Economic Challenges Highlighted in 2010 HR Benchmarking Data

By Stephen Miller, CEBS Jul 1, 2010
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The latest HR metrics from the Society for Human Resource Management’s (SHRM) 2010 Human Capital Benchmarking Database reveal that HR departments struggled with smaller budgets and curtailed spending. On a brighter note, more now expect their organizations to begin hiring again as revenues pick up.

In March 2010, SHRM surveyed a sample of HR managers and higher-level HR executives from among its members across a range of industries, and analyzed data based on 1,675 responses. Among the key findings revealed by comparing the 2010 data (reflecting fiscal year 2009) with that of SHRM’s March 2009 survey (reflecting fiscal year 2008):

Organizational Data

  • Year to year, organizational revenue decreased by nearly 52.1 percent. Revenue per full-time employee (FTE) decreased by 27.8 percent.

  • Looking ahead, fewer companies expect their revenue to continue to decrease (18 percent in 2010 vs. 27 percent in 2009), and more anticipate that revenues will increase (48 percent in 2010 vs. 29 percent in 2009).

HR Data

  • Companies were less likely to hire HR professionals to focus on workplace diversity (down 33.3 percent) and recruiting (down 50 percent). However, hiring for the HR director level and above increased by 45.5 percent.​

  • More companies were likely to outsource their technology, up 80 percent from the prior year. But outsourcing of employee services fell by 48.1 percent. Organizations also were less likely to outsource recruiting and benefits administration in 2010.

Compensation Data

  • Employee salaries as a percentage of operating expenses fell by 16.2 percent from the prior year. This reflected layoffs, salary reductions or other means taken to reduce salary costs.

  • Executive bonuses decreased by 36.5 percent.

Turnover

  • Involuntary turnover rates fell 27.9 percent in the 2010 survey, suggesting fewer layoffs from the prior year.

  • Voluntary turnover rates fell 51.2 percent, indicating employees were less likely to leave their company because jobs were still scarce. Essentially, there hasn’t been a lot of turnover.

Hiring

  • 68.9 percent of companies experienced a downsizing in 2009, while only 11.4 percent expect to downsize in 2010.

  • Roughly 60.8 percent of companies froze hiring in 2009, but in 2010 only 10.8 percent expect a hiring freeze.

  • Manufacturing (durable), construction/oil and mining, and arts/entertainment and recreation were the industries most likely to downsize in 2009, while biotech, government (federal) and utilities were least likely to downsize.

  • In the 2010 survey, more than twice as many companies as a year earlier (36 percent, up from 16 percent) expect to hire more people during the year.

Customized Reports

Customized benchmarking reports based on industry and employee size, drawing from the 2010 database, are now available through the SHRM Customized Benchmarking Service at www.shrm.org/benchmarks (a discounted price is available for SHRM members). Customized reports focus on three areas: human capital, health care, and retirement and welfare benefits.

“As the recovery gains momemtum, it will be important to know what new benchmarks exist in a post-recession economy so that your firm can be competitive,” said John Dooney, manager of strategic research for SHRM and project manager for the SHRM benchmarking service.

Types of HR Positions Organizations Expect to Hire for in the Coming Year

Percentage of respondents answering affirmatively.

Position

2009

2010

Change

Administrative support

31%

41%

32.3%

Benefits

11%

10%

-9.1%

Compensation

6%

7%

16.7%

Director or above

11%

16%

45.5%

Diversity

3%

2%

-33.3%

Generalist

33%

36%

9.1%

HRIS staff

9%

10%

11.1%

Recruiting

16%

8%

-50.0%

Other

13%

17%

30.8%

Source: SHRM’s 2010 Human Capital Benchmarking Database

Stephen Miller is an online editor/manager for SHRM.

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