With the debate over executive compensation still fresh in our memories, recent research conducted by ExecuNet, a private, professional network for business leaders, shows that companies are cutting back on executive compensation in 2009.

The survey of 476 search firm consultants and corporate human resource professionals revealed that many of the key compensation components businesses relied on to recruit and retain top talent in recent years are being withheld from new offers.

An analysis of six different elements of compensation shows reductions across the board when compared to last year. In 2008, 80 percent of compensation packages offered a performance bonus. This year, it dropped to 71 percent. Packages with performance reviews within first six months dropped from 56 percent to 42 percent. In addition, offers including non-compete agreements dropped from 65 percent to 38 percent; guaranteed severance dropped from 44 percent to 34 percent. Packages with stock options or equity went from 51 percent to 32 percent, and the percentage offering sign-on bonuses dropped from 36 percent to 25 percent.

“Guaranteed bonuses, severance pay, and stock options have become less prevalent in executive compensation packages as companies continue to tighten their belts,” says Mark Anderson, President of ExecuNet. “However, with executive turnover poised to spike during the early stages of the recovery, which could be stronger than many expect, these compensation trends may be short-lived, as companies enhance their offers in an effort to recruit and retain top talent in a more competitive marketplace.”

A separate, simultaneous survey of 2,685 business leaders reveals that average executive compensation decreased 1.7 percent in 2008. Despite this drop and current economic conditions, employed executives would expect a 17 percent increase in total compensation if they were to make a job change in the year ahead – down from 18 percent in 2008. However, compensation expectations are much more reserved for those who are in transition or unemployed and in a job search. These professionals can anticipate a 2 percent increase in pay – down from 7 percent one year ago.   Published by Execunet

 
Marty Weitzman
Gilbert Resumes
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http://Executiveresumewriter.com
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