The answer is yes, but with subtle differences depending on each case. As I already explained in my previous post, “Executives’ salaries: justified or exorbitant?”, a trend perceived some years ago was the increase in financial executives’ fixed salaries. This increase was an attempt to balance the final compensations received by these directors in relation with previous successful and much wealthier years. The real value of the bonuses received annually by these executives, and which depend on the results and benefits obtained each year by the company’s performance, is what mainly has suffered depletion due to the crisis. In any case, what has not happened, at least in general terms, is the continual increase of these salaries.
And “do the executives accept this?”. A friend of mine asked me this question one day while we had a coffee and so we discussed this matter in detail. “It depends…”, I told him. In presence of this widespread managers’ salaries stagnation, as a headhunter I have noticed three very different situations: those professionals who are comfortable with their current position; others who, even though are currently employed, are open to changes of their current job positions; and, finally, a group of executives who remain unemployed. What happens with the first of these groups of executives, those who are not looking for a change because they are satisfied with their position, is that they leave us, executive search professionals, with less ways to approach them. In these cases, the principal motivation for a change is normally the proposal of a lucrative economical offer in comparison with their current conditions. Thus, without an offer, the motivation for a change simply does not exist. Obviously, the project is very important, though given the market’s uncertainty, this type of candidates usually demand a number of benefits (golden parachute, seniority, redundancy clauses, etc.) which are not being offered. Consequently and as a result, one always ends up discussing about money.
At a midpoint is the second group of professionals: those executives who are not comfortable in their current projects, or those who believe that they cannot grow or that they have already reached the ceiling in their professional opportunities within their current workplace. In this case, a partial conformism exists. In other words, it is possible that these professionals would not accept a change for a salary lower than their existing one; however they are normally open to change when the offered salary is more or less equal to their current retribution, as long as behind this offer they also find a development project or perspectives for change or improvement which could lead this executive to be recognized as a leader in the new company.
Finally, we have those unemployed executives, definitely the professional niche where we have noticed the highest conformism. Honestly, I have found cases of professionals who have accepted positions which I never imagined they would accept. These executives are normally willing to earn a lower salary in exchange for returning to the labor market. And, unless the project undertaken represents a very stimulating challenge for the professional, what usually follows is that once the market recovers, this professional will abandon the project. And the market will recover, because it already begun to do so. Therefore, this situation is as it’s often said: “short-term gain, long-term pain”.
As I said, in the financial sector microcosm (the one I know the best), things have started to change in this sense. For some time now, in Signium International Spain we have started to notice how more and more firms are hiring executives. Thus, it can be said that a true desire and need for hiring new professionals exists. Always think positive, never negatively, as a certain soccer coach used to say.ç