Compensation for New Leadership Hires

Compensation for New Leadership Hires

A post-recession look at compensating design firm leaders: 2014-1018 to date

 

About this report…

As the recession waned, we began to see warnings about upcoming labor shortages in the AEC industry. The predictions have proven correct: we are experiencing a significant delta between demand and supply… especially for seasoned leaders. But this is not just a supply problem: attracting and hiring new leaders in the current strong market for AEC services is made more problematic by at least three factors:

 

  1. New leaders must be incorporated into firms with an already-established compensation profile and loyal, long-term employees
  2. When candidates relocate for a new position, both candidates and hiring firms have locational biases that influence their perspective on compensation.
  3. Past approaches to making offers may not work: creativity and customization are required.

 

Compensation is a complicated and technical field: we deal with only a small part of the compensation picture. But we do know what some of the country’s most active and successful design firms are offering potential new leaders.

 

We offer this non-scientific snapshot of placements we have made over the past four years to help illustrate the changing compensation landscape for AEC leaders. Our sample size is small; the data we present is limited to firms which have specifically sought our assistance in finding critical leaders; and we have no information on new leadership hires recruited internally or by other means. But we think there are some interesting potential trends that we’d like to share.

 

Here are some observations based on 84 placements in 26 firms throughout the country from 2014 to the present:

  • Non-design-trained leaders (e.g. COO’s; CMO’s) are receiving compensation that is generally equivalent to their design-trained leader-colleagues.
  • Overall base compensation for new hires in similar positions have trended up in the past four years, regardless of location.
  • Firms are using incentive compensation to tailor packages that address the needs of specific individuals …  venturing outside their comfort zone in the process.
  • New York City, Los Angeles and San Francisco are outliers in average base compensation for new leaders.  Those cities face particularly difficult challenges if they look outside their regions for talent.
  • Hiring patterns in the past four years may suggest an upcoming increase in the proportion of leaders who are female.
  • Attracting new leaders is taking longer than it did before … often because it takes time to develop offers that are non-traditional.

 

About this series…

As a boutique executive search firm working to find leaders for design firms throughout the U.S., Breuer Consulting Group deals every day with the factors that influence talent acquisition. Our clients frequently ask us for guidance about issues they confront and we are happy to provide insight from our practice of over 25 years. From time to time, we compile data to frequently-asked questions in the spirit of sharing what we have experienced over the years with a broader community of design professionals.  


 

Leave a Reply

Your email address will not be published. Required fields are marked *

For security, use of Google's reCAPTCHA service is required which is subject to the Google Privacy Policy and Terms of Use.

If you agree to these terms, please click here.