According to a recent survey, the human resource (HR) industry hasn’t escaped the economic downturn that’s put constraints on nearly every sector of the workforce. The 2002 Human Resource Management Compensation Survey, considered the leading source of pay information for the HR profession, includes data provided by 1,084 U.S. employers that collectively have 10.3 million employees. The organizations represent a cross-section of industries including health care, banking/financial services, nondurable manufacturing, retail/wholesale, insurance, durable manufacturing, professional services, and telecommunications.
The survey covers nearly 46,000 HR professionals in 109 different HR jobs. Among 12 of the most common jobs in HR, pay nudged up slightly for 11 of the 12 for an average increase of 1.7 percent. The largest change was for senior compensation analyst and general recruiter, both of which saw a 4.2 percent pay increase over 2001 pay levels. These slight pay increases mirror the overall pay trends for the U.S. for 2002. This information basically tells us what we already knew; HR is feeling the effects of the current economic reality just like other professions. It’s expected pay increases will revert to previous percentages once the economy recovers.
What’s also interesting is the survey shows a continuation of distinct pay differences among HR’s functional areas, particularly in middle and senior management. Among senior executives, international and labor/industrial relations responsibilities translate into the highest pay (median total cash compensation of $167,200 and $164,000, respectively). By comparison, pay is significantly lower for HR executives responsible for employee relations ($140,500), training ($140,000), compensation ($140,000), and benefits ($130,400).
Among managers in HR, pay for executive compensation managers (median total cash compensation of $125,000) outpaces pay for other managers by a wide margin. Labor relations and human resource information systems (HRIS) managers also have relatively high pay levels ($108,100 and $106,300, respectively). Meanwhile, managers responsible for employee relations, training, payroll, and relocation services all have median annual pay of less than $80,000.
This ranking of HR executives’ pay tends to shift over time, depending on factors such as the emerging priorities in HR and the availability of qualified candidates to fill these positions. At this time, the development of automated HR processes and the intense scrutiny of executive pay indicates the need for HRIS professionals and executive compensation managers are considered critical to organizations.
In addition, demographic factors, such as industry and geographic location, also affect the pay levels of HR professionals. Employers in the government, nonprofit, and education sectors typically are on the lower end of the pay scale for HR jobs, while the highest pay levels are found at banking/financial services, utilities, energy/mining, and manufacturing firms. For example, median total cash compensation for an HR director is highest in energy/mining and banking/financial services ($159,200 and $156,700, respectively), and lowest in education ($83,400).
Regionally, the highest pay for HR professionals is found on the West Coast and in the Northeast, reflecting geographic differentials in the workforce at large. An HRIS specialist, for example, would receive median total cash compensation of $61,800 and $56,900, respectively, in these regions, but far less in the North Central ($50,700), Southeast ($51,900), and South Central ($46,900) regions.
For more information about the survey, go to www.imercer.com or www.shrm.org. IBI