In Today’s Medtech Job Market, Employees Hold the Upper Hand

For many, it's smooth sailing in the medtech industry. Salaries are rising, job satisfaction and security are high, and demand for experienced medtech professionals continues to exceed supply.

Yet certain pockets of the industry seem poised to rocket higher than others. What can employees do to ensure they continue to thrive in this strong but evolving marketplace?

No Longer Just a Trend

Over the past few years, the medtech job market has smiled on employees. Experienced candidates have been able to secure moderate salary increases and higher bonuses.

That dynamic has only strengthened in 2016, which Paula Rutledge, president of Orlando-based medtech recruiting firm Legacy MedSearch, said has been the strongest year for medtech hiring since before the Great Recession.

"I think that trend is continuing. I may be ready to not call it a trend. I think it's just the new way of going forward," said Brian Cole, managing partner at Dallas-based MedTech Executive Search.

But it remains tough for companies to land quality candidates, said Amy Collins, a medical device recruiter at Smith Search Group, in Minnesota. Professionals laid off after large companies merge tend to be "snapped up quickly," she added.

"If you have device experience and a solid track record, you get hired quickly," Collins said.

Paying Top Dollar

All that has meant strong salaries for employees working in medtech. Respondents to MD+DI's 2016 Medtech Salary Survey reported a median salary of $118,750. That's an $11,750 increase over the median salary reported in the 2015 salary survey and an $8750 increase over the median salary from the 2014, although survey samples were not the same.

Those numbers square with what industry recruiters have observed. Cole said he's observing an average 7-8% bump in salary when employees leave their current position for a new opportunity. "Salaries have increased, without a doubt," he said.

Unfortunately, not all companies have kept pace with the industry's rising salaries.

"We've had more declined offers this year than we ever have before . . . based on salary," Rutledge said.

Some companies are drawing "a line in the sand," she noted, cautioning "that doesn't play, particularly as millennials are stepping up to take leadership roles."

Medtech--Emphasis on Tech

Some of the job growth in medtech is coming from a particular corner of the industry. Rutledge has noticed a significant amount of hiring from what could be called the "high-tech" categories of the industry: virtual reality, sensing, and robotics.

"I'm hearing a division between traditional med device--implants, specifically--and medtech, anything with a battery, a sensor, virtual reality, any kind of tech . . ." she said. "All the [companies] that we're working with that are doing massive hires have a tech component."

Consumer tech companies have entered the medical space through collaborations like the partnership between Dexcom and Verily (formerly Google Life Sciences); Google DeepMind's work on diabetic retinopathy and age-related macular degeneration; and Verb Surgical, the surgical robotics venture backed by Verily and Johnson & Johnson.

Rutledge said someone at a well-known venture capital firm recently told her that everything the firm is evaluating for potential investments has a health IT or medtech component. That kind of funding interest is fueling expansion and hiring within startups that play in those spaces.

Such companies are also targeting highly experienced executives from large industry players to help them build operations and commercialize products. "They're buying that brand name," Rutledge said. "They want the pedigree, but they want someone to have the pace of a startup."

That's welcome news to mid-career professionals who may have felt left out as major medtech companies merged.

"We've been very successful at pulling out incredible, high-level talent to work for much smaller companies with more of that early-stage excitement," Rutledge said. "With some of the mergers . . . there's so many of those folks who have been displaced or under-utilized." She added that many of these professionals are excited about working in the areas of robotics and sensing technology.

Another benefit of joining a small company might be a bigger salary. In the 2016 salary survey, reported salaries were often higher at companies with little revenue than at mid-sized companies. Professionals at companies with less than $10 million in annual sales reported a 14% higher median salary than those at companies with $10 million-$100 million in revenue and 9% higher than employees at companies with $100 million-$1 billion in revenue. Only at the largest companies, with revenue over $1 billion, did the median salary of $121,000 match that at the smallest firms.

That may seem confounding at first, but Rutledge speculated that it's a result of smaller companies "buying credibility" since they don't yet have the track record the biggest companies enjoy.

Other Hot Roles

Within traditional medical device companies, regulatory professionals still enjoy a hiring advantage.

"Regulatory obviously continues to be hot because there are not enough people being trained," Cole pointed out.

While quality assurance and quality control continues to be a good career path, Cole said job titles in this area are no longer the top priority for hiring, as was the case a couple of years ago. That's likely because FDA actions seem to be slowing down.

"Quality has tapered off," Cole said. "When FDA was going out throwing out warning letters and 483 letters, you saw a lot of these companies growing their quality departments by 40-50%." Now, "there's a demand in quality still, but it's not like it was two years ago."

As for disease areas, device companies focused on diabetes, cardiology, and neuromodulation continue to thrive and hire, according to Cole.

But not everyone enjoys a place in the sun. With consolidation and some companies shifting toward a rep-less business model, sales jobs may be tougher to come by.

"I think the sales reps should be concerned," Cole said. "I think you will see a smaller number of sales people every year."

Collins, who specializes in placing sales professionals, noted that sales salaries have remained stable but haven't increased, and there doesn't seem to be a lot of room for negotiation. Some sales reps working in medical supplies divisions at big organizations with overlapping call points are also experiencing streamlining.

"Those reps aren't having a ton of access with clinicians," she said. "I think it's turning into dealing with the value analysis committees and C-suite . . . versus a real clinical sale."

A small sample of sales and marketing professionals responded to MD+DI's 2016 salary survey. It's worth noting that while their average job satisfaction of 3.8 out of 5 was in line with some other titles, a higher proportion than other employees--almost one-quarter of respondents--reported they are actively looking for a new job.

Yet even within sales, there are areas of higher demand, including in the vascular arena and physical oncology, Collins said. Some parts of the United States--mainly the South, which has an aging population--are also seeing strong procedural volume, which has lead companies to hire more sales reps to handle the higher volume, she said.

Professionals in all positions working at traditional medical device companies with commoditized products may have more uncertain futures. Hiring seems to be especially slow within the spine industry, Cole said.

"Everyone is complaining about the me-too [products]," he said. "There's not a lot of innovation going on."

Other segments in which employees' fortunes may not be so favorable include orthopedics and diagnostics. Both the imaging diagnostics and patient diagnostics segments have seen salaries and job growth stagnate, Rutledge said.

Another area where the supply of talent may be outstripping demand is the executive suite, Cole said. "There's enough VP-level and CEO-level people out there actively looking," he said, adding that it's likely a result of consolidation and acquisitions in the industry.

The Fun Stuff

Tech's increasing focus on the healthcare space may be gradually ushering in unconventional perks for some employees.

Rutledge has seen some medtech companies--particularly startups--undertake a "Google-ization" of their office space, adopting "funky, cool" workspaces.

While still not the norm, some professionals participating in the 2016 salary survey reported unique benefits like flexible working hours, on-site fitness centers, and updated workplaces. One employee reported receiving every other Friday off, while a few others noted perks like onsite summer childcare, free or low-priced food, and additional vacation time.

While benefits overall haven't changed significantly in 2016 for most employees, Cole said some may be getting higher bonuses than in the past.

"Now bonuses are kind of coming back, and it's the norm again," he said.

Companies are rewarding employees with retention bonuses--a new phenomenon--and some professionals are reportedly receiving more than 100% of their bonus, Rutledge said.

"It's not every case, but I'm seeing a lot of cases where companies are putting their money where their mouth is with bonuses," she added. "Even some of the small companies [are paying] deferred bonuses" as a retention program.

In MD+DI's 2016 salary survey, more than two-thirds of full-time medtech professionals said they received a bonus in the past 12 months. The median bonus was $10,000, though many professionals reported bonuses many times that amount.

Device Tax Suspension

The device tax suspension that went into effect at the beginning of the year seems to have had a mixed impact on salaries. In a small survey conducted for the Medical Imaging and Technology Alliance earlier this year, more than two-thirds of executives said the tax suspension made them likely to hire more U.S.-based employees and more than three-quarters said they were likely to invest more in research and development. Executives at the biggest medtech companies also said publicly at the beginning of the year that they expected to increase investments in their businesses as a result of the suspension.

Calling the suspension a "tailwind" for some smaller companies, Rutledge explained that she has seen medtech companies start to reinvest in people and plant equipment as a result. Over the past several months, companies have started expanding and investing in manufacturing, she said, noting that this has in turn helped the secondary market in contract manufacturing.

Collins said she hasn't seen outright expansion but did note that companies have been backfilling sales positions this year. "They're more conservative on their expansion plans . . . I think they want to see what is going on," she said.

Cole hasn't observed a significant impact from the device tax suspension but did note a benefit to R&D. "I do believe if the tax were still there, it would probably slow down hiring," he said. "Most companies are spending that money trying to develop [their] product pipeline, so from an R&D perspective, I do think it was a big benefit."

Because it takes years for a medical device to reach commercialization, "it'll be a while before you need more marketing people or any others for those [products]," Cole said.

Stay Put or Look Around?

Overall job satisfaction is high in the medtech industry--an average of 3.9 out of 5, according to the 2016 survey.

"For the first time in a long time, I'm seeing fewer people actively looking [for a new job]," Cole said. "I think there were several years where everybody was out looking, and most of them have settled in and need to hang out, put some tenure in the company. They seem to be a lot more content."

In this year's survey, 12% of respondents said they are actively looking for a new job, down slightly from the 13% who reported doing so in 2015. Almost a third said they are strongly considering a new job search, about the same as last year.

But that contentment is not necessarily a boon for careers.

"The reality is, some of the CEOs and executives I talk to say the best time to look for new jobs is when they're at the top of their game," Cole said. "Look at sports [stars], look at Kevin Durant, look at all the NBA, NFL stars. When they have their best years, it's when they're out trying to market themselves better. I find a lot of mid- and lower-level [management] people don't have that mentality."

Still, younger medtech professionals continue to live up to millennial stereotypes, moving from job to job frequently, which isn't always a good thing. "More job stability to really anchor your success and your learning curve of the industry prior to making your next move" is a good idea, Collins advised.

Yet there may be a benefit to millennials' restlessness. Medtech startups that want to hire experienced medical device professionals don't want employees who have spent their entire careers at one place. In this case, loyalty isn't paying off.

"[Employers] don't want linear experience," Rutledge said. "CEOs will say . . . 'How can they help us accelerate our R&D if they've only seen it done [one] way?'"

Advice for Employers

In an employees' market, medtech companies can and should do a better job of attracting their ideal candidates.

"I think companies could do a lot better job onboarding . . . talking about what career paths look [like] for professionals," Cole said. "I think the companies either aren't recognizing or aren't willing to change or try to really take care of top talent well enough."

Some companies have been slow to offer higher salaries. "Those are the [companies] that aren't getting top talent," Cole added.

In general, salaries are being discussed earlier in the hiring conversation, and companies should thoroughly research what they need to be paying to attract top talent, Rutledge said.

"Employees, candidates . . . they know what they're worth," she pointed out.

Companies also need to work on retaining top talent.

"I think organizations need to learn how to keep their people engaged, too," Collins said.

Cole echoed that sentiment. "It's not about the money," he said. "I get people moving all the time for the opportunity and career growth path. That's really what it should come down to."

[Image courtesy of GREENLEAF DESIGNS/FREEDIGITALPHOTOS.NET]