Staff at contract research organisations are leaving for new jobs at a far higher rate than their counterparts in other industries, a US survey has found.
According to the 14th annual CRO Industry Global Compensation and Turnover Survey, the level of voluntary separation – leaving for a new position with higher compensation and/or greater opportunity – among CROs was 12.5% in 2012, compared with a national voluntary turnover rate of 1.5% (US Bureau of Labor Statistics data).
There was a 24.2% voluntary turnover rate among clinical research associates, while nearly 20% of project managers and 13% of data managers left their jobs voluntarily.
The survey conducted by HR+Survey Solutions also found that only 29% of CROs used retention bonuses to retain talented employees, whereas 65% offered sign-on bonuses.
“The survey indicates that there is tremendous movement within the CRO industry,” commented Judy Canavan, partner at HR+Survey Solutions.
“The reasons remain multi-faceted, but these numbers continue to be a concern in an industry that has seen double-digit growth and where companies’ greatest assets are their talent,” Canavan added.“CROs should consider solutions that foster retention of talent and institutional knowledge, including the use of stay bonuses, which are earned over time.”
The study revealed that target annual incentives and projected long-term incentive (LTI) levels were markedly lower for CROs than in other industries.
CRO executives with salaries of $250,000 were eligible for, on average, a target annual incentive of 26% of their salary and an LTI of 35%. Similar executives in other industries qualified for annual incentives and LTIs of 44% and 51% respectively.
While 90% of executive-level employees in CROs (senior vice presidents and vice presidents) were eligible for annual incentives, only 50% actually received bonuses. Around 40% qualified for LTIs, whereas only about 35-40% actually received them.
At manager level, 65% of employees were eligible for annual incentives, while just 45% received bonuses. Moreover, 6% of managers qualified for LTIs, and only 2% received them.
“This should send a strong message to CRO executives who have the opportunity to implement strategic solutions, including increasing the use of performance based incentives, to retain and motivate talent without having to increase fixed costs,” Canavan said.
The latest CRO Industry Global Compensation and Turnover Survey was conducted in September 2012 and involved a total of 17 public and private CROs with employee counts ranging from fewer than 500 to more than 12,000.
HR+Survey Solutions looked at compensation levels (base salaries, annual and long-term incentives) for 139 benchmark positions in 11 job families, as well as turnover; incentive-plan designs; benefit plans; perks; deferred compensation; and employment contacts.
Pay data were collected and analysed for 34 countries in addition to the US.