Maybe it's time to think seriously about performance pay

The modern workplace is rapidly changing and employment ideals such as company loyalty, job security and career stability seem reminiscent of a simpler time.

The modern workplace is rapidly changing and employment ideals such as company loyalty, job security and career stability seem reminiscent of a simpler time.

But while it’s true that what it means to go to work today is very different from years past, there are real advantages to both employers and employees who are willing to embrace a new kind of working relationship.

Engineering and IT organizations, especially, which may not have the resources to hire full-time employees in every situation, can now tap highly skilled contract workers who can hit the ground running and perform a job for a specific project. Conversely, we know that these highly skilled workers are now enjoying the freedoms that can come from not necessarily always being tied to one employer. They can enrich their own careers along the way by picking and choosing the projects that are right for them.

These are all positive aspects of the current job market, but one constant remains: Everyone is still working for a paycheck — and employees today are also looking for new ways to increase their earning power.

Considering “variable” compensation, otherwise known as “performance pay,” is one way for employers to look at the compensation issue differently — and to accommodate changing perceptions of pay among workers.

The 2013 Kelly Global Workforce Index (KGWI), an annual survey revealing opinions about work and the workplace from a generational viewpoint, shows us why. According to results of the survey, more than half (57 percent) of all respondents would most prefer pay for productivity or performance, given the choice between this or pay for overtime work.

These percentages get higher in the sciences, engineering and IT. In the high-tech field, for example, 63 percent of people working in this space say they prefer performance pay as opposed to the traditional model of overtime pay or straight salaries.

If an employer is quick to bristle at the possibility of performance pay, consider the fact that motivation may be higher when there are non-traditional monetary awards in the mix. Nearly half of respondents (46 percent) strongly agree that they would perform at a higher level if pay was tied to their performance.

These changing perceptions of pay only mean that employers today, more than ever, have to take compensation issues seriously, especially in robust industries like engineering and IT where the most highly skilled talent can often easily find better-paying roles. For this reason alone, employers must remain vigilant about recognizing that income is a strong motivator. It can mean the difference between keeping your most valued employees or watching them go somewhere else.

Susan Hornbuckle is area manager for Kelly Services in Salt Lake City. She has more than 25 years of experience in staffing, account management and business development.