Salaries are stagnant, bonuses are down, and employees are working longer hours—welcome to the medical device job market in 2012.
by Jamie Hartford, managing editor of MD+DI
It has been a tough year for U.S. medtech companies, and employees are feeling the pain. Plagued by a sluggish economy and questions about healthcare reform, medical device and diagnostics manufacturers collectively laid off more than 5000 workers in 2012.
Those who managed to keep their jobs were not immune to the pressures facing the industry. MD+DI’s annual salary survey provides a clue as to how challenges—from the lagging effects of the recession to overall uncertainty—trickled down to employees across six job descriptions: general and corporate management, product design engineering, production and manufacturing, quality assurance and quality control (QA/QC), regulatory and legal affairs, and research and development (R&D). This year’s data revealed that, like the devices they create, medtech employees are being asked to do more.
Both sales and staffing are down at medical device and diagnostic companies this year. Median sales fell nearly a quarter from 2011, while the average number of full-time employees dropped 8.4% this year, according to our survey.
Among those challenges are the struggling global economy, the healthcare market’s focus on cost containment, and healthcare reform in the United States, the world’s largest medical device market. No one knows how these factors will play out, and that uncertainty has not been good for the job market.
Interestingly, despite the tough job market and recent layoffs in the industry, some employees seem to be optimistic about their job security. While two-thirds of our survey respondents said they feel about the same about their job security, 16% reported feeling a higher level of job security than they did 12 months ago—an increase of one percentage point over 2011. Likewise, the share who feel less secure about their jobs fell by two percentage points, to 16%.
There was evidence of that in the salary survey data. Respondents reported putting in a median of 50 hours of work per week, two more hours than last year.
Though medtech companies are asking more of their employees, they don’t appear to be rewarding them with increased compensation. This year both median salary and median total compensation remained flat, at $100,000 and $120,000, respectively, according to our survey.
Respondents reported a median raise of 3%—the same as in 2011—but more employees than last year said they have not received a raise at all from their current employer. A lower percentage of respondents also reported receiving bonus compensation over the past year. While nearly two-thirds reported getting a bonus in 2011, just 58% said they got a bonus this year. The median amount of bonus compensation dropped as well, to $7500—down 20% from 2011. More than one-third of respondents said they did not receive a bonus over the past 12 months.
Benefits have also suffered. A smaller percentage of employees reported receiving perks including health insurance, 401(k), stock options, educational benefits, and profit sharing.
Happy to Have a Job
Still, despite stagnant salaries, fewer raises, a decline in bonus compensation, and dwindling benefits, medtech employees seem to be more satisfied with their jobs. Job satisfaction ticked up almost 3% over 2011, and more than two-thirds of our survey respondents said they are “satisfied” or “very satisfied” in their current positions.
Not surprisingly in this tough job market, fewer employees are trying to leave their current company. Employees actively looking for a new job or considering a job search are down five percentage points.
Where the Opportunities Are
While it might all sound like doom and gloom, there are bright spots in the medtech job market. Median salaries and median total compensation rose for employees working in production and manufacturing, QA/QC, regulatory and legal affairs, and general and corporate management roles this year, according to our survey. Only R&D and product design engineering jobs showed declines.
At 14%, general and corporate management roles saw the biggest relative median salary increases. Production and manufacturing salaries grew by more than 7%, and QA/QC and regulatory affairs salaries increased by around 4%.
Predictions for 2013
Some of the challenges the medical device and diagnostic industry faced this year show no signs of abating, and more are appearing on the horizon. One that will likely have an impact hiring and salaries is the 2.3% tax to be levied on medical device sales starting January 1, 2013.
Uncertainties with regard to the economy and healthcare reform continue to be barriers to job and salary growth in the industry.
Some questions were put to rest with the results of the 2012 presidential and congressional elections, and 2013 will bring more answers regarding how provisions of the Affordable Care Act will play out for medical device and diagnostic manufacturers.