More Plan to Pay Higher Bonuses at Year-End

Those expecting to increase bonus payouts handily outpace those who don’t

By Stephen Miller, CEBS Nov 7, 2014

U.S. executives are feeling optimistic, with nearly three-quarters of those surveyed expecting their businesses to expand next year. Reflecting this positive mood, 90 percent of executives plan to give year-end bonuses and 36 percent expect to increase bonuses this year compared with 2013, outpacing those who foresee lower bonuses (15 percent), according to a survey by executive recruitment firm Korn Ferry.

“The bottom line for most companies is in top-line growth,” said Nels Olson, co-leader of Korn Ferry’s board and CEO services practice, in a news release announcing the findings. “In this environment, those who are driving sales and revenue are in a much stronger position to secure bigger bonuses and increases.”

From Sept. 17 to Oct. 20, 2014, the firm surveyed 518 executives. The results are as follows:

Are you planning on 2015 salary increases for your staff?

  • Increasing from 2014—71 percent.
  • Stable, no increase or decrease—27 percent.
  • Decreasing from 2014—2 percent.

What are your plans for 2014 year-end bonuses for your staff?

  • No change from last year—39 percent.
  • Increasing from last year—36 percent.
  • Decreasing from last year—15 percent.
  • No bonuses: 10 percent.

In 2014 compared to 2013, did base salaries for your staff increase, decrease or remain at the same levels?

  • Increased in 2014—66 percent.
  • Same level in 2014 as 2013—28 percent.
  • Decreased in 2014 compared to 2013—6 percent.

Do you expect your business to expand or contract in 2015?

  • Expand—74 percent.
  • Contract—8 percent.
  • Stable, no increase or decrease—18 percent.

What “outside factor” would make you most apt to increase hiring in 2015?

  • Increased consumer demand worldwide—59 percent.
  • European Union economic stability—20 percent.
  • U.S. lowering its corporate tax rate—14 percent.
  • Stability in the Middle East—6 percent.
  • Geopolitical stability in Russia—1 percent.

Stephen Miller, CEBS, is an online editor/manager for SHRM. Follow him on Twitter @SHRMsmiller.

Related SHRM Articles:

Holiday Reward: Cash or Gifts?, SHRM Online Benefits, December 2014

Variable Pay Spending Spikes to Record High, SHRM Online Benefits, September 2014

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