High Levels of Turnover Plague CRO Companies, as Rates Escalate
CHICAGO--(BUSINESS WIRE)--Jan 7, 2020--
Turnover rates at clinical/contract research organizations (CROs) have been problematic for some time, especially among clinical research associates (CRAs). In 2018, CRA turnover rates in the U.S. reached a five-year high of nearly 30%, according to a new report from BDO USA, LLP.
The results of BDO’s 2019/2020 CRO Industry Global Compensation & Turnover Survey showed a 4 percentage point jump in turnover rates for clinical monitoring professional roles in the U.S. between 2017 and 2018, after hovering around 25% for the previous four years. Meanwhile, compensation levels for these roles have remained largely stagnant; salary increase budgets even started lagging behind general industry rates.
“If CROs hope to retain key talent, they must do a better job of linking pay raises to an employee’s level of contribution and re-assess merit budget increases,” said Judy Canavan, Global Employer Services Managing Director at BDO. “Competency models can help companies quantify this linkage.”
While incentives can serve as a powerful recruiting and retention tool, there has been little change in the CRO industry’s use of incentives in the U.S. since 2015, with eligibility for annual incentives either holding steady or declining. As further illustration of unchanged compensation strategies, the target and actual awards for annual incentives – both by job level and salary level – have remained flat over the past five years.
Meanwhile, turnover rates outside of the U.S. are notably lower – at 16.5%. This is up more than two percentage points from 2017, but down from a high of almost 23% in 2016.
“CRAs outside of the U.S. tend to have less intense travel requirements, likely easing turnover rates,” said Canavan. “Still, CRA retention is a major concern for CROs overall. Individuals in these positions gain valuable skills very quickly, making them attractive targets for competitors. Compensation strategies need to better reflect this dynamic.”
For more in-depth data and insights, read the Insights Report from BDO 2019/2020 CRO Industry Global Compensation & Turnover Survey.
*Material discussed is meant to provide general information and should not be acted on without professional advice tailored to your firm’s individual needs.
About the BDO2019 CRO Industry Compensation & Turnover Survey
The annual CRO Industry Global Compensation and Turnover Survey collects data for positions in the U.S. and 55 countries outside of the U.S. This survey is designed to help clinical research outsourcing companies develop confidence in their pay levels by providing data necessary to gain insight into their compensation practices relative to the market. Specifically, the survey covers compensation levels, turnover rates for key job roles, and plan design and prevalence. For companies outside of the U.S., it also includes detail about allowances, time off, and additional months’ pay.
About BDO’s Global Employer ServicesPractice
BDO’s Global Employer Services practice consists of an experienced and dedicated team of professionals who are committed to assisting companies with developing strategies and compensation programs designed to attract, retain, and reward talent. Our services include designing and benchmarking compensation programs including salary administration, broad based and executive annual incentives, cash- and equity-based programs, board remuneration, board and executive talent reviews, compensation committee development, non-qualified and deferred compensation plans, advising on tax and accounting issues, and other related services.
Our services are tailored and scalable, designed to accommodate the unique needs of public, private, and nonprofit clients of all sizes and across all industries including multinational Fortune 500 companies.
About BDO USA
BDO is the brand name for BDO USA, LLP, a U.S. professional services firm providing assurance, tax, and advisory services to a wide range of publicly traded and privately held companies. For more than 100 years, BDO has provided quality service through the active involvement of experienced and committed professionals. The firm serves clients through more than 60 offices and over 700 independent alliance firm locations nationwide. As an independent Member Firm of BDO International Limited, BDO serves multi-national clients through a global network of more than 80,000 people working out of 1,600 offices across 162 countries.
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms. BDO is the brand name for the BDO network and for each of the BDO Member Firms. For more information please visit: www.bdo.com.
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SOURCE: BDO USA, LLP
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PUB: 01/07/2020 10:59 AM/DISC: 01/07/2020 10:59 AM