August 2010 - SCM Salary Survey

INSIDE THE CURRENT ISSUE

August 2010

2010 Supply Chain Management Salary Survey

Recession? What recession, right?

Solid compensation gains are reported again, but cracks are starting to show

by Rick Dana Barlow

In one of the biggest blows to any recent recessionary aftershocks, save for the winding retail lines of iPhone 4-crazed Apple-philes earlier this summer, average salaries of healthcare supply chain management professionals continued climbing for the second consecutive year.

The latest annual industry-wide survey by Healthcare Purchasing News showed that supply chain salaries on average in 2010 increased more than 7 percent over 2009 levels to $74,816.

Historical View of SCM Salary Survey

While this year’s overall result represents a momentum-slowing rise above the previous year’s 12.7 percent spike, it looks remarkably more dramatic if you extend the jump over a two-year span. Since 2008 when most economists and pundits attribute the recession originated, average supply chain management professional salaries soared nearly 21 percent.

For a Wall Street analogy, supply chain salaries seem to resemble the bond market in a bear economy.

If you’re looking for more evidence that supply chain professionals should reserve their sobs for, say, Toy Story 3 viewing this summer, try this on for size. Fifty-eight percent of survey respondents indicated that their base salaries represented an increase over last year, a five percent dip from 2009 responses, but 37 percent replied that their compensation remained the same, a six percent rise.

Did your salary increase in 2010?

	Remained the same	Yes, it increased	No it decreased
Male	19.13%	32.95%	1.70%
Female	17.61%	24.24%	3.60%

Quivering confidence?

Those who reported a salary increase for 2010 saw their pay boosted on average 3.4 percent from the previous year, which represents roughly half a percentage point over 2009. But overall supply chain professionals reported an average 2 percent salary bump. That’s slightly less than half a percentage point over 2009’s results.

In a sliver of a shift away from confidence, 45 percent of survey respondents admitted they feel "very secure" in their current position; 46 percent indicated they feel "somewhat secure." Both figures were down slightly from last year.

To keep these data in perspective, however, please remember that results tend to reflect the number and title variations of respondents. For example, more senior-level executives who lead integrated delivery network (IDN) operations will push salary data higher, while more buyers at community hospitals responding may pull the salary data down.

Salary by Job Title

For this year’s survey, slightly fewer than half (49 percent) of respondents surveyed worked at a director level, with 43 percent indicating they serve as a director of materials management and 6 percent a corporate or senior vice president of materials or supply chain management. Another 18 percent indicated they were purchasing directors.

Also noteworthy: Slightly more than half (51 percent) of respondents worked at standalone hospitals and more than a third (37 percent) indicated that they were IDN, alliance or multi-hospital system staffers, a roughly 7 percent shift from last year’s demographics.

Salary by Facility Type

Salary by Facility Type & Gender

Clinic		Avg	$51,250
Female	$52,500	Male	$47,500
Group Practice		Avg	$101,000
Female	$23,000	Male	$140,000
Hmo/Ppo/Ipo/Insurance		Avg	$89,500
Female	$115,500	Male	$76,500
Hospital,Standalone		Avg	$68,344
Female	$59,404	Male	$75,396
IDN/Alliance/Multi-Group		Avg	$88,897
Female	$76,845	Male	$98,632
Long Termcare Facility/ Home Healthcare		Avg	$50,925
Female	$47,321	Male	$59,333
Surgi-Center/ Ambulatory Center		Avg	$53,481
Female	$49,583	Male	$63,500
Other		Avg	$84,167
Female	n/a	Male	$27,500

Location-wise, respondents were almost evenly split with 38 percent working in urban hospitals (where the average salary was $80,173), compared to 31 percent in suburban hospitals (where the average salary was $79,994) and 31 percent in rural hospitals (where the average salary was $63,003).

Not surprisingly, the average salary for the highest-level supply chain executives at the corporate and senior vice president positions at $119,864 was greater than those in the director’s office at $84,707.

Purchasing directors and managers reported a $68,505 average salary while senior buyers and buyers responded with $47,576 in average compensation.

On the more clinically-oriented side, value analysis coordinators clocked in at $73,667 on average, and operating room materials or business managers at $58,000. Both were roughly unchanged from the previous year. Materials management information systems managers said they earned $63,500 on average, nearly equivalent to last year’s response.

Salary by Years in Supply Chain Management vs. Years at Current Facility

Salary by Years at Facility & Gender

Salary by Years in SCM & Gender

YEARS AT FACILITY
More than 25	Female	$63,659
	Male	$75,587
	Avg	$69,756
20 - 24	Female	$61,225
	Male	$71,431
	Avg	$66,000
15 - 19	Female	$54,417
	Male	$82,167
	Avg	$65,843
10 - 14	Female	$58,595
	Male	$94,429
	Avg	$76,014
5 - 9	Female	$65,424
	Male	$83,473
	Avg	$74,723
2 - 4	Female	$68,924
	Male	$87,132
	Avg	$79,470
Less than 2	Female	$85,154
	Male	$86,043
	Avg	$85,802

YEARS IN SUPPLY CHAIN MGMT
More than 25	Female	$71,544
	Male	$92,702
	Avg	$85,628
20 - 24	Female	$64,646
	Male	$80,268
	Avg	$72,995
15 - 19	Female	$64,651
	Male	$84,843
	Avg	$74,114
10 - 14	Female	$61,522
	Male	$75,208
	Avg	$66,214
5 - 9	Female	$61,829
	Male	$73,481
	Avg	$66,903
2 - 4	Female	$53,867
	Male	$68,750
	Avg	$61,052
Less than 2	Female	$34,333
	Male	$62,500
	Avg	$54,050

More than half of survey respondents (58.3 percent) handle supply chain duties for

Please indicate the product areas for which supplies are purchased by your department. )

Med/Surg Supplies

95.8%

Medical Capital Equipment

89.2%

O.R. Supplies/equipment

89.0%

Office Supplies and Forms

87.9%

Sterilization/Infection Control

87.5%

Imaging/Radiology

84.1%

Housekeeping Supplies

82.8%

Laboratory

78.6%

Plant Operations/Maintenance

67.4%

Network/Computer Equipment

66.1%

Transportation
(patient and vehicular)

61.9%

Food

20.8%

Pharmaceuticals

16.9%

Other:

2.1%

a single hospital, nearly 19 percent said they were responsible for one or two additional acute-care facilities and more than 10 percent said they handled three to four more acute-care facilities. Forty percent, however, indicated they provided supply chain services for more than 10 non-acute care facilities, such as clinics, physician offices and surgery centers, but nearly 21 percent said none.

Depending on their own titles, 31 percent said they report to their organization’s CFO, 13 percent to the vice president of supply chain, 29 percent to the corporate director or director of materials management.

At 51.4 years of age, the average respondent has spent 15.6 years in materials management, 8.7 of which has been at their current facility, which has an average bed size of 358. On average, their department includes 17.6 employees. It’s important to note that these data are relatively close to last year’s responses with about two fewer years in materials management and at their current facilities that may have more than 40 fewer beds, but two more staff members.

More than 60 percent of respondents identified themselves as standalone hospitals but part of a group purchasing organization (GPO), while more than 31 percent indicated they were part of an IDN.

36% of Respondents Have Certification

Of the 36 percent of respondents who held certification, more than 58 percent earned the Certified Materials & Resources Professional (CMRP) designation through the Association for Healthcare Resource & Materials Management (AHRMM), while nearly 12 percent earned the Certified Purchasing Manager (CPM) designation through the more industry-focused Institute for Supply Management. More than 8 percent said they hold a Certified Registered Central Service Technician (CRCST) and more than 3 percent are AHRMM Fellows, according to the survey.

Average Salary Increase by Gender

Gender bending

No surprises here. Men, who outnumbered women 54 percent in survey respondents, also out-earned them on average, $84,051 vs. $64,223, a nearly $20,000 gulf that remains consistent with previous years’ results.

On a somewhat brighter note, men saw their average salaries jump nearly $4,700, while women saw their results jump $4,900.

From a regional perspective, men earn the most in the Pacific states at $96,914 on average, followed by the Southeast at $85,910. Rounding out the other three regions was the Northeast at $81,995, followed ever-so-closely by the Mountain states at $81,095 and the Central region at $79,253. Nearly $18,000 separated the highest-earning from the lowest-earning regions for men, a much-wider gap than the previous year’s results, which found the same regions bookending the spectrum.

Salary by Gender & Education

Women in the Pacific region earned the most at $70,500 on average, followed by the Southeast at $66,115. Rounding out the other three regions was the Northeast at $65,825, then the Central region at $61,816 and the Mountain states at $53,222. More than $17,000 separated the highest-earning from the lowest-earning regions for women, more than twice the spread shown in last year’s results.

Based on gender, the regional salary spread saw the Mountain states leading at $27,873 on average between men and women, followed by the Pacific at $26,414, Southeast at $19,795, Central at $17,437 and Northeast at $16,170. Canada was the only region where women fared slightly better than men, $106,250 to $103,333.

Salary by Gender & Region

Grow west, young people

Make it a "four-peat" for the Pacific region as the most lucrative area to work, regardless of gender. The average salary for supply chain professionals in the Pacific states was $83,521, a $4,700 rise from 2009 and roughly half the gap from 2008.

The Southeast trailed in second place with $76,013 on average, nearly $6,000 higher than the previous year.

In a reversal from the previous year and an equivalent spread, the Northeast slipped in next at $75,793, nearly $5,600 higher than 2009 results.

The Central region came in fourth with $70,359 on average, more than $4,700 higher than last year’s results, followed by the Mountain states at $65,417, a $2,250 decline from the previous year.