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Report: Contractor CFO Pay, Bonuses Peak

Thursday, April 5, 2018

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A new quarterly report suggests that high-ranking construction officials are reaping the benefits of the healthy market with significant salary increases and bonuses.

The Numbers

The report, issued by the Engineering News-Record, includes an analysis of 2017 statistics from industry compensation specialist PAS Inc. (Saline, Michigan).

The firm, which surveys 3,000 individuals in 18 executive roles, found that bonuses for chief financial officers rose 27 percent from 2016 while senior vice presidents saw a 25 percent jump and operations vice presidents saw a 21 percent hike.

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A new quarterly report suggests that high-ranking construction officials are reaping the benefits of the healthy market with significant salary increases and bonuses.

“I see these individuals achieving the upper level of the bonus structure,” said Dan Pauletich, senior managing director of industry executive search firm Specialty Consultants, in Pittsburgh. “Executives who have successfully led expansions into vertical silos [are] getting their bonuses paid out—in some cases, even 100 percent of base salary.”

Base pay also increased, by about 5.5 percent last year for presents and 6.5 percent for CFOs.

The firm also notes that many positions have opened up because of a slew of recent retirements, creating high demand for certain positions.

A person “who makes $100,000 per year can walk across the street and get $115,000 to $120,000,” said Michael Ketner, an industry recruiter. “There’s such a demand for chief estimators they could get 20 percent to 25 percent [more in salary]. If someone gets a 4 percent raise, it takes years to come close to what they could get by walking across the street.”

Other Stats

The ENR report also included results of its Construction Industry Confidence Index survey, which saw that most industry executives think that the construction boom will continue, but are skeptical beyond the short term.

The index is based survey responses from Feb. 9 and March 12, of more than 6,000 U.S. firms. This quarter, the CICI rose two points, to 73 (a rating above 50 indicates a growing market).

“Of the 281 executives of large construction and design firms responding to the survey, most believe market growth will continue at least through the end of 2018,” the survey noted.

Nearly 30 percent of those surveyed, though, think the market will decline in three years, and the report noted that other execs are worried that the recent tariffs on imported steel and aluminum could stall market growth and put pressure on profits.

   

Tagged categories: Business matters; Earnings reports; Finance; Market data

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