Pay Trends Emerge in Northeast Ohio

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

The 2013 ERC Salary & Wage Surveys report salary data for 9,000+ individual employees from 200+ participating organizations and hourly wage data for 7,500+ individuals from 150+ organizations respectively. This unique local market data is a key resource for employers in the local business community looking to attract and retain top talent in to their organizations in Northeast Ohio.

While pay rates from these annual surveys remained fairly stable overall, certain industries did see more positive patterns of growth than others. Industry specific growth was strong in IT, Science/Research & Development, Customer Service/Sales, Purchasing/Distribution, and Business & Administrative Support. Each of these areas saw their average median salary grow by 4% or more overall from 2012 to 2013.
Read this article...

A Toolkit for Retaining Great Employees

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

Are you giving your best employees good reasons to stay at your organization? Retaining employees comes down to giving great employees a good reason to stay at your workplace over and over again, especially when they have another opportunity on the table.

Over the years, ERC has conducted a large amount of research on what makes great talent stay at their organizations and has found that retention typically boils down to four (4) key factors: relationship with the manager, challenging work/learning opportunities, a great work environment, and compensation/rewards. Based on these factors, we've developed a toolkit of checklists to help you retain great employees.
Read this article...

Keeping Pay Adjustments In Perspective

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

In a 2013 overview of the state of compensation, Steve Bruce, contributor to HR Daily Advisor, makes a less than rosy comparison of where businesses stand today versus where a full economic recovery would have put businesses in terms of their compensation options. Employment overall is up and voluntary separations are beginning to increase, but for businesses looking to attract and retain top performing employees, rewarding these individuals through traditional compensation methods remains a challenge.

With merit increases averaging right around 3% according to World at Work, and several local surveys also pointing to the 3% mark, Bruce suggests that in fact, 3% may be the new norm. While it may not seem like much on paper, it is worth noting that 2012 was the first post-recession year that pay adjustments, merit based or not, hit that 3% threshold. At the macro level, 2012 also saw the percentage of Northeast Ohio organizations predicting at least some pay increase to 89%, a significant recovery in comparison to the all time low of 45% in 2009 (2012 ERC Pay Adjustment & Incentive Practices Survey).
Read this article...

Compensation Rising for Recent Graduates

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

With graduation day only a few months away, the pressure is on for many soon to be college graduates in need of full time employment. This flood of new job seekers on the market come May offers employers a great opportunity to take on these highly educated, enthusiastic potential new employees- and, even better, in most cases, these new employees can be brought on board at entry level compensation levels.

Benefits of Recent Grads

In fact, ERC/NOCHE’s 2012 Intern & Recent Graduate Survey reports that 42% of employers make their entry level hires directly from this pool of new college graduates. Their reasons for doing so are fairly consistent from year to year with the vast majority of employers recognizing new graduates not only as a great value (strong educational background, again for entry level compensation levels), but also as an opportunity for their organization to develop a talent pipeline, infuse the workforce with new energy, and boost the level of tech savvy among their employees.
Read this article...

Skilled Manufacturing Salaries Gain Ground

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

Despite multiple reports of optimism about Northeast Ohio’s manufacturing sector growth rate, the widely publicized quarterly economic indicator report published by Team NEO for the fourth quarter of 2012, further analysis offered by the report’s research team concedes that growth does not translate directly into job growth. The quarterly report cites data from Moody’s, placing the region above the national average for manufacturing sector growth rates. But, the researchers point out that increased production does not guarantee job creation at those same levels.

At least in the short term, manufacturing job growth here in Northeast Ohio does seem to be accompanied by slightly more competitive salaries when compared to national averages (2013 EAA National Wage & Salary Survey). Although the increases are small, only a few percentage points each year, skilled manufacturing positions such as welders and CNC machine center operators are among those that are consistently gaining ground and ultimately becoming more competitive when compared to national averages.
Read this article...

3 Pay Problems Most Companies Face And How to Solve Them

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

Pricing new and highly specialized jobs, salary discrepancies between sources, and making pay adjustments based on mixed rates of salary growth are three common compensation problems many companies are facing. Here's how to resolve them.

Pricing new and highly specialized jobs

New and "hybrid jobs" are increasingly being added to workforces and often include unique and highly specialized IT, marketing, and technical positions (i.e. Social Media Manager). Employers find that current compensation information sources may be limited because do not have specific pay data that directly match the job and are challenged in setting a competitive salary.
Read this article...

Executive Pay: The Power of Indirect Incentives

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

In a PricewaterhouseCoopers study of 1,106 individual executives across 43 countries, researchers found ample evidence to suggest that the effectiveness of executive pay hinges not only on a total dollar amount, but also on several key intangibles. Despite much focus on variable pay as a key element of executive total rewards packages, the PwC study reports that as a performance driver, variable pay is only a part of the story.

Instead, for this group of executives, their motivation to excel at work appears to stem from a combination of factors including, perceptions of fairness, job satisfaction, recognition and of course, to some degree, the final dollar figure. For example, when asked how much of a cut in pay they would be willing to take if offered their “ideal job”, on average, participants indicated that they would take a cut of up to 28% for the opportunity to pursue a more personally fulfilling job. However, it should be noted, that when asked the same question for someone beside themselves, their threshold for pay cuts was significantly higher in this less personal hypothetical scenario- with some breakouts as high as 70% and averaging at a 60% pay cut.
Read this article...

Risk Aversion & Executive Pay

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

In an economy where compensation is increasingly driven by “pay-for-performance” strategies, executive pay is no different. According to the 2012 EAA National Executive Compensation Survey, base salary accounts for approximately 75% of the total compensation package in Northeast Ohio. In theory, by focusing on variable pay, such as bonuses and other short term incentives, organizations are able to more closely tie executive pay to performance. However, a new international report by PricewaterhouseCoopers suggests that for many of the executives surveyed, certain types of variable pay, namely those associated with high levels of uncertainty, may not be an ideal driver of performance.

In terms of bonuses, the study cites only 28% of participants opting for a riskier, but higher yield bonus structure over a potentially lower dollar base-pay figure of pre-determined value. Taking the inquiry to a more psychological level, the same study then presented participants with several other reward structures of increasing complexity. Once again, the results clearly point to a strong desire for certainty and clarity over total value. Sixty-six percent of participants expressed a preference for a rewards plan based on internally controllable measurements such as profit, over a plan utilizing external factors such as shareholder returns.
Read this article...

Using ERC to Hire for a New Position

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

Hiring a new employee can be challenging and time-consuming. ERC members have access to resources at every step to make the process efficient and effective:

  1. Writing the Job Description
  2. Determining the Right Compensation
  3. Posting the Job
  4. The Hiring Process
  5. The On-Boarding Process

Writing the Job Description

When creating a job description for a new job, using secondary sources of job information can help you better understand a position and the typical duties a person would perform in that role. ERC members have free access to Bloomberg BNA's Custom Job Description tool, which allows you to search a huge database of job titles and customize a description that fits your job.
Read this article...

3 Reasons You're Losing Employees Because of Pay

Share on LinkedIn Share on Facebook Share on Twitter Share on Google Plus Share this Page

In this article, we explore three current and critical compensation problems that cause employers to lose talented employees. These issues include low salary increases, lack of differentiation in pay by performance, and difficulties finding the actual "going rate" for jobs.

Problem 1: Low or modest salary increases

Salary budgets have been lagging for 3-4 years, pay increase budgets are not growing rapidly, and the outlook for significant pay raises is fairly bleak. This means that your employees' salaries probably aren't growing. What happens when the market doesn't match what your employees want? Should you keep your pay practices firmly aligned with the market, or adjust them to what your employees want?
Read this article...