Date: Oct 08 2020
Every other year FOX sponsors a Family Office Compensation and Benefits Survey. The 2020 survey had a total of 201 participants from across the United States, and was based on data collected from June 11-August 7. 60% of participants own one more more operating businesses, and 42% have professional HR staff to oversee compensation and benefits decisions.
When asked, what are your greatest human challenges, it’s no surprise that 46% of offices answered finding staff with the right experience, closely followed by managing workload for current staff, and then employee succession.
59% of respondents said they had experienced no turnover, and 27% said less than 10% turnover. Only 23% said they are very likely to hire additional FTE in the next 12-18 months, while 37% said that is unlikely.
Looking at compensation, for small offices, 69% saw a salary increase with a median increase of 4%. In larger offices, 79% saw an increase with a 5% median increase.
The survey also examined professional development and training for employees. When asked if their office has a plan for professional development, only 32% said yes. Some were “working on it,” but 37% said no.
Short-term incentive compensation is still popular, with 63% of offices providing this. These bonuses are mostly determined by a subjective management decision (74%) or performance related to specific objectives (44%). In contrast, long-term incentives are consistently down with only 66% offering this in 2020.
95% of family offices provide insurance coverage:
- 55% offer medical coverage / 48% dental coverage for the employee only
- 79% offer family medical coverage / 70% offer family dental coverage
- 66% offer life insurance
- 51% offer short-term disability / 58% offer long-term disability
Most retirement plans are based on profit sharing. 76% of family offices offer at 401K – 28% of offices match at 4%, and 20% match at 3%.
Traditional PTO (part time off) includes days allocated for vacation, personal, sick time, etc. is preferred versus a PTO “bank” system, 59% to 30%.
Turning now to the how Covid-19 has changed the world of work, as family offices pushed through massive change around employee health and flexible scheduling and the resistance to working from home (WFH) vanished overnight.
Not surprisingly from a compensation perspective, more offices are reducing salary increases as a way to mitigate – or anticipate – pandemic pain. And while labor may seem plentiful now, tight labor markets will return in 2021. To attract and retain employees, employers must continually review and update WFH politics, revisit salary structures and enhance corporate culture.
Glen Johnson is Chief Operating Officer at Family Office Exchange (FOX). In this role, he is responsible for all aspects of the member experience, ensuring that each family member, family office executive, and trusted advisor has an unsurpassed experience partnering with FOX by providing unique industry knowledge and insights coupled with a safe and confidential environment where members can share best practices. In addition, Glen oversees the operations of FOX and is charged with establishing and executing systems to execute FOX’s strategic plan, promoting it’s vision and service-centric culture, and enabling the FOX team to work together to exceed our member’s expectations.
Areas of Expertise: Business Owners, Business Transition, Wealth Advisors