Projected salary increases for 2019

  • Lower Compensation Growth Expected Through 2020 and into 2021
  • Asian nations lead global salary increases for 2019
  • Salary Increase Budgets Decline during the Pandemic
  • Third of employers froze salaries in 2020, compared to projection of 2%, finds survey
  • Gazing Into the Crystal Ball: 2022 Salary Budget Predictions
  • Lower Compensation Growth Expected Through 2020 and into 2021

    Contact Salary Increase Budgets Decline during the Pandemic The global pandemic has impacted salary budget planning for the first time in years. The last time that U. However, most respondents anticipated that employee compensation would grow by an average of 2. Salary increase budgets, which consist of the pool of money available annually for base pay adjustments show that for nonexempt hourly nonunion employees that the actual mean the mathematical average of all respondents was 3.

    To date for , the mean is 2. For exempt salaried employees the actual mean was 3. For officers and executives, the actual mean was 3. WorldatWork Salary Budget Survey: Top-Level Results and Salary Budget Survey: Top-Level Results Salary structure changes, which consists of the percentage that pay grades, or salary structures increase each year, are down from In , the average was 2.

    WorldatWork also reported that base pay merit increase budgets for are at 2. This small percentage drop shows that employers continue to differentiate base pay-related rewards. The results further explained that companies granted employees increases between 2.

    While holding the line for increases employers are also embracing variable pay and other initiatives to recognize and help retain high performers. Also, that among organizations that plan to distribute bonuses, 33 percent expected payouts to be less than originally intended, 12 percent anticipated them to be at or above the target level.

    Pay equity still seems to be an issue for most employers. WorldatWork reports in their Salary Budget Survey that 65 percent of the employers who responded state that they expect to make pay changes in , to address pay equity issues, making pay more equivalent for women and minority employees based on factors such as position, tenure, education and experience.

    The projected percentage is about the same. For additional information related to salary increase budgets, salary structure increases, merit increases, or pay equity issues, please contact us at www. Written by: Kristen Deutsch, M.

    Asian nations lead global salary increases for 2019

    Methodology Executive Summary was an unprecedented year. A changing economy, the rise of remote work, calls for diversity, equity and inclusion, new laws around pay transparency, and the expectations that workers have for employment opportunities are all reshaping people strategy, which includes compensation.

    The impact of on the employee experience is creating waves that will result in a sea change over time. The question is what is important now? According to our data, the biggest themes include reductions in base pay increases and total compensation and their impact on income inequality, a growing focus on compensation strategy, higher investment in pay equity analysis to close pay gaps, and the importance of paid market data and transparency in driving compensation strategy and enabling shifts to accommodate changing conditions and expectations.

    In summary, organizations who are serious about being competitive when it comes to talent will need to invest in mature compensation management solutions and pay communication strategies in See Methodology for more information.

    Although impact on pay has been in the minority, it is more significant than what typically happens in a recession. The most common response was freezing pay or deferring raises for highest earners.

    However, the fallout of e. However, a quarter of organizations Going into , a smaller percentage of organizations plan to continue these changes, with the most common responses being pay freezes rather than pay cuts. However, nearly 30 percent are not ready to make those changes. The drivers most likely to change compensation strategy include the economy Contextually, this is troubling, especially for lower wage earners as the impact of the last recession of was still being felt more than a decade after corporate profits increased, with stagnation in real wage growth and declining labor share of corporate income.

    Before the Great Recession, percent annual wage growth was standard; after it hovered around 3 percent or less. With fewer organizations giving base pay increases at all, income inequality can be predicted to widen even further in coming years. Only A majority of organizations An increase of 3 percent or less has been standard for almost a decade, but is less than economists have said workers need for the economy to recover to pre-Great Recession levels.

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    Here are some key results related to expected salary projections for the coming year: Salary Increase Budget Decline Projected for the First Time since The recession was the last time businesses projected declining salary increases due to economic uncertainty.

    As with the pandemic, the crash created anxiety in the market, as many businesses shut down and were unable to secure cash flow to reopen. A survey conducted by WorldatWork from May 27 through June 26 studied salary projections for for a sample size of 4, total rewards professionals.

    Salary Increase Budgets Decline during the Pandemic

    The results indicated an average salary growth projection of 2. The declined percentage signifies how the compensation planners are factoring in economic uncertainties while projecting salary budget growth. Average salary increase projections were consistent for nonexempt hourly and salaried employees, although executives are expected to maintain a salary increase rate of 3.

    A more in-depth look into the numbers suggests many companies hope salary budgets will stay flat through At the same time, 84 percent of businesses expect to pay higher salaries to some extent for the year.

    Third of employers froze salaries in 2020, compared to projection of 2%, finds survey

    The most generous companies are planning to pay increases up to 3 or 4 percent. Another study of 1, organizations by Willis Towers Watson found similar results with average salary increases of 2. Salary increases have generally stayed steady around 3 percent per year in the past decade.

    Only 7 percent of companies do not plan on raising salaries next year, which is down from 14 percent in the previous year.

    On the positive side, 76 percent of firms plan to issue performance bonuses in Other Declared Results: These surveys can be compared with the data for the second quarter of received from the Bureau of Labor Statistics, which found wages and salaries for civilian workers rose by 0.

    Gazing Into the Crystal Ball: 2022 Salary Budget Predictions

    Another economic barometer released by the Commerce Department on July 31,declared that the overall American incomes fell by 1. Salary increase budgets in the banking industry are the lowest and expected to remain stable at 4. The sector has been facing headwinds due to the volatile economic environment, decline in business outlook and the intensifying competition from fintech developments.

    Despite these, the banking industry still draws the highest variable pay among all industries in the region. Employers in the banks are projected to pay a variable incentive of about three months Salaries in the insurance industry will see an increase from 5.

    Variable pay in the Insurance industry is also among the highest at more than two months The industry is also expected to add more headcount next year. Edward Hsu, Business Leader, Data Services and Compensation Software, Asia Pacific, Willis Towers Watson, commented: "Jobs in sales, engineering and technical skilled trades are the top three functions that organisations are likely to recruit in the next 12 months. The increase is projected to remain the same in The following sectors show a smaller salary increase budget this year: fintech at 3.

    However, the fintech industry shows one of the highest salary budget increment next year with employers projecting a growth of 0. This could be due to the increase in fintech investments, where the sector is looking to hire to support business growth. Employers in the construction, property and engineering industry are also projecting a higher growth in salary increase budget in with a potential growth of 0.

    On the other hand, these sectors show a possible slowdown in salary increase next year: retail projected 3. Inemployers in the banking and insurance sectors pay the highest variable incentives to employees in Singapore based on performance - banking at 3.

    Projected salary increases for 2019