Compensation and Benefits Managers


Quick Facts: Compensation and Benefits Managers
2017 Median Pay $119,120 per year 
$57.27 per hour
Typical Entry-Level Education Bachelor's degree
Work Experience in a Related Occupation 5 years or more
On-the-job Training None
Number of Jobs, 2016 15,800
Job Outlook, 2016-26 5% (As fast as average)
Employment Change, 2016-26 800

 


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Compensation and Benefits Managers Career, Salary, and Education Information

What Compensation and Benefits Managers Do

Compensation and benefits managers plan, develop, and oversee programs to compensate employees.

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compensation and benefits managers

Duties of Compensation and Benefits Managers

Compensation and benefits managers typically do the following:

  • Coordinate and supervise the work activities of specialists and support staff

  • Set the organization’s pay and benefits structure

  • Determine competitive wage rates to develop or modify compensation plans

  • Choose and manage outside partners, such as benefits vendors, insurance brokers, and investment managers

  • Oversee the distribution of pay and benefits information to the organization’s employees

  • Ensure that pay and benefits plans comply with federal and state regulations

  • Prepare a program budget and keep operations within that budget

Although some managers administer both the compensation and benefits programs in an organization, other managers—particularly at large organizations—specialize and oversee one or the other. All managers, however, routinely meet with senior staff, managers of other human resources departments, and the financial officers of their organization. They provide expertise and make recommendations on compensation and benefits policies, programs, and plans.

Compensation and benefits managers may perform data analysis to determine the best pay and benefits plans for an organization. They may also monitor trends affecting pay and benefits and assess how their organization can improve practices or policies. Using a variety of analytical, database, and presentation software, managers draw conclusions, present their findings, and make recommendations to other managers in the organization.

Compensation managers are responsible for managing an organization’s pay structure. They monitor market conditions and government regulations to ensure their organization’s pay rates are current and competitive. They analyze data on wages and salaries, and they evaluate how their organization’s pay structure compares with that of other companies. Compensation managers use this information to maintain or develop pay scales for an organization.

Some also design pay-for-performance plans, which include guidelines for bonuses and incentive pay. They also may help determine commission rates and other incentives for sales staff.

Benefits managers administer a company’s employee benefits program, which may include retirement plans, leave policies, wellness programs, and insurance policies such as health, life, and disability. They select benefits vendors and manage enrollment, renewal, and delivery of benefits to the organization’s employees. They frequently monitor government regulations and market trends to ensure that their programs are current, competitive, and legal.


Work Environment for Compensation and Benefits Managers

Compensation and benefits managers held about 15,800 jobs in 2016. The largest employers of compensation and benefits managers were as follows:

Management of companies and enterprises: 24%

Professional, scientific, and technical services: 13%

Government: 10%

Insurance carriers and related activities: 9%

Healthcare and social assistance: 8%

Compensation and benefits managers work in nearly every industry. Most of these managers work in offices.

Work Schedules

Most compensation and benefits managers work full time. About 1 in 3 worked more than 40 hours per week in 2016. They may work more hours during peak times to meet deadlines, especially during the benefits enrollment period of their organization.


How to Become a Compensation and Benefits Manager

Compensation and benefits managers need a combination of education and related work experience.

Education

Compensation and benefits managers typically need a bachelor’s degree for most positions. Managers usually need a bachelor’s degree in human resources, business administration, business management, finance, or a related field.

Work Experience in a Related Occupation

Work experience is essential for compensation and benefits managers. Managers often specialize in either compensation or benefits, depending on the type of experience they gain in previous jobs. Managers often start out as compensation, benefits, and job analysis specialists. Work experience in other human resource fields, finance, or management is also helpful for getting a job as a compensation and benefits manager.

Licenses, Certifications, and Registrations

Although compensation and benefits managers are not legally required to be certified, certification can show expertise and credibility. Employers may prefer to hire candidates who are certified, and some positions may require certification.

Certification programs for management positions often require several years of related work experience to qualify for the certifying exam. Many professional associations for human resources workers offer certifications. Some associations, including the International Foundation of Employee Benefit Plans and WorldatWork, offer certification programs that specialize in compensation and benefits. Others, including the HR Certification Institute, offer general human resources credentials.

Important Qualities

Analytical skills. Compensation and benefits managers analyze data on salaries and the cost of benefits, and assess and devise programs that best fit an organization and its employees.

Business skills. Compensation and benefits managers administer a budget, build a case for their recommendations, and understand how compensation and benefits plans affect the company’s finances.

Communication skills. Compensation and benefits managers direct staff, give presentations, and work with colleagues. For example, they may write about and present the advantages of a certain pay scale to management and address any concerns.

Decisionmaking skills. Compensation and benefits managers weigh the strengths and weaknesses of different pay structures and benefits plans and choose the best options for an organization.

Leadership skills. Compensation and benefits managers coordinate the work activities of their staff and properly administer compensation and benefits programs, ensuring work is completed accurately and on schedule.


Salaries for Compensation and Benefits Managers

The median annual wage for compensation and benefits managers was $119,120 in May 2017. The median wage is the wage at which half the workers in an occupation earned more than that amount and half earned less. The lowest 10 percent earned less than $68,510, and the highest 10 percent earned more than $202,590.

In May 2017, the median annual wages for compensation and benefits managers in the top industries in which they worked were as follows:

Insurance carriers and related activities: $127,740

Management of companies and enterprises: $127,700

Professional, scientific, and technical services: $125,840

Healthcare and social assistance: $108,280

Government: $97,690

Most compensation and benefits managers work full time. About 1 in 3 worked more than 40 hours per week in 2016. They may work more hours during peak times to meet deadlines, especially during the benefits enrollment period of their organization.


Job Outlook for Compensation and Benefits Managers

Employment of compensation and benefits managers is projected to grow 5 percent from 2016 to 2026, about as fast as the average for all occupations.

Organizations continue to focus on reducing compensation and benefits costs. Many firms have attempted to reduce costs by introducing various strategies, such as pay-for-performance and health and wellness programs. Organizations will need managers to evaluate and direct these compensation and benefits policies and plans.

Organizations will need the expertise of benefits managers when choosing, updating, and administering their benefits policies. Similarly, compensation managers will be needed to analyze compensation policies and design competitive compensation packages.

Many organizations increasingly contract out a portion of their compensation and benefits functions to human resources consulting firms in order to reduce costs and gain access to technical expertise. For example, to reduce administrative costs, organizations commonly use an outside vendor for processing payroll and insurance claims. These consulting firms can automate tasks and operate call centers to handle employee questions, thereby reducing the need for compensation and benefits managers.

Job Prospects

Jobseekers can expect strong competition for available jobs because compensation and benefits manager positions typically offer high pay, and job openings often attract many applicants. Those who have a master’s degree, certification, and extensive experience working with compensation or benefits plans should have the best job opportunities.

Employment projections data for Compensation and Benefits Managers, 2016-2026:

Employment, 2016: 15,800

Projected Employment, 2026: 16,600

Change, 2016-2026: +5%, +800


Careers Related to Compensation and Benefits Managers

Administrative Services Managers

Administrative services managers plan, direct, and coordinate supportive services of an organization. Their specific responsibilities vary, but administrative service managers typically maintain facilities and supervise activities that include recordkeeping, mail distribution, and office upkeep.

Compensation, Benefits, and Job Analysis Specialists

Compensation, benefits, and job analysis specialists conduct an organization’s compensation and benefits programs. They also evaluate position descriptions to determine details such as classification and salary.

Financial Managers

Financial managers are responsible for the financial health of an organization. They produce financial reports, direct investment activities, and develop strategies and plans for the long-term financial goals of their organization.

Human Resources Managers

Human resources managers plan, direct, and coordinate the administrative functions of an organization. They oversee the recruiting, interviewing, and hiring of new staff; consult with top executives on strategic planning; and serve as a link between an organization’s management and its employees.

Human Resources Specialists

Human resources specialists recruit, screen, interview, and place workers. They often handle other human resources work, such as those related to employee relations, compensation and benefits, and training.

Labor Relations Specialists

Labor relations specialists interpret and administer labor contracts regarding issues such as wages and salaries, healthcare, pensions, and union and management practices.

Purchasing Managers, Buyers, and Purchasing Agents

Buyers and purchasing agents buy products and services for organizations to use or resell. Purchasing managers oversee the work of buyers and purchasing agents.

Top Executives

Top executives devise strategies and policies to ensure that an organization meets its goals. They plan, direct, and coordinate operational activities of companies and organizations.

Training and Development Managers

Training and development managers oversee staff and plan, direct, and coordinate programs to enhance the knowledge and skills of an organization’s employees.

Training and Development Specialists

Training and development specialists help plan, conduct, and administer programs that train employees and improve their skills and knowledge.


Citation:

Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, Compensation and Benefits Managers,
on the Internet at https://www.bls.gov/ooh/management/compensation-and-benefits-managers.htm