Device Professionals Enjoy Solid Salary Gains and a Hot Labor Market in 1998

Posted by mddiadmin on August 1, 1998

Medical Device & Diagnostic Industry

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An MD&DI August 1998 Column

Respondents to MD&DI's 10th annual salary survey say challenging assignments are sometimes more important than hefty paychecks.

Medical device manufacturers are expecting more from their employees, and 1998's salaries and compensation packages reflect the increased work hours and responsibilities of today's industry professionals. MD&DI's 10th annual salary survey found that, on average, employees of medical device and in vitro diagnostic manufacturers earn a healthy $72,000 per year, with a total compensation package valued at $91,600. Respondents reported an average annual raise of 6.7%, with at least half receiving an increase of 5% or more. Medical device professionals are faring better than workers in other industries: According to figures from the U.S. Labor Department, the average hourly earnings of U.S. workers in all industries are about 4% higher than a year ago.

For the first time in the history of MD&DI's survey, the South edged out the rest of the country's regions, providing the highest total compensation to industry personnel. Traditionally, the South has been known for low salaries. "One of my clients once said, 'Don't you know Southern companies pay two-thirds sunshine and orange juice and one-third salary?'," says Sandy Lozano, owner of HR Professional Consultants, an executive recruiting company based in Ft. Lauderdale, FL. "In the past few years, as more mergers have occurred in the South, and the competition to recruit talented individuals has heated up, Southern companies have been making a larger effort to match salaries paid throughout the rest of the nation."

To help readers make relevant salary comparisons, MD&DI has devoted a full page to each of seven job functions:

Another indicator of appropriate reimbursement is the salary approximation worksheet provided. Experience, job function, and job responsibility continue to highly influence compensation; the importance of gender and region has varied from year to year. This year, men completing the survey should add $5820 to the base salary.

This added salary boost for men is reflected in industry averages as a whole. As in past years, respondents to the 1998 survey are overwhelmingly white men; however, women did account for 17% of the replies. Women have made gains salary-wise, earning an average $57,800 to their male counterparts' $75,200. This represents pay of 77 cents to every dollar earned by men, better than the national average of 74 cents/dollar.

The typical respondent to this year's questionnaire is a 43-year-old white male holding a bachelor's degree and working for a company that employs 2110 workers with 1997 sales approaching $75 million. He has worked in the industry 11 years—7 at his current company. He spends 49.5 hours on the job each week and supervises five employees.


This year's survey confirms a well-known maxim: The workplace today is not what it was 10 years ago. Employers and employees have new expectations—both about the work they'll do and about how they'll be compensated for that effort.

Employers' new demands are evident in the very expectations they have for new employees. Companies now want potential hires to already possess all of the knowledge and skills necessary to perform all tasks associated with a given position.

"Despite the fact that we're in a very competitive, candidate-driven market with a shortage of technical talent, companies haven't relaxed their standards of excellence," says Ken Larsen, director of medical recruiting for Fortune Personnel of San Antonio (San Antonio, TX). "If anything, companies probably need to be more flexible and not expect to find a 'perfect' candidate who has every single skill they're seeking. The goal should be to find someone with 75–80% of the desired skills, then grow the person into the rest of the position."

"Companies are expecting much more in minimum criteria for the people they're hiring," Lozano concurs. "Ten years ago, in lieu of a degree, manufacturers would accept several years of experience. Now, at the minimum, you need a bachelor's degree. Preferably, you have a master's or even higher degree, plus three to five years of industry experience." Of those responding to MD&DI's 1998 survey, nearly half have completed some postgraduate study or an advanced degree, so competition for key positions could still be strong.

Further, manufacturers want employees to possess a wider range of skills. "Companies want employees with diversified talents," says Lozano. "In the past, you could focus expertise in just one area—like manufacturing. Now, in addition to understanding the manufacturing and production processes, you should know how design ties in to packaging, marketing, and other areas. You need to understand what other groups within the organization will need to create a viable product and get it to market quickly, and you have to be able to deliver those tangibles quickly and well."

Finally, companies also expect their workers to be very committed. Fortunately, employees hold a similar goal-oriented perspective, finding personal satisfaction in a job well done.

"The past generation clocked a 40-hour workweek—their goal was to complete so many hours' worth of work," says Larsen. "Today, employees' focus has shifted to meeting set goals for product offerings and the bottom line, and they'll put in as many hours as it takes to reach those goals." MD&DI's survey substantiates this finding. In addition to logging extra hours, when asked to rank various factors' effect on their job satisfaction, respondents said challenging assignments were more important than both a compensatory salary and a comprehensive benefits package. Further, respondents scored a manageable workload and flexible hours lowest in their list of preferences.

In exchange for embracing diversified responsibilities and longer hours, employees are expecting—and getting—new perks. Still, it's generally easier negotiating extra benefits with a new employer than with a current one. "More and more candidates are getting sign-on bonuses, and they're getting larger bonuses than have been offered in the past," says Larsen. "Companies will also go the extra mile on the family side—paying for private schooling for elementary school–age kids, providing extra vacation time, and paying real estate fees in relocation situations."

Lozano adds, "Sign-on bonuses used to be reserved for higher-level executives, but today even technical engineers are getting nice-sized checks when they take a new job."

For employees who have been at their jobs for a while, as the average person surveyed this year has been, more and more people are receiving performance-related bonuses. Two years ago, 49% of respondents reported bonuses averaging $7890 as part of their overall compensation; this year, 59% received bonuses averaging $9100. "There's a definite trend toward letting even lower-level employees become full participants in the success of a company," says Larsen. "Traditionally, only top executives got bonuses, but larger companies are extending this benefit even to the lower echelons. Smaller companies compensate with stock options, which is more attractive—and probably more rewarding too—for more entrepreneurial spirits."


While the average respondent rated his job satisfaction at a pleased 3.8 on a 5-point scale, 47% said they are either actively engaged in or considering a job search. Before dusting off that resume, professionals should bear in mind a few items.

"In addition to having a well-diversified set of skills, job candidates must have a realistic, true view of how much money they can command," says Lozano. "Too many people expect to get a 25–30% salary increase and end up pricing themselves right out of the market. It's also bad to job hop. Employers are looking for people who have been at their current job for three to five years."

Right now, the hottest fields are in mechanical and electrical engineering, plastics, software engineering, information technology, and management information systems.

Prospects for the future are bright also. "Every candidate now seems to have two or three choices," says Larsen. "The medical industry—and careers in this industry—should stay hot for another 10–15 years due to the aging of the baby boomers, rapid changes in technology, and the need to keep health-care costs down. The only way to reduce costs is through innovation and creativity, which means good jobs for talented people."


More than half of the respondents to this year's survey seem happy in their jobs as well as in their chosen field. While high salaries, great job opportunities, and substantial compensation packages are enticing incentives to continue working in the medical device and diagnostic industry, quite a few respondents said there's an even more-rewarding aspect to their careers. In the words of one respondent, "I am saving lives." That can be compensation enough for many.


The data for this year's survey were obtained from a mail survey designed jointly by MD&DI and Readex Research, Inc. (Stillwater, MN), and conducted by Readex in February and March. Surveys were mailed to 1375 medical device professionals, 756 of whom provided usable responses, for a 55% response rate.

The survey results are based on the responses of 666 individuals who identified themselves as full-time professionals working for companies that manufacture medical devices or in vitro diagnostics. Responses were segmented according to the seven job functions outlined earlier as well as by the respondents' level of responsibility as follows: CEOs and presidents, vice presidents and directors, department heads and supervisors, and engineers and scientists.

The margin of error for percentages based on the 666 responses used is ±3.7% at the 95% confidence level.


The 10th Annual MD&DI Salary Survey is available as a bound reprint, containing a copy of this article, tabular breakdowns for the industry as a whole, and previously unpublished tabular breakdowns for the seven surveyed job functions.

Copies cost $60 each. For more information or to place an order, contact: Samatha Smith, Canon Communications, 3340 Ocean Park Blvd., Ste. 1000, Santa Monica, CA 90405; 310/392-5509, fax 310/392-4920.

Copyright ©1998 Medical Device & Diagnostic Industry

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