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July 2011
Organizations are increasingly recognizing the value of human resources and its strategic role
in helping recruit, develop, and reward talent. In turn, salaries and the opportunity to earn
incentives have increased for HR professionals.
This report examines total targeted annual cash compensation and incentive eligibility
for human resource jobs in the United States. We show how compensation for HR jobs can vary
by a number of factors including job level, specialization, geographic location, and company size.
In general, there is a strong correlation between job level and compensation. To demonstrate
this relationship, we aggregated all HR jobs by job level to show how total targeted cash
compensation varies across job levels (Figure 1).
The median total targeted compensation for a Senior Executive of HR ($273,000)
is approximately two times higher than a Senior Manager of HR ($136,910) and
over five times greater than an entry-level, Associate HR job ($50,120).
As job levels increase from associate level to senior executive, compensation does not
always increase in a consistent and predictable pattern. Pay levels for skilled experts
in non-management advisory level jobs often equal or exceed pay levels of first-level
leadership positions. In critical job functions, companies will often pay advisory level
employees at market rates close to or above supervisor and manager level positions.
For example, the median total targeted compensation for an Advisory HR job ($96,170) is
about 20% higher than an HR Supervisor ($80,400).
Table 1 reports the total targeted cash compensation for five select HR job functions:
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HR General (Culpepper Job Codes OP20-35-05x)
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Benefits Analysis (OP20-05-05x)
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Compensation Analysis (OP20-05-15x)
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Employee & Labor Relations (OP20-10-xxx)
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Employee Training & Development (OP20-20-xxx)
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HRIS Analysis (OP20-25-05x)
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Recruiting & Talent Management (OP20-30-xxx)
Within each job function, we provide aggregate breakouts for the following combination of non-executive job levels:
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Director Levels: Director (8) and Senior Director (9)
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Manager Levels: Supervisor (5), Manager (6), and Senior Manager (7)
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Advisory Levels: Advisory (3) and Senior Advisory (4)
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Individual Contributor Levels: Associate/Entry (0), Intermediate (1), and Senior (2)
Across most non-executive job levels, cash compensation for HR specialties is higher
than HR General. The median total targeted compensation for employees at the
Individual Contributor Level in an HR specialty is about 20% more than HR General
Individual Contributor Level positions. Total cash compensation for Directors
and Managers in specialized HR jobs averages between 8% and 13% higher than directors
and managers in general HR jobs.
For most job levels, Compensation Analysis leads the way with the highest levels of total
targeted cash compensation.
Compensation within specific job functions and levels varies considerably. The wide range spread
within each job function and level combination in Table 1 is due to a variety of
factors that influence compensation, including, but not limited to, geographic location and
company size.
Pay levels can vary significantly between different
geographic locations. In addition to
job function, it is critical to consider geographic location when benchmarking pay rates
and developing salary ranges for most non-executive level jobs.
For example, the median total cash compensation for Individual Contributor Level HR jobs
is nearly two-thirds higher in San Francisco, CA ($84,700) than Wichita, KS ($51,000) (Table 2).
In addition to geography, company size is also an important factor. There is a strong
correlation between company size and compensation, particularly for Director and
Executive level positions.
For example, the median total cash compensation for a Senior Executive of HR
is more than twice as much in a large company with more than 10,000 people ($387,700) than
in a small company with less than 100 people ($159,100).
Historically, HR employees were less likely to be eligible for incentives than employees
in other job functions. However, in recent years, HR has expanded its role beyond administrative
duties to become more of a strategic partner with top management. In turn, we have seen an increase
in both the percent of HR employees eligible for incentives and the amounts targeted.
Figure 2 shows the percent of HR employees eligible to receive short-term and
long-term incentives. There is a strong correlation between job level and incentive
eligibility, particularly for long-term incentives.
Short-term Incentives (STIs) include all forms of variable short-term cash compensation,
including bonuses, commissions, cash profit-sharing, and other forms of variable cash payments
earned within a one-year period.
Long-term Incentives (LTIs) include all forms of long-term incentives, including but
not limited to stock option awards, restricted stock shares/units, performance stock shares/units,
phantom stock shares, stock appreciation rights (SARs), and long-term cash awards typically
earned for periods longer than one year.
Culpepper Compensation Survey include powerful and easy-to-use
online reporting tools,
allowing participants to create relevant and customized compensation outputs.
We provide comprehensive compensation data covering base salaries, hourly pay rates & premiums,
short-term cash incentives, cash allowances, total cash compensation, equity compensation &
long-term incentives, and total direct compensation. Participants can segment compensation data
by specific job & level, industry sector, geographic location, company size (i.e., number of employees, annual revenue, market capitalization),
and ownership.
In conclusion, when benchmarking pay, it is critical to consider a variety of factors that
influence compensation, including job function/specialization (i.e., responsibilities) and
job level (i.e., skills, scope of leadership, experience). It is also critical to consider
the impact of geographic location for most non-executive jobs and company size for management
and executive positions.
Data Source: 484 participating organizations in the
Culpepper Human Resources
and Operations Compensation
Survey U.S. Database as of July 1, 2011.
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