COMP NEWS – Wages are up nearly 5% this year, a recent survey shows, and compensation increases seem unlikely to stop there. A Pearl Meyer compensation planning survey saw that over a third of employers are planning more increases in the middle of the year.
As inflation hovers at a 40-year high and with many wages already up by almost 5% this year, some U.S. employers are looking to raise worker pay again this year, according to a survey.
The Pearl Meyer compensation planning survey this month says that base wage and salary hikes this year were 4.8% for all employee groups combined, and found that about a third of employers are planning mid-year hikes.
At least two-thirds of employers received a 4% increase in compensation this year. With rising inflation, many are considering the need for more inventive types of compensation planning and incentive design.
Two-thirds of employers surveyed made wage and salary boosts above 4% this year, while a quarter of them increased pay by more than 6%.
“Most companies are giving thoughtful consideration to mid-year increases and are providing them to key employees, targeted job families, and top performers rather than granting increases across the board,” the survey said, noting that most of the organizations surveyed, 64%, said they’re not planning a mid-year pay increase.
In many cases, a flat compensation increase is not enough to offset the effects of inflation. In these cases, flat pay raises are unlikely to motivate workers and top performers.
As some employers raise wages, a report by the University of Wisconsin Population Health Institute found this year that worker compensation is still way behind what workers need to earn living wages.
The Wisconsin report found that most American workers need pay raises of more than 70% before earning a living wage — and the average living wage across all U.S. counties for one adult and three children is roughly $36 per hour.
To read more about how wages are up for workers, click here.
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