Businesses must do more to retain top executives, according to latest PayScale survey

Businesses must do more to retain top executives, according to latest PayScale survey

PayScale, a leading provider of compensation data for executives and organisations, has released their eagerly-awaited 2014 Compensation Best Practices Report. Entitled ‘The year of the great balancing act’, the report was based on responses PayScale received from around 5,000 executives and senior HR practitioners, who were asked to evaluate how they felt 2013 had shaped up as they strived to balance effective talent retention with overall financial growth.

It’s evident that businesses large and small were far more optimistic in 2014, with 72% of those surveyed confident that this year would see respectable

Improvements in their growth and profits. This sentiment ran particularly high in the telecoms, media and IT sector. As a result of their expansion plans, many were offering increasingly competitive compensation packages to lure top talent from competitors. Naturally, HR departments still have budgets to work to and employers can’t therefore hold out blank cheques to prospective executives in their sights. This was echoed by 57% of respondents who said retention is a key concern for them, as is a skills gap fuelled by a lack of suitably qualified applicants. Again, it’s the IT and media sector which is particularly concerned about losing their most talented executives, closely followed by the professional services and pharmaceuticals sectors. The results of the PayScale report also revealed that salaries rose in 2014, by an estimated 4.5%, with 88% of firms surveyed awarding salary increases.

Commenting on the trends revealed by his company’s survey, PayScale’s VP of Marketing, Tim Low remarked “With the economy improving, we’re constantly reminding clients that their top talent could jump ship for better opportunities. There’s a dawning realization that they have to do more to retain their talent than they have in the last few years. Compensation isn’t the only factor, but if you don’t get that right, other benefits and perks aren’t as appealing.”

Mr Low went on to remind companies that “People are your business, it bears repeating. You need to focus on keeping those people that are really helping make your business successful. Even within the constraints of a salary budget (and every company has one) you can be creative about how you allocate that.”

Organisations with strict compensation budgets must nevertheless continue to attract high-performing executives in today’s competitive market. Adjustments may need making to their executive recruitment strategies. The key may lie in offering candidates flexibility in their working hours, providing enhanced benefits, creating an attractive working culture or including in job descriptions ‘meaningful’ tasks which will contribute significantly to local communities or the environment.