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US Pay Increases
US businesses expect 87% of their employees to receive an increase in base pay (excluding promotional increases) this year, up from 83% in 2003, according to the 31st annual WorldatWork Salary Budget Survey (SBS) which reported earlier this month.
2004 salary budgets - the total amount of money allocated by an organization for all employee salaries - are still at historic lows. Participating organizations report an actual average total salary budget increase of 3.5%, less than the 3.7% they predicted last year - but have again predicted 3.7% for next year.
Seventy-seven percent of companies will link pay to performance this year, up from 75% last year and well up on the figure of 66% in 2001.
'The continuing lacklustre increases in salary budgets must be taken in context with relatively low inflation rates and high benefits costs', said Anne C. Ruddy, executive director of WorldatWork. 'And we're encouraged to see employers link pay to performance, which will be instrumental in retaining key employees as the economy improves and employees start looking around'.
The survey was answered by 2,774 WorldatWork members in organizations representing around 12.7 million US employees. Respondents are employed in the compensation and benefits departments, mostly of large companies.
WorldatWork is the world's leading not-for-profit professional association dedicated to knowledge leadership in compensation, benefits and total rewards and is online at www.worldatwork.org
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