It’s July and that means the 2014 Western Growers’ Professional Compensation and Human Resources (HR) Practices Survey results are in.
This year marks the fifth time Western Growers has asked members to participate in this important endeavor. The HR Practices Survey reports on participants’ health plan coverage and premiums, performance plans, merit increase budgets, paid time off programs, retirement plans, and austerity measures. The Compensation Survey reports base pay, incentives paid, total annual cash compensation, and car allowance/reimbursement for business expense. Participants can submit data for each survey or both.
The information is helpful to businesses in the decision-making process for at least one obvious reason: employees’ salaries, benefits, incentive and merit-based reward programs and non-cash reward programs represent a large percentage of a company’s operating expenses. Western Growers Professional Compensation and HR Practices survey data provides a resource for executive management to compare cash compensation and benefit plan levels with their peers, taking the pain out of some of those tough decisions. Additionally, this year’s survey added seven new positions to those that are being tracked, covering an even greater portion of an employer’s workforce.
With each passing year, the number of companies that contribute data grows, as does the repeat participation rate. Eighty-eight companies provided information for the 2014 compensation survey, a 10 percent increase from the previous year. Seventy-seven companies participated in the HR Survey, a 12 percent increase in participation.
Even more impressive is the repeat participation rate which hit 66 percent this year, up from previous repeat rates that topped out in the mid-50 percent range. Repeat participation is trending up largely for two reasons: (1) it is an acknowledgement that making pay decisions using data is important and valuable; 2) the survey submission process has been improved and simplified.
Why is this repeat participation important? Two words: critical mass. By securing the largest pool of data, we can provide the best sampling of what is happening in the ag industry when it comes to compensation and HR practices. And when that pool of data comes from the same companies year after year, we can report on real developments.
Fran Mueseler, President of People Matters Compensation Resources, LLC, who conducts the survey and prepares the results, explained it this way: “Apples to apples comparisons on data supplied by the same company each year make trends in health care coverage and costs as well as real increases in base salary and total cash compensation, year over year, more detectable. Our goal is to achieve an 80+ percent participation rate so that we can provide a ’trend’ section in the survey results that will provide statistically sound data, portraying not only the current state but historical movements. This information can serve as a predictive measure for industry management.”
As far as process, the feedback we receive regarding repeat participation comes from both the data and anecdotally. We have simplified the survey submission process, requiring companies to only update information that has changed year-over-year. Repeat participants no longer need to duplicate the reporting process of the previous year. The new process saves time and work for participants, and lowers our dropout rates.
Repeat Participation Rates
As we previously discussed, repeat participation rates were extremely high, adding current and future value to survey results. Our goal is to maintain and grow those rates by continuing to make the submission process simpler and more efficient, and by extoling the value of the survey to our members.
It goes without saying that the economy has a significant effect on how compensation and benefit decisions are made. This year was no different. Signs of an improving economy may have been the impetus for 50 percent of participating companies to eliminate austerity measures incorporated in 2013. This had a significant effect on the next highlighted area, merit pay, and provided good news for employees who may have taken a financial hit during the economic downturn.
Although agriculture companies are still being cautiously optimistic about the economy, there was a significant increase in the amount of companies who had increased their merit budgets, evidenced by a decrease in the number of companies with a 0-2 percent merit budget and an increase of companies with a 2-3 percent merit budget and a 3-4 percent merit budget. Companies with a 2-3 percent merit budget increased from 39 to 43 percent of the survey, and companies who had a 3-4 percent merit budget jumped a whopping 7 percent, from 26 to 33 percent. This means that, overall, the agriculture companies surveyed fall in line with the national merit budget average of a 3.2 percent for 2014.
Last, but certainly not least, is the trend of how health care system changes affect the way companies make health care decisions. In particular, the survey results showed that the size of a company affects how it passes along health care increases to employees. Companies with under $50 million in revenue were much less likely to pass on increased health care costs to their employees. Only 36 percent of companies in this category increased employee contributions to their health plans for 2014. On the flip side, 70 percent of companies with over $200 million in revenue passed along health care cost increases to employees. Certainly contrary to what one would expect, but such a disparity might be explained by the fact that smaller family-owned companies view employees as family and are less likely to pass along cost increases to them.
Availability of the Surveys
An added benefit to companies who take the time and effort to complete the survey is that they receive a free electronic and hard copy. Additionally, they have the opportunity to participate in a webinar that explains the survey highlights and how to use the data. The forum provides an opportunity for members to ask their own questions.
The survey results are available for purchase only to Western Growers members. For those who did NOT actually participate, they can buy the Compensation Survey for $1500 and the HR Practices Survey for $500. The combined survey can also be purchased at a discounted rate of $1800. The final results will be available for purchase online at www.agsalary.com, or by contacting Karen Timmins, Western Growers vice president of human resources at email@example.com or 949-885-2295.
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