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CHAPTER 1

INTRODUCTION

The 2010 Single-family Compensation Survey was conducted in June 2010 by the NAHB Housing Policy and Economics Group. The objective of this survey is to collect data on compensation and benefits for common positions at single-family home building companies. The data can be used to benchmark how single-family builders compensate their employees.

The survey questionaire (Appendix IV) was electronically sent to 4,350 single-family builders in June 2010. Responses were received from a total of 205 builders, for a response rate of 5 percent. Results in this report are broken down by region, 2009 dollar volume, number of single-family units started in 2009, and the number of employees on payroll (all details shown in Appendix III). Exhibit 1 shows the distribution of responses for these categories.

BUILDER PROFILE

PRINCIPAL OPERATION

Fifty-six percent of respondents reported the principal operation of their firm to be single-family custom building, while 26 percent reported single-family spec/tract building, and 17 percent single-family general contracting. The remaining 2 percent reported some other type of principal operation (Exhibit 2).

The builder's principal operation varies over the number of units built. Ninety percent of respondents who reported building over 100 single-family units in 2009 are primarily single-family spec/tract builders, while only 10 percent are single-family custom builders. Over half, 57 percent, of respondents who reported building between 11 and 99 units, reported single-family spec/tract building to be their principal operation, 31 percent reported single-family custom building, and 12 percent single-family general contracting. Only 15 percent of respondents who reported building between 1 and 10 units are primarily single-family spec/tract builders, while about two thirds (68 percent) are single-family custom builders and 18 percent are single-family general contractors (Exhibit 3).

NUMBER OF UNITS STARTED

In 2009, 62 percent of respondents built between 1 and 10 single-family units, 11 percent built between 11 and 25 units, 10 percent built between 26 and 99 units, 5 percent built 100 or more units, and 12 percent built none. In 2010, 64 percent of respondents expect to build between 1 and 10 single-family units, 15 percent between 11 and 25 units, 9 percent between 26 and 99 units, 6 percent 100 or more units, while 6 percent expect to build no units. The average number of single-family units started by survey respondents in 2009 is 26, and the expected number of starts for 2010 is also 26 (Exhibit 4).

2009 DOLLAR VOLUME OF CONSTRUCTION ACTIVITY

Forty-three percent of respondents indicated that their firm's dollar volume of construction activity during 2009 was between $1 million and $4,999,999, 11 percent between $5 million and $9,999,999, 4 percent between $10 million and $14,999,999, 8 percent $15 million or more. About 30 percent of respondents reported their 2009 revenue at less than $1 million. The median dollar volume of construction activity in 2009 was $2.6 million (Exhibit 5).

YEARS COMPANY HAS BEEN IN BUSINESS

A majority of respondents, 69 percent, have been in business for more than 12 years, 11 percent for 8 to 11 years, 19 percent have been in business for 3 to 7 years, and 1 percent for less than 3 years. The average number of years a respondent has been in business is 21 years (Exhibit 6).

TOTAL PAYROLL

Most of the respondents (61 percent) did not report the amount of their payroll as of March 31, 2010. Of the remaining 39 percent, 9 percent indicated it was under $100,000, 23% between $100,000 and $499,999, and 6 percent over $500,000. The average payroll among those who reported it was $468,984 (Exhibit 7).

NUMBER OF EMPLOYEES

About a quarter of respondents indicated there were 1 to 2 employees on their firm's payroll as of March 31, 2010. Another 24 percent reported 3 to 4 employees, 26 percent 5 to 9 employees, and 17 percent 10 or more. Five percent reported zero employees on payroll and 4 percent did not report the number of payroll employees at all (Exhibit 8).

The remainder of this report is divided into two sections that present the survey findings from two different perspectives:

• Compensations and Benefits Across 39 Positions - this section provides a broad view of all the full-time positions that currently exist at single-family building companies as well as a comparison of average total compensation and benefits across positions. For the purpose of this study the average total compensation is the sum of the average salary and the average bonus.

• Compensation and Benefits by Position - this section provides a more detailed view of each position's average compensation and benefits. It also shows how compensation can vary across firms of different size.

COMPENSATION AND BENEFITS ACROSS 39 POSITIONS

POSITIONS THAT CURRENTLY EXIST AT SINGLE-FAMILY BUILDING COMPANIES

Respondents were asked to indicate which of 39 positions exist at their firm and to write in others not listed. Almost all single-family builders (98 percent) responding to the survey have a President/CEO. Less than half of the respondents report having any of the other positions listed at their firm. Forty-one percent of the respondents report having a Superintendent, 38 percent a Bookkeeper, 28 percent a VP of Construction, and 26 percent report having a Project Manager. Eighteen percent of respondents report having a Controller, and another 18 percent report that they have a CFO/Head of Finance. Seventeen percent of responding firms report having an Office Manager and 14 percent a Head/Director of Sales and Marketing. A Salesperson and Production Manager each exist at 12 percent of responding firms. A Home Services/Warranty Manager, an Executive Assistant, and an Estimator each exist at 11 percent of responding firms. An Administrative Assistant exists at 10 percent of responding firms. Sales Manager and Architect each exist at 9 percent of responding firms. A Staff Accountant, a Receptionist, and a Head/Director of Purchasing each exist at 8 percent of responding firms. A Head/Director of Production exists at 7 percent, while a Selections Coordinator, a Purchasing Manager, and a Model Home Host each exist at 6 percent of responding firms. The remaining 15 positions listed exist at 5 percent or less of the responding firms (Exhibit 9).

TOTAL COMPENSATION BY JOB GROUP

Respondents were also asked to report the annual salary and bonus of each of the positions existing at their firm. Only full-time positions were considered in this report. To produce the average total compensation for a position, the average annual salary and the average bonus were combined. The average bonus was calculated taking into account "zero bonuses" (those who received a salary but not a bonus). When comparing average compensation levels, keep in mind that not all of the positions exist (at all or as a full-time job) at any one respondent's firm. Thus, the average total compensation for a particular position is only the average among those who actually have the position at their firm. For instance, since only a few large companies reported having a Recruiter, this position has a higher average total compensation than the Director of Human Resources position (which was reported by more, yet smaller, firms).

Appendix I lists all positions and their prevalence at responding firms (column A) as well as the average total compensation for each position (column D). In addition, a second bonus calculation is presented (column E) where only those who actually reported a bonus were averaged out (no "zero bonuses" were included).

Executive Jobs

Respondents reported that their firm's CFO/Head of Finance has an average annual salary of $106,692 and an average bonus, across all those who got a salary, of $23,962. This gives the CFO/Head of Finance an average total compensation of $130,654. The CIO/Head of IT has an average total compensation of $121,167 ($111,167 salary and $10,000 bonus), followed by the President/CEO with a total compensation of $107,811 ($96,727 salary and $11,084 bonus) , and the VP of Construction with a total compensation of $89,196 ($80,951 and $8,245 bonus). Respondents who indicated they had "other" executive jobs reported those jobs to have an average total compensation of $129,564 ($106,214 salary and $23,350 bonus) (Exhibit 10). Some examples of the "other" executive jobs include: Vice President, Regional President, and jobs that combine some of the responsibilities of the various executive jobs listed.

Operations Jobs

The Head/Director of Land Acquisition has an average annual salary of $143,333, and a bonus, averaged among all those with a salary, of $34,167, for a total compensation of $177, 500. The Head/Director of Development and Training has an average total compensation of $173,500 ($159,333 salary, and $14,167 bonus), the Head/Director of Sales & Marketing has an average total compensation of $104,335 (salary $79,854, and $24,481 bonus), the Head/Director of Purchasing, $96,930 ($81,200 salary, and $15,730 bonus), and the Head/Director of Production, $89,350 ($84,775 salary, and $4,575 bonus). Respondents who indicated they had "other" operations jobs reported these jobs to have an average total compensation of $72,739 ($68,756 salary and $3,983 bonus) (Exhibit 11). Some examples of the "other" jobs are the following: Marketing Manager, Operations Manager, and Director of Specification & Interior Design.

Finance Jobs

The Controller has an average annual salary of $69,046, and a bonus, averaged among all those with a salary, of $4,602, for a total compensation of $73,648. The Staff Accountant has an average total compensation of $62,040 ($58,578 salary, and $3,462 bonus), the Payroll Manager has an average total compensation of $44,325 (salary $44,075, and $250 bonus), and the Bookkeeper has an average total compensation of $39,075 ($38,597 salary, and $478 bonus). Respondents who indicated they had "other" finance jobs reported these jobs to have an average total compensation of $33,476 ($33,209 salary and $267 bonus) (Exhibit 12). Some of the "other" jobs are a combination of the finance jobs listed and a data processer.

Human Resources

Recruiters have an average annual salary of $92,500 and an average bonus (among all those who reported a salary) of $15,550 for a total compensation of $108,050. The Director of Human Resources has an annual average salary of $80,720 and an average bonus (among all those who reported a salary) of $10,000 for a total compensation of $90,720. Respondents who indicated they had "other" human resource jobs reported those jobs to have an average total compensation of $71,000 ($66,000 salary and $5,000 bonus) (Exhibit 13). One example of such "other" jobs is a Human Resources Generalist.

IT Jobs

The director of IT has an average annual salary of $95,400, and a bonus, averaged among all those with a salary, of $7,650, for a total compensation of $103,050. The Network Engineer has an average total compensation of $71,900 ($71,900 salary, and $0 bonus), and the Web Design Specialist has an average total compensation of $69,383 (salary $67,300, and $2,083 bonus). Respondents who indicated they had "other" IT jobs reported those jobs have an average total compensation of $61,233 ($61,233 salary and $0 bonus) (Exhibit 14). Some examples of these "other" jobs are IT Supervisor, and Software Specialist.

Administrative Jobs

The Settlement Coordinator has an average annual salary of $43,117, and a bonus, averaged among those all with a salary, of $2,556, for a total compensation of $45,673. The Office Manager has an average total compensation of $44,368 ($42,418 salary, and $1,950 bonus), the Executive Assistant has an average total compensation of $41,076 (salary $39,805, and $1,271 bonus), the Administrative Assistant has an average total compensation of $38,220 (salary $38,007, and $213 bonus), and the Receptionist has an average total compensation of $33,246 ($33,163 salary, and $83 bonus). Respondents who indicated they had "other" administrative jobs reported those jobs to have an average total compensation of $51,997 ($49,650 salary and $2,347 bonus) (Exhibit 15). Some examples of these "other" jobs are Office Assistant, Operations Manager, and VP of Customer Relations.

Production Jobs

The Land Manager has an average annual salary of $91,797, and a bonus, averaged among all those with a salary, of $8,650, for a total compensation of $100,447. The Purchasing Manager and Production Manager have similar total compensations with averages of $76,930 ($70,034 salary, and $6,896 bonus) and $76,255 ($64,993 salary, and $11,262 bonus), respectively. The Project Manager has an average total compensation of $68,823 ($61,820 salary, and $7,003 bonus), the Architect has an average total compensation of $63,760 (salary $61,714, and $2,046 bonus), and the Contract Manager has an average total compensation of $62,383 ($60,695 salary, and $1,688 bonus). The Superintendent has an average total compensation of $55,174 (salary $51,752, and $3,422 bonus), the Estimator has an average total compensation of $52,089 ($50,784 salary, and $1,305 bonus), and the Home Services/Warranty Manager has an average total compensation of $52,484 ($50,464 salary, and $2,020 bonus). Respondents who indicated they had "other" production jobs reported those to have an average total compensation of $44,561 ($41,766 salary and $2,795 bonus) (Exhibit 16). Some examples of these "other" jobs are Assistant Superintendent, Laborer, Purchasing Coordinator, and Senior Project Manager.

Sales & Marketing Jobs

The Sales Manager has an average annual salary of $67,990, and a bonus, averaged among all those with a salary, of $11,921, for a total compensation of $79,911. The Salesperson has an average total compensation of $71,039 ($42,900 salary, and $28,139 bonus), the Design Center Manager has an average total compensation of $57,738 ($53,600 salary, and $4,138 bonus), the Customer Service Manager has an average total compensation of $48,250 (salary $47,600, and $650 bonus), the Selection Coordinator has an average total compensation of $42,023 ($40,023 salary, and $2,000 bonus), and the Model Home Host has an average total compensation of $30,000 ($28,500 salary, and $1,500 bonus). Respondents who indicated they had "other" production jobs reported those jobs to have an average total compensation of $41,464 ($35,333 salary and $6,131 bonus) (Exhibit 17). Some examples of these 'other' jobs are Graphic Designer, Sales Assistant, Consultant, and Customer Service Representative.

BENEFITS

Respondents were further asked about which of a list of 13 fringe benefits were offered to each of the positions existing at the firm. A comparison of the prevalence of each of the fringe benefits across positions is as follows:

Health Insurance

Fourteen positions are offered Health Insurance by 100 percent of the respondents that reported their existence in the firm: CIO/Head of IT, Head/Director of Land Acquisition, Head/Director of Production, Head/Director of Development and Training, Director of Human Resources, Director of IT, Payroll Manager, Land Manager, Contract Manager, Design Center Manager, Settlement Coordinator, Web Design Specialist, Network Engineer, and Recruiter. The following 10 positions are offered health insurance by 90 percent or more of the respondents that reported them: Sales Manager (94 percent), Home Services/Warranty Manager (93 percent), Administrative Assistant (93 percent), Controller (93 percent), Head/Director of Sales & Marketing (93 percent), Purchasing Manager (92 percent), Staff Accountant (92 percent), CFO/Head of Finance (92 percent), Receptionist (91 percent), and Customer Service Manager (90 percent). As Exhibit 18 shows, at least half of all the builders responding provide health insurance to each of the positions listed in this survey.

Dental Insurance

Five positions are offered Dental Insurance benefits by 100 percent of the respondents that reported their existence in the firm: Head/Director of Land Acquisition, Head/Director of Development and Training, Payroll Manager, Web Design Specialist, and Recruiter. The following 12 positions are offered dental insurance by two thirds or more of the respondents that reported them: Receptionist (82 percent), Land Manager (80 percent), Settlement Coordinator (78 percent), Design Center Manager (75 percent), Salesperson (70 percent), Staff Accountant (69 percent), Head/Director of Purchasing (69 percent), Architect (67 percent), Contract Manager (67 percent), Network Engineer (67 percent), Director of IT (67 percent), and CIO/Head of IT (67 percent). The following 7 positions are offered dental insurance by less than two thirds, but half or more of them: Home Services/Warranty Manager (60 percent), Director of Human Resources (60 percent), Executive Assistant (59 percent), Purchasing Manager (58 percent), Sales Manager (53 percent), Customer Service Manager (50 percent) and Selections Coordinator (50 percent) (Exhibit 19).

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Excerpted from "2010 Single-Family Builder Compensation Study"
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