higher education remuneration trends · higher education remuneration trends ... quarter of 2016...

Higher EducationRemuneration Trends

August 2015

www.pwc.com

PwC

Agenda

Setting the scene: PwC’s CEO Survey andEconomic Overview

Participant Profile

Human Resources Metrics

Remuneration Package structures andPay Adjustments

Remuneration Trends

Your reward challenges?

2August 2015Higher Education Remuneration Trends

PwC

Setting the Scene: Extracts from the 18th AnnualGlobal CEO Survey and Economic Trends


PwC

The right mix of talent

• Skills are at the top of CEOs’talent agenda. 81% say theirorganisations are nowlooking for a much broaderrange of skills than in thepast.

• Learning and developmentis a particular focus; whenCEOs were asked whichaspects of diversity andinclusiveness werespecifically addressed intheir company’s talentstrategy, this was among thetop categories of responses.


PwC

The right mix of talent, easier said than done

• Gender and knowledge, skills and experience are by far the main reference points for diversityand inclusiveness strategies.

• What’s more, while most CEOs say their organisations are looking more widely across channels,geographies, industries and demographic segments to find talent, only a quarter cite access totalent as a top-three reason for partnering; even though collaborating with a range oforganisations – academia, government and business networks – can be a rich source of talent.


PwC

Cost of living around the globe – publishedJanuary 2015


PwC

Economic Indicators:Reserve Bank expects CPI to breach upper end of 3% - 6% target in 1st

Quarter of 2016 and average 6,1% for the year

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2005 2007 2009 2011 2013 2015

Headline CPITertiary Education 9.3%

Water & Services 8.0%

Fuel -10.9%

Medical 6%

Insurance 8.4%

Electricity 7%


PwC

South African and Global Regulation/Governanceimpacting HR and Reward

• Same pay for same job (Changes effective 1 August 2014)

• Employees will be able to launch unfair discrimination claims if employers pay employees different wages,salaries or benefits or if employers impose different terms and conditions of employment on employees whoperform the same or substantially the same work (or work of equal value) and where the differentialtreatment is based on the employees’ race, gender, religion or any of the other listed grounds ofdiscrimination in the Act;

• The fines for contraventions of the Act will increase substantially, ranging from R1.5 million or 2% of theemployer’s turnover to a maximum of R2.7 million or 10% of the employer’s turnover whichever is thegreater.

• Transformation requirements and employment equity

• The Women Empowerment and Gender Equity Bill [WEGE]

• King III

• Gini-coefficient and wage gap (global trends – capping of incentives)


PwC

Participant Profile


PwC

Source of Data

Launched in 2000, REMchannel® provides quality, well validated information by

both position and grade. Expansion into Africa has commenced. Botswana, Kenya,

Namibia, Swaziland and Uganda have been published.

REMchannel® South Africa

More than 487 participating companies. 85% ofthe top 100 companies.

More than 900 000 Validated Data points

18 600 Validated Executive Data points

REMchannel® Higher Education AllIndustries circle currently has 34

participants and the Higher EducationInstitutions circle currently has 28

participants in South Africa.


PwC

Sample by Job Discipline – Higher Education AllIndustries and National Industry Sectors

Job Discipline Higher Education All Industries National

Distribution/Supply Chain 273 31,813

Education 16,752 15,940

Executives 84 1,486

Finance 1,735 37,223

Human Resources 1,126 22,790

Information Technology 1,793 42,772

Marketing 724 12,857

Media 119 1,182

Property 671 4,075

Risk and Compliance 222 33,322

Safety/Health/Environment/Quality 1,459 48,657

Sales 317 132,097

Support Services 16,455 155,138

Technical 5,215 362,174

Total 46,945 901,526


PwC

Human Resources Metrics


PwC

Gini-coefficient and wage gap

It is generally accepted without question that the cause of the high Ginico-efficient within South Africa is a high level of earnings inequality, orthe pay gap between the highest and lowest earners within the country.However, is this perception accurate?

• Whilst it is widely acknowledged that South Africa has a uniquely high level of unemployment, theeffect of this level of unemployment on concepts such as national earnings inequality is often notdocumented. Whilst the pay gap is expressed as the difference in earnings between the highest paidearner and the lowest paid earner, the Gini co-efficient takes into account a high percentage ofSouth Africans who are not earning at all.

• Emerging research supports the notion that the Gini co-efficient may not be as accurate of ameasure of income inequality as previously thought. A number of studies undertaken have shown anegative causal relationship between levels of unemployment and income inequality, with a studyon the relationship between unemployment and earnings inequality in South Africa showing thatincreases /decreases in the unemployment rate accounted for about 72% of correspondingincreases / decreases in income inequality over the studied period.


PwC

Median Pay GapHigher Education All Industries and National in South Africa based on REMchannel®

Survey Data at 1 May 2015

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National Higher EducationSeries1 55 33

55

33

Pay Gap - Peromnes +1 vs 18/19


PwC

Diversity – front of mindOpportunities are not equal


PwC

Gender Representation and RemunerationExtracted from REMchannel® as at 1 May 2015

Peromnes Level(Paterson Modern Level)

Ge

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National All Industries Sector Higher Education All Industries Sector

Ma

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% Distribution

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% Distribution

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Peromnes 5 to 7(D Lower)

Male97,234

10.8 13.7 15.4 18.1 5811,267

12 14 15 17 58

Female 14.2 11.3 9.6 6.9 42 13 11 10 7.6 42

Peromnes 4 to 5(D Upper)

Male31,024

13.4 15.8 17.6 20.3 67707

13 15 17 20 65

Female 11.6 9.2 7.4 4.7 33 12 10 8.2 5.5 35

Peromnes 3 to 4(E Lower)

Male14,681

5.5 18.1 19.2 20.8 74570

15 17 18 17 66

Female 9.5 6.9 5.8 4.2 26 11 7.9 7.2 8.3 34

Peromnes 2(E Upper)

Male2,421

19.1 20.2 21.9 22.1 8363

16 22 21 19 78

Female 5.9 4.8 3.1 2.9 17 9.5 0 0 6.4 16

Peromnes 1(F Lower)

Male921

20.2 21.4 21.6 21.7 85

32

13 19 22 22 75

Female 4.9 3.6 3.4 3.3 15 13 5 7 1 25


PwC

Age Distribution: National vs Higher EducationAll Industries

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Up to 25 26 to 35 36 to 45 46 to 55 56 to 60 61 and up

National All Industry Higher Education All Industries


PwC

Labour Turnover by Termination Category

Percentage labour turnover by termination category

1 January 2014 – 31 December 2014

Termination category Percentage

Resignation 9.04%

Non-renewal of contract 6.64%

Dismissal – operational requirements (retrenchment) 2.48%

Dismissal – misconduct 1.40%

Dismissal – incapacity 0.12%

Retirement 0.71%

Death 0.25%

Other 0.69%

Total 21.30%


PwC

Remuneration Package Structures and PayAdjustments


PwC

Remuneration Package Structures –National vs. Higher Education All Industries

Executives Management General StaffUnionised

StaffExecutives Management General Staff

UnionisedStaff


Basic Salary 21 22.9 32.6 66.5 20.6 44.1 50 65.2

Flexible Package 6.1 6.7 5.7 3.1 8.8 11.8 8.8 8.7

Total Package 72.9 70.4 61.8 30.5 70.6 44.1 41.2 26.1

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PwC

Budgeted pay adjustments as at June 2015

6

6.2

6.4

6.6

6.8

7

7.2

7.4

Percentage Increaselast 12 months

Percentage Increasenext 12 months

Percentage Increaselast 12 months

Percentage Increasenext 12 months

National Industry Higher Education IndustryExecutives 6.7 6.5 7 6.9

Management 6.7 6.5 7 7

General 6.8 6.7 7 7

Unionised Staff 7.4 7.3 7 7

Perc

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PwC

Actual Pay Adjustments (June 2014 to June 2015)

7.3 7.1 77.4

88.5

9

8.4

13.1

11.7

6.46.9

8.2 8.4 8.3 8.1

7.1

6.5 6.7

7.8

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ExecutiveManagement

SeniorManagement

MiddleManagement

JuniorManagement

Entry LevelManagement

Supervisory SeniorClerical

Clerical Semi Skilled Unskilled

National Higher Education All Industries


PwC

Remuneration Trends


PwC

Median Market Premium Analysis by Grade

17,484 17,44822,092

26,700

40,764

85,968

67,992

57,948

78,000

170,472

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

12 11 10 9 8 7 6 5 4 3

National Higher Education All Industries Expon. (National ) Expon. (Higher Education All Industries)


PwC

Academic Remuneration Trend Analysis - 2015

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

9 8 7 6 5 4

Higher Education Basic Academic Median

National Basic Median

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200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

9 8 7 6 5 4

Higher Education TGP Academic Median

National TGP Median


PwC

Academics vs National All Industries marketPeromnes 7 to 9


PwC

Academics vs National All Industries marketPeromnes 6 to 4


PwC

Higher Education Total Guaranteed Package vs.National All Industries Sector

Compa ratioof 100 =NationalMedian


PwC

Prevalence of Variable Pay – past 12 Months

% Received % of Annual TGP % Received % of Annual TGP


Executives 80.1 57.1 35.2 5.5

Management 76.6 14.9 39.9 2.2

General Staff 63 5.6 27.2 0.9

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Your reward challenges?

“The information contained in this publication by PwC is provided for discussion purposes onlyand is intended to provide the reader or his/her entity with general information of interest. Theinformation is supplied on an “as is” basis and has not been compiled to meet the reader’s orhis/her entity’s individual requirements. It is the reader’s responsibility to satisfy him or her thatthe content meets the individual or his/ her entity’s requirements. The information should notbe regarded as professional or legal advice or the official opinion of PwC. No action should betaken on the strength of the information without obtaining professional advice. Although PwCtake all reasonable steps to ensure the quality and accuracy of the information, accuracy is notguaranteed. PwC, shall not be liable for any damage, loss or liability of any nature incurreddirectly or indirectly by whomever and resulting from any cause in connection with theinformation contained herein.”

© PwC Inc. [Registration number 1998/012055/21](“PwC”). All rights reserved. PwC refers tothe South African member firm, and may sometimes refer to the PwC network. Each memberfirm is a separate legal entity. Please see www.pwc.co.za for further details.

René Richter

PwC | Partner/DirectorOffice: +27 (11) 468 2639Mobile: +27 (82) 460 4348Email: [email protected]://www.pwc.com/za

higher education remuneration trends · higher education remuneration trends ... quarter of 2016...

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