Architecture, engineering, and environmental firm leaders are predicting an increase of 5% in incentive compensation spending for this year. Of the more than 100 firms surveyed for ZweigWhite’s 2006 Incentive Compensation Survey of Architecture, Engineering, Planning & Environmental Consulting Firms, half are predicting some level of increase, while 29% are expecting spending levels to remain the same. Only 11% predicted a decrease, and the remainder was undecided.
The survey defines incentive compensation as any kind of additional pay or award offered by a firm to its employees in addition to base wages as a means of stimulating increased effort and motivating employees. Survey data show firms spent a median of 5% of net service revenue on incentive compensation in 2005, or $4,545 per employee.
Additional survey results indicate the most common incentive plans among architecture, engineering, and environmental consulting firms are performance bonuses, signing bonuses, referral bonuses, and profit sharing. Firm leaders report performance bonuses and profit sharing plans have been their most successful plans, citing that performance bonuses most accurately reward performance and profit sharing encourages employees to think like business people and concentrate on the profitability of the firm.
The 2006 Incentive Compensation Survey of Architecture, Engineering, Planning & Environmental Consulting Firms is available for $395, plus $8 shipping and handling. To order, contact Zweig White Information Services at 508-651-1559 or e-mail [email protected]