Compensation Soars Despite Inflation and Recession Fear

Abstract

In 2021, average base salary raises for construction staff jumped to 4.2%, from 3.6% on average in 2020, says data from compensation consultant Personnel Administration Services. In its 2022 Construction/Construction Management Staff Salary Survey, employers predicted they would keep raises level at 4.2%. Related Link: ENR 2022 2Q Cost Report PDF But firm President Jeff Robinson notes that companies typically underestimate anticipated increases by 0.5%. He adds that high demand for talent coupled with inflationary pressures could push compensation to 5% heading into next year. The Personnel Administration Services survey shows that compensation varies significantly by U.S. region. In 2021, the northwest reported an average increase of 5.3%, New York-New Jersey at 5.1%, western states at 4.9% and the Rocky Mountain area at 4.8%. New England states reported an average increase of 3.5% and Great Lake states reported 3.8%. Between 2021-22, survey data shows project superintendents gained some of the highest compensation increases, averaging 6% nationwide. Big CarrotsWhile employers need to offer existing staff handsome raises to retain them, contractors have to be particularly aggressive with compensation packages for new employees in a tight talent market, according to industry recruiters. "As of today, contractors are still in the mode of needing to be competitive." Jeff Robinson, President, Personnel Administration Services As a result, Huddleston says nine out of ten placements he has made result in compensation offers with double-digit increases. "The client pays a bit of a higher base salary, then uses the rest to cover travel costs to the office a few times per month. For the candidate, it offers a flexible schedule appealing to work-life balance."Jim Vockley, president of Adams Consulting Group, which specializes in AEC sector recruiting, says he also sees that balance, especially among younger candidates, as a potentially equal or larger draw than compensation.