Medical Device Link.

Eighth Annual MD&DI Salary Survey

THE COMPANY

Location. This year, for the first time, the region in which an employee works does not appear as a determinant in MD&DI's salary worksheet. Nevertheless, the region in which a device manufacturer is located continues to have a strong effect on its employees' salaries. After losing their lead to Northeastern companies in MD&DI's last two surveys, the companies of the West came roaring back this year, offering the strongest compensation packages in the nation.

One respondent to this year's survey summed up the difference succinctly: "I took a drop in salary from California of $5000." That summation is confirmed by the overall responses to the survey. Average salary at Western companies last year amounted to $68,100, more than $4000 greater than the industry average and more than $5000 greater than the nearest regional competitor.

Raises offered by Western companies were also solid, though by no means overpowering. Raises in the West last year averaged 6.5%, while those in the Northeast came to 6.4%, and those in the Midwest and South trailed slightly at 6.1% and 5.7%, respectively.

Western companies also offered larger bonuses--and to a greater percentage of employees--than did companies in any other region. Western bonuses averaged $10,480, while those in the Midwest came to $7120, those in the South $7010, and those in the Northeast a mere $5700. Companies in the West paid bonuses to 57% of their employees, a figure nearly matched by the 56% of Midwestern and 53% of Southern employees who received bonuses. Northeastern companies trailed in this area, offering bonuses to only 44% of their employees.

Total compensation in the West averaged $88,100, nearly $5000 above the nationwide average for the industry. The closest regional competition was provided by companies in the South, which offered their employees compensation packages worth $85,700. The Northeast and Midwest tied in this area, each offering compensation of $80,100.

Company Size. In this year's survey, a small gap opened among the average salaries paid by small device companies ($10 million or less in sales) when compared with those of medium-sized companies (sales between $10 million and $99 million) and large companies (sales of $100 million or more). Taking all job categories together, salaries at small companies averaged $66,100, those at medium-sized companies averaged $62,800, and those at large companies averaged $63,500.

Small companies also offered their employees larger raises than either medium-sized or large companies. According to the survey results, the average raise for small-company employees was 9.2%, while medium-sized companies offered just 5.8%, and large companies provided an even smaller 5.0%. Moreover, 32% of small
company employees received raises in excess of 10%, while only 16% of medium-sized company employees and 5% of large company employees did so.

When they were offered, the bonuses paid by small companies were also quite handsome last year. According to the survey results, bonuses paid by small companies averaged $9630, by medium-sized companies $8200, and by large companies $6940. However, only 41% of all employees at small companies actually received a bonus last year, compared to 57% of medium-sized company employees and 63% of large-company employees.

The apparent advantages of working for a small company are somewhat diminished, however, when one looks at the total compensation figures reported for this year's survey. In that area, small companies still come out in the lead, offering an average total compensation of $84,900, but that lead is not nearly so great as in other areas. The total compensation at medium-sized companies last year averaged $79,600, while large companies drew even closer with an average offering of $84,800.

These numbers hint that small companies may not do as well as their larger cousins in providing nonsalary benefits to their employees, a suggestion that is borne out in this year's survey results. While small companies perform nearly as well as others in offering health insurance, stock options, profit sharing plans, and incentive pay, they are generally 30% less likely than their larger competitors to offer their employees life, dental, or disability insurance and approximately 20% less likely to offer either educational benefits or a pension plan.

Overall, the significance of these differences among small, medium, and large companies comes down to a matter of preferences. For those who would rather have cash in hand--and strong incentives to earn more--the approach of small companies is an ideal one. But for those who are looking for a more managed benefits package, perhaps including a carefully groomed pension fund, small companies are unlikely to fill the bill.

Number of Organizations. A majority of respondents to this year's survey (52%) reported that they had worked for only one device organization in the past five years, and a further 39% indicated that they had been with two companies. Among the job categories in the survey, those least likely to move are QA/QC and marketing personnel, 60 and 58% of whom, respectively, reported that they had been with only one company in five years.

In most of the nation's regions, more than half of the survey respondents reported working for only one company in the past five years. As in last year's survey, however, employees with firms in the West are most likely to have worked for more than a single company in the past five years; more than half (55%) of such respondents indicated that they had worked for two or three companies, and a further 4% reported working for four or more firms.

One difference from last year's results is that Westerners are no longer seeking new jobs at their former rate; this year, only 12% reported that they are actively seeking a new position, compared with 22% last year.

Next: Conclusion