Employers Not Planning To Freeze Employee Wages

Results from the 35th Annual WorldatWork Salary Budget Survey, the largest survey of its kind, show pay budgets growing steadily from 2008 to 2009 in the U.S. and Canada. The actual increase in salary budgets was 3.9 percent in 2008 and is projected to rise again by another 3.9 percent in 2009 across all employee categories, regions and industries, according to the survey.

Key survey findings:

  • Among U.S. major metropolitan areas, organizations in Washington, D.C. report the highest 2008 salary budget increases for all employee categories and industries: 4.0 percent. On the low end, employers in Cincinnati, Detroit, Minneapolis, Pittsburgh, and St. Louis report average pay budget increases of 3.7 percent.
  • U.S. organizations in nine states are increasing salary budgets at the national level of 3.9 percent; the rest are reporting below average increases.
  • In Canada, employers in the major metro areas of Calgary and Edmonton report the highest actual 2008 salary budget increases: 4.0 percent; employers in Montreal and Quebec report the lowest actual pay budget increases: 3.6 percent.
  • Nine out of ten employees (91 percent) in both the U.S. and Canada can expect to receive base pay increases this year.
  • High performers can expect raises over 5 percent while below average performers can expect 2 percent or less.

“Pay increases are only one way an organization attracts and retains talent regardless of the overall economy,” said Anne C. Ruddy, CCP, president of WorldatWork. “Organizations continually evaluate the attractiveness of their entire rewards package and develop new programs accordingly. They are investing in other areas of total rewards, such as employee development, training and work-life balance. For example, the number of organizations offering telework as a flexible work program is up significantly (40 percent) compared to a year ago.”

After seeing salary budget increases sink to historic lows in 2003 and 2004 and climb slowly from 2005 through 2008, this year’s study confirms that the growth in salary budgets is holding steady, an indication that labor markets are stable. The WorldatWork Salary Budget Survey is the most comprehensive salary budget survey with more than 2,700 organizations representing 13.6 million North American employees.

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