For Fourth Year in Row, Salary Increases Topped 16 Percent – Nowhere Near Pre-Recession Levels, but Still Stronger Than During Recession
One Exception: Executives Who Landed Jobs After Being Unemployed Tended to be Hired at Previous Salary Level
PHILADELPHIA, April 9, 2014 (GLOBE NEWSWIRE) -- For the fourth year in a row, senior executives who changed jobs last year received compensation increases that topped 16 percent, reports retained executive search firm Salveson Stetson Group. The increases were above the 11 percent that was typical during the recession, but nowhere near the 25 percent increases in the two years before the recession began in 2008.
"This data points to a continued – albeit slow – recovery of the job market," said John Touey, Principal at Salveson Stetson Group. "But it also demonstrates that companies are still in the driver's seat with the ability to leverage the high unemployment rate to get a deal on talent."
The firm, which places executives in senior-level roles at corporations and nonprofits, analyzed compensation data from a sample of 25 senior executives who were recruited into new jobs in 2013. It found that the average compensation increase for a senior-level candidate accepting a new job last year was up slightly over the prior year – 17 percent in 2013 vs. 16.5 percent in 2012.
Compensation packages refer to base salary and bonus. They sometimes include a signing bonus, as well.
But for unemployed executives who were hired in 2013, the offer was closer to what they had been making at their last job.
"Fully employed senior executives who are recruited to a new employer are typically not looking for a job," Touey noted. "Employers generally need to sweeten the pot to entice a highly desired executive to make a change."
Salveson Stetson Group has been tracking compensation packages since 2006. Highlights of its research include:
- Executives who switched jobs before the recession – from 2006 to 2007 – received an average compensation increase of 24.96 percent. "One could certainly argue that the compensation packages just prior to the recession were over-inflated and a 'compensation bubble' that mirrored the times," said Touey.
- The average compensation increase offered to new executive hires during the height of the recession – 2008 to 2009 – dropped to 11.07 percent.
- Post-recession compensation packages for executives who changed jobs from 2010 to 2012 recovered to 16.5 percent, and last year averaged 17 percent, but are still lower than pre-recession levels.
Salveson Stetson Group did not track compensation increases prior to 2006, but Touey said that increases in the early 2000s were in the 20-25 percent range.
"Though the economic recovery remains sluggish, this sustained trend of compensation increases for new hires is an encouraging sign that employers are willing to make more attractive offers to the talent they seek," said Touey. "In-demand executives can expect the competition amongst prospective employers to heat up in the next year."
About Salveson Stetson Group
Salveson Stetson Group (www.ssgsearch.com) is a multi-specialty retained executive search firm based in suburban Philadelphia. Specializing in $150,000+ salaried positions, Salveson Stetson Group places executives at organizations ranging from Fortune 500 companies to non-profit entities. The firm is a member of IIC Partners, one of the top ten retained executive search groups in the world with 47 offices in 34 countries.
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Source:Salveson Stetson Group