2010 Single-Family Compensation Study

By NAHB Economics & Housing Policy Group

The 2010 Single-Family Builder Compensation Study, conducted by the NAHB Economics & Housing Policy Group in June 2010, provides compensation and benefits data for 39 common positions at single-family home building companies. Builders can use results to benchmark what they pay their employees against current industry averages. The study shows average total compensation and the prevalence of benefits offered to each position by geographic region, 2009 dollar volume, number of single-family units started in 2009, and the number of employees on payroll. The study is divided into two sections that present the survey findings from two different perspectives: a broad view comparing average total compensation and benefits across all positions and also a more detailed view of each individual position?s average compensation and benefits.

• Language: English
• Publisher: BuilderBooks
• Release date: Jan 2, 2010
• ISBN: 9780867187007

Book preview

Survey

I. INTRODUCTION

The 2010 Single-family Compensation Survey was conducted in June 2010 by the NAHB Housing Policy and Economics Group. The objective of this survey is to collect data on compensation and benefits for common positions at single-family home building companies. The data can be used to benchmark how single-family builders compensate their employees.

The survey questionaire (Appendix IV) was electronically sent to 4,350 single-family builders in June 2010. Responses were received from a total of 205 builders, for a response rate of 5 percent¹. Results in this report are broken down by region, 2009 dollar volume, number of single-family units started in 2009, and the number of employees on payroll (all details shown in Appendix III). Exhibit 1 shows the distribution of responses for these categories².

Exhibit 1. Distribution of Responses

¹ Response rates for past compensation studies have been around 3 percent.

² The response distributions shown in Exhibit 1 accurately reflect the characteristics of all single-family builders, as collected in the 2009 membership census.

BUILDER PROFILE

PRINCIPAL OPERATION

Fifty-six percent of respondents reported the principal operation of their firm to be single-family custom building, while 26 percent reported single-family spec/tract building, and 17 percent single-family general contracting. The remaining 2 percent reported some other type of principal operation (Exhibit 2).

Exhibit 2. Principal Operation

The builder’s principal operation varies over the number of units built. Ninety percent of respondents who reported building over 100 single-family units in 2009 are primarily single-family spec/tract builders, while only 10 percent are single-family custom builders. Over half, 57 percent, of respondents who reported building between 11 and 99 units, reported single-family spec/tract building to be their principal operation, 31 percent reported single-family custom building, and 12 percent single-family general contracting. Only 15 percent of respondents who reported building between 1 and 10 units are primarily single-family spec/tract builders, while about two thirds (68 percent) are single-family custom builders and 18 percent are single-family general contractors (Exhibit 3).

Exhibit 3. Principal Operation by Number of Units Started in 2009

NUMBER OF UNITS STARTED

In 2009, 62 percent of respondents built between 1 and 10 single-family units, 11 percent built between 11 and 25 units, 10 percent built between 26 and 99 units, 5 percent built 100 or more units, and 12 percent built none. In 2010, 64 percent of respondents expect to build between 1 and 10 single-family units, 15 percent between 11 and 25 units, 9 percent between 26 and 99 units, 6 percent 100 or more units, while 6 percent expect to build no units. The average number of single-family units started by survey respondents in 2009 is 26, and the expected number of starts for 2010 is also 26 (Exhibit 4).

Exhibit 4. Number of Units Started

2009 DOLLAR VOLUME OF CONSTRUCTION ACTIVITY

Forty-three percent of respondents indicated that their firm’s dollar volume of construction activity during 2009 was between $1 million and $4,999,999, 11 percent between $5 million and $9,999,999, 4 percent between $10 million and $14,999,999, 8 percent $15 million or more. About 30 percent of respondents reported their 2009 revenue at less than $1 million. The median dollar volume of construction activity in 2009 was $2.6 million (Exhibit 5).

Exhibit 5. 2009 Dollar Volume of Construction Activity

YEARS COMPANY HAS BEEN IN BUSINESS

A majority of respondents, 69 percent, have been in business for more than 12 years, 11 percent for 8 to 11 years, 19 percent have been in business for 3 to 7 years, and 1 percent for less than 3 years. The average number of years a respondent has been in business is 21 years (Exhibit 6).

Exhibit 6. How Long Company Has Been in Business

TOTAL PAYROLL

Most of the respondents (61 percent) did not report the amount of their payroll as of March 31st, 2010. Of the remaining 39 percent, 9 percent indicated it was under $100,000, 23% between $100,000 and $499,999, and 6 percent over $500,000. The average payroll among those who reported it was $468,984 (Exhibit 7).

Exhibit 7. Total Payroll as of March 31st, 2010 (Including Owner/President/CEO)

NUMBER OF EMPLOYEES

About a quarter of respondents indicated there were 1 to 2 employees on their firm’s payroll as of March 31st, 2010. Another 24 percent reported 3 to 4 employees, 26 percent 5 to 9 employees, and 17 percent 10 or more. Five percent reported zero employees on payroll and 4 percent did not report the number of payroll employees at all (Exhibit 8).

Exhibit 8. Number of Employees as of March 31st, 2010 (Including Owner/President/CEO)

The remainder of this report is divided into two sections that present the survey findings from two different perspectives:

Compensations and Benefits Across 39 Positions - this section provides a broad view of all the full-time positions that currently exist at single-family building companies as well as a comparison of average total compensation and benefits across positions. For the purpose of this study the average total compensation is the sum of the average salary and the average bonus.

Compensation and Benefits by Position - this section provides a more detailed view of each position’s average compensation and benefits. It also shows how compensation can vary across firms of different size.

III. COMPENSATION AND BENEFITS ACROSS 39 POSITIONS

POSITIONS THAT CURRENTLY EXIST AT SINGLE-FAMILY BUILDING COMPANIES

Respondents were asked to indicate which of 39 positions exist at their firm and to write in others not listed. Almost all single-family builders (98 percent) responding to the survey have a President/CEO. Less than half of the respondents report having any of the other positions listed at their firm. Forty-one percent