Merit increases running at highest levels in recent memory
Employers are paying merit increases at 4% and above—the highest levels in recent memory and above last year’s 3%.
They
also are raising salaries, adding cost-of-living adjustments at higher
levels, and paying hefty sign-on bonuses—all in an effort to retain and
attract workers in the face of rising inflation and a tight labor
market.
That’s
the word from David Turetsky of salary.com, which conducted a salary
survey of more than 1,000 companies in late February and early March.
Will they work?
But are these increases sufficient to retain top-quality employees?
Time
will tell whether the increases are enough to combat inflation levels
that are running at about 6.5%, the highest point since 1982, Turetsky
says.
“Despite
their best intensions, 80 percent of companies told us they don’t feel
their efforts are helping them retain employees,” he adds.
“Thanks to these historic inflation rates, the Great Resignation may
continue for a while longer.”
Other takeaways from the survey:
- Seven out of 10 businesses are “very concerned” that rising inflation rates are eroding employee compensation.
- Workers are also expressing their concerns. Seven out of 10 companies say their employees have made their worries known to their managers, Human Resources, and leadership teams.
To download the full report, go here.