pay (still) matters ccbf comp pl… · mercer 3 canadian compensation planning survey results a...

PAY (STILL) MATTERS

25 October 2012

Eleana Rodriguez, Principal

1MERCER 1

Baby boomer retirement

Labour shortage of high-skilled workers

Small merit budgets

Aging population

Talent and Pay Issues

2MERCER 11/9/2012

Mercer Resources

• Today’s presentation is based on the following Mercer research sources: – 2012 Mercer Survey Panel Attraction & Retention– 2012/2013 CA Compensation Planning Survey

3MERCER

Canadian Compensation Planning Survey ResultsA look back….

2008 2009 2010 2011

3.1%4.0% 3.0%2.9%

2012

Salary increase budget* 3.2%

Source: Mercer Global Compensation Planning Reports

2.0% including zeros


*Excluding zeros



4MERCER 4

YEAR ALLEMPLOYEES EXECUTIVE MANAGEMENT PROFESSIONAL CLERICAL OPERATIONAL

2013 (projected)

3.2% 3.2% 3.2% 3.2% 3.1% 3.1%

2012(actual)

3.2% 3.4% 3.3% 3.2% 3.2% 3.1%

2011(actual)

3.0% 3.1% 3.0% 3.0% 2.9% 3.1%

2010(actual)

2.9% 3.0% 2.9% 2.8% 2.8% 2.8%

Canadian Compensation Planning Survey Results2013 Projections: Minimal differentiation across employee levels

Source: Mercer 2012/2013 Canadian Compensation Planning Survey

5MERCER 5

Oil and Gas 4.2% Durable Manufacturing 2.9%

For Profit Services 3.5% Transportation 2.9%

Natural Resources 3.4% Finance/Bank/Investment 2.9%

Utilities 3.3% Public Sector/Not for Profit 2.9%

Insurance 3.2% Wholesale/Retail 2.9%

Pharmaceutical and Biotech 3.1% Hospitality/Entertainment/Media 2.8%

Non-Durable Manufacturing 2.9% High-Tech/Telecom 2.8%

Canadian Compensation Planning Survey Results2013 projections: by industry


6MERCER

Canadian Compensation Planning Survey Results2013 projections: CCBF Spot Poll

Do you provide retention awards? Answers Responses Percent

No 10 62.50%Yes, to retain organizational intellectual capital 2 12.50%

Yes, to reward special project completion 3 18.80%

Yes, to enhance market competitiveness 1 6.30%

Total 16

7MERCER 7

Canadian Compensation Planning Survey Results2013 projections: by geography


8MERCER 8

Canadian Compensation Planning Survey ResultsContinued differentiation in performance and awards

0.6%


0.1%1.2%

3.0%

3.9%

5.0%

9MERCER 9

Source: Mercer Canadian Compensation Planning Surveys

Canadian Compensation Planning Survey ResultsIncentive awards 1.5 times higher for top performers

10MERCER

Key considerations for 2013…and beyond

1 Competitiveness of your salary structure

2 Structure adjustment vs. merit budget differential

3 Geographic differentials

4 Employee performance differentiation

11MERCER 11

Attraction & Retention Survey Panel Results

12MERCER

Attraction & Retention Survey Panel ResultsDemographics: by industry (US and Canada)

8%

7%

7%

7%

6%

6%

6%

6%

5%

4%

4%

4%

3%

3%

2%

2%

1%

1%

1%

16%

0% 2% 4% 6% 8% 10% 12% 14% 16% 18%

Professional services

Banking/Finance

Durable goods manufacturing

Energy

Healthcare-non insurance

Not for profit

Public administration/government

Retail

Pharmaceutical/Life Sciences

Electronic/high-tech

Transportation

Utilities

Food, beverage and tobacco manufacturing

Insurance-non healthcare

Insurance-healthcare

Telecommunications

Entertainment and publishing

Hospitality/Restaurant

Real estate and construction

Other

N=472

13MERCER

Attraction & Retention Survey Panel ResultsDemographics: by ownership (US and Canada)

N=472

-Public sector or not-forprofit20%

Private equity-owned4%

Subsidiary9%

Publicly-traded36%

Privately-held31%

14MERCER

Attraction & Retention Survey Panel ResultsDemographics: by revenue (Canadian participants)

Under 50 million27%

50 million < 99 million9%



1 billion < 5 billion20%

Over 5 billion9%

N=173

15MERCER

Attraction & Retention Survey Panel ResultsDemographics: by number of employees (Canadian participants)

Less than 10015%

100 to 50030%

501 to 1,00015%

1,001 to 5,00025%

Over 5,00014%

N=173

16MERCER

Attraction & Retention Survey Panel ResultsTalent hiring strategy

N=173

37%

48%

13%

2%

0% 10% 20% 30% 40% 50% 60%

Hiring talent and expandingoverall workforce

Hiring talent to replacementlevels only, no net change from

last year

Hiring talent in some criticalareas, while at same timereducing overall workforce

Reducing the overall workforce

17MERCER

What is your talent hiring strategy? Answers Responses Percent

Hiring to replacement levels only 8 47.10%

Expanding workforce overall 1 5.90% Hiring in critical areas but reducing overall workforce 7 41.20%

Reducing overall workforce 1 5.90% Total 17


18MERCER

What is your planned merit increase budget for 2013? Answers Responses Percent

Higher than 3 % 2 11.80%

3% 7 41.20%

Lower than 3 % 8 47.10% Total 17


19MERCER

Attraction & Retention Survey Panel ResultsEmployee engagement over the past 12-18 months

N=173

3%

25%

43%

26%

3%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Decreased significantly

Decreased somewhat

Stayed about the same

Increased somewhat

Increased significantly

20MERCER

Attraction & Retention Survey Panel ResultsVoluntary turnover

N=173

0%

1%

48%

46%

5%

0% 10% 20% 30% 40% 50% 60%

Will decrease significantly

Will decrease somewhat

Will stay about the same

Will increase somewhat

Will increase significantly

21MERCER

Attraction & Retention Survey Panel ResultsCompeting for talent - by industry

N=173

59%

56%

55%

34%

58%

41%

44%

45%

66%

42%

0% 10% 20% 30% 40% 50% 60% 70%

Executives

Middle Management (e.g.,Managers/Directors)

Professional (Non-sales andSales)

Office/Clerical/Technician

Trade/Production Workers

Industry-specific Cross industry

22MERCER

Attraction & Retention Survey Panel ResultsCompeting for talent – by region

N=173

39%

57%63%

88%

78%

44%37%

29%

8%

18%17%

6% 9%3% 4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Executives Middle Management (e.g.,Managers/Directors)

Professional (Non-salesand Sales)

Office/Clerical/Technician Trade/Production Workers

Local National Global

23MERCER

Attraction & Retention Survey Panel ResultsImportance of talent and reward actions

N=173

87%

83%

52%

47%

47%

46%

46%

43%

42%

35%

31%

29%

22%

18%

17%

13%

12%

9%

9%

9%

8%

13%

15%

40%

36%

41%

46%

44%

47%

44%

47%

45%

54%

50%

47%

48%

27%

32%

41%

31%

39%

23%

0%

2%

8%

17%

12%

9%

10%

10%

14%

18%

23%

17%

28%

35%

35%

61%

57%

51%

60%

52%

69%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Retaining and engaging the ‘right’ talent

Attracting/hiring the ‘right’ talent

Gathering relevant market compensation data

Ensuring performance and pay differentiation for high performers

Developing/implementing a rewards strategy aligned to business direction

Keeping rewards affordable and sustainable

Communicating the value of rewards to employees

Improving performance coaching and development planning

Enhancing succession planning processes

Increasing effectiveness of variable/incentive pay

Identifying lateral and vertical ‘career paths’ for employees

Expanding use of HR analytics/metrics to predict future workforce outcomes

Investing more in employee training and development

Increasing effectiveness of rewards administration and management systems

Developing rewards programs that better meet employee lifestyle needs

Becoming more globally integrated in the design of rewards programs

Modifying employee benefits programs

Improving governance of reward programs

Introducing globally consistent job leveling tools

Enhancing employee mobility programs

Segmenting reward programs by different employee populations

Critical importance Moderate importance Minimal importance

24MERCER

Attraction & Retention Survey Panel ResultsHot jobs

N=173

33%

37%

26%

24%

22%

19%

9%

7%

6%

4%

4%

0% 5% 10% 15% 20% 25% 30% 35% 40%

Information Technology

R&D/Scientific/Engineering

Executives/Top Management

Operations

Sales

Finance & Administration

Marketing

Human Resources

Digital Communications

Legal & Compliance

Contact Center/Customer Service

25MERCER

Attraction & Retention Survey Panel ResultsTalent acquisition strategy

N=173

73%

17%

10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

It will be an even balance between buyingand building

We will focus on buying talent externally(rely on new hires)

We will focus on building talent from within

26MERCER

What is your talent acquisition strategy? Answers Responses Percent Focus on building talent from within 7 41.20%

Focus on buying externally 0 0.00% Even balance between buying and building 10 58.80%

Total 17


27MERCER

Attraction & Retention Survey Panel ResultsShort-term incentive participation and awards

N=173

85%

6%1%

8%4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

No changes planned toparticipation or award

opportunities

Expanded annualincentive participation

Reduced annualincentive participation

Increased annualincentive awardopportunities

Reduced annualincentive awardopportunities

28MERCER

New! Mercer Incentive Plan Design Survey

• Short-term incentives

• Sales incentives

• As CCBF members, you get the National report free if you submit by the Nov 9 deadline

• www.imercer.ca/ipd

http://www.imercer.ca/ipd

29MERCER

Attraction & Retention Survey Panel ResultsLong-term incentive participation and awards

N=173

87%

6%1%

6%3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

No changes planned toparticipation or award

opportunities

Expanded long-termincentive participation

Reduced long-termincentive participation

Increased long-termincentive awardopportunities

Reduced long-termincentive awardopportunities

30MERCER

Attraction & Retention Survey Panel ResultsRetention awards

N=173

72%

11%

9%

8%

6%

3%

5%

0% 10% 20% 30% 40% 50% 60% 70% 80%

No retention awards provided

Yes, to retain organizational intellectual capital

Yes, to reward special project completion

Yes, to enhance market competitiveness

Yes, to retain key employees during restructuring, downsizing orM&A situations

Yes, to retain key employees during time of financial difficulty

Other (describe):

31MERCER

Attraction & Retention Survey Panel ResultsNon-cash rewards offered

N=173

20%

23%

22%

23%

21%

23%

20%

16%

8%

8%

6%

78%

75%

76%

74%

75%

74%

76%

81%

87%

87%

90%

2%

2%

2%

3%

4%

3%

4%

4%

4%

4%

5%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Communicating the value of total rewards to employees

Use of social media to enhance the employee work experience

Formalized career paths to provide vertical and lateral developmentopportunities

Formal training and/or re-training (internal or external)

Special recognition programs (e.g., spot awards, gift cards, certificates,public acknowledgment, etc.)

Social and team-building events

Special project opportunities

Work-life programs (e.g., telecommuting, flexible schedules, part-timeschedules)

Workplace facilities and perquisites (e.g., on-site heath clubs, on-sitechildcare, concierge services, etc.)

Employee mobility (short- and long-term relocation assignments)

Time-off programs (vacation, sabbaticals, etc.)

Offered more Remained the same Offered less

32MERCER

Attraction & Retention Survey Panel ResultsReward elements impacting ability to retain and engage the right talent

N=173

50%

44%

52%

40%

25%

38%

39%

37%

39%

28%

23%

31%

22%

24%

25%

24%

19%

44%

47%

38%

42%

58%

44%

49%

49%

52%

51%

44%

52%

55%

57%

51%

51%

47%

6%

9%

11%

18%

17%

18%

12%

15%

9%

21%

32%

18%

23%

19%

24%

25%

34%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Annual base salary increases

Vertical career progression

Leadership development programs

Short- and long-term variable pay

Healthcare benefits

Work-life programs (e.g., telecommuting,flexible schedules, part-time schedules)

Enhanced performance management

Time-off programs (vacation, sabbaticals, etc)

Formal training and /or re-training

Off-cycle base salary increases/adjustments

Retirement benefits

Lateral/cross-functional career progression

Inter-organization mobility

Cross-functional work assignments

Employee communication campaigns

Non-cash recognition programs

Workplace facilities and perquisites

Strong impact Moderate impact Weak impact

Mercer (Canada) Limited

pay (still) matters ccbf comp pl… · mercer 3 canadian compensation planning survey results a...

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