Deloitte: Compensation and retention during a turbulent economy - 17 Dec 2009

Under Pressure

Compensation and retention during a turbulent economy

Dear Dan,



Over the past year, you have confronted the most difficult economic
environment in a generation. Among the many challenges you may have
faced, a primary concern was likely how to motivate and retain key
talent while a dismal economy was wreaking havoc on traditional
compensation plans.



At Deloitte we have explored this issue in a recently released survey, “Under Pressure: Compensation and Retention in a Turbulent Economy.” According to survey participants:

• While
  the macro-economic outlook may have brightened, the recovery has been
  uneven — and pessimism about the past, rather than optimism about the
  future, appears to be driving corporate compensation strategies.
  
  
  
  


• Every
  component of compensation remains under pressure — from base pay,
  bonuses and retirement plans to stock options and restricted stock
  grants.
  
  
  
  


• Companies
  appear to have little appetite for modifying compensation plans in
  order to increase payouts to employees, even to top talent. Retention
  programs remain a relatively low priority for companies in many
  industries that believe employees “are lucky they have jobs” in a tough
  economy.
  
  
  
  


• Some
  companies, however, are holding compensation packages steady or even
  increasing them, positioning themselves for a turn in the economy when
  the talent market heats up. Organizations that adjust their
  compensation and retention strategies now stand to benefit as the
  recovery takes hold.

You can access the full “Under Pressure” survey here.



You may also be interested in some related research from the Managing Talent in a Turbulent Economy series.

Access additional content related to talent management and human capital.