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Executive Compensation Swells Amid Increased Competition For Talent
www.execunet.com - September 20, 2006 - A recent survey of 150 executive recruiters conducted by ExecuNet, a leader in executive-level job and networking opportunities, reveals how pay packages are evolving in the wake of the recent recession and accounting changes that are expected to require companies to deduct the cost of stock options from their profits.
According to the survey of 120 search firms and corporate recruiters, an increasing number of organizations are turning to employment contracts, guaranteed bonuses and severance, and stock options to recruit executive candidates as the supply of top talent tightens:
Compensation Data For Executive Hires
2005 compared to 2006 (as of 6/30/06)
Element
Percent of Packages (2005)
Percent of Packages (2006)
Percent Change
Guaranteed First Year Bonus
27%
45%
+18%
Employment Contract
21%
36%
+15%
Guaranteed Severance
29%
39%
+10%
Stock Options/Equity
42%
50%
+8%
Performance Bonus
76%
82%
+6%
Sign-On Bonus
34%
39%
+5%
"Demand is very strong for the best executive talent in the market, which is reflected in the more than 20% increase we've seen in recruiter activity in our network this year," says Mark Anderson, President of ExecuNet. "While competing for candidates solely on the basis of bigger paychecks isn't completely effective at the executive level – there's no question that companies must raise the stakes in order to win the war for talent in this expanding market."
A separate survey of 1,805 executives conducted earlier this year revealed that compensation expectations have reached their highest level since 2002. According to the survey, employed executives would expect a 15% increase in total compensation if they were to change jobs in 2006.
ExecuNet, the original executive job search, business, and recruiting network, provides exclusive access to confidential six figure job listings, expert advice, and high-level business connections for professionals while helping corporate and search firm recruiters find qualified executive candidates. Founded in 1988, ExecuNet helped transform the executive recruiting industry by launching the first online community designed to bring together senior-level professionals and search firms in a confidential, trusted network.
Based in Norwalk, Connecticut, ExecuNet is a recognized authority in executive recruiting trends and proprietary employment market research. For more information, visit www.execunet.com.
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