How bad is the economy? A recent CEO confidence study by San Diego-based chief executive organization Vistage International reveals that more than 40 percent of CEOs surveyed expect the economy to worsen in the next 12 months.
On the flip side are outlooks such as the U.S. News & World Report online series "Dude, Where’s My Recession?," in which author James Pethokoukis provides reasons why it’s a nonissue.
But really, says Kilmartin, managing director of compensation consulting for HR data and software firm Salary.com, recession or no recession, it doesn’t matter. Companies remain in a hiring mode, and, Kilmartin says, "Even organizations that are having any sort of negative impact because of the economy, if they’ve lost a director or other certain positions high in the organization, they’re going to replace that person."
The economy shouldn’t have much bearing on job seekers or recruiters, either. Truth be told, job seekers are in a good position. Kilmartin says there is a lot of competition vying for top talent, so companies don’t have much wiggle room to lower salaries and cut benefits because high gas prices, health care benefits and other variables are affecting workers’ bottom lines.
And recruiters? They should be in good shape, too, especially if they can persuade clients to offer total compensation packages—benefits such as stock options, 401(k) matching programs, telecommuting and more—and prove the value of these benefits to potential recruits.
Aon Consulting, an HR and risk management services company headquartered in Chicago, also has realized the benefit of highlighting total compensation versus merely focusing on salaries in job offers. The company has developed an innovative tool that gives potential employees an edge while providing recruiters with a valuable new resource.
Aon’s product, called Rewards on Board, is a Web-based system that allows recruits to see the value of the total compensation package. It adjusts costs based on the benefit packages they’d likely pick, the percentage they’d likely contribute to the 401(k), and other metrics such as wealth-accumulation modeling for stock options.
Indeed, there are plenty of online resources and salary wizards already available through compensation Web sites, but in many ways this tool raises the bar. Aon senior vice president Bill Crawford says Rewards on Board, which was proposed by one of Aon’s corporate clients, benefits companies looking to fill positions as much as it benefits applicants.
"There’s value to the employer, because the [potential] employee can see the amount of the total offer—pay plus benefits," says Crawford, who has been with Aon for 33 years. "And the recruit gets to see that it’s not, let’s say, just a $75,000 offer; it’s really a $90,000 offer."
Rewards on Board went live in late spring and has been well received by its clients and job seekers alike, so much so that Aon is now looking into broader applications for recruiters.
"There would be many benefits to having recruiting firms offer Rewards on Board to clients," Crawford says. "With the Rewards on Board tool, recruiting firms would be able to articulate the total compensation picture—pay plus benefits—to job seekers. For example, if the job seeker is looking at a total compensation offer from Company A, but only a direct compensation offer from Company B, then Company A should have a distinct advantage, everything else being equal."
What Rewards on Board doesn’t show, however, is the value of such benefits as flextime, positive organizational culture and concierge services, which are important to many recruits, especially at higher levels. Therefore, Kilmartin says, recruiters need to be aware that touting these intangibles is just as important these days as the traditional benefits.
"Hiring managers have to understand that people look at things differently," Kilmartin advises. "The newer generation is more interested in leisure time than the baby boomer generation, who were more willing to work on holidays and vacations. So companies have to be creative and know what their market is."
"Today we’re seeing a shift from total values to total rewards," he says. "Organizations are touting things such as telecommuting, flexible work schedules, education assistance, advancement opportunities and other things that fall outside of the traditional definition of benefits. Some of our clients are even communicating their community activity and environmental approaches to doing business."
Recruiters should keep in mind that some job seekers might still get starry-eyed over an $80,000 offer with limited benefits and overlook a $70,000 offer with benefits and options that could increase the total compensation to more than $90,000. Still, Crawford maintains, "There are definite advantages to giving potential employees a big-picture view, rather than just focusing on the direct-pay component."
This is especially true for companies in such industries as high tech and biotech that have the means to offer large starting salaries and impressive benefits. So there’s one thing recruiters should keep in mind, says Kilmartin: "If a company is in a space where the competition is offering a robust benefits program, they’d better be offering a robust benefits program too."