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SHRM HR Trend Book (2013)
1. SPECIAL SUPPLEMENT TO
AWARDS & INCENTIVES
BENEFITS
COMPENSATION
EDUCATION,TRAINING & DEVELOPMENT
MOBILITY
STAFFING MANAGEMENT
TECHNOLOGY
WORKFORCE TRENDS
Trendbook
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4. 48 HR Magazine • 2013 HR Benchmarks Trendbook
AWARDS & INCENTIVES
Link to Engagement Drives Growth for Diverse Incentives
A
lthough use of rewards and incen-
tives in forms other than cash
appears to be increasing, the most
noteworthy trend in this area may be
the expanding definition of rewards.
“We think of a reward as anything the
organization provides to employees of
perceived value,” notes Tom McMullen,
reward practice leader for North America
at the Hay Group in Chicago.
HR professionals are closely
monitoring the value of those rewards
and incentives, often discovering that
they return value to organizations by
helping increase employee retention
and engagement. The causal links
appear to be shaping how HR profes-
sionals measure and manage
nonfinancial rewards initiatives such as
employee recognition programs. They
track financial returns from recognition
and other awards programs with metrics
such as return on investment, turnover,
customer retention and employee
productivity. In particular, some survey
research has shown a return on
investment—in the form of
reduced health care costs—
from wellness programs
that feature awards and
incentives.
In many cases, adding
up these numbers yields
an interesting conclusion:
A number of nonfinancial
rewards and incentives that
traditionally were considered
or dismissed as “soft,” such
as internal recognition, can
help boost the bottom line.
A majority of U.S. and Canadian
companies have increased or
maintained use of recognition
programs to help improve em-
ployee retention and employee
engagement, according to the
results of Mercer’s 2012 Attrac-
tion and Retention Survey. These
percentages show what portion
of 472 responding companies
have increased, maintained and
reduced recognition programs
from 2010 to 2012. These
programs include noncash
rewards such as spot awards,
gift cards, certificates or public
acknowledgment.
22%
74%
4%
Offered more
Remained
the same
Offered less
Prevalence of Employee Recognition Programs
By organization size
Overall, 76 percent of organizations have an employee recognition
program in place; larger organizations are more likely than smaller
organizations to have formal programs.
Percentage of organizations with recognition programs
Number of employees
$1 to $3 Decrease
in overall health care costs
for every dollar spent by most
North American employers that
analyzed the return on investment from wellness programs.
Organizations that found a positive return were more likely
to use incentives such as insurance premium reductions.
36.7% of survey respondents that provide
incentives for wellness programs offer insurance premium
reductions. Nearly 90 percent of the organizations
surveyed provide incentives.
Source: International Foundation of Employee Benefit Plans survey,2012.
Rewards Other Than Cash Prove Popular
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91%25,000 or more
2,500 to 24,999
500 to 2,499
100 to 499
1 to 99
Recognition Program Return on Investment
Only respondents whose companies track the return on employee
recognition programs reported. Percentages do not total 100 percent
because multiple responses were allowed.
Percentage of
employers tracking
Employee retention 74%
Financial results 61
Employee productivity 60
Employee engagement scores 57
Employee absenteeism 28
Customer retention 21
Other 6
15%
of companies with recognition
programs measure the return on
investment of these programs.
77%
73%
65%
72%
Source: SHRM Survey Findings: Employee Recognition Programs,Winter 2012.
Awards That Encourage Health
_______________________________
5. 2013 HR Benchmarks Trendbook • HR Magazine 49
BENEFITS
Benchmarks Document Shared Benefits Costs
D
uring the past decade, the
employee benefits landscape has
been transformed by the escalating
costs of benefits coupled with legisla-
tive changes and new benefits options.
Benefits budgets have experienced
substantial cuts because of the reces-
sion and tepid economic recovery. As
a result, employers continue to shift
cost accountability and decision-making
to employees, as confirmed by the
Society for Human Resource Manage-
ment’s research and analysis, along
with studies by the U.S. government,
benefits consultancies and nonprofit
organizations.
Among the key shifts highlighted by
these benchmarks:
• A majority of American employers
now offer a high-deductible consumer-
directed health plan tied to a health
savings account, along with tools and
information to enable employees to
make cost-conscious decisions about
the care they choose to receive.
• Employers are more likely than
not to provide a variety of wellness
programs that offer incentives to spur
health-promoting behaviors.
• The predominant vehicle for
retirement savings through the
workplace is a defined contribution
plan, and automatic employee
enrollment in this type of plan is
increasingly prevalent.
These and other findings reflect the
ongoing shift of costs and responsibility
to employees, with employer-provided
support to help workers navigate an
increasingly complex benefits terrain.
Private-Sector Employment Costs
On average, private-sector employers paid $28.80 in total compensa-
tion per hour worked in June.Wages and salaries averaged $20.27 and
accounted for 70.4 percent of these costs.The cost of benefits averaged
$8.52 and accounted for the remaining 29.6 percent, as detailed below.
Wages and salary 70.4%
Percentages do not total 100 percent due to rounding.
Source: U.S. Bureau of Labor Statistics.
Legally required benefits 8.2%
Insurance 8.1%
Paid leave 6.8%
Retirement and savings 3.5%
Supplemental pay 2.9%
7%Expected cost increase of employer-
sponsored health care benefits in
2013 at the largest U.S. corporations
Source: National Business Group on Health.
Consumer-Driven Health Plans
Now Second Most Common Design
Plan type Percentage of
employers offering
Preferred provider organization 79%
Consumer-driven health 58
Health maintenance organization 38
Point of service 15
Source: Aon Hewitt 2012 Health Care Survey.
43% of employers offered health savings accounts in 2012,
up from 35 percent in 2011. Source: SHRM 2012 Employee Benefits.
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_______________
6. BENEFITS
50 HR Magazine • 2013 HR Benchmarks Trendbook
Source: U.S. Bureau of Labor Statistics.
Retirement and savings benefit costs include defined benefit and defined contribution
plans. The sum of the entries does not always equal the total retirement and savings
costs due to rounding.
Retirement and Savings Benefits Costs Vary by
Employer Size
In June, average costs in private industry for retirement and savings
benefits were $1.02 per hour worked, or 3.5 percent of total
compensation. These benefits costs vary by employer size.
$2.50
$2.00
$1.50
$1.00
$0.50
$0.00
1 to 99
workers
100 to 499
workers
500 workers
or more
Retirement, savings Defined benefit Defined contribution
31%
38%
Prevalence of Domestic Health Care Coverage
Percentage of companies offering
Spousal coverage Same-sex domestic
partner coverage
Opposite-sex
domestic partner
coverage
96%
U.S. Employees’ Share of Health Care Costs
Average costs for an employee-only plan
Annual in-network deductible $981
Annual out-of-network deductible $1,994
Co-pay for in-network primary care office visits $21
Employers, Employees Share Premium Burden
Average share of medical plan premiums paid by employers
and employees in private industry.
Family coverage
79% 68%
Single coverage
21%
32%
Employer paid Employee paid
Source: U.S. Bureau of Labor Statistics, March.
Most Organizations Offer
Just One Health Care Plan
1
plan
40%
2
plans
32%
3
or more plans
28%
$430Average employer contribution to a monthly
health care premium for an employee-only plan
39% of organizations have
self-funded health care.
Source: SHRM Customized Benchmarking Database, 2012.
Source: Fidelity Investments and the National Business Group on Health.
$460 Average incentive U.S.
companies offered employees to participate
in health improvement programs in 2011
$169 Average amount employers
spent per employee on health improvement
programs in 2011, excluding incentives
0.62
0.23
0.39
1.09
0.44
0.65
2.09
1.00
1.10
Flex delivers consumer-driven, tax-advantaged plans, including FSAs, HRAs,
HSAs,Transit and COBRA to employers throughout the US. Flex also offers
the InsureXSolutions™ private insurance exchange that utilizes the defined
contribution funding model to provide health and retiree benefits. Find out
how your employee benefits programs can go further with Flex.
Flexible Benefit Service Corporation (Flex)
marketing@flexiblebenefit.com
866-472-0882
www.flexiblebenefit.com
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8. 52 HR Magazine • 2013 HR Benchmarks Trendbook
BENEFITS
Common Retirement Plans and Features
Percentage of organizations offering or providing
Defined benefit pension plan 23%
401(k), 403(b) or similar
defined contribution plan 93
Employer contribution 80
Automatic employee enrollment 40
Source: SHRM Customized Benchmarking Database, 2012.
Source: SHRM Customized Benchmarking Database.
Health savings account
$627
Health reimbursement
arrangement
$1,935
Employers Support Supplemental Accounts
Employer contributions, 2012
Consumer Decision-Support Tools
The majority of companies give enrollees of qualified high-deductible health
plans that are linked to health savings accounts tools and information to make
better informed health care decisions, according to a comprehensive 2012
census of health insurance companies by America’s Health Insurance Plans.
Health education information
Member access to
health savings account information
Hospital-specific quality data
Personal health record
Physician-specific quality data
Provider cost information
Percentage of companies offering tools
97%
93%
92%
90%
86%
84%
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10. 54 HR Magazine • 2013 HR Benchmarks Trendbook
COMPENSATION
Post-Recession Compensation Patterns Emerging From the Data
I
n most organizations, the recession
has significantly affected compensa-
tion planning and strategy. In the
depth of the recession, employers froze
or reduced salary increases and, in
some extreme cases, even asked work-
ers to take pay cuts to save jobs.
Now that the recession has receded
but the economy has not yet fully
recovered, most companies—though
not all—have unfrozen their salary
increase budgets, as seen in compen-
sation benchmarks.
Company leaders, however,
may still be looking for the optimal
level of compensation spending as
a percentage of overall operating
expenses. At the same time, they
continue to look for ways to reward
and differentiate pay for their best
performers. For example, even during
the depths of the recession, employers
maintained their commitment to
variable pay and, indeed, increased
the percentage of base pay dedicated
to this form of compensation. Finally,
the data show that companies are
looking to shift the executive pay mix
to emphasize long-term results and
decision-making.
9.2%of companies provided catch-up or
remedial salary increases in 2012.
Source: Empsight International,
2012 Policies, Practices & Merit Report.
Projected Average Base Pay Increases
By employee job level
Employees at all levels may expect modest pay increases for 2012 and 2013.
Executive Salaried Salaried Nonunion Union
exempt nonexempt hourly
2012 2.9% 2.8% 2.7% 2.7% 2.5%
2013 3.0 3.0 3.0 2.9 2.6
Source: Aon Hewitt, 2012-2013 Salary Increase Survey.
Top Performers Rewarded More
The following percentages represent average base salary increases based on
employees’ performances:
Highest
performers
Above-average
performers
Average
performers
Below-average
performers
Management, excluding
executives
4.8% 3.7% 3.1% 1.4%
Exempt, nonmanagement 4.7 3.9 3.2 1.3
Nonexempt, salaried 4.9 4.1 3.7 1.4
Nonexempt, hourly 4.6 3.7 3.6 1.5
Source: Towers Watson, 2012 General Industry Salary Budget Survey-U.S.
1 to 99
100 to 249
250 to 499
500 to 999
1,000 to 2,499
2,500 to 7,499
7,500 or more
Salary Costs
By organization size
Salaries account for a big budget bite. The following
percentages represent the average amounts of oper-
ating expenses made up by salaries in 2012:
Number of employees
Source: SHRM Customized Benchmarking Database, 2011.
40%
39%
45%
42%
40%
18%
48%
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11. 2013 HR Benchmarks Trendbook • HR Magazine 55
COMPENSATION
Target Bonuses for Nonexecutives
By organization size
The biggest employers are more generous
with variable pay. The following percentages
represent the amount of average variable pay
as a percentage of base pay in 2012:
Number of employees
1 to 99
100 to 249
250 to 499
500 to 999
1,000 to 2,499
2,500 to 7,499
7,500 or more
2.5%
4.0%
3.6%
5.0%
3.9%
13.0%
10.0%
Source: SHRM Customized Benchmarking Database, 2011.
Short-Term Incentives and Discretionary Bonuses
Executives are projected to reap big incentive and bonus awards
in 2013.The following percentages represent the amount they are
expected to receive as a percentage of total base salary:
Short-term Discretionary
incentive bonus
Executives 40.0% 13.5%
Management, excluding executives 19.3 4.0
Exempt, nonmanagement 10.0 3.0
Nonexempt, salaried 5.0 2.5
Nonexempt, hourly 5.0 2.0 Median Size of Signing Bonuses
for New College Graduates
Bachelor’s degree, nontechnical $4,500
Bachelor’s degree, technical 5,000
Master of Business Administration 10,000
Other master’s degree 6,125
Source: Empsight International, 2012 Policies,
Practices & Merit Report.
Variable Pay Rising
Variable pay for salaried exempt employees,
as a percentage of payroll.
2010 2011 2012 2013,
projected
Source: Aon Hewitt, 2012-2013 Salary Increase Survey.
Sample Compensation Across Professions
Median annual salaries and total cash compensation for select positions.
Title 2011 salary 2012 salary 2011 total cash
compensation
2012 total cash
compensation
Top public relations executive $173,000 $168,500 $204,100 $204,300
Public relations—entry 44,500 44,800 45,100 46,500
Marketing communications group
manager 128,300 130,400 147,200 138,000
Marketing communications manager 85,900 82,200 92,100 87,400
Top advertising and sales promotion
executive 162,800 180,000 204,600 235,400
Advertising group manager 155,100 144,200 178,500 159,400
General accounting manager 90,000 89,700 96,100 96,000
General accounting—entry 44,900 43,200 45,700 44,200
CFO and top financial officer 308,400 309,800 412,300 402,400
Financial analysis and tax—entry 48,700 47,300 49,800 49,100
Customer service manager 75,500 77,700 80,900 83,400
Customer service—entry 34,000 37,500 34,600 38,700
Logistics group manager 120,200 125,000 138,200 140,400
Logistics manager 86,200 87,400 93,300 91,400
Engineering manager 98,500 99,300 105,300 106,000
Engineering—entry 54,600 57,100 55,600 58,000
Manufacturing operations group
manager 130,500 141,000 143,900 158,800
Manufacturing operations manager 84,000 85,800 90,300 92,900
Top sales executive 212,400 230,600 276,000 304,100
Direct sales group manager 137,800 146,800 156,600 165,600
Information technology development
manager 139,400 146,600 162,900 162,000
Information technology
development—entry 52,000 53,800 52,300 54,000
Source: Towers Watson survey data.
Types of Short-Term Incentive Plans
The following percentages of organizations surveyed
in 2012 offer these short-term incentive plans:
Combination companywide incentive
with individual performance component.................. 51.7%
Companywide incentive
(include a profit sharing plan)......................................... 34.2
Individual incentive................................................................. 27.8
Business incentive.................................................................. 24.3
Workgroup or team incentive........................................... 13.3
Source: Buck Consultants, Compensation Planning for 2013.
$6.1M
Median value of long-term
incentives for CEOs at S&P
500 companies in 2011, up
from $5.42 million in 2010.
Source: Mercer analysis.
Source: Towers Watson,
2012 General Industry
Salary Budget Survey-U.S.
11.3% 11.6% 12.0% 12.1%
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12. 56 HR Magazine • 2013 HR Benchmarks Trendbook
EDUCATION, TRAINING & DEVELOPMENT
$52Average cost per
training hour in 2011
15.3
hoursAverage formal training hours
per learner in 2011, up from
12.75 hours in 2010
2011 Annual Training Budgets
By organization size
Number of employees
1 to 99
100 to 499
500 to 2,499
2,500 to 24,999
25,000 or more
Training Makes Gains
T
raining departments continue to
reclaim budget dollars lost during
the Great Recession, with 2011
year-over-year training spending up
9.5 percent to an average of $800 per
learner, according to Bersin & Associ-
ates, a research firm headquartered in
Oakland, Calif. The result? Training bud-
gets are now back to 2005 levels. How-
ever, employers are focusing on onsite
training vs. training delivered through
technical schools, community colleges
or universities.
Tuition reimbursement allotments
have decreased by 11 percent from
2011 to 2012, dropping from $5,579
to $4,980 per person, according to the
Society for Human Resource Manage-
ment’s Human Capital Benchmarking
Database—even though average
college tuition at four-year colleges
increased by 15 percent from the
2008-09 school year to the 2010-11
school year, says the U.S. Department
of Education College Affordability and
Transparency Center. In addition,
Section 127 of the Internal Revenue
Code, which allows employees to
exclude from income up to $5,250 per
year in college educational assistance,
is set to expire Dec. 31 unless
Congress acts to renew it or make it
permanent.
Employers continue to explore
e-learning options as a way of
decreasing the cost per training hour.
E-learning has begun to focus more
heavily on informal, social learning
opportunities—wikis, blogs, social
media, chat forums and other collab-
orative learning platforms. In 2011,
25 percent of U.S. companies invested
in informal learning tools or services,
with large companies more than
doubling what they spent in 2010 to
an average of $40,000, according to
Bersin & Associates.
Training Spending per Learner
$1,000
900
800
700
600
Source: Bersin & Associates/Karen O’Leonard, The Corporate Learning Factbook
2012: Executive Summary.
Source: SHRM Survey Findings: Changing Employee Skills and Education Requirements—Training Budgets, Resources and Strategies.
Source: Bersin & Associates/Karen O’Leonard,The
Corporate Learning Factbook 2012: Executive Summary.
$797
$853
$904
$805
$716
$730
$800
2005 201120102009200820072006
$150,000
$200,000
$20,000
$32,500
$75,000
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13. 2013 HR Benchmarks Trendbook • HR Magazine 57
EDUCATION, TRAINING & DEVELOPMENT
E-Learning Moves to the
Head of the Class
A majority of organizations are expanding or
planning to expand their use of e-learning.
Source: SHRM Workplace Forecast, 2011.
No plans
to expand
23% Currently
expanding
52%Plan to
expand
25%
Where Employees Receive Training
Onsite 81%
Employer-provided, offsite 57
Technical or community college 44
College or university 41
Percentages do not total 100 percent due to multiple responses.
Source: SHRM Survey Findings: Changing Employee Skills and Educa-
tion Requirements—Training Budgets, Resources and Strategies, 2012.
Maximum Tuition Reimbursement per Year
The maximum reimbursement allowed by employers for tuition/
education expenses per year per employee.These expenses do not
include training expenses for seminars and other activities that are not
part of a college- or university-level undergraduate or graduate course.
2010
2011
2012
Source: SHRM Human Capital Benchmarking Database.
$4,980
$5,579
$4,575
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14. 58 HR Magazine • 2013 HR Benchmarks Trendbook
MOBILITY
57%of multinational companies
expect to increase the
current number of employees
relocated outside their home
countries in 2012-13.
Mobility Professionals Get Creative
N
umerous mobility benchmark
indicators are rising, offering
positive and negative news for
human resource professionals.
On the plus side, relocation
volumes and budgets have resumed
growth following a stretch during which
many companies cut or froze moves
and budgets. On the negative side,
more employees are expressing reluc-
tance to move. Besides addressing
this resistance to relocation, mobility
professionals report contending with:
• A difficult housing market.
• Safety risks to expatriates.
• The rising cost of house-hunting
trips.
Survey research shows that many
mobility professionals are getting
creative in response to this complex
mix of opportunities and challenges.
For example, the number of corpo-
rate policies allowing homeowners
to rent, rather than requiring them
to buy homes in new locations, has
increased in the past three years. This
approach lowers relocation costs while
mitigating a key source of relocation
reluctance: high housing costs in new
locations.
Two overarching qualitative trends
illustrate a creative and strategic
approach to managing mobility:
• Growing use of alternative inter-
national assignments designed to
respond faster to businesses’ need
for specific talent.
• Ongoing elevation of mobility as an
integral part of talent management
strategies.
A benchmark supporting the latter
point represents perhaps the most
noteworthy data in mobility today:
A whopping 92 percent of mobility
professionals surveyed by Weichert
Relocation Resources Inc. during
March and April identified their activi-
ties as either “important” or “critical”
to their companies’ talent manage-
ment strategies.
Source: Cartus Corp., 2012 Trends in Global Relocation.
37%of multinational companies
plan to sustain their current
rate of global relocation.
6%of multinational companies
plan to decrease the number
of global transferees during
the next year.
Global Transfer Volume Rising
Fewer than 500 500 to 4,999 5,000-plus
salaried employees salaried employees salaried employees
Increase 23% 25% 29%
No change 63 63 55
Decrease 14 13 16
Source: Atlas Van Lines, 2012 Corporate Relocation Survey.
Relocation Budget Changes
By company size
Compared to 2011, do you anticipate that your relocation budget in 2012 will:
Average Relocation Costs
Source: Worldwide ERC, 2012 U.S.Transfer Volume & Cost Survey.
Current employee homeowners
New-hire homeowners
Current employee renters
New-hire renters
$97,166
$19,309
$72,672
$24,216
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15. 2013 HR Benchmarks Trendbook • HR Magazine 59
MOBILITY
Use of Alternative International
Assignments Increase
Are you using alternative assignments?
Yes
39%
Considering
implementing
22%
No
39%
41%
of companies report experiencing
“moderate to major” problems
related to employees’ reluctance to
relocate; an additional 36 percent
report “minor difficulties.”
Reasons for Reluctance
Percentages do not total 100 percent because multiple responses were allowed.
Source: Worldwide ERC.
Slowed real estate appreciation and depressed housing market in old location
Old location home is in negative equity
High housing cost in new location
Employee or family resistant to the move
Spouse reluctance to leave job
High cost of living in new location
Undesirable new locations
Less-than-adequate relocation policy
Source: Weichert Relocation Resources Inc., 2012
Employee Mobility Survey.
67%of respondents have structured
programs where mobility profes-
sionals help guide potential job
candidates through their decisions to
relocate, up from 53 percent in 2011.
Most Desirable U.S. Cities for Executive Talent
City Attractions
Atlanta Business infrastructure, affordability and quality of life
Chicago Strong culture, ethnic diversity, moderate cost of living and public
transportation
Denver Active adult and outdoor lifestyle
Dallas High number of Fortune 500 companies and affordable living
Source: Heidrick & Struggles, internal survey of 50-plus executive search consultants.
Assignment Definition
Use by the following
percentages of respondents
Commuter
assignments
International assignment involving travel between home and destina-
tion countries for a number of workdays per month, with a set maxi-
mum return trips home. Employee typically stays on home-country
payroll but is expected to work in the host country frequently.
58%
Extended
business
travel
Employee travels regularly to an international location, typically
for one or two weeks, to work on key projects.
72%
Rotational
assignments
Series of two or more international assignments, typically one
to three months, returning to home location or different location
for a set period.
42%
Core-flex Basic set of fixed and optional benefits, resulting in a package
tailored to the employee’s circumstances or the unit’s cost
constraints.
20%
Local plus Such programs accelerate transition to the destination with
local salary and benefits, plus payments to ease adjustment.
Typically offered for permanent assignments or international
new hires.
45%
Types and Use of Alternative International Assignments
Source: Weichert Relocation Resources Inc., 2012
Alternatives to International Assignments survey.
Source: Weichert Relocation Resources Inc., 2012 Alternatives to International Assignments survey.
91%
86%
20%
17%
13%
9%
28%
28%
For links to some of the reports and
surveys cited in this section, see the
2013 Benchmarks Trendbook online
at www.shrm.org/1212-Benchmarks-
Trendbook.
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16. 60 HR Magazine • 2013 HR Benchmarks Trendbook
STAFFING MANAGEMENT
Employment Trends a Mixed Bag
S
taffing trends in the United States
during the past five years have
been a study in contradictions. The
Great Recession, which began in Decem-
ber 2007, produced massive layoffs
and hiring and salary freezes throughout
2008 and the first half of 2009.
While the National Bureau of
Economic Research declared an end to
the economic recession in June 2009,
companies have been slow to create
new jobs and increase hiring—despite
generating large profits. Between the
second quarter of 2009 and the fourth
quarter of 2010, corporations in the
United States raked in $464 billion
in pretax profits while the monthly
unemployment rate hovered between 9
percent and 10 percent.
As of August 2012, 40 percent of
unemployed workers had been looking
for work for 27 weeks or longer. In
perhaps a sign of frustration, the
percentage of people participating in
the workforce reached its lowest level
since 1981 in August—63.5 percent,
according to the U.S. Labor Department.
Paradoxically, HR professionals
who are hiring report difficulty finding
and retaining workers with key skills,
especially given companies’ meager
merit increases. As unemployment
edges lower, voluntary departures are
on the rise, encouraging employers
to pay attention to what engages and
retains their workers. But data show that
strategic staffing can help HR profes-
sionals keep cost-per-hire low, and
retention and productivity high.
Private Employment Not Keeping Pace
While no longer hemorrhaging jobs, the economy hasn’t created the necessary 150,000 jobs per month to recoup the pre-2010 losses and keep up with the growing
population, estimates the U.S. Labor Department. U.S. private employers have exceeded that target some months, but have fallen well short of it other months.
March
April
May
June
July
August
September
October
November
December
January2011
February
March
April
May
June
July
August
September
October
November
December
January2012
February
March
April
May
June
July
August
February
March
April
May
June
July
August
September
October
November
December
January2009
February
March
April
May
June
July
August
September
October
November
December
January2010
February
January2008
Total Private Employment, Monthly Change
In thousands
Source: U.S. Bureau of Labor Statistics.
Voluntary Turnover Rising
As unemployment has edged down, voluntary turnover has risen.
U.S.
unemployment rate
Voluntary
separation rate
2004 5.5% 9.3%
2005 5.1 10.5
2006 4.6 10.4
2007 4.6 10.4
2008 5.8 9.2
2009 9.3 7.3
2010 9.6 7.0
2011 8.5 8.0
Source: PwC Saratoga, 2012/2013 U.S. Human Capital Effectiveness Report:
State of the Workforce.
For links to some of the reports and surveys cited in this section, see the 2013
Benchmarks Trendbook online at www.shrm.org/1212-Benchmarks-Trendbook.
300
200
100
0
-100
-200
-300
-400
-500
-600
-700
-800
-900
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17. 2013 HR Benchmarks Trendbook • HR Magazine 61
STAFFING MANAGEMENT
Mismatched Supply for Demand
Despite the more than 12 million people out of work, 52 percent
of organizations with full-time job openings indicated that they
are having difficulty recruiting, according to 2011’s SHRM Poll:
The Ongoing Impact of the Recession—Recruiting and Skill Gaps.
The following percentages of HR professionals indicated that it is
“somewhat” or “very” difficult to fill these positions:
Of respondents reporting difficulty recruiting, the following percent-
ages of HR professionals indicated that job applicants lack skills in
these key areas:
Source: Empsight International LLC, 2012-2013
Policies, Practices and Merit Survey.
Skills Shortages
Companies have big concerns about
skills shortages.
Very concerned 18.8%
Concerned 33.5
Somewhat concerned 34.6
Not at all concerned 13.1
54%
44%
41%
39%
36%
36%
30%
25%
21%
19%
17%
Critical thinking and problem-solving
Professionalism and work ethic
Written communications
Leadership
Teamwork and collaboration
Oral communications
Information technology application
Creativity and innovation
Lifelong learning and self-direction
Ethics and social responsibility
Diversity
Percentages do not total 100 percent because multiple responses were allowed.
Hiring Highs and Lows
Cost-per-hire varies by industry, organization size, and whether recruiters are assigned
to fill similar jobs or dissimilar jobs within a business.
Cost-per-Hire for Key Industries
Industry Cost-per-hire Number of
positions hired
Industries with high cost-per-hire
Association—professional/trade $5,582 10
Manufacturing—durable 5,159 2,401
Publishing 4,438 1,501
Industries with low cost-per-hire
Services—accommodation 1,062 316
Waste management 1,320 4,243
Arts and recreation 1,394 184
Cost-per-Hire by Organization Size
Cost-per-hire Time-to-fill
Fewer than 1,000 employees $3,079 29 days
1,000 or more employees $4,285 43 days
Recruiter Assignments
Cost-per-hire Time-to-fill
By job specialty or function $2,958 28 days
By business unit $3,939 39 days
Source: SHRM Customized Benchmarking Database, 2011.
High Productivity Means Low Turnover
Industries reporting lower turnover rates have higher productivity levels than those
found in industries with high turnover rates. This differential may suggest that indus-
tries with higher revenue per full-time equivalent are more likely to hold onto their
staffs.
Industry
Average
annual
turnover
Revenue per
FTE
Services—accommodation, food and drinking places 35% $183,173
Arts, entertainment and recreation 27 188,817
Retail/wholesale trade 22 523,529
All industries 15 339,785
High-tech 11 207,763
Government/public 9 204,594
Association 8 294,582
Utilities 8 413,086
Source: SHRM Customized Benchmarking Database, 2011.
Planning for Change
Identifying top performers and high-potentials at risk of leaving, and monitoring
gaps in current workforce capability and future workforce needs, are elements
of a strategic workforce plan, but HR professionals have a long way to go in
workforce planning.
Has your organization conducted a strategic workforce planning
assessment to …
Identify future workforce needs over the next five years?.......................................40%
Identify potential skills gaps over the next five years? ............................................36%
Analyze the impact of workers age 50 and older leaving your organization?......29%
Source: SHRM Survey Findings: SHRM-AARP Strategic Workforce Planning, 2012.
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Engineers
High-skilled medical
High-skilled technical
Scientists
Managers and executives
Sales representatives
Skilled trades
Accounting, finance professionals
88%
86%
85%
83%
78%
72%
68%
54%
18. 62 HR Magazine • 2013 HR Benchmarks Trendbook
TECHNOLOGY
For links to some of the reports and surveys
cited in this section, see the 2013 Benchmarks
Trendbook online at www.shrm.org/1212-
Benchmarks-Trendbook.
HR Technology Is More Complete, Complex
A
fter a period that was seen as a
deep freeze on systems spending
for HR, many companies are finally
thawing out budgets and looking to
upgrade or add capabilities. Many orga-
nizations are beginning to resume their
technology spending to improve core
HR services and realize efficiencies.
Talent and performance management
remain top priorities, while software-
as-a-service and shared services are
emerging as the most prevalent models
for delivering HR services.
To help give you some idea of how
organizations view, use and plan for
their HR technology needs, the following
tables and charts look at buying plans for
HR software, the state of HR self-service
and analytics, and where major
companies stand with regard to social
media adoption and implementation.
HR Technology Spending
2012 vs. 2011
More than 20
percent reduction
6%
Less than 20
percent reduction
10%
About the same
53%
Less than 20
percent increase
21%More than 20
percent increase
10%
Source: Towers Watson, 15th HR Service Delivery Survey.
Service Delivery Applications Usage and Plans
In use
Budgeted
within 12
months
Within
next 36
months
No plans
or not
aware
Employee self-service 82% 9% 6% 3%
Manager self-service 54 19 14 13
Role-based portal access to
self-service transactions and
information
47 17 18 18
HR-oriented help desk 40 4 9 47
Source: CedarCrestone, 2012-2013 HR Systems Survey.
70%of companies use
social media technologies.
Source: McKinsey Global Institute, The Social Economy: Unlocking value and productivity
through social technologies, 2012.
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19. 2013 HR Benchmarks Trendbook • HR Magazine 63
TECHNOLOGY
Factors Accounting for Increased HR Technology Spending in 2012
Percentage of respondents
Deploying new modules or functions from existing vendors
Upgrading or re-implementing existing human resource management systems
Expanding self-service offerings
Replacing older systems
Implementing new vendors to automate processes for the first time
Deploying new HR analytics or workforce planning capabilities
Expanding existing functions into new regions or business units
Deploying or redeploying an HR portal
Deploying or redeploying a data warehouse
Implementing new call center support technology
Implementing mobile access
Moving to an internally deployed cloud-based architecture
Bringing services or technology formerly outsourced back in-house
Moving to an information technology outsourcing approach
Percentages do not total 100 percent because multiple responses were allowed.
Source: Towers Watson, 15th HR Service Delivery Survey.
38%
36%
34%
33%
29%
25%
21%
12%
9%
7%
4%
3%
2%
Use of Software-as-a-Service vs. Licensed Model
Across all applications
Budgeted
In use within
12 months
Other 9% 4%
Outsourced process and software 3 3
Hybrid 10 11
Software-as-a-service, subscription-based 23 35
Licensed software, hosted 18 14
Licensed software, on premise 38 33
Basic HR Systems Usage and Plans
Budgeted Within No plans
In use for next 36
12 months months
Payroll 99% 1% 0% 0%
HR management system 97 2 1 0
Benefits administration 90 4 2 4
Workforce management
Workforce analytics or planning
Talent management
Social media tools
Service delivery
Business intelligence,
visualization and tools
Administrative
Talent Management Applications Usage and Plans
Budgeted Within No plans
In use for next 36 months or
12 months not aware
Career planning and development 26% 16% 20% 38%
Succession planning 29 15 20 36
Compensation management 57 12 10 21
Competency or profile management 57 15 15 13
Performance management 64 12 12 12
Learning management 66 7 8 19
Recruiting 85 5 3 7
Three-Year Application Adoption Outlook
% in use within three years % in use
0 20 40 60 80 100
80%of companies host HR portals via in-house data centers.
The remaining 20 percent use third-party hosts.
System
22%
Source: CedarCrestone, 2012-2013 HR Systems Survey.
Source: CedarCrestone, 2012-2013 HR Systems Survey.
Source: Towers Watson, 15th HR Service Delivery Survey, 2012.
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20. 64 HR Magazine • 2013 HR Benchmarks Trendbook
WORKFORCE TRENDS
A Snapshot of the U.S. Workforce
October 2012
U.S. Unemployment Rate, 2007-12
2007
2008
2009
2010
2011
2012
Year Baby Boomers (age 55 and older)
2010
2020
Year Prime-age workers (ages 25 to 54)
2010
2020
Year Young workers (ages 16 to 24)
2010
2020
Foreign-Born Workers As a Share of
Regional Labor Force
Hispanic workers
2010
2020
Asian workers
2010
2020
Black workers
2010
2020
15.9%Percentage of foreign-born workers
in the U.S. labor force in 2011
Projected Employment Change
by Major Industry, 2010-20
Source: All figures from the U.S. Bureau of Labor Statistics.
In thousands
Health care and social assistance 5,639
Professional and business services 3,809
Construction 1,840
Retail trade 1,769
State and local government 1,642
Leisure and hospitality 1,343
Educational services 819
Other services 819
Transportation and utilities 817
Financial activities 780
Wholesale trade 744
Information 140
Mining 25
Manufacturing -73
Federal government -372
West
Northeast
South
Midwest
Projected Change in Percentage
of Minorities in the U.S. Workforce
Projected Change in Age
Composition of the U.S. Workforce
4.6%
6.1%
9.7%
9.6%
9.1%
7.9%
24.0%
8.0%
14.2%
18.5%
19.5%
25.2%
11.2%
13.6%
63.7%
66.9%
14.8%
12%
11.6%
5.7%
4.7%
18.6%
Labor force 155.6 million
Employed 143.4 million
Unemployed 12.3 million
Long-term unemployed 5.0 million
Marginally attached 2.4 million
Part-time for economic reasons 8.3 million
Part-time for noneconomic reasons 18.9 million
The long-term unemployed category includes those who have been
jobless for 27 weeks or more.“Marginally attached” people have not
searched for work in the four weeks prior to the U.S. Bureau of Labor
Statistics survey, and they are not counted as unemployed.They
include 813,000 discouraged workers who are not looking for work
because they believe no jobs are available.
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