Texas Compensation

Trends & Pay PracticesZach Batson

Sales Manager

Karaka Leslie

Partnership Manager

www.payscale.com

www.payscale.com

14,000 Positions 3000 Customers 11 Countries

250 Compensable Factors

40 Million Salary Profiles

www.payscale.com

Agenda

General Market Trends

Discuss 5 Compensation Best Practices

Immediate Action

Q & A

Trends

We surveyed 4,700+

companies about…

• Economic climate

• Compensation practices

• Business practices

Key Findings

Companies have big

plans for 2014:

• Workforce expansion

• Better financial performance

• Raises

But, they have big concerns about:

• Retention

• The skills gap

• Lack of good salary data

www.payscale.com

Dallas & Houston vs.

National Trends

What specifically does the PayScale Index measure?

The PayScale Index specifically measures the quarterly change in total cash compensation of

full time private industry employees

Houston Metro Area vs. Dallas Metro Area Year-Over-Year Percentage Change in Pay by Quarter

Compensation Best Practices

1) Understand Your Labor Market

2) Understand Your Jobs

3) Create a Competitive Strategy

4) Communicate Pay Strategy

5) Pay for Performance

Understand Your

Labor Market

Who do you compete with for your talent?

Size, Location, Revenue, Industry

Who can you compete with?

Understand Your Labor Market

THE COMPETITION

The Competition

YOU

Where could your employee work?

Understand Your Labor Market

Headline: HOUSTON IS HOT!

Understanding Your Markets

Understand

Your Jobs

Understanding

your Jobs

Work Gets More Specialized

Hot Skills in Texas

Not All Jobs Are Created Equal

Hot Jobs in Texas

EngineeringPrecision Measurement 11.49%

Distributed Control Systems (DCS) 11.11%

Chemical Process Engineering 10.75%

Oil and Gas Formation Evaluation 10.19%

Well Production Engineering 10.17%

Drilling Engineering 8.32%

Industrial Hydraulics 7.56%

Tungsten Inert Gas (TIG) Welding 6.64%

Reservoir Engineering 5.90%

FinancialFinancial Modeling 9.96%

Statistical Analysis 4.60%

OtherLoan Underwriting 8.66%

Data Modeling 6.74%

HOT Skills in Texas

Without Specialty

With Specialty

Skills Can Play a Role

Production Operator–20.99%

Geologist- 15.78%

Cost Engineer–15.63%

Process Technician- 14.69%

Customer Support Representative-12.27%

Quality Assurance (QA)/(QC) Inspector– 12.10%

Financial Planning Analyst– 12.10%

Technical Advisor- 12.01%

Pharmacy Technician, Lead– 11.84%

Project Control Specialist–10.65%

Physical Therapy Assistant–8.97%

Petroleum Geologist–8.12%

% increase

year over

year

HOT Jobs in Texas

94.0

96.0

98.0

100.0

102.0

104.0

106.0

108.0

110.0

2011

Q1

2011

Q2

2011

Q3

2011

Q4

2012

Q1

2012

Q2

2012

Q3

2012

Q4

2013

Q1

2013

Q2

2013

Q3

2013

Q4

2014

Q1

Software Developer Median Pay

Across Time for Texas

Software Developer United States

85.0

90.0

95.0

100.0

105.0

110.0

2011

Q1

2011

Q2

2011

Q3

2011

Q4

2012

Q1

2012

Q2

2012

Q3

2012

Q4

2013

Q1

2013

Q2

2013

Q3

2013

Q4

2014

Q1

Sales Director Median Pay

Across Time for Texas

Sales Director United States

The “market” changes by job

Create a

Competitive

Strategy

THE COST OFGETTING

COMPWRONGPayroll is by far your biggest expense; the cost of getting it wrong is tremendous.

www.payscale.com

Why Have a Comp Strategy?

We asked thousands of HR and business leaders* about their top challenges in compensation. They said:

1. Retain. They don’t want to risk losing employees by underpaying

them, or losing money by overpaying them

2. Attract. To compete for talent, job offers must match the market

and the unique factors driving pay for their jobs.

3. Motivate. Drive performance with strategies that reward top

performers while aligning with company goals.

4. Confidence. Having the science to back up decisions and

conversations with executives and employees.

Source: http://www.payscale.com/hr/compensation-practices-survey

FACTORS TO CONSIDER…

WHAT ARE OUR BUSINESS GOALS?

WHAT DO YOU WANT TO REWARD?

HOW COMPETITIVE DO YOU WANT TO BE?

WHAT IS YOUR MARKET?

Vary strategy by department

Base your decisions on key roles

Competitive Strategy

Communicate

Pay Strategy

COMP STRATEGY EXECUTION

• Communicate compensation

policy & plan to leadership

• Train & educate managers on

compensation policy & plan

• Better communication = better

engagement, higher

productivity, etc.

73% of company leaders do not feel confident in their managers’ ability to effectively

communicate with employees about salary issues. 2014 PayScale CBPR

COMMUNICATINGCOMP

Pay for

Performance

Top people concerns

among senior business

executives are:

� Creating a high-

performance culture

� Leadership

development

� Talent Management

� Training

Return on Comp Investment

Leading edge practice: Pay for Performance

o Exceeds expectations

o Meets expectations

o Does not meet expectations

o Comp trend of yesterday: COLA

Source: Institute for Corporate Productivity 2013

% pay increase based on

Performance Metric

Elementary

• Know your jobs

• Have an understanding of the market

Intermediate

• Discuss a compensation strategy with leadership

• Know what you want to reward and what you value

• Build guidelines that reflect a compensation strategy that works for your business

Advanced

• Find new and creative ways to incorporate performance pay

• Know how your pay practices stack up against your exact competition for talent

• Communicate you pay strategy with management

• Develop a strong compensation structure

Immediate Action

Special Offer for

Texas HR Professionals

PayScale Delivers Where Other Compensation Providers Fall Short

PayScale leads the world in compensation knowledge with the freshest and

most detailed data from over 40 million salary profiles. More than 3000

organizations use PayScale’s software and intelligence to get the greatest

return on their talent. Smart businesses use PayScale Insight to recruit, retain

and motivate their people.

Visit our blog: www.payscale.com/compensation-today

Join our Group on LinkedIN: Compensation Today: HR Best Practices

Zach Batson

Sales Manager

PayScale, Inc.

Karaka Leslie

Partnership Manager

PayScale, Inc.

www.payscale.com