NCPA - National Center for Policy Analysis

Signing Bonuses Proliferating

June 10, 1998

Once confined to the realm of upper-echelon executives and professional athletes, signing bonuses are being pressed upon teachers, government employees and even fast-food restaurant managers.

  • In a new survey by the American Management Association, 44 percent of the 344 corporate members who replied said they paid signing bonuses to employees hired in the last year -- up from 30 percent last spring.
  • Bonuses generally range from 5 percent to 15 percent of a year's salary.
  • Fast-food chains are not offering them yet to counter clerks, who might take a $200 bonus and quit within a week -- but some do offer "retention" bonuses to those who stay six months.
  • For all its growing popularity, signing bonuses are hard for the federal government to track because they are usually paid by the time an employee starts work -- and thus are not included in such statistics as the Employment Cost Index.

In Texas, school boards in Dallas and Fort Worth are reportedly engaged in what amounts to a bonus bidding war. Fort Worth initially offered bonuses starting at $500 and rising to $2,000 for teaching applicants who signed contracts by June 1. Dallas countered last month with a flat $1,500 for each new hire.

Source: Louis Uchitelle, "Signing Bonuses Now a Fixture Farther Down the Job Ladder," New York Times, June 10, 1998.


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