner of Springfield, Ill.-based Rogers HR Consulting.

"Base salary adjustments add to [companies'] bottom lines on an annual basis," she says. In contrast, a spot bonus "can be taken out of a pool of profits and it's a one-time shot" in a precarious economy.

Other data reinforce the cost-control mode that has taken hold across the private sector. Employers projected an average salary increase of just 2.4 percent for all workers in 2012, according to a survey of 2,175 HR professionals for the Society for Human Resource Management's 2012 Human Capital Benchmarking Study.

In general, many workers in HR and other fields are probably "losing money" right now on their salaries, based on difficult economic conditions and the fact that wage growth has been at a bare minimum, says Dan Ripberger, managing director of Cincinnati-based RSC Advisory Group. …

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