A few columns ago, I talked about the special compensation and benefits studies ASA did this past fall and winter.
The studies were done, in part, because the latest report of record prior to that was the cross-industry compensation and benefits study from 2020, which came out in the midst of the global pandemic.
Those two studies focused mainly on our PHCP-PVF industry and provided a strong compensation and benefits snapshot for positions such as driver, warehouse worker, counter worker, and inside and outside sales positions.
ASA has followed those two studies up with the release of the new 2022 cross-industry compensation and benefits study. This time, the report features data from 959 distribution companies representing more than 10,000 locations. ASA is one of 22 distribution-related associations that took part in the survey.
The 63-page report is produced for ASA by Industry Insights, the association’s long-time business intelligence partner.
The 2022 installment has some interesting findings as it related to labor force participation rate, which tracks the percentage of the population that is either employed or actively seeking employment.
For this 2022 survey, the average reported turnover was at 20.6% and the quit rate was 14.8% for non-management employees.
From 2002-2008, Industry Insights notes, the labor force participation rate was around 66%. From 2014-2019, those numbers dipped to between 62-63%, the lowest since the 1970s. In the peak of the pandemic, those numbers dropped below 61%. April 2022 showed a rebound to 62.2%, which was still below the pre-pandemic level of 63.4% in February 2020.
“Post-pandemic, the demand for labor has far outpaced labor supply, which has created an environment of increased wage pressures,” Industry Insights wrote in the report’s Executive Summary.
In 2021, quit rates ballooned to 32.7% nationally in what many termed the “Great Resignation.” For this 2022 survey, the average reported turnover was at 20.6% and the quit rate was 14.8% for non-management employees.
“As the recovery has accelerated faster than most had thought it would, strong demand continues to put an enormous strain on the supply chain and labor markets,” Industry Insights wrote.
That’s one of many key statistical nuggets contained in the report, which is free to ASA member distributor companies that contributed data, and can be purchased by both ASA members and non-members that did not participate in the survey.
Other key items contained in the report include: the top five major concerns/issues related to the labor market; top methods used to successfully fill open positions; percentage of insurance premiums paid by the company for full-time employees, types of retirement plans offered, top 10 other benefits provided to employees, capping mechanisms used to limit incentive pay for salespeople, when commissions are typically paid, the most common method used to provide salespeople with automobiles and the five most common compensation methods for outside salespeople.
The report also gives detailed average compensation and benefits levels for positions such as president/CEO, COO, CMO, HR, IT, purchasing, director of sales, counter, warehouse, drivers, branch managers, outside sales, inside sales, showroom and more.
If you are looking for a great benchmarking tool to compare yourself to the distribution industry when it comes to the ultra-important topic of labor, this 63-page report is it. A report like this is kind of like a big industry voice telling you either “Rest easy, friend, you are right on target,” or “You might have a little work to do.” Either way, it’s great intel to have.
A few issues down the road, we’ll take a look at our major Operating Performance Report, which dumps even more great benchmarking data right in your lap.
Boots on the street
I also have referred to a neat newer feature in our ASA monthly sales report where we publish comments from ASA distributor members about what they are seeing in terms of business conditions. When distributors fill out the monthly sales report survey (also administered by Industry Insights), they are asked about current conditions.
Here’s a recent snapshot:
- “All percentages are up from the prior year. Most of the increase is due to inflation. Inventory value has increased due to inflation. We are receiving orders timely. We have fewer employees and it is difficult to hire new employees. Receivables are up. Again, this is probably due to inflated sales values. Business outlook is cautious.”
- “Business conditions for the first quarter were EXCELLENT. Our YTD sales are up and our YTD booked orders are up.”
- “Business remains extremely strong, but is coming up against very hard comps the year prior.”
- “Demand continues to be strong and supply chain problems have lessened over the past six months, although still a major problem with some products.”
- “Inflation, supply chain, workforce — all still issues.”
Sound familiar in your neck of the woods? This is another example of ASA providing critical content for its members on the business intelligence/benchmarking front, and we’re always looking to do more. If you have an idea/suggestion for a benchmarking report you would like to see, contact me at firstname.lastname@example.org.
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