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Manufacturing Industry Compensation Experts

Learn more about our expertise in the manufacturing sector

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Offices in Houston, Dallas, and Denver serving surrounding states.

Compensation in the Manufacturing Industry

In the coming years, the manufacturing industry will be put to the test as it will need to continually adapt to an ever-changing environment, while also keeping up with integrating technology into everyday operations. The shortage for skilled talent remains one of the manufacturing industry’s top challenges. Therefore, a compensation plan that provides a competitive edge is crucial to attracting the top performers necessary to the success of any manufacturing business. That’s where Longnecker & Associates comes in. Although we’re considered strategic compensation experts across many industries, we’ve emerged as leaders in the manufacturing space. Our team of experts understands the challenges and keeps abreast of trends affecting the industry to provide strategic plans that produce results.

L&A is here to assist clients through the changing environment in the manufacturing industry with compensation programs that will not only align the labor force to the goals of the company, but to shareholder performance as well. While recognizing that a client’s identity is not indistinguishable to any other, and each have their own unique thumbprint on the industry, it is our goal to ensure we understand a client’s competitive profile and how we can best support the achievement of long-term value creation.

In addition to L&A’s work with some of the nation’s most prominent companies, our team is also experienced with small and startup companies, many of which are backed by private equity groups. Below are some of the manufacturing clients L&A has worked with.

  • Compensation Philosophy Development
  • Peer Group Development
  • Executive Compensation Analysis
  • Annual and Long-Term Incentive Plan Design
  • Board of Director Compensation Analysis and Structure
  • All Employee Compensation Analysis and Salary Grade Development
  • Severance Benefit Design
  • Employment Agreement Design
  • Compensation Risk Assessment
  • Change in Control and Employment Agreement Plans
  • Merger and Acquisition HR Integration
  • Investor Relations, Shareholder Engagement Strategy
  • Succession Planning Design
  • Retirement Compensation Design
  • Compensation Discussion & Analysis Drafting and Review

In reaction to the COVID-19 impact on compensation programs, namely annual and long-term incentives, L&A worked with a public building materials company to alter the annual incentive plan. This alteration resulted in the utilization of a quarterly performance goal setting process and payouts. The results were a more manageable bonus program that allowed for more realistic projections and will reduce the need to make major discretionary adjustments at the end of the annual period.

The Compensation Committee released a supplemental proxy detailing the revised program and received positive feedback from key investors.

Compensation structures are dramatically evolving and therefore require greater strategic thought to stay in front of the market. L&A stays up-to-date on the latest trends affecting the industry to keep our clients informed and strategically positioned to succeed. The manufacturing industry outlook for the next three years is highly optimistic, but have you considered what this means for compensation? Below are a few facts and figures demonstrating current trends.

  • The median 2020 projected salary increase budget for all employees is 3.0%.
  • Retention of key executives and employees in any market remains an important initiative for boards and management teams, while 89% of companies indicated moderate to significant hiring efforts in 2020 and 2021.
  • There has been an increased use of quantitative performance measures in annual incentive plans to satisfy the investor push for clearer understanding of bonus compensation decisions. 
  • Manufacturing has been slower to shift away from stock options than most industries, but the prevalence of time-vested restricted stock has increased to the point of surpassing stock options, which highlights the retention focus.


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11011 Jones Road, Suite 200
Houston, TX 77070

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