Yearend bonuses are a thing of the past at many companies.
Challenger, Gray & Christmas surveyed human resources executives and found that 43% of companies don't award yearend bonuses, perks or gifts. Back in 2007, just 28% of companies surveyed by the outplacement firm said they never award yearend bonuses.
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Among the 53% of companies that do give out a yearend bonus, the takeaway is oftentimes small. At half of the bonus-giving companies, employees receive either a non-monetary gift or a nominal monetary award valued at less than $100. Nearly one-third (31%) said they give a monetary bonus based on the company's performance, and 19% give bonuses only to selected employees based on performance.
Compared to last year, 75% said they're giving the same size bonuses, 17% said bonuses are getting bigger, and 8% said bonuses are shrinking compared to a year ago.
It's an entirely different story on Wall Street, where yearend bonuses typically comprise a larger percentage of annual pay. Challenger, Gray & Christmas cited data from consulting firm Johnson Associates, which found the average Wall Street managing director will take home about $900,000 in yearend bonus money (down from $1.2 million a year ago).
"There could be several reasons for the shift away from year-end bonuses. Certainly, the economic conditions of the last four years have contributed. In addition, some companies may have found that year-end bonuses are not the morale booster they once were and that there are more effective ways to reward high performers, while increasing the morale and loyalty of all employees. In many companies, year-round efforts may have replaced the end-of-the-year gesture," said John Challenger, CEO of Challenger, Gray & Christmas, in a statement.
Ann Bednarz covers IT careers, outsourcing and Internet culture for Network World. Follow Ann on Twitter at @annbednarz and check out her blog, Occupational Hazards. Her e-mail address is firstname.lastname@example.org.