July 23, 2010

HR Fact Friday: Pay Incentives Planned to Limit Post-Recession Flight

Filed under: Compensation — Tags: , , , , , , — Paul @ 6:00 am

Many U.S. employers are planning to use compensation incentives to limit “post-recessionary employee flight”, according to a survey of HR decision-makers by Workscape. The survey conducted at the end of March, 2010 found that 65% of the 476 respondents are considering or strongly considering pay increases to drive retention as the economy recovers, while 46% will consider benefits increases. 79% of those polled or interviewed represented companies with less than 5,000 employees; 7% represented organizations with 5,000 to 10,000 employees; and 13% represented companies with more than 10,000 employees.

Looking back, only 10% of organizations cut employees’ pay as the recession entered its third year in 2009, but 39% froze compensation, respondents indicated. The vast majority of those that awarded increases held them to 3% or less, and only 2% or respondents said their organizations increased average compensation by 5% or more.

Respondents who siad their organizations intend to provide incentives to retain and engage employees as the economy improves are most likely to offer:

  • Merit increases (66%)
  • Performance-based bonuses (52%)
  • Market or equity adjustments (24%)
  • Lump sum payments (12%)

Source: SHRM, HR Magazine, Stephen Miller, July 2010, pg 11

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June 4, 2010

HR Fact Friday: Pay Incentives to Limit Post-Recession Flight

Filed under: General HR Buzz,Salaries & Pay — Tags: , , , , , , — Paul @ 9:37 am

Many U.S. employers are planning to use compensation incentives to limit “post-recessionary employee flight,” according to a survey of HR decision-makers by Workscape, a provider of employee performance, compensation and benefits administration services, conducted at the end of March 2010. According to the survey report, Managing Employees and Total Rewards during the Economic Upswing, 65 percent of respondents are considering or strongly considering pay increases to drive retention as the economy recovers, while only 46 percent will consider benefits increases.

Looking back, only 10 percent of organizations cut employees’ pay as the recession entered its third year in 2009, but 39 percent froze compensation, respondents indicated. The vast majority of those that awarded increases held them to 3 percent or less, and only 2 percent of respondent organizations increased average compensation by 5 percent or more.

(more…)

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October 30, 2009

HR Fact Friday: Salary Secrets Exposed

Filed under: Compensation — Tags: , — Paul @ 3:27 pm

In down economic times, companies seem to have carte blanche to limit salaries and make low-ball offers. But that shouldn’t be the case.

Below are the top salary secrets your employer doesn’t want you to know. With this information in hand, you’ll be in a better position to get the pay you deserve.

Employers don’t always offer a fair salary.
Some employers think they’re being fair, but they’re not up-to-date with the latest salary information. Others may try to pay less than the market value because they’re financially strapped. That’s why it’s important that you know exactly how much money you should be making. 

You can negotiate your salary in a tight job market.
In a recession, many people would rather take a pay cut than lose their jobs. Raises are hard to come by and new hires may feel they have less negotiating power. But that doesn’t mean it’s impossible to bump up your salary;  it’s just a little more challenging.

According to a recent survey from the Society for Human Resource Management, 80 percent of HR professionals say employers are willing to negotiate salaries. So, if you’re looking for a raise at your current job, come armed with your marketplace worth and make your case. And, if you’ve been offered a job that pays less than you like, don’t be afraid to name your realistic asking price. Keep in mind that, if you got the offer, you’re clearly the best candidate for the job — even in this highly competitive job market.

New hires sometimes earn more than long-term employees.
When there’s a strong job market, organizations need to do whatever they can to attract top candidates. This often means that starting salaries may be higher for newbies than they are for long-term employees. Given the current economic conditions, that’s less the norm these days, but it still happens in certain industries. If you suspect that a new hire with similar responsibilities is making more than you are, use current salary data to approach your manager with the request to bring your salary up to par.

Your performance doesn’t decide your pay.
While your performance is one important factor in the salary equation, your pay is also a reflection of many other factors, including:

The job market — lower pay is more acceptable in tighter job markets.
Location — generally the higher the cost of living, the higher your salary.
Years of service — in many cases, the longer you’ve been with a company, the higher your pay.
Organization size — large organizations tend to pay more than small ones.
Education level — in most cases, the more education you have, the higher your pay. Take a free education test to find out how going back to school can help you earn more.

If you’re a valued employee who isn’t making the money you deserve, you do have options. Know your value and make your case. And know too, that many employers — particularly larger employers — have a little more in the “raise kitty” than they let on. 

Source: Maria Hanson, LiveCareer

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July 24, 2009

HR Fact Friday: Pay Raises Smallest in Decades

Filed under: Compensation — Tags: , , , , , — Paul @ 6:00 am

Recession-starved employee salaries have scarcely grown this year, and early predictions for 2010 aren’t looking much better. Two surveys released earlier this week found employers have increased salaries this year by the smallest percentage in decades.

Human resource consultants Watson Wyatt Worldwide, Inc. and Hay Group estimate that median pay raises for 2009 ranged between 2% and 3%. The U.S. Labor Department says pay for the average worker increased 2.2% in the year ended March 31, down from 3.2% in the year-earlier 12 month period.

For next year, the firms are projecting slightly bigger raises of 3%. That’s the smallest forecast increase in the 29 years Hay Group has done its survey.

The reasons are clear: In a recession that has eliminated 6.5 million jobs since the end of 2007, millions of workers have suffered pay cuts or have been forced to take time off withouth pay. Economists expect the U.S. economy to resume growing later this year, but the labor market typically recovers more slowly.

Analysts say the findings demonstrate the depth and volatility of the recession. A year ago, the consulting firms predicted average workers would see pay increases of 3.5% to 4% this year. But the new surveys show that raises fell well short of that.

Source: Salt Lake Tribune, July 20, 2009, Michael Sanserino

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December 19, 2008

HR Fact Friday: Employers Cut Pay Raises in 2009

Filed under: Salaries & Pay — Tags: , , , , — Paul @ 8:41 am

The Wall Street Journal reported on 12/16/08 that employers have done a sudden about face in regard to projected pay raises for 2009.  Many who as recently as October said they were barely modifying their salary budgets in 09, have now changed their tune bringing projected annual pay raises for some workers to a 30 year low.

Overall, workers are now projected to receive average annual merit increases of 3% in 09 according to a new survey by Hewitt Associates. When polled just 2 months ago, employers said they had already lowered their budgets to 3.6% from 3.8% in July.

Pay for some workers may go as low as 2.5%, a clear signal that companies are concerned about managing their fixed costs during such a challenging worldwide business climate.

(more…)

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