Finance salaries continue to rise in North America, even among non-executive staff. According to a survey released Wednesday by AFP, average salaries in finance departments of corporations increased in 2013, reflecting continued modest growth in the U.S. economy. Financial professionals at the staff level reportedly saw the biggest bump in compensation.
Conducted in February 2014, the 2014 AFP Compensation Survey
collected data on total compensation earned by financial professionals during calendar year 2013, as well as data on base salaries effective January 1, 2014. Over 3,300 professionals responded on behalf of more than 4,300 incumbents holding the 20 job titles tracked.
Overall, financial professionals realized a 3.8 percent gain in their base salaries in 2013, up from the 3.4 percent increase reported in last year’s survey. This gain is likely to be attributed to the increased level of confidence in the recovering economy. Among the three job tiers referenced in this report, the staff level garnered the greatest percentage increase of 4.1 percent, with financial professionals at the management level following closely with an increase average of 4.0 percent. Financial professionals at the executive level saw an average increase of 3.5 percent.
“In finance, compensation packages are closely tied to corporate performance, which is influenced by the business environment,” said Jim Kaitz, AFP’s president and CEO. “With higher compensation packages now trickling down to the staff level, companies are expressing a modest level of confidence.”
Among positions tracked at the executive level, director of treasury/finance and vice president of finance garnered the highest average base salary increase of 4.6 percent and 4.4 percent, respectively. Within the management tier, financial reporting specialist obtained the highest average salary increase of 5 percent. Indeed, that 5 percent increase was also the largest among all the 20 tracked job titles in the survey. Analysts earned the highest increase within the staff tier (4.8 percent).
At the executive level, the average percentage increase in base salaries from January 1, 2013 to January 1, 2014 was 3.5 percent, although that figure is down 0.3 percentage points from 2012. Still, this was higher than increases reported in the three years prior to 2012-2013. By comparison, base salaries for management and staff level professionals during the same period increased by 4 percent and 4.1 percent, respectively, and outpaced those reported in the past five years. Factors determining bonuses, advancement
Survey results indicate that in 2013, 62 percent of organizations relied on operating income or EBITDA targets to evaluate performance when awarding bonuses, while 51 percent awarded bonuses based on completion of specific projects.
A variety of factors also influence a financial professional’s potential for promotion. The most often-cited criterion for upward mobility is increased job responsibility (87 percent). Other factors impacting career advancement include an employee’s contribution to profitability (cited by 69 percent of survey respondents), holding a MBA or other advanced degree (39 percent) or earning a professional certification such as AFP’s Certified Treasury Professional (27 percent).
Financial professionals who hold a professional certification can claim prestige and credibility in their field. Among the most recognized and respected certifications in the industry are the Certified Treasury Professional (CTP) and Certified Public Accountant (CPA). Directors of risk management who held a certification recorded the largest average difference; those with a CTP earned 14 percent more than did those without. Reflecting the economy
Financial professionals’ salaries reflected the continued modest growth of the U.S. economy in 2013, as evident in the average increase of 3.8 percent. Staff-level financial professionals realized the largest increase in base salary in 2013 – 4.1 percent on average. Among all job titles, the financial reporting specialist position garnered the greatest percentage increase in base salary in 2013 (5 percent).
Survey results also reinforce the findings that compensation varies by region, industry and organization size. Financial professionals in the Northeast earned the highest average salary in 2013. Those employed in energy/utility sector earned the highest average compensation relative to those employed in other sectors. Perhaps not surprisingly, large organizations tend to support higher compensation levels on average.
Finally, an organization’s benefits package continues to be an important facet in recruiting and retaining talent. A portion of most benefits packages includes paid time-off, with the majority of organizations awarding five additional days after a specified time frame. As businesses gain a more stable footing in a strengthening economy, financial professionals can look forward to a continued uptick in their compensation packages. Download the 2014 AFP Compensation Survey here.