As the US reverses restrictions on immigration, experts say firms may find more tech talent, which could reshape their business. While a majority of organizations are reporting little change in their base salary administration processes vs. pre-pandemic, there is a higher percentage of organizations utilizing: Increased use of select cash compensation programs in the new war for talent. Employers have an opportunity to share with employees not only how pay levels are set, but also information on the market range for their role. Still, only 30% of companies will communicate an employees grade/band upon request. Despite knowing this, we have continued to ask survey participants to give us their budget projections in August, largely because, well, clients and consultants alike are used to survey vendors publishing budget numbers at this time of year. This survey digs into the why and how of talent global mobility programs within your company's overall strategy. While pay transparency might be in the news more and more, employers have been slow to modify their communication of pay ranges. To be considered a participant, confirmation of the data is required in each edition, even if your data has not changed. This Video is unable to play due to Privacy Settings. Asia, 21 December 2021 - Companies in Asia Pacific are forecasting a median 5.4% increase in overall salaries for 2022 amid uncertainty as economies start to reopen, compared to 5.1% in 2021 and 4.8% in 2020, according to Mercer's latest Salary Movement Snapshot Survey 1. As a result, forecasted increases are likely understated to actual total increase practices by as much as 25-33% of the overall budget. These are the highest budgets we've seen since the 2008 financial crisis. "2023 promises to be another banner year for employees seeking salary increases," says Chris Fusco, senior vice president of compensation at Salary.com. Salary Projections for 2022. Follow Mercer on LinkedIn and Twitter. Mercer is a business of Marsh McLennan (NYSE: MMC), the worlds leading professional services firm in the areas of risk, strategy and people, with 83,000 colleagues and annual revenue of approximately $20 billion. September 30, 2022 New York, United States Today, Mercer released the results of its 2023 US Compensation Planning Survey revealing that while salaries are going up, 2023 compensation budgets and salary projections for US employers are expected to lag behind inflation. Then, collect and incorporate the unique factors of your organization that will influence the budgets (e.g., financial performance, hiring needs, etc.). Discover which types of transportation benefits companies typically offer and understand Visit the US & Canada Participation Station! Share. WorldatWork projected a national total salary budget increase average at 3.3% for 2022, which the firm's director of Total Rewards content, Alicia Scott-Wears, said "signified not only . Looking back over the last two decades, inflation has been low most commonly between 0 and 2 percent, while merit budgets have remained relatively stable at around 3 percent. Take a proactive approach to managing your workforce in a competitive job market. Our whitepaper analyzes some of the big trends for 2022, such as improving employee wellness and leveraging remote work in your strategies for both compensation and recruitment. Forgotten your login user name or password? Weekly leadership messages from our CEO Gary Burnison, capturing the mood and the moment with storytelling and insights. Mercerbelieves in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. By. At Mercer, we believe in building brighter futures. This, combined with a strong job market, has heightened employee expectations for increased compensation this year; and employers are responding. 3 ways to emphasize the human dimension and focus on your people amid digital transformation. Over half (53%) of organizations said they will comply with local laws and have no plans to broaden transparency beyond what is required. To address this question, its helpful to examine how compensation budgets have been impacted by inflation in years past. We are in the midst of a labor shortage in the US, and wages are moving up especially for hourly pay. When it comes to compensation decisions, employers are caught in the middle of recessionary concerns, a tight labor market, and shifting employee expectations due to inflation. Slightly higher than the pre-pandemic levels, the projected salary . Enter the characters shown in the image. Hiring across the region has also accelerated in the second half of 2021, as businesses shift their attention from reducing staff to hiring more, albeit still not at pre-pandemic levels. US MBD: Mercer/Gartner Information Technology Survey. The average 2023 merit increase budget, including zeros, reported by survey participants came in at 3.4%, compared to the 3.2% actually delivered in 2022. The projected increment is higher than the pre-pandemic levels of 2019 by 50 basis points. A competitive leave policy is a benefit to everyone. Discover whats next in the world of rewards from Korn Ferrys Client Partner, Ben Frost. Top-performing individuals can be enticed with multi-year bonuses or lump sums to reflect current market premiums. Nearly two-thirds (64%) of employers in the United States have budgeted for higher employee pay raises than last year, according to a report from Willis Towers Watson (WTW). The Video could not be loaded because the privacy settings are disabled. The combination of wage growth and the rise in inflation is reflected in the projection of salary increase budgets for 2022, climbing to 3.9% in November from the 3% reported in April 2021. In summary, wages are going up, but inflation is not the trigger. Now part of the Mercer QuickPulse TM survey series to give you the latest insights in compensation planning and total rewards. Follow Mercer on LinkedIn and Twitter. Still, only 24% of companies will communicate an employees grade/band upon request. All Mercer events about talent, investment, and health issues. Marsh McLennan is the leader in risk, strategy and people, helping clients navigate a dynamic environment through four global businesses. Workspan Magazine supplies in-depth analysis on pressing issues. Depending on the industry, we may continue to see budgets increase but some organizations bracing for a recession are likely providing conservative merit increases in an attempt to avoid layoffs later in the year. Just as important, however, is ensuring that your organizational culture is one that actively seeks out this kind of feedback, welcomes it and, most importantly, acts on the findings. The Video could not be loaded because the privacy settings are disabled. This Video is unable to play due to Privacy Settings. And Statistics Canada is now reporting CPI at 4.1% (Year-over-year August), the . Employers are increasingly using off-cycle increases to combat retention concerns, along with other issues. 2023 Mercer (Canada) Limited. How will you use this information to develop your proposal, knowing its preliminary? At this same time last year, we asked survey participants to indicate what month they will have a finalized annual increase budget for the coming year. Excluding companies that have implemented wage freezes, it is a 1.2% improvement from 5.3% this year but still below the 6.9% in 2019. Retail and Wholesale, along with Mining and Metals, on the other hand, tend to be a bit more conservative at communicating grades/bands than other industries. 46% of . The Video could not be loaded because the privacy settings are disabled. The pace of change in the market may also warrant employers to make adjustments outside of the traditional annual paycycles. More than 30 million viewers are expected to watch football this Thanksgiving. Download now to learn about all these trends in compensation strategy and more as the new normal continues to evolve. For example, twice per year compensation increases have become the norm inArgentina. Organizations are generally split between those who include vs. exclude promotions, internal equity adjustments, market adjustments, key contributor increases and other off-cycle increases in these projections. To be considered a participant, confirmation of the data is required in each edition, even if your data has not changed. Next year's planned pay increases would be the highest on record since 2008. Learn about healthcare offerings that help you create an inclusive benefits program to meet the needs of all employees. Singapore, November 15, 2022- Salary increases in Singapore are expected to surpass pre-pandemic levels with increments to average 3.75% in 2023, compared to 3.65% in 2022 and 3.60% in 2019. Update your submission as needed, and click the Submit button! Need compensation planning data in Canada? Employers' compensation budgets are set to rise 3.3% for merit budgets and 3.5% for total budgets in 2022, a survey by HR consulting firm Mercer found a slight increase from the 2.8% merit and . Employers must increase focus on pay for skills across the employee life cycle that is aligned with overarching rewards and talent strategies to future-proof their workforces for whatever upheavals that may come.. There are several findings that are worth noting from our survey of global practices. When comparing the average base pay per employee from 2021 to 2022, wages increased an average of 4.9percent. Japan, New Zealand and Australia are the lowest at 2.5%, 3.1% and 3.3% respectively. Talent All Access gives you both with quick to find and easy to digest content. their associated costs. Need help? Worldwide Benefit & Employment Guidelines, Salary increase budgets for 2023 provide updated amounts if they have changed, Salary increase budgets for 2024 provide updated amounts if they have changed. Time is limited. Most organizations globally are reporting an uptick in their median total salary increase budgets for 2022 vs what they had planned in 2021. Likewise, employees with small children have also had a pandemic experience that is vastly different from those who have teenagers or no children. With remote work here to stay, employees can cast a much wider net in their job searches than when they were limited by geography. You may access your survey submission at any time to make updates. Lastly, take the opportunity to become more transparent around pay. To find out what creative approaches you can be taking, contact us here. Chinas potential in the life sciences sector is undisputed, given its long history and tradition in medicine. As you plan your compensation strategy and total rewards program, you'll want the latest data-driven insights about the labour market. The total base salary increase budget includes other base pay increases such as promotions and cost of living adjustments, in addition to merit increases. This survey explores trends with regard to long-term assignments (LTA), and how policies and practices to manage them evolved since our last 2020 edition, run during the pandemic. The days of a standardized one-size-fits all employee benefits package could be drawing to a close. The US Compensation Planning Survey includes data from more than 1200 US organizations of varying sizes across 15 industries. Organizations are generally split between those who include vs. exclude promotions, internal equity adjustments, market adjustments, key contributor increases and other off-cycle increases in these projections. While wage increases are inevitable, there's more to the solution. "May you live in interesting times" is an English expression claimed to be a translation of a traditional Chinese curse. Its hard to say. It seeks to understand the drivers for talent international mobility, where mobility management fits in the organization, the organization and responsibilities of the Mobility function, digitalization & technology and framework trends. But its also the little things, like paying attention to what food is served in the office, what music is played at corporate events, and ensuring that everyone, at every level, is respected. The labor shortage was reported as the top driver for increases in compensation budgets for employers, which aligns with long-standing practices focused on paying based on demand for labor, not inflation or cost of living. Mercer noted that total . For example, Life Sciences, High Tech and Other Manufacturing are all showing base pay changes over 5%, while Healthcare and Insurance/Reinsurance are coming in under 3%. We recommend employers consider three actions: First, while employers may not need to take broad-scale action on compensation due to inflation, action is warranted based on the conditions of the labor market. Review market practice and statutory requirements of paid and unpaid time off for a selection of core leave programs. We have provided the data excluding those organizations that are not providing an increase. According to Mercer's US Compensation Planning Survey, the average 2022 merit increase budget is 3.4 percent, with total increases (including other types of base pay increases, such as promotional awards) reaching 3.8 percent. Recession fears dont seem to be impacting increase budgets, Employers are increasing pay outside of the annual cycle. Slightly higher than the pre-pandemic levels, the projected salary . However, it should be noted that these budget numbers are only preliminary and should be considered to be one of several inputs used to determine an organizations budget. Despite the second wave of Covid-19 hitting the . Use your compensation budget wisely. Wages are on the rise. Start by examining your organizations work-life balance, opportunities for internal promotions and benefits packages. How can they be made to feel like they belong in your organization when not sharing office space and coffeebreaks? Scroll down for more information on this survey. The pandemic had the effect of thrusting inequality into the spotlightnot just in healthcare or law enforcement, but in the workplace, as well. Africa: Algeria, Angola, Cameroon, Egypt, Ethiopia, Ghana, Ivory Coast, Kenya, Morocco, Mozambique, Nigeria, Senegal, South Africa, Tanzania, Tunisia, Uganda, Zambia, Americas: Argentina, Bolivia, Brazil, Canada, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Mexico, Mexico-Monterrey-Saltillo, Panama, Paraguay, Peru, Puerto Rico, Trinidad and Tobago, United States, Uruguay, Asia Pacific: Australia, Bangladesh, Cambodia, China-Beijing, China-Changsha, China-Changzhou, China-Chengdu, China-Chongqing, China-Dalian, China-Guangdong, China-Hangzhou-Ningbo, China-Hefei-Wuhu, China-Nanjing, China-Qingdao, China-Shanghai, China-Shenyang-Changchun, China-Shenzhen, China-Suzhou, China-Tianjin, China-Wuhan, China-Wuxi, China-Xiamen-Fuzhou, China-Xian, Hong Kong, India, Indonesia, Japan, Macau, Malaysia, Myanmar, New Zealand, Pakistan, Philippines, Singapore, South Korea, Sri Lanka, Taiwan, Thailand, Vietnam, Central & Eastern Europe: Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Georgia, Hungary, Kazakhstan, Latvia, Lithuania, Moldova, North Macedonia, Poland, Romania, Serbia, Slovakia, Slovenia, Ukraine, Uzbekistan, Middle East: Lebanon, Oman, Qatar, Saudi Arabia, Turkiye, United Arab Emirates, Western Europe: Austria, Belgium, Cyprus, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, United Kingdom. These include the Hospitality, Airlines, Retail and Luxury Goods sectors.. Theres one thing certain about the future of work: unpredictability. According to Mercers US Compensation Planning Survey, the average 2022 merit increase budget is 3.4percent, with total increases (including other types of base pay increases, such as promotional awards) reaching 3.8percent. The survey found that no employers are currently planning to freeze pay in 2023. You need numbers to get the conversation started. In 2020, inflation was a low 1.4% but salary increase budgets in 2020 and 2021 were higher (between 2.5% and 2.8%). But whats the difference between tolerable stress and toxic stress? Other factors commonly considered include internal equity and current salary compared to midpoint or market value. We were prompted to initiate this survey when it became increasingly clear from our clients toward the latter part of 2021 that early compensation increase projections for 2022 may no longer be relevant. If you would like more details on the Mercer QuickPulse or US Compensation Planning Survey please contact us at 800-333-3070. We use cookies to improve your experience. More than 93 per cent of Australian organisations are planning salary increases for their workforce in 2022 of 3 per cent, up 0.5 per cent from 2021, according to Mercer's annual Total Remuneration Survey (TRS) . Missing your live results access code? Excluding companies that have implemented wage freezes, Pakistan (9%) has the highest projected salary increase in 2022, followed by India (8.7%) and Bangladesh (7.8%). From that lens, we are seeing that salaries across the board have increased 4.0%, but there are some significant differences by industry. While nearly 80% of organizations reported that they are just in the preliminary stages of determining their 2023 annual . The average raise is expected to be 3% next year, up from 2.7% in 2021, according to a survey by Willis Towers Watson, a human resources consulting company. View our expertise through the lens of your existing organizational culture to determine what kinds of solutions may work best for your remoteteam. Employers are budgeting an average of 3.8% for merit increases compared to the 3.4% actually delivered this year and 4.2% for their total budget increase for 2023. More centralized review, calibration, and control processes of base salary increases, Greater differentiation in increases between outstanding and competent performers, The use of sustainability, ESG and DEI metrics in incentive plans, Connecting the work the organization does to its mission, vision, and values, Clarifying and communicating employee growth and career development opportunities, Engaging with employees in organization change priorities, Building manager and leader effectiveness to build connections and inclusivity within their teams. As skills begin to overshadow education or experience, more companies are implementing skills-based pay practices to attract new talent and retain critical skills. Total increases were slightly higher at 2.9%, decreasing to 2.6% when factoring in those not providing increases. There are several findings that are worth noting from our survey of global practices. It can be difficult to keep up with relevant compensation trends and how they impact your organization. Additionally, to keep it in perspective, the majority of employers did report that the percentage of employees receiving off-cycle increases is typically less than 30%. This is the sixth in a series of global pulse surveys from Korn Ferry designed to gather insights into how organizations are adapting their reward programs in response to a rapidly changing world, and to assess how their plans for future rewards programs are evolving. Internet Explorer is no longer a supported browser on imercer.com. For an optimal experience on imercer.com, please use Chrome, Edge, Firefox, or Safari. So many things in our world are changing. Please see ourPrivacy Policyfor details. Mercers 2021 Flexible Working Policies & Practices Survey show that 54% of companies in Asia Pacific have implemented or are actively developing a long-term flexible working strategy. Complete/update all the tabs identified below, prior to the deadline for each edition, to ensure you receive access to the results! Create a solid foundation for your pay structure. The majority (80%) of organizations are beginning to determine their 2023 annual increase budget, and overall salaries are going up. Individual performance is still the most common factor that employers use to determine the size of an individuals annual increase. Explore Mercers latest thinking to see how were helping to redefine the world of work, reshape retirement and investment outcomes, and unlock real health and well-being. That's a far cry from just a couple of years ago. Current & projected data on pay increases, structure adjustments, and more. Sky-rocketing prices have begun to raise many questions from US employers on how to manage compensation budgets in times of high inflation. Senior Principal Kurt Groeninger talks about creating the foundation for your ESG strategy by setting up the right infrastructure for your organization. Buy or Participate TRS - The Key to Designing Competitive Pay Packages worldwide. Internet Explorer is no longer a supported browser on imercer.com. For an optimal experience on imercer.com, please use Chrome, Edge, Firefox, or Safari. While wage increases are on the horizon in almost every industry, employees are looking for more than just financial compensation for theirwork. This is up just slightly from 2022 projections of 3% and 3.3%*, respectively, from our August Pulse and an increase over 2021 actual increases of 2.8% . Mercers approximately 25,000 employees are based in 43 countries and the firm operates in 130 countries. Employers are budgeting an average of 3.8% for merit increases compared to the 3.4% actually delivered this year and 4.2% for their total . Simply revisit the survey and click the submit button to confirm previously entered data. Employers are increasingly using off-cycle increases to combat retention concerns, along with other issues. The most increased focus is in the following areas: The results of this survey show that as salary increases stall, employers will need to get creative about non-cash rewards to retain and engage employees. However, with teams spread across a country or globally, employers need to overcome key challenges in fostering a sense of organizational values and processes. As a global leader in tech-optimized mining solutions, Hexagon Mining wanted to improve the efficiency of 23,000 global employees and ensure their safety. Survey respondents are typically HR professionals, and their organizations cover a broad range of of size, geography, and ownership structure. India (9.4%) has the highest salary increase in 2022, followed by Vietnam (7.4%) and Indonesia (6.7%). This will continue to drive dissatisfaction with compensation programs and pressure employers to increase wages in the months ahead. Salary increase planning made easy. Contact Us. We use cookies to improve your experience. Take this opportunity to seal any cracks in your competitive position, increase pay transparency, and reassure employees that their pay is aligned with the external market even if they dont see their pay moving at the rate ofinflation. This snapshot survey is conducted four times per year and provides up-to-date salary increase budget data for 100+ markets across the globe. This would lead us to believe that although they are providing off-cycle increases, inflation is not the driving factor. Mr Swani added, Despite the impact of the pandemic on global unemployment, employers in many markets are having difficulty finding talent especially with very limited talent mobility across countries due to border restrictions, and companies are looking to attract and retain their employees with more competitive compensation and benefit packages.. Stay on top of the latest leadership news with This Week in Leadershipdelivered weekly and straight into your inbox. Take an inclusive approach to benefits. Then, consider benchmarking how your total rewards program stacks up against your competitive set: salary, benefits and those more nuanced qualitative differentiators that speak to your organizational culture. Notably, when asked what they were doing to offset market inflation for their employees, only 34% indicated that they would provide an ad hoc off-cycle wage review and/or adjustment, while a similar percentages indicated they that were not planning to do anything. The survey also found a high double-digit attrition rate of overall 20 per cent, along with voluntary attrition at 15.4 per cent. For example, remote workersespecially those living in small communities or rural areasmay be more enticed by virtual offerings for medical and mental health support. Our look at pressing problems and solutions for board directors. While inflation has had limited impact on compensation planning in recent history, it can play a larger role outside the US, where countries are more likely to experience hyperinflation or persistent and sustained high inflation as part of their economy (e.g., Turkey and Argentina in recentyears). Could the results create an entirely new approach to succession planning? No two workplaces will have the same answers to these questions. Other factors commonly considered include internal equity and current salary compared to midpoint or market value. Senior Client Partner, ESG & Global Leader Total Rewards. This year, Mercer's Total Remuneration Survey (TRS) also saw higher projected increments across most of the 18 1 industries surveyed. Compare your company to the market with base salary and total cash compensation data for up to 50 benchmark jobs. And with the quit rate hovering near 20-year highs of 2.9percent per month, employees are taking advantage. except for those from the High Tech industry, can also expect higher bonus payouts this year, based on Mercer's mid-2022 forecast. Give us a call at 1-855-286-5302 or email surveys@Mercer.com. Providing more flexibility around days off for caregiver support could be one way to show the parents on your team that their wellness matters to the entire organization. 2023 Mercer (US) LLC, All Rights Reserved, About Mercers US Compensation Planning Survey, Turning health risk into value: well-being, Gig is BIG: The nature of work has changed, Shifting Trends and What They Mean for the Future, Value of integrating investment and actuarial services, See all investments and retirement insights, 2022 US Compensation Planning Survey, March edition, Analysis of Mercers 2022 Mercer Benchmark Database. Consider whether starting wages require a boost either overall or in select high-cost markets. While pay is a driving factor for many workers, it is not the only one. Simply revisit the survey and click the submit button to confirm previously entered . While pay transparency might be in the news more and more, employers have been slow to modify their communication of pay ranges. NEW YORK, September 30, 2022--Today, Mercer released the results of its 2023 US Compensation Planning Survey revealing that while salaries are going up, 2023 compensation budgets and salary . These products are all included in Talent All Access Portal+, but can also be purchased separately. If you have previously participated in the 2023 SBS survey, you can return to the survey, and enter your email address to receive the link to your existing survey submission. As you plan your compensation strategy and total rewards program, youll want the latest data-driven insights about the labour market. Commenting on the industry salary trends, Mr Swani said, Industries that were relatively immune to the impact of the pandemic, such as Consumer Goods, Chemicals, Life Sciences and High Tech, are providing merit salary increases as usual. Mercers approximately 25,000 employees are based in 43 countries and the firm operates in 130 countries. Under the 'Manage Cookies' option in the footer, accept the Functional cookies to allow the video to play. In 2020 when the pandemic began, Fusco adds, just . Singapore, November 17, 2021 -Salary increases in Singapore are rebounding to pre-pandemic levels, with increments expected to average 3.5% in 2022, compared to 3.3% in 2021 and 3.6% in 2019. What are they doing right? Be a part of our global team dedicated to building brighter futures for employers and their people.