How Should Construction Companies Use Compensation Benchmarking Data?

Construction industry compensation insights from CICPAC

Attracting and retaining skilled professionals continues to be one of the most significant challenges facing construction companies today. Competitive compensation strategies play an important role in addressing workforce pressures while supporting long-term business growth.

Through our membership in CICPAC, Keiter has access to benchmarking resources developed specifically for the construction industry. One such resource is a quarterly compensation survey that examines salary and compensation practices for several key positions within construction organizations. The complimentary survey below provides a multidimensional view of compensation by analyzing data across several categories and demographic breakdowns, allowing construction companies to evaluate their practices within the broader context of the industry.

Evaluating compensation data from multiple perspectives

The survey results are summarized using a variety of categories and sub-breakdowns to provide a more comprehensive view of the salaries paid for the selected positions.

When reviewing this type of benchmarking information, it is important not to rely on any single variable in isolation. Instead, companies should evaluate several relevant categories together to identify comparisons that most closely align with their own circumstances. For many organizations, a useful starting point is the Total Revenue category, which can serve as a baseline for comparing compensation levels among firms of similar size.

Matching survey positions to your organization

When comparing survey data to internal roles, it is helpful to focus on position descriptions rather than job titles. Titles can vary widely between organizations, while job responsibilities often provide a more accurate point of comparison. If the responsibilities described in a survey position reflect the majority of the functions performed by an employee within your company, the role is likely a reasonable match.

In some cases, a position within a construction company may encompass responsibilities associated with more than one survey role. For example, a Project Manager may also perform Senior Estimator responsibilities on a regular basis. When this occurs, organizations may find it helpful to review compensation data for both positions and evaluate the relative importance of each function when assessing appropriate compensation levels.

Using industry data as a benchmark

Compensation surveys should be viewed as a general indicator of industry practices rather than a definitive benchmark for any single company. A number of factors that influence compensation decisions may not be captured in survey data, including:

• Organizational structure

• Regional economic conditions

• Company size and market focus

• The complexity of projects performed

Because of these variables, organizations should avoid relying on a single number from the survey as a direct compensation target. Instead, the data should be considered within the context of the company’s unique circumstances.

Understanding variability in incentive compensation

Elements of compensation tied directly to company profitability such as bonuses and other performance incentives can vary significantly from one organization to another. Because these forms of compensation are often linked to company performance and financial results, they may fluctuate across firms and from year to year. As a result, bonus and incentive data within surveys should also be viewed as a general indicator of industry practices rather than a precise benchmark.

How to review the survey data

When evaluating the survey, companies may want to begin by comparing their internal compensation data with the national summary of all firms included in the report. In many cases, a company’s compensation levels may fall above or below the survey’s average or median figures. From there, organizations can refine their analysis by reviewing the various sub-breakdowns and demographic categories that more closely reflect their company’s size, structure, and market conditions. By examining the data through multiple perspectives, construction leaders can gain a clearer understanding of how their compensation practices align with broader industry trends.

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Compensation benchmarking is one of many tools construction companies can use to evaluate workforce strategies and remain competitive in a challenging labor market.

If you would like to discuss how industry benchmarking data may apply to your organization, Keiter’s Construction Industry specialists can help you interpret industry trends and evaluate strategies that support long-term growth and profitability. Contact your Keiter Opportunity Advisor or Email | Call: 804.747.0000

Frequently asked questions about construction industry compensation benchmarking

Why is compensation benchmarking important for construction companies?

Compensation benchmarking helps construction companies understand how their salary and incentive structures compare with industry practices. Reviewing benchmarking data can help organizations remain competitive when attracting and retaining talent while ensuring compensation strategies align with company performance and market conditions.

How should construction companies interpret compensation survey data?

Compensation surveys should be viewed as a general indicator of industry trends rather than a strict formula. Companies should evaluate several variables such as company size, geographic market, and organizational structure when comparing their compensation practices with industry data.

Should construction companies rely on a single number from a compensation survey?

A single data point rarely reflects the full context of a role within a construction organization. Factors such as job responsibilities, experience level, company profitability, and local market conditions all influence compensation levels. Reviewing multiple survey categories together provides a more accurate perspective.

How do construction company job titles affect compensation comparisons?

Job titles in the construction industry can vary significantly between companies. For benchmarking purposes, it is more effective to compare roles based on the responsibilities described in the position rather than the title itself. This approach helps ensure the survey data aligns more closely with the functions performed within the organization.

How often should construction companies review compensation benchmarks?

Many construction companies review compensation benchmarks annually as part of budgeting or workforce planning. Regular reviews allow leadership to monitor industry trends, evaluate compensation competitiveness, and adjust strategies as market conditions and business needs evolve.