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High staff turnover found in CROs

US research firm warns that pharma companies will assess CRO turnover rates

Clinical research organisations (CROs) in the US are experiencing a dramatically high level of employee turnover, according to a new study.

The CRO Industry Global Compensation and Turnover Survey by research firm HR+Survey, found that employees at CROs are leaving for new jobs at significantly higher rates than their counterparts in other industries.

The survey results showed that in 2012 the CRO industry experienced 12.5 per cent 'voluntary separation' (moving to find positions with higher compensation and/or greater opportunities), compared with a national voluntary turnover rate average of 1.5 per cent (US Bureau of Labor Statistics).

The HR+Survey report warned that high employee turnover rates could be damaging for CROs because pharmaceutical companies will assess turnover rates during the decision-making process for outsourcing clinical trials.

"The survey indicates that there is tremendous movement within the CRO industry," began Judy Canavan, partner at HR+Survey.

"The reasons remain multi-faceted, but these numbers continue to be a concern in an industry that has seen double-digit growth and where companies' greatest assets are their talent.

"CROs should consider solutions that foster retention of talent and institutional knowledge, including the use of stay bonuses, which are earned over time," she added.

Currently, 65 per cent of the country's CROs offer sign-on bonuses to attract talent, yet only 29 per cent offer retention bonuses as an incentive for retaining employees.

In addition, the target for annual incentives and projected long-term incentive (LTI) levels were found to be considerably lower for CROs compared to other industries. For example, CRO executives with a $250,000 salary were eligible for an average target annual incentive of 26 per cent and LTI of 35 per cent, while counterparts in other industries could expect annual incentives and LTIs of 44 and 51 per cent, respectively.

"This should send a strong message to CRO executives who have the opportunity to implement strategic solutions, including increasing the use of performance based incentives, to retain and motivate talent without having to increase fixed costs," Canavan continued.

"As we move into developing our 2013 survey, CRO leaders should consider participating in this research to more fully understand the impact of their compensation plans," she said.

11th April 2013

From: Research

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