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Buyers Guide Accelerate

How Has the Economy Affected Compensation and Benefits? 

2010 Golf Industry Compensation and Benefits Report - Executive Summary

The NGCOA and Industry Insights, Inc., an independent professional research and consulting firm, jointly developed a survey to collect compensation and benefit information from NGCOA members. In total, 879 facilities responded to the survey. A total of 29 job titles were included in the survey. Below is a summary of average total compensation by all responding facilities (private and public-access) in 2010.

In addition, average total compensation is provided based on the data collected in 2008. Since the 2010 and 2008 figures are based on different samples, caution should be used when interpreting the results.

While there are numerous factors that can affect the compensation of club staff, the summary looks to identify a few of them that appear to have a clear and direct relationship. There are three such factors - facility classification, gross revenue of the facility and number of golf holes available at the facility. Other factors - including type of facility, tax status and geographic region - most certainly affect club staff compensation; however, no clear and direct relationship could be found and/or insufficient sample sizes existed to analyze some of these variables.

Facility Classification
Employee compensation showed a direct relationship with facility classification. In particular, private facilities tended to pay significantly higher compensation than public-access facilities.

Gross Revenue of Facility
Employee compensation also showed a direct relationship with size of facility. Larger facilities tended to pay more than smaller ones. Using the Chief Staff Executive/General Manager as an example, the chart below shows the impact annual gross revenue has on compensation. For instance, Chief Staff Executives/General Managers at facilities with annual gross revenue of less than $2 million earn an average total compensation of $75,196. Those working at facilities with annual gross revenue over $7.5 million, however, earn an average total compensation nearly three times larger at $208,706.

Employee Benefits/Policies

  • The vast majority (87%) of responding facilities provided health insurance, down from 90% in 2008. The most popular types of plans offered were Preferred Provider Organizations (PPO), Traditional Indemnity and Health Maintenance Organizations (HMO) at 46%, 37% and 34%, respectively.
  • On average, employers paid 80% of the health insurance premiums for individual coverage with the remaining 20% paid by the employee.
  • Responding facilities experienced an average increase of 11.3% during their most recent health care insurance renewal, similar to the 11.1% reported in 2008. On average, health insurance expenses accounted for 4.1% of an organization’s operating budget.
  • Most of the respondents (82%) reported taking steps to control the cost of providing medical insurance/healthcare to employees within the last year. The most popular steps taken were increasing the deductible (53%), increasing employee contribution (42%) and changing insurance carriers (34%).
  • The responding facilities reported paying $5,302 in healthcare premiums per staff member during the most recent fiscal year, similar to the $5,337 in 2008.
  • More than half of the responding facilities provide a retirement plan. Of those providing a retirement plan, 84% offer a 401(k) plan.
  • The vast majority of the responding facilities (95%) pay respective professional association dues on behalf of staff members.

Compensation Outlook:

Effect of Economic Downturn
The severe economic downturn over the past few years had a major impact on the compensation and benefits offered to employees. More than half of the respondents to this year’s survey (70%) indicated that they made a reduction in staff over the past 12 months and/or froze salaries. In addition, half of the respondents eliminated or postponed bonuses (49%) and reduced travel, training or other employee-related expenses (49%).

Looking forward, more than half of the responding companies plan to freeze salaries (62%) and reduce travel, training or other employee-related expenses (57%) in 2010. Nearly half still plan on eliminating or postponing bonuses or making a staff reduction (47% each).

Salary Budgets Increase Slightly
Across all industries, salary budget increases in 2009 and 2010 were the lowest in well over 10 years in the U.S., at just over 2 percent. Over the past 10 years, salary budgets had been increasing about 4 percent annually. In 2011, companies are projecting salary budget increases of 2.9%.

Inflation Wanes
The economic downturn and financial crisis created slight deflation, measured by the Consumer Price Index (CPI), at -0.3% in 2009. Inflation is expected to increase in 2010 and 2011, but still remain historically low.

Unemployment Rate Spikes
The unemployment rate started to increase dramatically in the Fall of 2008. The unemployment rate is expected to average 9.7% in 2010 and fall slightly to an average of 9.1% in 2011.

In the short-term, employees will likely face salary freezes or small increases in compensation. A slow economy and low inflation will be the main contributors. In the long-term, the outlook is cautious optimism. The economy should improve and unemployment rates should fall over the next few years. As this happens, companies will be likely to grant larger pay increases in an effort to attract and retain staff.

Purchase the full Report from the NGCOA Online Bookstore. Click here.

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