Surveys: We’re in line for 3% raises in 2013
Surveys from three separate consulting firms found that employers expect to give their workers modest raises averaging about 3% in 2013.
According to a survey of 857 U.S. companies conducted by Towers Watson, companies are planning pay increases averaging 2.9% in 2013 for salaried, nonmanagement employees.
That's just slightly higher than the 2.8% hike they received last year and the 2.7% raise they received in 2011.
"Most U.S. companies continue to keep their salary budgets relatively tight, especially since they are having little difficulty attracting and retaining employees, in general, reflecting the soft labor market," says Laura Sejen, global practice leader for rewards at Towers Watson.
The results from a similar survey of 1,500 midsize and large U.S. employers by Mercer agrees with Towers Watson, saying that workers can expect a median raise of 2.9% in 2013.
Results from Buck Consulting, a human resource and benefits consulting firm that surveyed more than 350 organizations, say employees can expect a mildly more optimistic 3% increase in pay next year.
It’s impossible to know if a modest 3% raise will even be enough to beat inflation.
But the Consumer Price Index rose just 1.7% in 2012, so it’s possible so long as we continue to see the same moderate inflation we’ve been enjoying since the recession.
Of course, top-performing employees, which make up 8% of the workforce, are reaping the biggest boost in salary.
That's due to companies' desire to retain key talent.
However, the surveys differ in the bump that the best employees will receive.
Towers Watson says that workers with the highest-performance ratings can look forward to an average salary increase of 4.7% this year, while workers with average ratings will take home 3.2%.
Mercer's survey found that the best performers will receive a 4.4% pay increase this year, while average performers, which make up 54% of the workforce, will get a 2.4% raise.
And, according to Buck Consulting, the best performers will get a bump of 4.1% in their salaries.
Either way, it certainly pays more to be one of the best.
“Differentiating salary increases based on performance is the norm and remains an effective way for employers to wisely spend their reward dollars on the most impactful employees,” says Mike Burniston, leader of Mercer's human capital consulting business for the U.S. and Canada regions.