Survey: Less Than 20% Of Executives Believe In Cutting Salaries During COVID-19 Pandemic

Jennifer Keiper
May 19, 2020 - 1:25 pm

    CHICAGO (WBBM NEWSRADIO) -- A new survey explores the possibility of cutting salaries and more during the COVID-19 pandemic.

    Trying to get a global snapshot of salaries during the COVID-19 pandemic, executive search firm Kingsley Gate Partners surveyed 1,200 executives in North America, South America, Europe, and Asia in April. 

    They found that less than 20-percent of those surveyed believed there would be any downward shift in compensation for the immediate future.

    "That is for employees across the company. Now remember, these are for employees that were gainfully employed at the time of the survey, not for those that have already been laid off," said Kingsley Gate Co-CEO Umesh Rama-krishnan.

    In looking at the results, Rama-krishnan shared his take on the numbers.

    "It was higher than I expected, given the higher level of unemployment, I would have expected that number to be lower," he said. "I do believe that we will see that number go up - meaning a higher percentage will believe in reduction of compensation in the months of May and June."

    Of the 1,200 executives surveyed, 63 percent said they plan to maintain their key talent's salaries for the remainder of 2020. They told executive search firm Kingsley Gate Partners that maintaining salaries during this crisis is a prominent concern.

    When it comes to trying to keep top talent, Rama-krishnan said "what they are doing is ensuring that they don't reduce salaries for those star talent that they want to keep. And in addition, they are deferring bonuses for most executives and most employees to the second half of the year."

    But Rama-krishnan said as part of a retention plan for some employees and managers, they are not deferring those bonuses.

    The survey also finds that most of the employers surveyed are seeing less than a 25-percent efficiency loss due to employees working from home; and just over half of the companies are anticipating less than a 25-percent decrease in sales by the end of this year.  

    Surveyed were executives on four continents with companies in retail, hospitality, or real estate. 

    Rama-krishnan said this survey is just a snapshot in time during the COVID-19 pandemic that has changed things rapidly.  So, they plan to do this survey, periodically, to watch the trends.