The Challenges of Determining Earning Capacity in the Changing Labor Market Brad Taft, MBA, CMF, SPHR, SHRM-SCP, CFLC

Transcription

1 2019 ABVE Annual Conference The Challenges of Determining Earning Capacity in the Changing Labor Market Brad Taft, MBA, CMF, SPHR, SHRM-SCP, CFLC Objectives Identify and understand labor market trends that affect traditional occupational categories Develop strategies for analyzing the employability and earning capacity of non-traditional workers including independent contractors Identify sources of valid compensation data How to apply Benchmarking and other survey methodology to effectively determine the placeability and earning capacity of individuals in the local labor market

2 2019 ABVE Annual Conference The Challenges of Determining Earning Capacity in the Changing Labor Market Brad Taft, MBA, CMF, SPHR, SHRM-SCP, CFLC The Main Challenge to Traditional Earning Capacity Analysis: The Changing Labor Market

3 2019 ABVE Annual Conference The Challenges of Determining Earning Capacity in the Changing Labor Market Brad Taft, MBA, CMF, SPHR, SHRM-SCP, CFLC Changes to the Labor Market Offshoring Outsourcing On-Demand Jobs Full Time Jobs Replaced with Contingent Positions Part-time, Project, Seasonal, Interim Opportunities Rise of the Independent Contractor (i.e. Entrepreneur)

4 Vocational Evaluation Process The Traditional vs. Non-Traditional Employee Education & Employment History Health Issues Current Talent Base Employability Labor Market Analysis Compensation Analysis Earning Capacity

5 Employability Health Issues? Unemployed How Long? Under-employed? Additional Training? Vocational Readiness of the Non- Traditional Employee

6 Lessons from Business Valuators: Determining the Reasonable Compensation of an Entrepreneur Analyze the Functional Tasks of a Business Owner % of Time & Proficiency Level of Each Task Comparability Data: Wages for Functions [Occupations] Location

7 Labor Market Analysis Identify Occupational Categories Identify Available Jobs Determine Match Between Job and Talents Benchmarking

8 Compensation Analysis Compensation Surveys National - Regional Local Sponsoring Organizations Validity of Data

9 Compensation Analysis (Con t) Bureau of Labor Statistics & State Workforce Agencies National-Regional-Local Quantity versus Quality Job Categories are too General

10 Location Pay Period BLS OES - Wages for Controllers (2017 Data) 10% 25% Median 75% 90% United States Hourly $31.96 $43.11 $60.14 $83.62 $ Yearly $66,480 $89,670 $125,080 $173,920 $208,000+ California Hourly $35.04 $46.39 $65.13 $91.56 $ Yearly $72,870 $96,500 $135,460 $190,440 $208,000+ Los Angeles, CA Metropolitan Division Hourly $36.98 $48.72 $68.38 $97.20 $ Yearly $76,910 $101,340 $142,220 $202,170 $208,000+

11 Location Pay Period BLS - OES Wages for Childcare Workers (2017 Data) 10% 25% Median 75% 90% United States Hourly $8.41 $9.22 $10.72 $12.79 $15.76 Yearly $17,490 $19,180 $22,290 $26,610 $32,780 Arizona Hourly $10.01 $10.23 $11.24 $12.39 $14.27 Yearly $20,810 $21,290 $23,380 $25,760 $29,670 Tucson, AZ MSA Hourly $10.00 $10.01 $10.29 $11.66 $14.57 Yearly $20,810 $20,810 $21,400 $24,240 $30,300

12 Location: Los Angeles, CA 25th 75th Job Title Source Percentile Median Percentile Controller CompAnalyst $179,137 $218,806 $262,868 Controller Robert Half $121,440 $156,090 $224,230 Controller OES $101,340 $142,220 $202,170

13 Compensation Analysis (Con t) Private & Non-Profit Sponsors Comp & Benefit Consulting Firms Trade & Professional Associations Employee Survey Companies Validity of Data Benchmarking

14 2019 ABVE Annual Conference The Challenges of Determining Earning Capacity in the Changing Labor Market Brad Taft, MBA, CMF, SPHR, SHRM-SCP, CFLC Challenges for Earning Capacity Analysis Finding Empirical Compensation Data Determining an Independent Contractor s Annual Earnings (Earning Capacity versus Business Valuation)

15 SUMMARY Vocational Evaluators are challenged by the changing Labor market and need to understand the trends affecting the workplace and individuals roles in it. We need to develop strategies for analyzing the employability and earning capacity of nontraditional workers. We must identify a number of potential sources of valid compensation data. And we need to apply benchmarking and other survey methodology to effectively determine the placeability and earning capacity of individuals in the local labor market.

16 2019 ABVE Annual Conference The Challenges of Determining Earning Capacity in the Changing Labor Market Brad Taft, MBA, CMF, SPHR, SHRM-SCP, CFLC The Gig Economy Continues to Disrupt the Future of Work. - Human Resource Executive Magazine The Gig Economy Continues to Complicate the Determination of Earning Capacity. - Brad Taft btaft@taftvocationalexperts.com