ADP The State of HR 2019

Section 3
The ADP Research Institute®
2019 State of the

Workforce Report:
Pay, Promotions and
Retention
Ahu Yildirmaz
Christopher Ryan
Jeff Nezaj
About the Institute Acknowledgments
The ADP Research Institute (ADPRI) is the global We thank our colleagues from the ADP Research
thought leader for Labor Market and People and Institute team, specifically Mita Goldar, Sara Klein,
Performance research. ADP pays one in six workers in Renzhong Meng and Sinem Buber-Singh, for their
the U.S. and serves more than 740,000 clients globally. contributions to this research.
Our unmatched expertise in workforce analytics
and talent management, combined with access to We are also thankful to our university partners from the
comprehensive human capital data, enables the Institute University of Chicago and Cornell University for their
to conduct unique and cutting-edge research addressing constructive feedback, support and insight. We would
all aspects of the world at work. ADPRI is the source like to acknowledge Erik Hurst, Professor of Economics
that industry experts and policy makers turn to for the and Deputy Director of the Becker Friedman Institute,
most timely, comprehensive and credible information and John Grigsby, Ph.D. candidate in Economics from
surrounding human capital management. Our reach the University of Chicago, as well as M. Diane Burton,
extends to some of the brightest minds in the world to Associate Professor of HR Studies at Cornell University.
ensure we always provide relevant and actionable data
to business owners, team leaders and policy makers We would also like to thank John Boudreau, Professor
alike, removing the guesswork and giving leaders the of Management and Organization at the University
insights they need. of Southern California for his contributions to this
research.
For more information, visit ADP.com/research.
We are also grateful to the ADP Data Cloud team of
data experts whose support proved to be invaluable in
this endeavor. We appreciate their generosity of time,
insight and support.
Finally, we would like to acknowledge Carlos Rodriguez,

President & CEO of ADP, and members of the ADP
executive committee for their leadership and continued
support of our research, including Matt Levin, Jan
Siegmund and Don Weinstein. This research would not
have been possible without their continued support.
The ADPRI 2019 State of the Workforce Report: Pay, Promotions and Retention 1
Table of Contents
Section 1 Executive Summary 3
Section 2 Introduction 8
Section 3 Data and Methodology 12
Section 4 National Overview 19
Section 5 Industry Deep Dive 31

Construction 31
Education & Health 38
Finance & Insurance 45
Information 52
Leisure & Hospitality 59
Manufacturing 66
Professional & Business Services 73
Trade/Transportation/Utilities 80
Section 6 Conclusion 87
Section 1
Executive Summary
Section 1 Executive Summary
Organizational design — the way we staff, manage and reward people to accomplish
work — is fundamental to the success of every employer. Yet, despite decades of
business and academic research, empirical data for organizational benchmarks is hard to
come by. Employers routinely undertake complex organizational restructuring projects
with limited insight and benchmarking data. A void exists in the market for high-quality
human resources data that can portray different characteristics related to the structure
of firms, accurately and in real time.
To fill this gap, the ADP Research Institute® (ADPRI) On average, employers will promote 8.9 percent of
has published a unique new report — the ADPRI their employees annually, and those employees will
2019 State of the Workforce Report — that provides receive an average wage increase of 17.4 percent
comprehensive, high-quality, data-driven organizational More broadly, 84 percent of all American workers in the
benchmarks derived from ADP’s aggregated and study have nonsupervisory roles, versus 16 percent of
anonymous de-identified HR and payroll data. This report employees in supervisory or professional roles, and the
helps employers gain a better understanding of the average time for an employee to receive a first manager
hierarchical structure of organizations, pay levels, how promotion is 6.9 years. Further analysis of promotion
pay and promotions are connected and how employers rates by demographic factors reveals interesting
retain workers throughout their organizations. Providing disparities. Between the genders, males are more
details about firm hierarchy, promotions, turnover and likely to get a promotion compared with females —
span of control is vital to understanding relevant market 9.3 percent compared with 8.4 percent, respectively.
trends, which is the focus of this report. Promotion rates by generation show that millennials, at
10.5 percent, are most likely to get a promotion over all
As a comprehensive, up-to-date source of organizational other age groups.
data, the findings in the report provide a solid basis for
firms to understand their own organizational dynamics Impact: Understanding how a firm’s promotion rate
and improve performance. compares at national, industry and demographic levels
can help diagnose career advancement issues within a
Key observations from this inaugural study illustrate firm.
some of the ways employers can use this data:
Firms are more likely to promote internal employees showed a turnover rate of 13.3 percent, while teams
for management positions without a promotion had 12.3 percent turnover.
A comparison of promotion rates over a one-year period
against the proportion of new hires reveals that firms Impact: Employers should consider the effect of
generally are more confident in promoting from within promoting individual team members and the retention
versus hiring externally for management positions. strategy for key team players.
Overall, firms promoted 8.9 percent of employees,
while new hires made up a much larger portion at 30.2 Employee turnover varies significantly with
percent. At the supervisory levels, firms promoted more demographic factors
internally than they hired externally — 17.2 percent Monthly turnover rates for older employees are relatively
of managers are promoted, while 15.6 percent are new lower compared to workers in younger age groups. The
hires. The disparity becomes even more apparent at the overall turnover rate for those 65+ was 2.2 percent,
highest rankings within an organization, where 21.5 while turnover successively increases across younger
percent were internally promoted and only 12.5 percent age groups to 8.0 percent for those age 25 years or less.
were new hires. The turnover rates were very similar across genders, with
males leaving their jobs at a rate of 3.0 percent per month
Impact: Employers can compare their rate of internal and females at 3.5 percent per month overall.
promotion against national and industry benchmarks to
determine the health of career development programs, Impact: Employers can compare employee turnover
learning and development and the cost of losing high against national and industry benchmarks split out by
potential front-line workers. In addition, externally hired age and gender to pinpoint organizational issues.
managers are more likely to increase total compensation
costs.
Promotions within a team are associated with

higher turnover among other team members
The effect of promotions on turnover within teams of
three or more employees was analyzed. The data show
that teams in which an employee was promoted had
higher turnover when compared to teams where no
promotions occurred. Teams where a promotion occurred
Women are under-represented in upper levels of management
compared to men
6th Level 15% $164

Managers 85% $212
5th Level 19% $121

Managers 81% $156
4th Level 23% $98

Managers 77% $120
3rd Level 35% $61

Managers 65% $85
2nd Level 37% $46

Managers 63% $55
1st Level 43% $36

Managers 57% $45
Managers 44% $36

w/o Directs 56% $48
Non- 48% $22

Managers 52% $27
% of Employees Female/Male
Hourly Wage
Males and females show significant disparities While less than half of one percent of all American
across pay and organizational hierarchies workers reach the three highest management tiers, the
Gender differences across hierarchy levels show that under-representation of women is problematic because
the proportion of women in senior level positions is these elite positions have an outsized influence on
significantly lower than that of men. This pattern was corporate policy and culture. The average wages of job
evident across all industries and intensifies up the holders in these fourth-level management positions is
corporate ladder. In addition, the gender pay gap remains also 40 to 50 percent higher. Considering that these
intact across hierarchy levels and is consistent with leadership positions typically require candidates with
previous research results. substantial job tenure and mentoring, short-term fixes
will be challenging.
The fourth management level, however, appears to
define the “glass ceiling” — a steep decline in female Impact: Employers have new benchmarking data for
representation even from the third level. measuring the effectiveness of Diversity and Inclusion
programs.
Span of control is marginally correlated with patterns. Average employee age, wages, promotion
turnover and promotions rate, turnover and span of control differ significantly.
Report data show that firms with high average spans Similarly, organizational metrics vary significantly, based
of control in some industries generally exhibit slightly on organizational size.
lower promotion rates and higher turnover rates
compared to firms with low spans of control. Impact: Employers should compare their organizational
statistics against companies within their industry
Impact: Employers can adjust span of control in order sector and size, whenever possible.
to better manage employee turnover — especially in
hiring environments with large numbers of younger,
inexperienced workers.
Every industry sector has its own unique dynamic

Different industry sectors within the U.S. economy face
different types of market conditions, growth rates and
consumption of resources. As a result, the organizational
metrics within each industry sector follow distinctive
Span of Control, Promotion and Turnover Rate for Individual Industries
Leisure &
Hospitality
Span of Control
Education &
Health
Trade/
Transportation/
Utilities Manufacturing
Professional
& Business Construction Information
Services
5% 6% 7% 8% 9% 10% Finance & 11% 12%

Insurance
Promotion Rate
Section 2
Introduction
Section 2 Introduction
All employers face the fundamental challenge of structuring, rewarding and motivating
their organization’s workforce for optimal productivity and overall business performance.
Unfortunately, there is no magic formula for success that works in all situations. Each
employer faces its own unique circumstances — mission, market demand, competitive
differentiation, labor availability and cost structure, among other things — that drive
continuous change. Existing literature suggests that an organization’s ability to adapt to
these changes is fundamental to the organization’s survival.
Reorganization, if done effectively, can be one of productivity and labor costs — organizational and HR
the best ways for companies to unlock hidden value. metrics are often sparse or altogether missing.
Yet, research also suggests that many corporate
reorganizations fail to generate the desired financial Even when companies have access to detailed
results or other benefits to the organization. A failed organizational data, interpretation can be a challenge.
reorganization is not only a disappointment to the Is a managerial span of control of 8.2 employees per
company’s bottom line, but also could diminish employee supervisor optimal? Is voluntary turnover of 2.7 percent
engagement and, in the end, do more harm than good. per month a problem? Should we care if 40 percent of
front-line supervisory positions are filled from external
While there is no perfect science to how a sources rather than internal candidates? The short
reorganization is implemented, a critical part of the answer to all of these questions is, “It depends.” At a
process is to start with strategy. While this may sound small manufacturer in a rural environment with a high
obvious, many firms don’t spend enough time — or investment in technology, these numbers would have
go into enough depth — at this stage. Developing a very different significance than for a franchise owner
sound strategy with critical input from more than a few with a chain of restaurants in an urban area.
company executives can bring important insights to the
process before the implementation phase. This reality may explain why restructuring often
results in business plans that work well on paper, but
In particular, at many firms Human Resources (HR) is don’t translate to specific people and organizations.
not always included in reorg strategy sessions. HR can Unrealistic job roles, talent shortages, work activities
be overlooked in the decision-making process because that don’t provide opportunity or motivation, and
they are often perceived as the department that will organizational layering that prevents strategic planning
implement the changes after the fact, rather than or engagement are all examples of how a restructuring
guiding strategy informing those decisions up front. plan can be short-circuited. Compounding this is the
continuous patching and micro-adjustments that
One thing reinforcing this perception is that, while there agile organizations need in order to succeed in rapidly
is typically an abundance of marketing and financial changing marketplaces. To that end, organizational
data readily available — sales forecasts, profitability, benchmarks can help HR become a more effective
strategic partner in the decision-making process — from Understanding Organizational Metrics

day-to-day running of the business to restructuring. Organizational design is the art of compromise. Each
employer faces its own unique circumstances that
Analyzing key HR metrics such as employee turnover, drive organizational decisions. The result is that most
wages, promotional opportunities, span of control and organizational metrics reflect the tensions of competing
organizational hierarchy are absolutely critical and demands.
can help companies understand, identify and correct
underlying weaknesses in the organization. For example, Organizational Tensions
turnover rates combined with average wages may be
an indicator of whether there is an engagement or pay
issue. Similarly, promotional activity combined with
span-of-control data can provide insight into how well
an organization trains its employees to take on added
responsibility, as well as insight into opportunities
within the organization. Cost Talent
The first annual ADPRI State of the Workforce

Agility Reliability
Report presents national trends as well as detailed
organizational metrics by industry and firm size. For Fungible Engaged
the first time, decision makers have access to Roles Workers
organizational benchmarks to compare against their Speed
Profitability
own internal HR statistics. to Market
External Proprietary
Although this data can present new insights to HR Skills Capabilities
leaders, we would like to provide a word of caution to
readers. The organizational benchmark metrics in this Hire Talent Make Talent
report should be viewed as data points for comparison,
not objectives or goals. These HR metrics provide Chaos Bureaucracy
numbers for comparison; however, they do not offer
analytics for why your organization’s metrics may differ.
Only the reader can provide analytics to gain insights For this reason, it can be misleading to talk about an
regarding key differences. In the section that follows, objective “ideal” level of turnover or an “ideal” span of
we provide an overview on how to use and interpret control. Even within specific industries, an employer
organizational metrics. may have a compelling business reason to vary from peer
norms. High or low variance compared to a benchmark
is not necessarily good or bad. Rather, organizational
choices should be deliberate and aligned with strategy.
Insight comes from linking organizational benchmark If there isn’t a compelling business reason for
results to other business indicators. A budget hotel being different from other organizations, is there
chain may actively cultivate an organizational design evidence that our organization has a potential
with higher turnover, lower wages and high employee/ competitive advantage or underlying weakness?
supervisor ratios as part of their core business model.
A luxury hotel resort, on the other hand, will hire, train Before taking any action based on benchmarks, employers
and groom staff for long-term careers, with trained should carefully evaluate their own operations to
specialists to support events and functions. As long understand the significance of benchmark results.
as your organization’s variance from industry norms is
deliberate and the strategic and financial consequences This report provides analysis of HR characteristics in
are well understood, there should be no reason to two sections. The National Overview section provides a
consider reorganization to meet these metrics. It’s high-level overview of HR metrics at the national level,
when an employer varies from benchmark norms for inclusive of all industries and all firm sizes (of at least
no apparent reason that management may wish to 50 employees). The Industry Deep Dive section delves
investigate further. into HR metrics in more detail for each industry sector,
presenting data by demographics (age and gender),
Organizational analysis starts with a few simple tenure and hierarchy/managerial levels.
questions:
How do our organizational metrics compare against

industry benchmarks in this report? Are we high,
low or similar to other organizations?
• For metrics where we differ significantly from
benchmark averages, is there a compelling business
reason why we should be different?
• How does our mission, strategy, product, business
model, location, markets, etc. require us to manage
people differently than other organizations?
Section 3
Data and Methodology

Section 3 Data and Methodology
Unlike traditional organization studies that rely on survey data, the ADPRI 2019 State of the
Workforce Report is derived from aggregated and anonymous de-identified HR data records.
The ADPRI 2019 State of the Workforce Report is based factors closely mimic the BLS survey data, which
on January 2018 data of anonymized HR and payroll represent the U.S. labor force very well. This research
records of about 13 million employees from 30,000 evaluated the dataset along several dimensions,
firms across eight sectors in the United States. Firms including age, gender, tenure, compensation level,
with 50+ employees from the following sectors were industry and firm size. The industry mix does not
included in this study: Construction, Education & Health, exactly mirror that of the total United States across all
Finance & Insurance, Information, Leisure & Hospitality, industries. However, the data are robust and represent
Manufacturing, Professional & Business Services, Trade/ each industry well.
Transportation/Utilities and Resources & Mining.*
The following key HR metrics were calculated:
The data sample used in this report compares well Hierarchy, Promotion Rate, Turnover Rate and Span
against U.S. Bureau of Labor Statistics (BLS) survey of Control
data in terms of age, gender and regional distribution.
The employee distributions within these demographic To determine each organization’s Hierarchy reporting
* Resources & Mining was not included in the Industry Deep-Dive section due to structures, anonymized employee manager relationships
sample size limitation. were identified, including managers without subordinates.
The data used in this research compare well with
the U.S. Bureau of Labor Statistics (BLS) data: Once each firm’s hierarchy was established, Promotion
Rates were determined. Since promotion rates are
ADP Employee BLS Employee defined as the proportion of the employee population
Age
Distribution Share
who were promoted over a one-year period, metrics
<25 yrs 13% 13% were measured against January 2017 data to calculate
the promotion rates year over year.
25-34 yrs 25% 23%
35-54 yrs 42% 42%

The Turnover Rate is defined as the proportion of the
total employee base that was separated from their jobs
55+ yrs 20% 22% over a one-month period. Both voluntary and involuntary
turnover rates were determined by reviewing the reason
ADP Employee BLS Employee employment was terminated.
Gender
Distribution Share
The Span of Control is determined by simply counting
Female 47% 47%
the number of direct reports under each manager. The
Male 53% 53% manager’s span of control, or the number of subordinates
a supervisor has, was derived from the organizational
ADP employee distribution based on January 2018 time period. BLS
employee share based on December 2017 time period. structure within each firm.
Statistics have been calculated and rounded up to Tenure: Employee tenure is a distinctive variable that
the nearest percentage or value. For example, an age can predict key strengths and weaknesses within the
calculation of 40.6 would be rounded up to age 41 workforce. A high-tenured workforce is more likely to
and would be reflected in the “41 to 50” age range. In achieve the skill mastery required to perform core work
another example, if a firm had an average of 6.8 direct duties, although the downside may be a workforce
reports per manager, this number would be rounded with more bureaucratic thinking and a more parochial or
up to 7 and would be reflected in the range of “7 to 9” inward focus.
direct reports.
Firm Size: Firm size is often directly related to the
A look at a few additional key metrics: Age, Gender, specialization and complexity of individual job roles.
Tenure, Firm Size and Wages Larger firms are more likely to achieve scalability and
maturity around corporate G&A functions, and they are
In addition to the four key metrics (Promotion Rates, often better able to offer higher wages and benefits to
Turnover Rate, Span of Control and Hierarchy) there are their employees. Smaller firms may have less maturity
a few other critical metrics in this report. and greater job role ambiguity, since highly experienced
workers are more likely to switch interchangeably into
Age: Employee age is a significant indicator of different job roles.
workforce tenure and maturity, as well as a causal factor
for many aspects of employee behavior, including overall Wages: Industry wage data can be a powerful tool;
turnover. Younger workers tend to have greater wage however, one must also look at other organizational
sensitivity and may be more mobile. Older workers often metrics. When higher wages occur in conjunction with a
have greater self-knowledge and may be more willing to track record of business performance, higher pay may be
accept financial trade-offs to achieve better work-life viewed as an advantage. Nonetheless, an employer who
balance. offers relatively lower wages, but has low turnover and
a reputation as a great place to work, may also achieve
Gender: Women make up 48 percent of the total U.S. competitive advantage — especially in margin-sensitive
workforce, and it is critical for employers to attract, industries.
retain and engage women in the workplace in order
to compete. To the extent that organizational metrics How to use and interpret Organizational Metrics —
reveal unfairness in pay or promotional opportunities a quick introduction
between genders, employers may be putting themselves Key HR metrics can provide significant clues into the
at risk by accepting an unbalanced organizational overall health of an organization. Tracking HR metrics
environment. within an organization — and comparing them to
peers and national benchmarks — can provide a solid
indication of the company’s strengths and opportunities
for development.
Promotion Rate
Tracking the promotion rate of a company is important for assessing career opportunities within the organization,
and may be associated with revenue growth. High internal promotion rates may indicate best-in-class employment
practices, while low promotion rates could reflect organizations that are growing rapidly or undergoing change.
The following charts illustrate considerations regarding positive and negative reasons for benchmark differences:
? Your Promotion Benchmark: Good or Bad?
Lower Than Benchmark Higher Than Benchmark
May be positive when: May be positive when:

• Younger company • Stable and profitable
• Rapid growth • Clear strategy/strong culture
• New market/technology/process • Market leader/proprietary methods
• Cultural change • High customer retention
• Expansion of corporate infrastructure
May be negative when: May be negative when:

• New management team • Internal focus
• High cost structure • Declining market share
• Distrust of culture/people • Change-resistant culture
• Diversity and Inclusion issues • Inflexible/bureaucratic
Turnover Rate
Turnover sometimes has a negative connotation; however, it is a natural part of the employee life cycle and
organizational renewal. When reviewing turnover rates compared with peers in the industry, rates may reflect
either positive or negative reasons for the differences, as illustrated below.
? Your Turnover Benchmark: Good or Bad?

• Market leader • Strong performance culture
• Prestigious employer brand • Younger workforce than peers
• High market share and customer retention • Successful innovation
• High profitability relative to peers • Lower operating costs; no impact to quality or
• Emerging market/rapid growth service
• Value creation from “alumni” network

• High cost/low margins • Poor day-to-day execution
• Shrinking customer base • Declining quality, service levels and brand
• Unresponsive to changing markets reputation
• Diversity and Inclusion issues • High overtime
• Bureaucratic culture • Poor employer reputation
• Diversity and Inclusion issues
Span of Control
There is no such thing as an “ideal” span of control; however, an analysis of where an organization compares to peers
can give insight to managers and leadership. The following considerations may offer such insights into differences
regarding span of control.
? Your Span of Control Benchmark: Good or Bad?

• Market leader • Price/cost leader
• High value-added products and services • Streamlined workforce and processes
• Quality/safety overrides cost • Experienced workforce
• Steep learning curve for new employees • Agile/matrix project work
• Rapid industry growth and change • No impact to quality or service

• High cost/low margin versus peers • Poor day-to-day execution
• Declining customer retention • Declining quality/service levels
• Unresponsive to changing markets • Poor brand reputation
• Rapidly aging workforce • High overtime
• Bureaucratic culture
• Diversity and Inclusion issues
Hierarchy
The number of organizational layers within a firm can impact the functional operation and efficiency of an
organization. Less hierarchy means lower costs, but may also place an undue burden on supervisors and executives if
there are not sufficient layers to perform work efficiently. The following chart illustrates considerations regarding
positive and negative reasons for benchmark differences:
? Your Hierarchy Benchmark: Good or Bad?

• Rapid growth/young company • Market leader
• Focused scope/strategy • Competitive advantage through customer
• Competitive advantages associated with speed retention, reliability, safety
to market and labor costs • High cost of entry for new competitors
• Proprietary capabilities/agile workforce

• Lack of strategic focus and leadership • Poor visibility to front-line execution
• Lapses in quality, safety, responsiveness to • High labor costs — especially SGA
market • Distant executive leadership
• Insufficient executive bandwidth to address • Complex business strategies/competing agendas
growth opportunities
• Nonresponsive to changing markets
• Burn out
• Aging workforce with low internal promotion
rate
Section 4
National Overview
Section 4 National Overview
Summary Statistics
The U.S. labor market has seen extremely positive, consistent job growth over the
last eight years. In 2018 alone, growth averaged just better than 200,000 jobs per
month. However, wage growth has lagged behind, increasing at only about one to
two percent annually in the same time frame. In 2018, hourly wages were about $29
per hour across all sectors. Wages vary greatly across industries, firm size and other
demographic factors, which is demonstrated throughout this report.
The overall wage gap between men and women, for example, remains a concern
as evidenced by the difference in hourly wages across all sectors. In addition, the
difference in wages between managers and non-managers is also quite substantial.
The metrics shown in this section of the report represent the averages of all sectors.
In Section 5 of this report, a deep-dive view of HR metrics is provided for each sector.
National Averages
Age (years) 41.7 Monthly Turnover 3.2%
YEARS Tenure (years) 5.6 Span of Control 6.9
Hourly Wages $29.03

Annual Promotion 8.9%
% Managers 16% $47 Rate
% Non-Managers 84% $25
% Male 53% $32
% Female 47% $25
Age, Tenure, Hourly Wages (Firm Averages)
Age YEARS Tenure Hourly Wages
Average age is Average tenure is Average hourly wage

41.7 years. 5.6 years. is $29.03.
Percent of 36% Percent of 37% Percent of

Firms Firms Firms
27% 28% 27%
24%
21% 19%
18% 18%
12% 5% 5% 4%
10% 9%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Monthly Turnover
The monthly turnover rate is defined as the percentage of employees who separate
from their employer, whether for voluntary or involuntary reasons. The total monthly
turnover rate is 3.2 percent, of which 1.8 percent left for voluntary reasons and 1.4
percent left for involuntary reasons.
Twenty percent of all firms in this study have a turnover rate of four percent or higher.
Between the genders, involuntary turnover is fairly similar, but voluntary turnover for
females is slightly higher. By age, turnover is significantly higher among the youngest
workers (<26 years old). Their turnover rate is more than two times higher than any
other age group.
Turnover Rate Turnover by Gender

Average Turnover Rate is 3.2% 3.5%
3.2% 2.0% 3.0%
Percent of Firms
1.8% 1.7%
27% Voluntary
29% 25%
1.4% 1.4% 1.3%

16%
14%
11% Involuntary
6%
All Females Males
% <1 1-2 2-3 3-4 4-5 >5
Employees
Turnover by Age Turnover by Tenure
Voluntary Involuntary Voluntary Involuntary
8.0%
4.6%
5.1%
2.9%
3.7%
3.4% 2.2%
2.2% 2.2%
1.6% 1.5%
1.2% 1.4% 2.2% 1.0% 0.9%
0.9% 0.9% 0.8%
1.5% 0.6% 0.5% 0.5%
1.0% 0.7% 0.8% 0.6% 0.4% 0.4% 0.3%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Monthly Turnover
Observing the turnover rates by sector shows significant differences. The Trade/
Transportation/Utilities sector, which includes retail, exhibits the highest overall
monthly turnover at five percent with Leisure & Hospitality not too far behind at
4.4 percent. The Trade/Transportation/Utilities sector is also the only group in which
the majority of turnover is due to involuntary reasons. It is also noteworthy that
both the Trade/Transportation/Utilities and Leisure & Hospitality industries have the
youngest workforce overall. Examining turnover by company size shows that firms with
5,000 employees or more have the highest monthly turnover, which is mostly due to
involuntary reasons.
1.8% 1.4% 3.2%

Voluntary Turnover Involuntary Turnover Total Turnover
1. Personal 1. Terminated
2. Abandonment, 2. Layoff
another job 3. Seasonal termination
3. Promotion, 4. Misconduct
advancement 5. Low performance
4. Education
5. Retirement
Turnover by Industry Turnover by Company Size
Trade/Transportation/Utilities 2.3% 2.7% 5.0% Voluntary Involuntary

Leisure/Hospitality 3.0% 1.4% 4.4%
4.0%
Construction 2.1% 1.4% 3.5% 1.9%
2.9% 2.9% 3.0%
Professional/Business Services 1.9% 1.2% 3.1%
1.8% 1.9% 1.9%
Information 1.6% 0.9% 2.5%
Education/Health 1.6% 0.8% 2.4% 2.0%
Finance/Insurance 1.4% 0.8% 2.2% 1.1% 1.1%

1.0%
Manufacturing 1.3% 0.8% 2.1%
50-499 500-999 1,000-4,999 5,000+
Voluntary Involuntary
Company size (number of employees)
Span of Control
The span of control is defined as the number of subordinates, or direct reports, that are
under the control of a manager. The average number of direct reports for a manager is
6.9 with 56 percent of firms having an average span of less than seven. The span can
vary based on a variety of factors including job complexity, employee skill level and
organization size.
Span of Control
Average Direct Reports is 6.9
Percent of Firms
39%
23%
17%
10% 4%
7%
1-3 4-6 7-9 10-12 13-15 >15
In more than 60 percent of companies, managers have between

four and nine employees who report to them.
Managers’ Span of Control
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 42% 39% 38% 39% 39% 40%
% Male Managers 58% 61% 62% 61% 61% 60%
Managers’ Percent of Turnover
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Managers’ Turnover 1.0% 0.8% 0.7% 0.6% 0.6% 0.6%
% Direct Reports’
3.5% 2.3% 2.5% 2.7% 2.9% 3.5%
Turnover
Span of Control
Sectors with unskilled workers, where the job functions tend to be routine and relatively
simple, are more likely to have wide spans, as is the case with the Leisure & Hospitality
sector, which has the highest overall span of control at 11.4 directs per manager. On
the contrary, sectors where the job functions are inherently complex and require a high
degree of skill have the narrowest span of control, as is the case for the Finance &
Insurance sector, with the lowest span of control at 5.7 directs per manager. The size of
a company will also impact the span of control, where smaller companies tend to have
more narrow spans and larger companies have much wider spans.
6.9 Total Span of

Control
Span of Control by Industry Span of Control by

Company Size
Leisure/Hospitality 11.4
8.2
Education/Health 8.5
7.0
Construction 7.0 7.6
5.8
Trade/Transportation/Utilities 6.8
Manufacturing 6.8
Professional/Business Services 6.2
Information 6.0
Finance/Insurance 5.7 50-499 500-999 1,000-4,999 5,000+

Company size (number of employees)
Annual Promotion Rate
Offering promotions within an organization is key to retaining and motivating valued

workers. Promotions and accompanying wage increases vary across the sectors. The
Leisure & Hospitality segment has the lowest annual promotion rate of all sectors at 5.8
percent, but has the highest percentage of wage-level increase due to a promotion.
The Information sector exhibits the highest overall promotion rate on an annual basis
at 11.1 percent, with an average promotion wage increase of 17.4 percent. This
6.9 represents a significant increase since salaries in the Information sector reflect some
of the highest hourly wages of all sectors.
Years to first manager
promotion Promotions by Gender
8.4%
Female Male 9.3%
6.6 Female Promotion Rate Promotion Rate
17.4% 17.4%
7.3 Male Wage Increase Wage Increase
Firm Avg. Promotion Rate Firm Avg. Promotion Wage Increase

Average 8.9% Average 17.4%
Percent of Percent of
Firms 29% Firms 30% 31%
26%
24%
16% 15% 14% 13%
2%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%
Promotion Rate Promotion Wage Increase
Promotions by Age
17.4%
Promotion Rate Total Promotion Wage
Wage Increase
Increase
20.3%
12.1% 15.8% Companies between
23.9% 14.0%
7.2%
8.8%
6.0% 16.9%
4.8%
10% 1,000 & 4,900
have the highest
promotion rate
Yrs <26 26-35 36-55 56-65 >65
Firms are more likely to promote internal employees for management positions. Overall,
firms promoted 8.9 percent of employees, while new hires made up a much larger portion
at 30.2 percent. At the supervisory levels, firms promoted more internally than they hired
externally — 17.2 percent of managers are promoted, while 15.6 percent are new hires.
New Hire Rate vs. Promotion Rate
New Hire Rate Promotion Rate

Manager 20.5% 16.7%
Non- w/Directs
32.9% 7.3%
Manager*
1st Level 13.5% 15.5%
Manager† 15.6% 17.2%
2nd Level 15.8% 8.9%

21.9%
Total 30.2% 8.9%
12.5% 30.2% 21.5%
* 67 percent of non-managers are incumbents, those who are not
3rd+ Level
new hires or promotions.
† 84 percent of managers are incumbents, those who are not new
hires or promotions.
New hires are defined as an employee hired within one year.
When comparing companies of differing sizes, those with between 1,000 and 4,999
employees promote their employees at a higher rate (10 percent), compared with all other
company sizes.
Annual Promotion Rate by Company Size Annual Promotion Wage Increase by Company Size
10.0%
8.4% 8.6% 8.5%
17.4% 18.1%
17.3%
16.8%
50-499 500-999 1,000-4,999 5,000+ 50-499 500-999 1,000-4,999 5,000+

Company size (number of employees) Company size (number of employees)
The effect of promotions on turnover within teams of three or more employees was also
analyzed. There does appear to be evidence that promotions can actually increase turnover
rates for other members of a team when another team member is promoted. The voluntary
turnover rate within teams, where at least one employee was promoted, was higher than
those teams where no promotion occurred (13.3 percent versus 12.3 percent, annually).
8.9% Total Promotion

Rate
Annual Promotion Rate by Industry Annual Promotion Wage Increase by Industry
Leisure/Hospitality 5.8% Leisure/Hospitality 30.5%
Trade/Transportation/Utilities 8.7% Trade/Transportation/Utilities 19.0%
Education/Health 7.7% Education/Health 18.2%

Professional/Business Services 8.7% Professional/Business Services 17.7%
Construction 9.7% Construction 17.9%
Information 11.1% Information 17.4%
Finance/Insurance 10.4% Finance/Insurance 16.3%
Manufacturing 10.3% Manufacturing 14.2%
Annual Pre-Promo Wages (/hr) by Industry
Leisure/Hospitality $18
Trade/Transportation/Utilities $23
13.3% VS. 12.3%
Education/Health $25
Professional/Business Services $33

Turnover rate Turnover rate for
Construction $28 for teams with a teams without a
Information $42 promotion promotion
Finance/Insurance $32
Manufacturing $27
Hierarchy
Hierarchy levels within an organization are defined as the “rungs of a ladder” representing
the chain of command from the bottom to the top of an organization. Non-managers make
up the majority of the workforce at 84 percent, while managers account for 16 percent.
Further dissection of the manager pool shows that the majority of managers (51.6
percent) are first-level managers — people who directly supervise only non-managers.
Approximately 27 percent are managers who do not have any direct reports. The remaining
managers, roughly 20 percent, are supervisors of other managers.
Managers’ Hierarchy Level
% of Total Managers $205
$150
84% $42 $116
16% $47/hr
51.6%
$77
$25/hr Managers $43 Hourly wage
$52
Non-Managers 27.7%
14.0% 4.9% 1.1% 0.4% 0.2%

Managers
w/o Directs
First Level
Managers
Second Level
Managers
Third Level
Managers
Fourth Level
Managers
Fifth Level
Managers
Sixth Level
Managers
Gender Mix and Pay Disparity Among Hierarchy Levels
$48 $
$35 77% %
$22
Share 77%
82% $ - Wage difference
$24 85%
$10 81% (average $ per hour
$12 $8 72% 77%
$7 $5 83% male wages more
75% 81% than female wages)
79% 81% 65%
63%
56% 57%
53% 52% % - Wage ratio
(female pay as a
% of male pay)
Share %
Male share of all
employees at this
Managers
w/o Direct
Reports
First Level
Managers
Second Level
Managers
Third Level
Managers
Fourth Level
Managers
Fifth Level
Managers
Sixth &
Plus Level
Managers
level
All
Non-
Managers
Climbing the Hierarchy
Wage in $ Percent of Turnover
Employees Promotions
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 47.3 52.7 29.03 25.20 32.08 3.2 1.9 1.4 8.9 17.4 6.9
6th+ Level 0.04 14.9 85.1 205.26 164.29 212.42 0.6 0.3 0.3 28.5 12.9 7.7
Managers
5th Level
0.1 18.6 81.4 149.92 121.15 156.51 0.7 0.5 0.2 27.4 13.7 7.9
Managers
4th Level
0.2 23.3 76.7 115.69 98.81 120.83 0.7 0.4 0.3 26.7 12.8 7.9
Managers
3rd Level
0.8 35.4 64.6 77.24 61.16 85.20 1.6 0.8 0.7 18.8 13.6 8.0
Managers
2nd Level
2.2 37.3 62.7 52.14 46.15 55.70 1.4 0.8 0.6 21.9 13.2 8.3
Managers
1st Level
8.3 43.1 56.9 41.57 36.76 45.13 1.4 0.8 0.6 15.6 16.9 6.5
Managers
Managers
4.5 44.3 55.7 42.88 36.22 48.02 2.5 1.5 1.0 16.8 15.6 N/A
w/o Directs
Non-
83.9 48.4 51.6 25.28 22.48 27.59 3.6 2.0 1.5 7.3 19.1 N/A
Managers
Report Card for National Firms
Your Firm
National National (enter your statistics
Average (1,000+ Firms) here for comparison)
Age (years) 41.7 41.1
YEARS Tenure (years) 5.6 5.4
Hourly Wages $29.03/hr $28.41/hr
% Managers 16% $47/hr 16% $42/hr

% Non-Managers 84% $25/hr 86% $26/hr
% Male 53% $32/hr 51% $32/hr

% Female 47% $25/hr 49% $25/hr
Monthly Turnover 3.2% 3.4%
Span of Control 6.9 7.9
Annual Promotion 8.9% 7.3%

Rate
Section 5
Industry Deep Dive
Construction
Section 5
Industry Deep Dive Construction
Sectoral Summary Statistics (Averages)
Construction is a relatively small sector comprised primarily of small businesses

with fewer than 50 employees. Construction work is highly seasonal, with peak
employment during the summer months. Investment in public infrastructure and
rebuilding after natural disasters can dramatically boost demand for skilled and
unskilled construction workers within specific geographic areas.
It is important to note that the current opioid epidemic in the United States has
had a substantial impact on the construction sector, creating significant shortages
of workers in some locations. Wages within the sector are slightly above average
compared with the overall labor market, with hourly wages averaging just under
$29 per hour. Notably, wages are growing faster in construction than in all other
industries. Males represent 74 percent of the construction workforce and, on average,
earn $5 more per hour than females within the sector.
Hourly Wages $28.71

% Male 74% $30
% Female 26% $25

41.8 years 4.8 years is $28.71
Percent of Percent of 49% Percent of

44%
Firms Firms Firms
28% 29% 24% 24% 22% 22%
5% 8%
14% 2% 14% 3% 1%
10%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Section 5
Monthly Turnover
Monthly turnover within the construction sector is moderately high, compared with all
other sectors, at 3.5 percent total turnover each month.
Males have a higher rate of turnover than females for both voluntary and involuntary
purposes.
Turnover by age is highest for those under the age of 26; however, overall turnover
decreases with time. When considering tenure, turnover is highest for those with
fewer than four years on the job. Turnover sharply decreases with more than four
years’ tenure.

Average Turnover Rate is 3.5% 3.5% 3.6%
Percent of Firms 3.2% 2.2%
2.1%
1.9%
Voluntary
29%
23%
20% 21%
16% 1.4% 1.5%
1.3%
12% Involuntary
8%
All Females Males
% <1 1-2 2-3 3-4 4-5 >5 Employees

7.1%
4.9% 5.1%
4.2% 3.1%
2.6%
2.8% 2.8%
2.2%
1.5% 1.5%
2.1% 2.1% 1.6%
1.0% 1.2% 1.1%
1.6% 0.9% 0.8%
1.3% 1.2% 1.3% 0.7% 0.6% 0.4%
0.7% 0.5% 0.5% 0.4%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Section 5
Span of Control
The average span of control within the construction Span of Control

industry averages seven direct reports per manager.
Average Direct Reports is 7.0
Percent of Firms
Managers with high spans of control are more likely to
36%
be males than females, whereas low spans tend to be
females when comparing to the overall gender mix. 19%
24%
Employee turnover tends to be higher when a manager’s
span of control is 10 or more employees. 11%
6%
4%
1-3 4-6 7-9 10-12 13-15 >15
In more than 60 percent of companies, managers have between four and

nine employees who report to them.
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 35% 26% 23% 23% 19% 20%
% Male Managers 65% 74% 77% 77% 81% 80%

Reports 1-3 4-6 7-9 10-12 13-15 >15
% Direct Reports’
3.7% 3.0% 2.7% 3.4% 3.4% 3.7%
Turnover
Section 5
Promotions within the construction sector average 9.7 percent annually — with an
average wage increase of 17.9 percent due to a promotion.
Males have an advantage when it comes to promotion rates, but women receive a slightly
higher wage increase when a promotion takes place.
Promotion rates peak between the ages of 26 and 35 years of age and decrease steadily
after that point. The time it takes for a non-manager to reach the manager level within a
construction firm averages 6.4 years.
6.4
Construction firms fill their management roles more via promotions than hiring external
candidates — where promoted managers make up 18.2 percent of all managers, and new
hires make up only 15.5 percent of the manager pool.
9.1%
Female Male 9.9%
18.2% 17.8%

Percent of Firms 36% Percent of Firms
33%
29%
23% 25%
22% 10% 9%
11%
2%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%
Promotions by Age New Hire Rate vs. Promotion Rate
Promotion Rate Wage Increase New Hire Rate Promotion Rate
Non-manager* 34.0% 7.9%

20.9%
23.5% 16.5% Manager† 15.5% 18.2%
12.5%
8.5% 9.6% 14.6% 14.9%
Total 30.9% 9.7%
6.4% 4.9%
* 58 percent of non-managers are incumbents, those who are not new hires or promotions.
Yrs <26 26-35 36-55 56-65 >65 † 66 percent of managers are incumbents, those who are not new hires or promotions.
Section 5
Climbing the Construction Ladder
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 25.6 74.4 28.71 25.17 29.83 3.5 2.1 1.4 9.7 17.9 7.0
6th+ Level 0.04 9.1 90.9 188.69 176.15 189.76 1.3 0.0 1.3 13.2 15.1 7.8
Managers
5th Level
0.1 6.6 93.4 154.43 108.43 157.72 0.0 0.0 0.0 21.1 17.2 6.8
Managers
4th Level
0.2 13.3 86.7 117.51 94.35 120.98 1.1 0.3 0.8 26.8 15.8 7.6
Managers
3rd Level
0.6 16.5 83.5 94.18 80.51 96.82 0.6 0.4 0.3 19.4 13.1 8.3
Managers
2nd Level
2.0 22.9 77.1 61.52 55.17 63.39 1.0 0.5 0.5 28.4 11.6 9.0
Managers
1st Level
7.6 31.9 68.1 44.14 37.62 47.11 1.2 0.7 0.6 16.2 20.1 6.3
Managers
Managers
6.8 26.6 73.4 40.88 33.94 43.27 3.1 1.9 1.2 17.3 15.0 N/A
w/o Directs
Non-
82.7 25.2 74.8 24.53 21.62 25.41 3.8 2.3 1.6 7.9 19.8 N/A
Managers
Section 5
Report Card for Construction Firms
Your Firm
Construction Construction (enter your statistics
Age (years) 41.8 41.3
% Managers 17% $48/hr 21% $47/hr

% Male 74% $30/hr 69% $30/hr

% Female 26% $25/hr 31% $25/hr

Rate
Section 5
Industry Deep Dive
Education & Health

Section 5
Industry Deep Dive Education & Health
The Education & Health sector is labor-intensive relative to other industries, with
the majority of services delivered by a fairly narrow band of well-defined job roles,
including teachers, physicians, nurses and support staff. A significant portion of this
sector is employed through not-for-profit and government entities, and bargaining
units may represent key job classes.
Because payroll costs for employers in this sector often exceed 60 percent of total
operating costs, employers within this sector tend to be more sensitive to wage
variation than other sectors. The workforce in this sector is dominated by women, who
make up close to 75 percent of all workers. Even though males make up only 25 percent
of this sector, they have a significant advantage in hourly pay, making $34 per hour
versus $25 for women, which represents a 36 percent difference. Overall, the average
pay within the sector is slightly lower compared to other industries at $27 per hour.
Hourly Wages $27.03

% Male 36% $34
% Female 74% $25

Percent of 44% Percent of Percent of

Firms Firms 41% Firms
31% 32%
25% 24% 26%
17% 8% 17% 7% 19% 5%
1% 2% 2%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Section 5
Monthly Turnover
The average monthly turnover rate within the Education & Health industries is 2.4
percent, which is among the lowest of all industries in this study.
Females exhibit a higher turnover rate than males, leaving at a rate of 2.5 percent,
whereas turnover for males is 2.2 percent each month.
Turnover in the Education & Health sector is significantly higher for younger workers.
For those age 26 or younger, the turnover rate is 4.5 percent. However for those age
26 and up, the turnover rate is three percent or less.
When looking at the turnover rate compared with the length of time on the job,
rates for workers with fewer than four years of tenure are significantly higher at 3.6
percent versus 1.1 percent for those with four years or more of tenure.

Average Turnover Rate is 2.4%
2.4% 2.5%
Percent of Firms 2.2%
1.6% 1.7%
1.4%
31%
Voluntary
26%
29%
18%
0.8% 0.8% 0.8%
Involuntary
10% 9%
6%
All Females Males
% <1 1-2 2-3 3-4 4-5 >5 Employees

4.5% Voluntary Involuntary Voluntary Involuntary
3.2%
3.6%
2.9% 2.4%
2.0%
1.9% 1.9%
1.5% 1.5% 0.7%
1.2% 1.3%
0.9% 0.9% 1.1% 1.0% 0.4%
1.3% 1.2% 0.6% 0.3%
0.9% 0.5%
0.7% 0.7% 0.6% 0.6% 0.5%
0.5%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Section 5
Span of Control
The average span of control for managers in the

Education & Health fields is 8.5 directs, which is Span of Control
among the highest, second only to the Leisure & Average Direct Reports is 8.5
Hospitality sector. This is consistent with job roles in Percent of Firms
this sector being well-defined and able to be performed

semiautonomously. 28%
26%
Turnover rates do not vary greatly among employees

with high or low spans of control, as seen in some 14% 13%
10%
industries. Employees of managers with a span of one 7%
to three direct reports have the highest turnover rates
1-3 4-6 7-9 10-12 13-15 >15
among the cohorts at 2.7 percent. Employee turnover
remains relatively flat under those managers who have In more than 50 percent of companies, managers have between four and
four or more direct reports.
Managers with a low span of control (between one and

three direct reports) are slightly more likely to turn over
compared to managers with a higher number of reports.
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 65% 66% 67% 69% 72% 74%
% Male Managers 35% 34% 33% 31% 28% 26%
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Direct Reports’
2.7% 2.1% 2.1% 2.2% 2.1% 2.3%
Turnover
Section 5
The average promotion rate in this sector is 7.7 percent, which ranks second lowest among
the industries studied. When a promotion does take place, the average wage increase is 18
percent. Because management overhead is low in this sector, there are likely to be fewer
supervisory positions available for front-line workers.
As gender relates to promotions, males exhibit a slightly higher promotion rate compared to
females, but both genders have very similar promotion wage increases.
Regarding age, promotion rates peak during the ages of 26 to 35. Wage increases are the
6.9 highest at the age of 35 or lower and remain very flat after 35 years of age.

7.5%
Female Male 8.1%
18.3% 18.1%

Percent of Firms 36% Percent of Firms
33%
29%
22% 23% 25%
10% 9% 11%
2%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%

Non-Manager* 30.2% 6.4%
19.8% Manager† 14.3% 16.9%

17.1%
24.8% 10.0% 17.0%
7.7% 17.1%
Total 28.2% 7.7%
6.4% 5.7% 4.9%
Section 5
Climbing the Education & Health Ladder
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 73.8 26.2 27.03 24.66 33.53 2.4 1.6 0.8 7.7 18.2 8.5
6th+ Level 0.03 34.8 65.2 168.55 132.30 187.85 0.0 0.0 0.0 25.4 10.0 7.9
Managers
5th Level
0.1 42.2 57.8 118.80 98.57 133.64 0.7 0.3 0.3 28.2 14.3 8.1
Managers
4th Level
0.2 49.0 51.0 93.12 80.82 104.91 0.5 0.3 0.2 27.5 14.5 9.8
Managers
3rd Level
0.5 57.3 42.7 71.73 61.98 84.72 0.9 0.6 0.3 23.5 13.4 9.7
Managers
2nd Level
1.6 66.4 33.6 49.28 44.68 58.34 1.4 0.8 0.6 23.8 13.2 10.7
Managers
1st Level
6.9 71.1 28.9 36.89 34.16 43.48 1.5 0.8 0.7 15.0 18.0 7.9
Managers
Managers
3.5 67.2 32.8 39.61 34.62 49.64 2.4 1.6 0.8 15.9 15.0 N/A
w/o Directs
Non-
87.1 74.6 25.4 24.57 22.75 29.77 2.5 1.7 0.9 6.4 20.1 N/A
Managers
Section 5
Report Card for Education & Health Firms
Education & Education & Your Firm

Health Health (enter your statistics
Age (years) 42.4 42.3
% Managers 13% $42/hr 13% $42/hr

% Male 36% $34/hr 25% $34/hr

% Female 74% $25/hr 75% $25/hr

Rate
Section 5
Industry Deep Dive
Finance & Insurance

Section 5
Industry Deep Dive Finance & Insurance
The Finance & Insurance sector employs a broad range of workers, including highly paid
IT, financial, sales and actuarial professionals, as well as workers in customer service
and office administration. With direct accountability for assets under management,
the integrity and reliability of workers in this sector is critical. Employees may require
specific background checks and/or licensure to hold specific jobs.
While women make up 56 percent of all workers in this sector, the finance sector also
exhibits the second-largest gender pay gap of any industry at $13 per hour, similar to
the gap in the Information industry. Average hourly wages track with the overall labor
market, while the average age in this sector is slightly higher at 43.2 years.
Hourly Wages $32.88

% Male 44% $40
% Female 56% $27

Percent of Percent of Percent of

42%
Firms 34% Firms Firms
32%
29%
20% 22% 22%
19% 16% 5% 5%
13% 14%
10% 9% 9%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Section 5
Monthly Turnover
Monthly turnover within the Finance & Insurance sector ranks among the lowest compared
with all industries, with 60 percent of all firms having a turnover rate of two percent or less.
Low turnover is consistent with an industry that values employee reliability.
Like other sectors, employee turnover declines with age and tenure. Younger workers,
age 25 or less, are over two times more likely to turn over than any other age group in
this sector.
When looking at length of time on the job, workers with fewer than four years of
tenure are over three times more likely to turn over compared with those who have
four or more years of tenure.
Both females and males in the Finance & Insurance sector experience turnover at an
equal rate (2.2 percent per month).

Percent of Firms 2.2% 2.2% 2.2%
1.4% 1.4% 1.3%
32%
28% Voluntary
29%
16% 0.8% 0.8% 0.9%

Involuntary
10%
8%
6%
All Females Males
% <1 1-2 2-3 3-4 4-5 >5 Employees

5.4%
3.8%
3.4%
2.2%
2.6%
1.7% 2.0%
1.6%
1.4% 1.3% 1.3%
1.6% 0.9% 0.9% 0.8%
0.8% 1.2% 0.8% 0.7%
0.9% 0.6% 0.4% 0.4%
0.7% 0.6% 0.7% 0.5% 0.4%
0.4% 0.3%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Section 5
Span of Control
The span of control within the Finance & Insurance areas

ranks the lowest of all industries. This may be due to both Span of Control
the complexity of job functions within the sector, as well Average Direct Reports is 5.7
as the need to sign off on decisions involving the control, Percent of Firms
investment and disbursement of money.

61%
Managerial span of control does not appear to have an

impact on employee turnover rates.
While employees of managers with 15+ direct reports 16% 16% 4% 2% 1%

show somewhat higher turnover rates, employees of
1-3 4-6 7-9 10-12 13-15 >15
managers at all other levels of span of control have very
similar turnover rates. In more than 60 percent of companies, managers have between four and
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 52% 51% 49% 50% 50% 48%
% Male Managers 48% 49% 51% 50% 50% 52%
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Direct Reports’
2.2% 1.9% 2.0% 2.0% 2.2% 2.5%
Turnover
Section 5
The average promotion rate within this sector is 10.4 percent, with an average wage
increase of 16.3 percent when a promotion occurs.
Regarding gender, males have a slight advantage over women in obtaining a promotion
in this sector, and males are more likely to have a larger wage increase upon receiving a
promotion.
Promotion rates are highest between the ages of 26 and 35 and decrease over time. Wage
increases due to a promotion are highest at age 25 or less and decrease over time.
7.1
The average length of time a non-manager must wait for a first promotion into
management is 7.1 years, which is among the longest of all industries.

10.1% Male 10.7%
Female
15.8% 16.7%

Percent of Firms Percent of Firms
35%
29%
27% 26%
24%
19%
16% 14%
10% 2%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%


19.2%
15.3% Manager† 14.3% 18.1%
22.0% 14.5%
10.2% 12.7% 15.4%
8.2%
7.0% Total 28.1% 10.4%
6.2%
Section 5
Climbing the Finance & Insurance Ladder
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 56.3 43.7 32.88 27.36 39.80 2.2 1.4 0.8 10.4 16.3 5.7
6th+ Level 0.07 14.4 85.6 231.10 201.99 236.03 0.3 0.1 0.1 32.9 11.0 7.7
Managers
5th Level
0.1 20.3 79.7 165.16 134.17 173.12 0.6 0.5 0.1 30.5 10.8 7.7
Managers
4th Level
0.3 28.9 71.1 126.11 104.59 134.89 0.3 0.2 0.1 28.4 11.8 7.4
Managers
3rd Level
1.1 33.3 66.7 91.69 73.56 100.82 0.5 0.3 0.2 22.6 13.2 6.9
Managers
2nd Level
3.0 46.6 53.4 64.04 51.56 74.91 0.8 0.5 0.3 23.1 12.7 6.5
Managers
1st Level
9.7 55.5 44.5 45.69 37.96 55.32 0.9 0.5 0.4 17.0 16.3 5.3
Managers
Managers
5.7 50.4 49.6 45.33 36.34 54.38 2.4 1.5 0.9 15.8 16.6 N/A
w/o Directs
Non-
80.0 57.6 42.4 27.47 24.01 32.04 2.4 1.5 0.9 6.4 20.1 N/A
Managers
Section 5
Report Card for Finance & Insurance Firms
Finance & Finance & Your Firm

Insurance Insurance (enter your statistics
Age (years) 43.2 43.5
% Managers 20% $54/hr 18% $50/hr

% Male 44% $40/hr 43% $39/hr

% Female 56% $27/hr 57% $27/hr

Rate
Section 5
Industry Deep Dive
Information
Section 5
Industry Deep Dive Information
The Information sector employs primarily highly skilled workers. Competitive

advantage is driven by short product cycle times and high reliability, rather than
low margins. Competition for talent between start-up ventures and established
business is extreme. However, the Information sector is more likely to outsource
all nonessential activities, employ high-wage temporary contractors and support
employment in remote locations through network infrastructure. As a result, this
sector has the highest average wages at $41/hour, but less variation in pay/skill sets
than other sectors.
The gender pay gap represents the largest pay difference among the industries in this
report, with a $15 per hour gap favoring male workers. Information workers also tend to
be younger compared to other sectors with an average age of just under 41 years old.
Hourly Wages $41.11

% Male 59% $47
% Female 41% $32


Firms Firms Firms
36% 34%
25% 24% 24% 21%
21% 21% 18%
15% 7% 5% 13%
12% 13% 10%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Section 5
Monthly Turnover
The average total turnover rate within the Information industry is 2.5 percent.
However, the data does not reflect the extensive use of highly skilled temporary
workers.
Turnover rates vary only slightly between males and females, with rates of 2.6
percent and 2.4 percent, respectively. The small difference stems from voluntary
turnover, where men have a slightly higher rate than women.
Younger workers, age 25 or less, are over two times more likely to turn over than any
other age group within the Information sector.
Workers with fewer than four years of tenure are over two times more likely to turn
over compared with those who have four or more years of tenure.

Average Turnover Rate is 2.5% 2.5% 2.6%
2.4%
1.5%
29% Voluntary
27%
29%
16% 0.9% 0.9% 0.9%

12% Involuntary
9%
6%
All Females Males
% <1 1-2 2-3 3-4 4-5 >5 Employees

6.4%
4.7%
3.6%
2.6% 2.4%
1.0% 0.8%
1.7% 1.8% 1.9% 0.6%
1.5% 1.5% 0.5%
1.0% 1.2%
1.6% 1.2% 0.9% 0.4%
0.8% 0.3%
1.2% 0.7%
0.8% 0.8% 0.7% 0.7% 0.5% 0.5%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Section 5
Span of Control
Most Information firms have an average span of control

Span of Control
of four to six direct reports per manager. This short
span likely reflects the close supervision and teamwork Average Direct Reports is 6.0
required to develop and support complex products and Percent of
54%
Firms
services.
Female managers are more likely to have either very low or

very high spans of control (fewer than four or more than 15
employee direct reports). 19%
17%
3% 3%
While manager turnover decreases with an increasing 5%
1-3 4-6 7-9 10-12 13-15 >15
span of control, the turnover rate for their corresponding
subordinates increases steadily as the manager’s span In 90 percent of companies, managers have nine or fewer employees
increases. who report to them.

Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 39% 33% 31% 32% 31% 41%
% Male Managers 61% 67% 69% 68% 69% 59%
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Direct Reports’
2.0% 2.4% 2.4% 2.8% 3.0% 3.5%
Turnover
Section 5
At 11.1 percent, Information firms are more likely to promote from within to fill manager
positions. This is the highest among all industries and suggests that prior knowledge of
the employer’s proprietary technology and working culture are important attributes for
managerial positions.
The average wage increase due to a promotion is 17 percent, which is squarely in the
middle of other industries on a percentage basis. However, because wages for Information
jobs are already high, this results in the largest increase in pay in absolute dollars ($7/hour)
among all sectors.
5.7 Males tend to be promoted more often than females, but females receive a slightly higher
wage increase when given a promotion.
10.1% Male 11.8%
Female
17.9% 17.2%

32%
27% 27%
25%
20% 23%
18%
16%
9% 2%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%


20.0%
16.5% 15.5%
26.0% Manager† 15.1% 20.0%
10.3%
8.0% 12.7%
13.1% Total 26.4% 11.1%
5.4%
3.7%
Section 5
Climbing the Information Ladder
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 41.4 58.6 41.11 32.07 46.85 2.5 1.6 0.9 11.1 17.4 6.0
6th+ Level 0.05 12.4 87.6 210.56 152.65 218.74 1.3 1.3 0.0 32.7 21.7 7.8
Managers
5th Level
0.1 15.1 84.9 170.64 123.37 178.97 0.2 0.2 0.0 29.0 18.4 7.7
Managers
4th Level
0.3 19.2 80.8 133.84 117.29 137.81 1.6 0.9 0.8 28.4 15.7 6.8
Managers
3rd Level
0.9 27.3 72.7 93.87 78.98 99.51 1.1 0.6 0.5 24.3 13.5 6.6
Managers
2nd Level
2.5 36.3 63.7 66.22 57.15 71.45 1.3 0.6 0.7 24.7 13.6 6.9
Managers
1st Level
7.8 39.2 60.8 50.94 45.45 54.47 1.3 0.7 0.7 18.6 17.2 5.5
Managers
Managers
7.5 39.6 60.4 47.87 41.07 52.28 2.6 1.6 1.0 18.9 14.1 N/A
w/o Directs
Non-
80.9 42.3 57.7 37.39 28.43 43.14 2.6 1.7 0.9 9.1 18.9 N/A
Managers
Section 5
Report Card for Information Firms
Your Firm
Information Information (enter your statistics
Age (years) 40.9 41.0
% Managers 19% $56/hr 15% $49/hr

% Male 59% $47/hr 58% $48/hr

% Female 41% $32/hr 42% $31/hr

Rate
Section 5
Industry Deep Dive
Leisure & Hospitality

Section 5
Industry Deep Dive Leisure & Hospitality
The Leisure & Hospitality sector includes hotels, restaurants, amusement parks and
theaters, as well as other businesses related to arts, entertainment and recreation. This
sector has the youngest workers (at an average age of 38) and the lowest wages (at
an average hourly wage of $17) among all sectors. Leisure & Hospitality jobs are often
seasonal in nature, and staffing depends on varying levels of demand — sometimes even on
a daily basis. As a result, 60 percent of all jobs within this sector are part-time positions, and
many of these jobs are subject to fluctuating work schedules. These attributes contribute
to the high turnover rate within the industry at 4.4 percent per month.
While the Leisure & Hospitality sector has experienced substantial job growth in the United
States over the past decade, key labor pools for part-time workers (e.g., 16- to 24- year-old
workers) have shrunk compared to 10 years ago, creating potential labor shortages.
Hourly Wages $18.15

% Male 49% $20
% Female 51% $16
Average age is Average tenure is 72% Average hourly wage

65% 37.5 years 4.0 years is $18.15

Firms 41% 39% Firms Firms
5% 19% 5%
16% 3% 15% 4% 3%
11% 1% 1% 1%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Section 5
Monthly Turnover
The average monthly turnover rate within the Leisure & Hospitality industry is 4.4
percent. However, a significant portion of all firms, 31 percent of the industry, have
an average turnover rate of over five percent.
Between the genders, turnover is fairly similar, with males leaving at a slightly higher
rate of 4.5 percent versus 4.3 percent for women.
The turnover rate for workers with fewer than four years of tenure is six percent
versus 1.2 percent for those with four years or more of tenure.

Average Turnover Rate is 4.4% 4.4% 4.3% 4.5%
3.0%
31%
Voluntary
29%
20%
15% 1.4% 1.3% 1.5%
12% 11% Involuntary
10%
All Females Males

% <1 1-2 2-3 3-4 4-5 >5 Employees

7.3%
5.2%
6.0%
4.2%
4.9%
3.4%
2.8%
0.9% 0.7%
1.9% 1.8% 1.7%
1.8% 0.5%
2.2% 1.2% 0.4%
1.1% 1.2% 1.8% 1.1% 0.4%
1.5% 0.3%
1.0% 0.7%
0.6% 0.6% 0.6% 0.5%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Section 5
Span of Control
The span of control within the Leisure & Hospitality

Span of Control
sector averages 11.3 direct reports for each manager,
which is the highest among all industries. A high span Average Direct Reports is 11.4
of control is often observed in organizations with large Percent of Firms
numbers of entry-level workers performing well-defined 24%

uniform tasks. 21% 20%
Managers with a low span of control (between one and 14% 14%
three reports) are more likely to turn over compared to

7%
managers with higher spans.
1-3 4-6 7-9 10-12 13-15 >15

Employees of managers with a span of one to three
direct reports have the highest turnover rates among In 65 percent of companies, managers have nine or fewer employees
cohorts at 4.5 percent. Turnover increases at each who report to them.
level beyond four to six direct reports, which is to be

expected.
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 45% 39% 39% 40% 40% 41%
% Male Managers 55% 61% 61% 60% 60% 59%
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Direct Reports’
4.5% 3.4% 3.9% 4.2% 4.5% 4.5%
Turnover
Section 5
The firm average promotion rate is 5.8 percent within the Leisure & Hospitality sector,
which is the lowest rate among the industries in this report. This is consistent with
having a high span of control, meaning there are fewer available supervisory positions
per employee.
The wage increase due to a promotion is over 30 percent, which is the highest of all
industries, but since Leisure & Hospitality wages are also the lowest, it only represents
a modest dollar increase.
4.9 Males in this sector have a slightly higher promotion rate than females. However,
males have a much larger advantage when receiving a wage increase due to a
promotion (34.8 percent for men versus 24.8 percent for women).
5.6%
Female Male 5.9%
24.8% 34.8%

44% 63%
31%
14% 0.5% 0.5% 6% 18%

2% 12%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%

48.0%
7.7% 21.4%
33.5% 6.0% 17.8% Manager† 15.4% 16.2%
4.7% 19.5%
4.1%
3.4% Total 5.8%
36.9%
Section 5
Climbing the Leisure & Hospitality Ladder
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 50.7 49.3 18.15 16.20 19.98 4.4 3.0 1.4 5.8 30.5 11.4
6th+ Level 0.02 15.3 84.7 209.89 166.97 217.81 0.0 0.0 0.0 27.9 24.8 9.0
Managers
5th Level
0.0 24.2 75.8 144.03 114.57 153.60 0.5 0.5 0.0 24.1 19.8 8.5
Managers
4th Level
0.1 24.7 75.3 101.54 85.22 106.94 0.6 0.4 0.2 23.6 14.0 8.0
Managers
3rd Level
0.7 40.1 59.9 49.12 37.15 56.63 1.0 0.4 0.6 11.1 15.8 9.0
Managers
2nd Level
1.5 39.8 60.2 41.80 37.19 44.82 1.6 1.0 0.6 21.5 20.4 11.4
Managers
1st Level
6.1 47.2 52.8 31.16 28.16 33.81 2.2 1.3 0.9 16.0 27.7 11.7
Managers
Managers
3.8 48.0 52.0 28.81 25.84 31.48 2.9 1.9 1.0 15.1 28.9 N/A
w/o Directs
Non-
87.7 51.3 48.7 14.98 13.77 16.15 4.7 3.3 1.4 4.3 37.9 N/A
Managers
Section 5
Report Card for Leisure & Hospitality Firms
Leisure & Leisure & Your Firm

Hospitality Hospitality (enter your statistics
Age (years) 37.5 38.0
% Managers 12% $34/hr 14% $32/hr

% Male 49% $20/hr 47% $19/hr

% Female 51% $16/hr 53% $15/hr

Rate
Section 5
Industry Deep Dive
Manufacturing
Section 5
Industry Deep Dive Manufacturing
The Manufacturing sector has undergone a transformation in recent years due to investments in automation,
artificial intelligence and logistics, all of which have allowed for increased productivity. In this sector, managing
hourly labor costs has become less of a priority than attracting and retaining highly skilled workers who are capable
of leveraging sophisticated new technologies.
Manufacturing workforces are more likely to be characterized by stable, well-paid and highly skilled workers.
Manufacturing workers tend to be older males with an average tenure of eight years with the same company and
average earnings of more than $29 per hour. The Manufacturing sector hires fewer younger workers annually
than other sectors; however, turnover tends to be lower due to the specialized training required for proficiency
within each specific factory setting and the prevalence of unions in this sector. Manufacturing jobs are primarily
concentrated in the south and mid-west regions of the United States where locations of facilities are more likely to
be dispersed over wide areas rather than concentrated in one location.
Hourly Wages $29.34

% Male 69% $31
% Female 31% $26


Firms Firms Firms
30% 32%
26% 26%
19% 21% 22%
15% 18% 6%
11% 9% 12% 3% 3%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Section 5
Monthly Turnover
Turnover rates within Manufacturing are the lowest among all industry sectors with
an average monthly turnover rate of 2.2 percent.
The majority of Manufacturing companies (57 percent) have an average monthly

turnover rate of less than two percent.
Turnover in the Manufacturing sector is closely associated with employee age and
tenure. Turnover incidence reduces from 6.3 percent for employees, age 25 years
or younger, to 2.8 percent for employees in the 26-to-35-year age band. Similarly,
turnover declines by more than 50 percent after three years of service.
Turnover rates, both voluntary and involuntary, are statistically similar between
women and men.

Percent of Firms
2.4%
2.2% 2.1%
1.5% 1.3%
1.3%
Voluntary
29%
29% 28%
0.8% 0.9% 0.8%
17%
Involuntary
10% 10%
5%
All Females Males
% <1 1-2 2-3 3-4 4-5 >5 Employees

6.3% 3.7%
4.0% 2.3%
2.8% 2.7%
1.4%
1.7% 2.1% 1.0%
2.3% 1.6% 1.4% 0.8% 0.9%
1.2% 0.8%
0.9% 0.6% 0.5%
0.7% 0.6% 0.5%
1.0% 0.7% 0.6% 0.4%
0.5% 0.4% 0.3%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Section 5
Span of Control
The average span of control for Manufacturing managers

Span of Control
is 6.8 direct reports per manager, with more than
60 percent of companies having an average span of Average Direct Reports is 6.8
between four and nine. This number is similar when Percent of Firms
36%
compared with other industries.
28%
16%
12%
4% 4%
1-3 4-6 7-9 10-12 13-15 >15


Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 29% 23% 19% 18% 16% 16%
% Male Managers 71% 77% 81% 82% 84% 84%
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Direct Reports’
2.0% 2.0% 2.0% 2.2% 2.2% 2.6%
Turnover
Section 5
Internal promotion rates for Manufacturing are among the highest rates across all sectors
at 10 percent overall. In fact, more than 60 percent of manufacturers exceed the 10
percent promotion rate.
Promotion rates are highest between the ages of 26 and 35 — at 14 percent.
The average time to a first promotion is one of the longest among all industries at over nine
years, with female workers being promoted slightly sooner than males.
9.4 The percentage of male workers who are promoted versus female workers is consistent
with the overall percentage of men and women employed in the sector as a whole.
10.0% Male 10.4%
Female
14.6% 14.1%

41%
30%
25%
19% 18% 22%
17% 18%
9% 2%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%
16.9% Non-Manager* 26.0% 8.6%

14.3% 13.5%
19.8% Manager† 15.0% 19.1%
9.6% 10.4% 11.0%
12.3%
6.6% Total 24.3% 10.3%
4.9%
Section 5
Climbing the Manufacturing Ladder
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 30.5 69.5 29.34 26.04 30.70 2.2 1.3 0.8 10.3 14.2 6.8
6th+ Level 0.04 7.7 92.3 219.42 166.79 223.81 1.0 0.3 0.7 28.6 12.2 7.8
Managers
5th Level
0.1 7.5 92.5 160.39 143.52 161.76 0.9 0.6 0.3 26.1 12.1 7.6
Managers
4th Level
0.2 10.8 89.2 120.26 116.06 120.77 0.9 0.3 0.5 24.8 12.1 7.6
Managers
3rd Level
1.0 27.0 73.0 73.22 55.87 78.72 3.1 1.1 2.0 17.1 13.0 7.3
Managers
2nd Level
2.1 23.2 76.8 60.78 55.76 62.31 1.0 0.5 0.5 23.1 11.8 7.5
Managers
1st Level
8.2 27.8 72.2 46.82 43.78 47.94 1.2 0.8 0.4 17.7 12.8 6.5
Managers
Managers
4.4 29.3 70.7 45.46 41.05 47.24 2.3 1.4 0.9 19.8 11.9 N/A
w/o Directs
Non-
83.9 31.2 68.8 25.28 22.88 26.29 2.3 1.4 0.9 8.6 15.7 N/A
Managers
Section 5
Report Card for Manufacturing Firms
Your Firm
Manufacturing Manufacturing (enter your statistics
Age (years) 44.5 44.5
% Managers 16% $52/hr 17% $49/hr

% Male 69% $31/hr 69% $32/hr

% Female 31% $26/hr 31% $27/hr

Rate
Section 5
Industry Deep Dive
Professional & Business

Services
Section 5
Industry Deep Dive Professional & Business Services
Professional & Business Services include a broad array of advisory and administrative
services with a diverse mix of high-paid skilled and low-paid unskilled jobs. The term
“services” includes both high-margin businesses such as legal services, consulting
and risk management, as well as routine support services such as security, property
management, janitorial and BPO services. A key differentiator is that firms within this
sector offer their services primarily to other businesses rather than consumers.
While average wages within this sector are among the highest at $35 per hour, there
is also higher variation in wages to accommodate the diverse mix of skills represented
within this sector. This broad variation should be considered carefully when comparing
the organizational metrics of individual firms to the overall averages represented
within the sector. Interestingly, more than 60 percent of this sector is composed of
employers with more than 500 employees.
Hourly Wages $35.32

% Male 55% $39
% Female 45% $30


Firms 39% Firms Firms
32%
27% 23% 21%
22% 22% 23%
8% 8% 16% 19%
16% 3% 12% 10%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Section 5
Monthly Turnover
The average total monthly turnover rate within the Professional & Business Services
sector is 3.1 percent. Approximately 51 percent of firms have a turnover rate of two
percent or less.
The turnover rate for female workers is significantly higher than for male workers
(3.4 percent vs. 2.9 percent), which can be attributed to the difference in voluntary
turnover where women leave their employer at a rate of 2.1 percent compared to men
at 1.7 percent.
The turnover rate for workers with fewer than four years of tenure is 4.5 percent
versus 1.2 percent for those with four years or more of tenure.
Workers within the Professional & Business Services sector are more likely to leave
their jobs for voluntary versus involuntary reasons.

Percent of Firms
3.1% 2.1%
2.9%
1.9%
1.7%
Voluntary
26% 25%
16% 16% 1.3% 1.2%

1.2%
11% Involuntary
6%
All Females Males
% <1 1-2 2-3 3-4 4-5 >5 Employees

4.7%
4.5%
2.7%
3.6%
2.3%
2.4%
1.9% 2.0% 0.9%
2.4% 1.4% 1.6% 0.7%
1.2% 1.8% 1.2% 0.5%
1.0% 0.4%
1.4% 1.0% 0.4%
1.1% 0.7% 0.3%
0.9% 0.8% 0.6% 0.5%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Section 5
Span of Control
The average span of control for a manager in the

Span of Control
Professional & Business Services sector is 6.2 direct
reports per manager. Average Direct Reports is 6.2
Percent of Firms
Males make up a larger share of the total managers 43%
within the sector and are more likely to manage more 20%
direct reports than females. 19%
While manager turnover generally decreases as the

8%
number of their direct reports increases, employee 7%
turnover tends to increase when their manager’s span 3%
1-3 4-6 7-9 10-12 13-15 >15
of control is 10 or more employees.

Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 41% 36% 34% 35% 35% 36%
% Male Managers 59% 64% 66% 65% 65% 64%
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Direct Reports’
3.4% 2.2% 2.3% 2.4% 2.5% 3.4%
Turnover
Section 5
Across all firms in the Professional & Business Services industry, the average
promotion rate is 8.7 percent.
Males have a slightly higher rate of promotion within this sector at 8.9 percent versus
8.5 percent for females. Males also see a slightly higher wage increase upon promotion
at 18.0 percent versus 17.1 percent for females.
Males and females both wait an average of roughly six years to reach their first
5.9 managerial promotion. This number is consistent with formal development tracks
often found in professional service firms.

8.5%
Female Male 8.9%
17.1% 18.0%

32%
26% 25% 26%
24%
18%
15% 16% 15%
3%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%


18.9%
12.0% 16.2% Manager† 18.8% 15.5%
24.0% 17.0%
8.3% 22.9%
6.9% Total 32.0% 8.7%
5.6% 4.7%
Section 5
Climbing the Professional & Business
Services Ladder
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 45.0 55.0 35.32 30.37 39.11 3.1 1.9 1.2 8.7 17.7 6.2
6th+ Level 0.04 15.5 84.5 188.30 159.28 193.61 0.5 0.2 0.3 24.6 13.2 7.8
Managers
5th Level
0.1 17.5 82.5 143.66 126.09 147.37 0.8 0.5 0.3 26.3 16.1 8.7
Managers
4th Level
0.2 22.6 77.4 118.36 103.63 122.67 0.7 0.4 0.3 26.0 12.2 7.7
Managers
3rd Level
0.8 32.2 67.8 86.56 73.83 92.67 1.2 0.7 0.6 19.8 14.0 8.5
Managers
2nd Level
3.5 34.3 65.7 41.65 38.68 43.19 2.0 1.1 0.9 17.8 13.9 8.3
Managers
1st Level
10.1 38.4 61.6 47.21 42.05 50.39 1.4 0.6 0.8 14.1 16.0 5.4
Managers
Managers
5.3 42.9 57.1 51.57 44.09 57.12 2.4 1.4 0.9 15.5 15.8 N/A
w/o Directs
Non-
80.1 46.7 53.3 31.29 27.30 34.52 3.5 2.1 1.3 7.0 19.7 N/A
Managers
Section 5
Report Card for Professional &
Business Services Firms
Professional & Professional & Your Firm

Business Services Business Services (enter your statistics
Age (years) 41.8 41.8
% Managers 19% $50/hr 21% $44/hr

% Male 55% $39/hr 54% $36/hr

% Female 45% $30/hr 46% $29/hr

Rate
Section 5
Industry Deep Dive
Trade/Transportation/
Utilities
Section 5
Industry Deep Dive Trade/Transportation/Utilities
The Trade/Transportation/Utilities sector includes workers from various industries, including

wholesale and retail trade. Retail trade constitutes a larger portion of the industry on an
employee-share basis compared to wholesale. The industry, as a whole, provides the highest
share of labor and makes up over 20 percent of the U.S. private-sector workforce.
Staffing requirements in this sector are more likely to be tied to daily, weekly and
seasonal demand cycles, resulting in large percentages of part-time, contingent and
seasonal workers. Front-line jobs are often simplified to accommodate rapid training
of new and returning employees. In this environment, higher turnover, lower pay and
higher spans of control are expected relative to other sectors.
The gender mix within this sector is slightly skewed toward males, who make up 57
percent of all employees.
Hourly Wages $24.27

% Male 57% $26
% Female 43% $21


Firms Firms Firms
36% 33%
30%
26%
22% 25%
18% 9% 16% 5% 15% 5%
13% 2% 1%
Yrs <41 41-43 44-46 47-49 >49 Yrs <4 4-6 7-9 10-12 >12 $ <21 21-30 31-40 41-50 51-60 >60
Section 5
Monthly Turnover
The average total turnover rate within the Trade/Transportation/Utilities industries is

five percent. Employees within this sector are slightly more likely to leave their job for
Females within the retail trade industry have a significantly higher turnover rate than
males (6.1 percent versus 4.3 percent). A potential explanation for this disparity is the
substantial presence of female employees in part-time and seasonal retail jobs.
Young workers, age 25 or less, have the highest turnover rate among the industries
at 11.4 percent. Young or inexperienced workers, those under 25 years of age or
those with fewer than three years of tenure, are also more likely to leave a job for

Percent of Firms 2.9%
5.0%
4.3%
2.3%
2.0% Voluntary
23%
22% 3.2%
17% 2.7%
2.3%
12% 18% Involuntary
8%
All Females Males

% <1 1-2 2-3 3-4 4-5 >5 Employees

5.2%
7.6%
3.5%
6.2% 5.1%
2.4%
3.0% 2.8% 4.2% 0.9% 0.7%
1.4% 2.1% 1.6% 1.1% 0.5%
2.7% 1.4% 0.4%
1.0% 0.4% 0.3%
1.6% 0.9% 0.6%
1.1% 1.3% 0.7% 0.5%
Yrs <26 26-35 36-55 56-65 >65 Yrs <4 4-6 7-9 10-12 >12
Section 5
Span of Control
The average span of control for this sector is just under

Span of Control
seven direct reports per manager, but there is a high
variance based on the type of business. Average Direct Reports is 6.8
Percent of
Firms 38%
Males constitute a larger share of the total managers
within these industries, making up over 65 percent of
all managers, while constituting only 57 percent of the 24%
total employee population. 17%
10%
Managers with fewer than 10 direct reports have 7%
slightly higher turnover rates compared with managers 4%
1-3 4-6 7-9 10-12 13-15 >15
who have more than 10 direct reports.
Employees of managers with very low or very high nine employees who report to them.
spans of control (between one and three direct reports,

or greater than 15 direct reports) have higher turnover
rates (>5 percent) compared to employees of managers
with intermediate spans of control.
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Female Managers 34% 32% 35% 35% 36% 35%
% Male Managers 66% 68% 65% 65% 64% 65%
Reports 1-3 4-6 7-9 10-12 13-15 >15
% Direct Reports’
5.5% 3.0% 3.6% 3.8% 4.2% 5.6%
Turnover
Section 5
Promotion rates average nearly nine percent within the sector.
Males have a slightly higher average promotion rate of nine percent versus eight
percent for females, but females are more likely to reach the manager level more
quickly than their male counterparts (5.6 years versus 6.8 years).
A higher proportion of manager positions is sourced through external candidates

6.3 rather than promoting from within, compared with other industry sectors.

8.4%
Female Male 9.0%
19.0% 19.0%

Percent of Firms Percent of Firms 35%
32%
28% 27%
25%
15% 14% 11% 11%
2%
<6% 6-10% 11-15% 16-20% >20% <6% 6-10% 11-15% 16-20% >20%


22.0%
24.2% 17.3% Manager† 14.8% 16.3%
12.0%
7.8% 8.5% 13.9% 16.6%
Total 8.6% 33.6% 8.7%
5.7% 4.3%
Section 5
Climbing the Trade/Transportation/Utilities Ladder
Span of Control
Wage Increase
Involuntary
Level Share
Promotions
Associated
Voluntary
Turnover
Female
Female
Total
Male
Male
Total 100.0 42.7 57.3 24.27 20.87 26.31 5.0 2.3 2.7 8.7 19.0 6.8
6th+ Level 0.03 10.4 89.6 203.63 184.67 205.84 0.9 0.5 0.4 29.8 10.4 7.5
Managers
5th Level
0.1 13.2 86.8 147.44 139.05 148.72 0.4 0.4 0.0 27.8 13.3 8.0
Managers
4th Level
0.1 14.8 85.2 112.66 104.72 114.04 0.6 0.5 0.1 28.1 13.2 8.1
Managers
3rd Level
0.7 40.6 59.4 69.59 46.39 81.27 1.5 1.3 0.2 16.4 14.6 8.4
Managers
2nd Level
1.7 31.2 68.8 50.12 45.24 52.32 1.3 0.7 0.5 24.2 12.9 8.9
Managers
1st Level
8.3 38.8 61.2 32.93 29.78 34.87 1.5 0.9 0.6 14.0 20.8 6.3
Managers
Managers
3.6 44.0 56.0 34.30 27.61 39.19 2.7 1.6 1.1 17.0 17.7 N/A
w/o Directs
Non-
85.5 43.4 56.6 21.46 18.68 23.13 5.6 2.6 3.0 7.5 20.3 N/A
Managers
Section 5
Report Card for Trade/Transportation/Utilities
Firms
Trade/ Trade/
Transportation/ Transportation/ Your Firm
Utilities Utilities (enter your statistics
Age (years) 39.7 38.3
% Managers 15% $38/hr 14% $34/hr

% Male 57% $26/hr 53% $26/hr

% Female 43% $21/hr 47% $20/hr

Rate
Section 6
Conclusion
Section 6 Conclusion
The most significant test for any business leader or organization is strategic
execution — the translation of planning into business results. Building an effective
strategy can be challenging, but it is an order of magnitude harder to build and structure
a cost-effective organization that can actually execute against plan. Moreover, business
plans require constant revision in the face of changing market conditions. Organizations
must be sufficiently agile to adapt in the face of rapid change. Organizational
adaptability plays a crucial role in strategic execution.
But how can we bring more science to the process of performing at the highest level. And this is where, armed
organizational design? What measurements matter with the right data, the right approach and the right
most? What insights are missing? We know from insights, HR professionals can elevate their role and
literally a century of business cases that organizational occupy a key seat at the table to help chart a better
restructuring — when performed correctly — can course toward their organizations’ future.
unlock extraordinary business value, but organizational
change is a high-risk activity. We also know from Tying HR data to company performance
multiple studies that “agility” — the ability of an In that respect, the availability of high quality, granular
organization to sense, adapt and respond to dynamic organizational benchmarks from the ADPRI 2019 State
market conditions — is critical for modern businesses of the Workforce Report represents a major advance
competing in a fast-paced global economy. for HR professionals. Until now, most employers had
access only to labor cost and productivity data to guide
The organizational benchmarks and metrics contained in organizational change and strategic workforce
the ADPRI 2019 State of the Workforce Report provide planning — particularly smaller employers.
an important step forward in solving this puzzle — a
new data set that allows HR professionals to provide So how should HR departments use the ADPRI 2019
strategic guidance around organizational design and State of the Workforce Report data? By analyzing 1)
strategic workforce planning. turnover rate, 2) promotion rate, 3) span of control and
4) hierarchy benchmarks that employers can tie HR data
Historically, workforce decisions have been driven by back to other performance criteria. Does a company
financial data because profitability, productivity and have problems with front-line quality and service
labor cost data are readily available. Measuring and delivery? Additional organizational data can help tease
benchmarking financial costs and employee productivity out the root causes for front-line breakdowns. Are there
is relatively easy, compared to gaining “bigger picture” problems with adaptive response to the marketplace?
insights about the health of the organization and its Organizational data may corroborate a top-heavy or
ability to attract, retain and empower its people. bureaucratic organization. A simple report card approach,
demonstrated in the industry sectors, provides
For most companies, it’s much harder to diagnose critical an opportunity to plot against benchmarks.
organizational issues that may be preventing it from

Your Firm
Span of Control and Monthly Turnover Percent
National National (enter your statistics
# of Directs % Turnover
Age (years) 41.7 41.1 42.5
YEARS Tenure (years) 5.6 5.4 5.8
7.4
Hourly Wages $29.03/hr $28.41/hr $26.11/hr
7.2 7.3
7.0
% Managers 16% $47/hr 16% $42/hr 15% $41/hr
6.9
% Non-Managers 84% $25/hr 86% $26/hr 80% $23/hr 6.5 6.8 6.8
% Male 53% $32/hr 51% $32/hr 49% $29/hr
% Female 47% $25/hr 49% $25/hr 46% $22/hr
Monthly Turnover 3.2% 3.4% 3.3%
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
Span of Control 6.9 7.9 7.0 2017 2018 2019
Annual Promotion 8.9% 7.3% 7.8%

Rate
National and industry-specific insights

compensated; how The ADPRI 2019 State of the
Achieving accurate measurements and reliable Workforce Report also provides insight into national
benchmarks when it comes to these metrics — including and industry-sector workforce trends. On a national
how companies are structured; how employees are basis, the average monthly turnover rate is 3.2 percent,
compensated; how pay and promotions are connected
The 2019 ADP RI State of the Workforce Report: Pay, Promotions and Retention 30 of which 1.8 percent left their employer for voluntary
and how employers retain workers— can potentially reasons and 1.4 percent left for involuntary reasons.
help organizations illuminate some fundamental issues The average annual promotion rate is 8.9 percent
and opportunities that might otherwise go unnoticed or with a promotional wage increase of 17.4 percent.
undetected. The average span of control is 6.9, implying that a
manager has an average of about seven employees
Beyond a benchmark report card, we recommend that HR as direct reports. From a hierarchy point of view, the
departments track their key organizational ratios on an workforce is comprised of 84 percent non-managers
ongoing basis, using quarterly dashboards and time plots with an average hourly wage of $25 and 16 percent
to allow for continuous monitoring. Human Resources managers with an average wage of $47/hour. These
can proactively work with Finance and Operations to trends, taken together, provide insight into the overall
look for signs of underperformance and make small health and competitive nature of the U.S. labor market.
continuous adjustments to stay on course. The next However, each industry sector displays its own
chart provides simple visual evidence of a relationship distinctive patterns. For example, the Manufacturing
between turnover and span of control. In this instance, sector workforce is highly distinctive and different from
HR and Operations can monitor an ongoing initiative Leisure & Hospitality, suggesting that best practices for
to determine if/when an organizational delayering workforce management may not translate well between
initiative has gone too far. each sector.
organizational metrics, their application and their

Insights on employee turnover influence on corporate decision-making suggests that
The study also points to a highly complex relationship the role of Human Resources will continue
between employee turnover and other organizational to evolve.
variables. The average promotion rate, workforce age,
tenure, wages and industry growth rate are all highly Compliance and process efficiency will also continue
correlated with employee turnover. However, these to drive adoption of new technologies and new
variables are also strongly interrelated, and causality business models by HR departments. Automation and
isn’t necessarily clear. Pay tends to increase with age outsourced services will further streamline key HR
and experience. Similarly, promotional opportunities and transactional services to reduce costs and maintain
age are disproportionately more important factors for compliance with labor laws. This evolution is ongoing
younger workers, but they are decidedly interrelated. and, while its ROI will be measured in terms of labor
costs, the real benefits will come in the form of time and
Other organizational factors that impact turnover have energy reallocated to HR’s core mission: the attraction,
competing tensions. A short span of control might be retention and development of talent.
conducive to employee engagement, which presumably
would lower turnover. However, if the shorter span of With latent talent shortages and highly dynamic
control is tied to higher labor costs, more bureaucracy markets, HR departments must also focus on continuous
and lower average wages, we might expect turnover to reconfiguration to stay current with the marketplace.
increase. And, in this new world, the role of the HR professional
has the potential to be elevated beyond tactical and
Context matters operational to strategic and visionary.
The final lesson of this study is that organizational
metrics can be misleading when taken out of context. In the HR leader’s new role, business literacy and
More than anything, organizational metrics derive their quantitative acumen will become all the more important.
power when combined with other types of business Operations, Financial and HR data analytics will be
performance data, going beyond relative performance increasingly interpreted side by side. HR practitioners
measures to illuminate directional trends. They may will be expected to collaborate more frequently with
provide clues as to what is going right or wrong and their peers in Operations and Finance with data-driven
permit adjustments, but they also have the potential to insights.
foster a deeper examination of a company’s own unique
characteristics and circumstances, which can provide For these new HR leaders, the future holds new
additional context when correlated with business opportunities that are well suited to their experience
performance. and expertise. Beyond being another stakeholder at the
table, they may now have an opportunity to become key
Elevating the role of HR strategists, decision-makers and leaders in a world of
Ultimately, the availability of these kinds of work that truly demands their knowledge and insights.
The ADP logo, ADP and ADP Research Institute are trademarks of ADP, LLC.
Copyright (c) 2019 ADP, LLC. ALL RIGHTS RESERVED.

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Section 3

The ADP Research Institute®

2019 State of the

Finally, we would like to acknowledge Carlos Rodriguez,

Section 1 Executive Summary 3

Section 3 Data and Methodology 12

Section 4 National Overview 19

Section 5 Industry Deep Dive 31

Promotions within a team are associated with

6th Level 15% $164

5th Level 19% $121

4th Level 23% $98

3rd Level 35% $61

2nd Level 37% $46

1st Level 43% $36

Managers 44% $36

Non- 48% $22

Every industry sector has its own unique dynamic

Span of Control, Promotion and Turnover Rate for Individual Industries

5% 6% 7% 8% 9% 10% Finance & 11% 12%

strategic partner in the decision-making process — from Understanding Organizational Metrics

The first annual ADPRI State of the Workforce

How do our organizational metrics compare against

Data and Methodology

35-54 yrs 42% 42%

? Your Promotion Benchmark: Good or Bad?

Lower Than Benchmark Higher Than Benchmark

May be positive when: May be positive when:

May be negative when: May be negative when:

? Your Turnover Benchmark: Good or Bad?

Lower Than Benchmark Higher Than Benchmark

May be positive when: May be positive when:

May be negative when: May be negative when:

? Your Span of Control Benchmark: Good or Bad?

Lower Than Benchmark Higher Than Benchmark

May be positive when: May be positive when:

May be negative when: May be negative when:

? Your Hierarchy Benchmark: Good or Bad?

Lower Than Benchmark Higher Than Benchmark

May be positive when: May be positive when:

May be negative when: May be negative when:

Age (years) 41.7 Monthly Turnover 3.2%

YEARS Tenure (years) 5.6 Span of Control 6.9

Hourly Wages $29.03

Age, Tenure, Hourly Wages (Firm Averages)

Age YEARS Tenure Hourly Wages

Average age is Average tenure is Average hourly wage

Percent of 36% Percent of 37% Percent of

Turnover Rate Turnover by Gender

1.4% 1.4% 1.3%

Turnover by Age Turnover by Tenure

Voluntary Involuntary Voluntary Involuntary

1.8% 1.4% 3.2%

Turnover by Industry Turnover by Company Size

Trade/Transportation/Utilities 2.3% 2.7% 5.0% Voluntary Involuntary

Education/Health 1.6% 0.8% 2.4% 2.0%

Finance/Insurance 1.4% 0.8% 2.2% 1.1% 1.1%

In more than 60 percent of companies, managers have between

Managers’ Span of Control

Reports 1-3 4-6 7-9 10-12 13-15 >15