Treasury and Finance Pros’ Salaries Are Rising in a Tight Job Market

Nearly 60 percent of treasury and finance functions are facing a talent shortage, according to the 2023 Association for Financial Professionals (AFP) Compensation Survey. But while business leaders are eager to fill open positions, they struggle to find candidates with the necessary skills. Meanwhile, employees have been leaving their jobs in droves as they seek better opportunities, higher salaries and benefits, and flexible work arrangements.

These trends can be traced back to the post-pandemic economic recovery, when we saw an uptick in hiring as business leaders were eager to restore normalcy. Employees, on the other hand, were coming off a very challenging couple of years. Some had lost their jobs as businesses experienced closures, downsizing, or financial constraints. Others, who faced high workloads and elevated stress during the pandemic, were yearning for a better work-life balance. Additionally, many employees who got used to the flexibility of working from home during the pandemic were reluctant to return to the office.

Talent scarcity is certainly a problem for business leaders and human resources, as the time and cost it takes to hire and on-board a new employee can be significant. However, employees are also negatively impacted. They may be asked to take on additional work to cover vacant positions, even if they are already stretched thin. In this year’s survey, 42 percent of respondents cited limited resources (financial, personnel, managerial) as the biggest challenge employees face right now. Their volume of work (40%) and the recruitment of personnel (37%) follow close behind.

Salaries and Bonuses

Treasury and finance professionals’ base salaries appear to have benefited from the tight job market. In 2022, treasury and finance professionals at all levels realized a gain in their base salaries of around 5 percent, the highest increase in a decade. In addition, 70 percent of treasury and finance professionals responding to our survey received bonus pay in 2022. Unsurprisingly, executive-tier professionals received larger bonuses than others, reaching nearly $70,000, or 34 percent of base salary.

Keen to avoid employee turnover, employers used raises and bonuses to incentivize their teams to stay on board. And our research suggests this strategy worked: Survey respondents at companies offering more lucrative salaries and flexible work arrangements believe these strategies helped prevent an uptick in resignations.

Determinants of bonuses.  The organization’s performance plays a big role in determining its employees’ bonuses. Nearly 60 percent of respondents said their organization’s operating income or its ability to reach EBITDA (earnings before interest, taxes, depreciation, and amortization) targets determined their bonuses. Also playing a role in employees’ bonuses were the organization’s profits or increased profit targets (cited by 44 percent of respondents). Employees, too, bear some responsibility in the size of their bonuses, as 40 percent said they were awarded bonuses for completing specific projects.

Influences on salary.  Treasury and finance professionals’ earnings are also influenced by factors such as experience, education level, and professional certification. Additionally, geographic location, industry, and organization size play a part in determining total compensation.

• Education.  Survey results indicate that in 2022 finance professionals with an MBA earned an average base salary that was approximately $19,000 higher than that of their counterparts who held only a bachelor’s degree or high school diploma/associate degree.
• Certification.  Finance professionals who hold a professional certification can claim prestige and credibility in their field. Among the most recognized and respected certifications in the profession are the Certified Treasury Professional (CTP), Certified Public Accountant (CPA), and Certified Corporate Financial Planning and Analysis Professional (FPAC) designations. For certain job titles, incumbents who hold certifications tend to have higher salaries than those in similar positions who do not.
• Region.  Finance professionals’ salaries can also vary depending on the location of their organization. In examining the average base salary of finance professionals in each of the four regions of the United States (as defined by the U.S. Census Bureau), AFP added a “virtual” region this year to include those respondents whose organizations are exclusively virtual. The typical finance professional in the Northeast earned the highest base salary in 2022—a mean of $131,735 and 9 percent more than that earned by a peer in the Midwest ($120,852).
• Industry.  AFP Compensation Survey data over the years has revealed that average salaries vary by industry. In 2022, average base salaries ranged from $109,487 for treasury and finance professionals in the government/nonprofit sector to $134,746 in the energy/utility sector—a 19 percent difference.
• Organization size—as measured by annual revenue or size of workforce—is another influence on employees’ salaries, and the survey data reveals disparities in salaries based on both annual revenue and number of employees. In 2022, the typical finance professional at a company with annual revenue under $100 million earned an average base salary of $111,328; their counterpart at a company with at least $1 billion in annual revenue earned an average of $146,612—a difference of 24 percent. There is a similar pattern when looking at organization size by number of employees. Finance professionals at organizations with 1,000 or more employees earned 14 percent more, on average, than their peers at organizations employing fewer than 250 employees.

Upward mobility.  Various factors influence a treasury or finance professional’s potential for promotion. The primary criterion for upward mobility is increased job responsibility (cited by 81 percent of respondents). Sixty-one percent of respondents noted that company growth often leads to upward mobility opportunities in their organization.

Benefits and Leave

Almost all organizations represented in our survey offer health insurance, dental insurance, and a vision plan (all cited by more than 94 percent of respondents). Other benefits often provided to employees are life insurance (91%), retirement/pension plans (88%), and disability insurance (82%). Though paid maternity leave is covered by 68 percent of organizations, only 53 percent of employers offer paid paternity leave.

Paid time off is another important consideration for employees evaluating a job offer. A majority of employers represented in our survey (60%) offer paid time off that includes both personal and sick-leave days. Others offer separate categories of leave—paid leave (50%) and sick leave (46%). In this year’s survey, AFP also asked respondents about unlimited paid time off—also known as “discretionary paid time off”—a leave structure in which employees do not have a fixed number of days off. Fifteen percent of respondents said their organization offers unlimited or discretionary leave to employees.

Many organizations increase the number of days off employees receive as they gain longer tenure. For those that limit paid time off, 92 percent give employees five additional days of paid leave after they have been employed for a specific number of years. At 43 percent of organizations, employees need to be employed for at least five years to gain five additional paid days off.

Looking Ahead

A majority of treasury and finance professionals (58%) are concerned about a possible recession in the near future. Two-thirds of those who expect to see a recession (67%) are adjusting their personal finances to prepare for it, while 35 percent are investing time and resources in their professional development.

Though treasury and finance professionals have received steady raises for two consecutive years, the average increase in 2022 (5%) did not match the rate of inflation, which was 6.5 percent. Whether this cohort will receive salary increases in 2023 will depend on the economy, as a downturn could undermine their chances of seeing an uptick in pay. However, if the economy stays on course or strengthens, they could very well enjoy compensation increases next year too.

Mariam Lamech is the director of survey research for the AFP. In this role, Lamech manages the project lifecycle for AFP’s proprietary research, including survey rationale and design, survey administration, analysis and interpretation of survey data, and writing and producing AFP’s survey reports. Lamech leads and executes AFP’s survey research with a focus on enhancing the value of AFP’s external survey projects to the treasury and finance profession through the development and production of ancillary products. She has nearly 25 years’ experience within research functions at associations.