For design professionals, large salary increases came to a screeching halt in mid-2001, when the softening of the construction market became apparent. Design firms have kept their raises low, waiting for signs of a rebound.

This year has been no exception. Firms are wary of big increases in healthcare costs and that means design firm managers have little expectation of big raises any time soon. A survey of design firm managers’ compensation published by ZweigWhite, a Natick, Mass.-based consulting and publishing firm focusing on the design industry, shows this trend.

"Overall, there has been very little increase for most positions," says Laura Rothman, managing editor of ZweigWhite’s survey publications. She notes that the only positions to see major increases in the survey were for project managers, up 13% from last year’s survey, and marketing managers, up 7%. For satellite office managers, human resources directors and information technology managers, median salaries actually declined. Median salaries for principals were unchanged in the past.

"Project managers are in particular demand right now," says Po-Sun Chen, manager of ZweigWhite’s San Francisco office and leader of the firm’s Staffing Solutions recruitment group. He notes that design firms are clamoring for people with project management experience and are seeking people "who are on the cusp of being made principal and who can help healthy firms sustain growth."

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How Design Firm Manager Salaries and their Bonuses Look

But few experts see much pressure to increase base pay. "What we are hearing is that increases will just be keeping up with the increases in the cost of living," says Bill Fanning, Atlanta-based research director for PSMJ Resources, a Newton, Mass.-based management consulting and publishing firm. Firms are worried about the spiraling increases in health insurance. "Most firms are in a reactive mode and are wary of being locked into higher base salaries," he says.

Bonuses have also taken a hit. "For years, firms could get away with lower base pay while paying substantial bonuses," says Jeffrey M. Robinson, president of PAS Inc., a Saline, Mich.-based management consulting firm. But now, many firms are unable or unwilling to pay the level of bonuses. "So, more companies are asking us to help redesign their compensation plans," he says.

But that doesn’t mean that money is the end-all. "People are willing to move for opportunity to grow as much as for more [money]," Chen says. So a successful firm that can offer a chance for career development can avoid some of the pressures to raise salaries, he says.