The top three sectors with the highest salary increase projected for 2022 are technology, e-commerce, and IT-enabled services. Organizations should take care in interpreting this forecast data as there is a significant variance in company practices regarding the types of pay increases that are included in these projections. Actual and projected pay increase data at the city and national levels. These are the highest budgets we've seen since the 2008 financial crisis. View our expertise through the lens of your existing organizational culture to determine what kinds of solutions may work best for your remoteteam. Lastly, take the opportunity to become more transparent around pay. The survey, conducted between October and November of 2021, looked at 1,004 U.S. companies and found that nearly 1 in 3 respondents (32%) had bumped up original salary increase projections from . This snapshot survey is conducted four times per year and provides up-to-date salary increase budgets for 100+ markets across the globe. We have provided the data excluding those organizations that are not providing an increase. 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. The days of a standardized one-size-fits all employee benefits package could be drawing to a close. 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. Time is limited. You need numbers to get the conversation started. For example, the US median increases have risen from 3.0% (during the middle of 2021) to 3.5% (as of now). Please use one of these supported browsers to ensure the best experience on this site: Participate to get the latest salary increase budget data! Most organizations globally are reporting an uptick in their median total salary increase budgets for 2022 vs what they had planned in 2021. But is it enough? Flex work and full-time remote work are increasingly part of the employee value proposition. For more data and insights from Mercers Total Remuneration Survey 2021, please see here. Participate by February 3 | Results publish early March, Participate by May 5 | Results publish early June, Participate by August 11 | Results publish early September, Participate by November 17 | Results publish mid December. 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. The Great Resignation has overwhelmed nearly every industry except two. As long as the economy and the job market remains strong, were likely to see continued upward pressure on wages, particularly with hourly workers and in certain industry sectors. WALTHAM, MA (September 1, 2021) - Salary.com's Annual U.S. National Salary Budget Survey reveals that 41 percent of organizations plan on having a higher salary increase budget in 2022 than they did in 2021, representing the first significant shift in merit increases in the last 10 years of survey data. 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. 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. 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. With 11.3million job openings, employees have options. The pace of change in the market may also warrant employers to make adjustments outside of the traditional annual paycycles. Guleyin stated that the average wage increase expectation for 2022 for the 673 companies surveyed stood at 32%. If your company runs on a calendar financial year, then its likely that you are putting together the numbers and justification for annual increases, structure adjustments, and other critical compensation management elements. Interestingly, the Technology industry typically leads the market with their compensation awards, yet the survey found that while Technology employers are right at the national average for total increase (4.2%), there is a slight lag on the national average for merit increases (3.7%) a departure from previous years. Slightly higher than the pre-pandemic levels, the projected salary increments reflect a faster and stronger economic rebound when compared to the Global Financial Crisis, with real Gross Domestic Product (GDP) growth expected to increase by 5.1%2 in 2022. From that lens, we are seeing that salaries across the board have increased 4.1%, but there are some significant differences by industry. Salary data for a broad cross-section of jobs within 5 US geographic regions. Ensure your incentive programs are competitive. 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. Just always keep in mind that you will likely see a change from the September to the November publication of the projected budget numbers. . And with the quit rate hovering near 20-year highs of 2.9percent per month, employees are taking advantage. Simply revisit the survey and click the submit button to confirm previously entered data. Only 10% of US organizations say that recessionary concerns are having a high impact on their salary increase budgets right now. Learn about healthcare offerings that help you create an inclusive benefits program to meet the needs of all employees. Employee benefits consulting and brokerage, Mental health's impact on work and home life, Mental health and how to improve employee access and support, Pension evolution: Retirement and investment video series, Addressing workforce diversity, equity and inclusion (DEI), Moving mobile employees ahead of inflation, Reshaping the future: Take stock & solidify - Feb 2, 2023, Mercer Global Investment Forums 2022 - Canada, Webinar replay: Global Talent Trends 2022, global pandemic survey on labour market challenges. Missing your live results access code? At Mercer, we believe in building brighter futures. In February this year, services firm Aon revised its salary increment trend to 9.9% versus an average of 9.4% that it had forecast in September 2021. And the Workspan Podcast offers timely insights from experts in a . That's a far cry from just a couple of years ago. Hong Kong (3.5%), Singapore (3.5%), Malaysia (4.5%), Philippines (5%) and Thailand (5%) came in below the regional median of 5.4%, while Indonesia came in above at 6.5%. As a result of the last two years of adapting and evolving, organizations globally have charted new business and talent strategies, and this has had a significant impact on the direction of reward programs. In March 2022, only 38% indicated that they were providing off-cycle increases, but in this pulse survey, 64% of participants report that they provide off-cycle increases. 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%). 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%. Given the current climate, salary projections for 2022 are lower than expected, according to Normandin Beaudry. The projected salary increments reflect guarded optimism as Thailand's Gross Domestic Product (GDP) is expected to grow by 3.8% in 2023, the highest in . The 15 largest economies in the world are forecasting an average increase of 4.3%, which is 3 percentage points higher than the actual increase of 4.0% in 2021. There are several findings that are worth noting from our survey of global practices. While nearly 80% of organizations reported that they are just in the preliminary stages of determining their 2023 annual increase budget, the survey found that overall salaries are going up. 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. 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. This Video is unable to play due to Privacy Settings. As a result, forecasted increases are likely understated to actual total increase practices by as much as 25-33% of the overall budget. With more states requiring external publication of pay ranges on job postings, it is critical that organizations build their own story around compensation because without the right context, employees will create their own narrative, added Mason. Corporate & Investment Banking / Global Markets. The consumer price index rose 8.5 percent over the last 12months the highest inflation the US market has seen in more than 40years. Small amounts of short-term stress can boost performance. This year, Mercer's Total Remuneration Survey (TRS) also saw higher projected increments across most of the 18 1 industries surveyed. First off, use this as directional information and combine it with additional sources. Increases are forecast at 2.8 per cent, excluding freezes, nearly identical to the 2.7 per cent increase recorded in 2019. Theres an increased use of select cash compensation programs in the new war for talent and increased utilization of select non-financial reward programs. Employers are responding by developing DEI policies, all with the goal of making their organizational culture feel more welcoming to people with a wide range of backgrounds. The Video could not be loaded because the privacy settings are disabled. This snapshot survey is conducted four times per year and provides up-to-date salary increase budget data for 100+ markets across the globe. 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. Rising wages due to the labor shortage, coinciding with periods of high inflation, have created confusion for employees. For example, remote workersespecially those living in small communities or rural areasmay be more enticed by virtual offerings for medical and mental health support. Most organizations globally are reporting an uptick in their median total salary increase budgets for 2022 vs what they had planned in 2021. Workspan Daily provides fresh news, every weekday. Using this measure, inflation is projected to reach its highest level since indexing began, causing 7%-11% increases for most limits, based on their rounding levels. Notably, when asked what they were doing to offset market inflation for their employees, only 38% indicated that they would provide an ad hoc off-cycle wage review and/or adjustment, while a similar percentages indicated that they were not planning to do anything. 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.. Need compensation planning data in Canada? Likewise, we are seeing an increase in the total increase budget for 2023: 3.9% for 2023, compared to 3.4% in 2022. Over half (53%) of organizations said they will comply with local laws and have no plans to broaden transparency beyond what is required. Resources: Leading in the New Shape of Work. To be considered a participant, confirmation of the data is required in each edition, even if your data has not changed. The 2023 limits will reflect increases in the Consumer Price Index for All Urban Consumers (CPI-U) from the third quarter of 2021 to the third quarter of 2022. Personalized benefits plans are a great way to account for these discrepancies. How will you use this information to develop your proposal, knowing its preliminary? Our look at pressing problems and solutions for board directors. This Video is unable to play due to Privacy Settings. The UK has gone from 2.5% to 3.0% (from the middle of 2021 to now), Australia from 2.4% to 3.0%, Brazil from 6.1% to 7.4%, Turkey from 18% to 30%, Ukraine from 6.5% to 10.3%, and Russia from 5% to 7.5%. 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 . With all that said, what are we looking at for 2023 preliminary budget projections? The 2023 survey is now open. Organizations in France, Russia, India and South Korea are all forecasting . Chinas potential in the life sciences sector is undisputed, given its long history and tradition in medicine. Simply revisit the survey and click the submit button to confirm previously entered . Participants will receive a complimentary executive summary report of the results! The short answer is: they havent. Our whitepaper analyzes some of the big trends for 2022, such as improving employee wellness and leveraging remote work in your strategies . Mercer's Total Remuneration Survey 2023 is a salary and benefits study that offers in-depth reports and benchmarks for total compensation analysis. The disconnect in compensation budgets and rising inflation is creating frustration with workers, who have seen all of their wage gains eroded by rising costs. In 2020 when the pandemic began, Fusco adds, just . For more information, visit mercer.com. The average 2023 merit increase budget, including zeros, reported by survey participants came in at 3.8%, compared to the 3.4% actually delivered in 2022. 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. With minimal impact on productivity, collaboration or employee development, more employers are also willing to offer either part-time remote working (76%), flex-time (75%) or full-time remote working arrangements (32%) as part of their future of work policy, up 46%, 12% and 22% respectively in relation to pre-pandemic levels. Other industries such as High Tech and Consumer Goods also saw increases over prior year. Now part of the Mercer QuickPulse TM survey series to give you the latest insights in compensation planning and total rewards. If you would like more details on the Mercer QuickPulse or US Compensation Planning Survey please contact us at 800-333-3070. . Employers are increasingly using off-cycle increases to combat retention concerns, along with other issues. Monitor employee movement trends in, out, and within companies around the world with data on turnover, workforce changes, hot skills and more. The total base salary increase budget includes other base pay increases such as promotions and cost of living adjustments, in addition to merit increases. Of the 55% that plan to adjust structures in 2023, we expect to see the structures increase by 2.8%, which is just above the average actual adjustment of 2.2% reported in March of 2022. For example, Life Sciences, High Tech and Other Manufacturing are all showing base pay changes over 5.6%, while Healthcare and Insurance/Reinsurance are coming in under 2.7%. Participate to receive a free country report for all markets where you provide data! The study found that employers primary response to inflation is a reactionary one of providing ad-hoc off-cycle wage reviews and/or adjustments (reported by 38% of employers). Still, only 30% of companies will communicate an employees grade/band upon request. Review statutory and supplemental benefit details for social security, retirement, medical, death, disability and more. A majority of organizations are granting a significant percentage of their employees a salary increase this year (i.e., at least 90% of employees will receive an increase). If you need more assistance, we have team members standing by to help. Bringing you the most up-to-date information on remuneration trends and insights on the current rewards environment, key economic data affecting pay decisions, topical HR issues and more. The US Compensation Planning Survey includes data from more than 1200 US organizations of varying sizes across 15 industries. Many companies took immediate action following the minimum wage announcement, according to Mercer Turkey CEO Dincer Guleyin. Salary.com | Sep 2022 Salary Budget Survey 2022-23: Top-Level Results Average Salary Increase Budgets Were 4.1% in 2022 and Projected at 4.1% in 2023 WorldAtWork | Aug 2022 Companies are budgeting . Participation is simple, with just one survey for all four editions. This Video is unable to play due to Privacy Settings. Mercers approximately 25,000 employees are based in 43 countries and the firm operates in 130 countries. The last remaining legacy of this historical practice is reflected in some labor contracts and collective bargaining agreements where wage increases remain indexed toCPI. From job search strategies to networking and interview tips, our coaches and tools are here to help. Separate promotion budgets still dont seem to be the norm only 24% indicated that they have them. To participate, go to the survey and enter your email address to begin participation. Sign up to be notified when the next pulse survey opens for participation. Take an inclusive approach to benefits. Next year's planned pay increases would be the highest on record since 2008. Determine the right incentive program for your company by evaluating eligibility, targets and actual incentive data for STI, sales and LTI. Overall salary increments projected for 2023 to average 4.8% across markets in Asia Pacific, but real salary increases are nominal. Its hard to say. By partnering with Korn Ferry, Keystart has begun to act transparently on employee feedback, leading to enablement and engagement throughout the business. Mr Swani added, Adopting skills-based pay approaches, either by replacing or complementing existing job-based models, creates a competitive edge in todays changing business environment by supporting the attraction, development and retention of critical skills. By using our site, you agree that we can place cookies on your device. We use cookies to improve your experience. Now part of the Mercer QuickPulseTM survey series to give you the latest insights in compensation planning and total rewards. Industry-wise, financial services is . Complete/update all the tabs identified below, prior to the deadline for each edition, to ensure you receive access to the results! 46% of . Take a proactive approach to managing your workforce in a competitive job market. You need numbers to get the conversation started. And a quarter of employers plan to give increases in the range of 5%-7% in 2023. 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. For example, some companies have been considering stipends or allowances to help workers combat the rising gasprices. The Leader in Executive Compensation Consulting | Salary Survey | Pearl . Employers are increasingly using off-cycle increases to combat retention concerns, along with other issues. 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% . Now part of the Mercer QuickPulse TM survey series to give you the latest insights in compensation planning and total rewards. Short Description Current & projected data on pay increases . 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. This is especially true for hourly workers, whose base pay rose on average 6.7%2 in 2022, despite a 3.8%3 total base pay increase budget. 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. For most employers, cost of living increases are a thing of the past. The industries predicted to have the biggest salary increases in 2022 compared to what their increases were in 2021 are: Retail and wholesale trade: 2.8% to 3.6%; Finance: 2.7% to 3.5%; Likewise, we are seeing an increase in the total increase budget for 2023: 4.2% for 2023, compared to 3.8% in 2022. Senior Principal Kurt Groeninger talks about creating the foundation for your ESG strategy by setting up the right infrastructure for your organization. Only 2% of participants responded that they did not use factors and instead provided an across the board increase, which would indicate that increasing pay across the board for inflation or cost of living is a prevalent practice. Remuneration Trends & Insights. Not only can doing so enhance retainment, it can also save your organization money in the longrun. Salary increase planning made easy. Mercer, an American asset management firm, projected an increase of 9% in salaries across industries in 2022. In the near future, jobs are no longer going to be the organizing unit of work but skills would be. The future of rewards is shifting. However, only 16% of companies in Asia Pacific formally monitor the market demand for skills. 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. While nearly 80% of organizations reported that they are just in the preliminary stages of determining their 2023 annual . 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%. The actual average merit increase delivered so far in 2021 was 2.8%, but that number dips to 2.5% when including those companies that did not deliver increases. All Rights Reserved. These include: Increased utilization of select non-financial reward programs. Most employees today see compensation as a blackbox and dont understand how their pay is set. "May you live in interesting times" is an English expression claimed to be a translation of a traditional Chinese curse. Create a solid foundation for your pay structure. Mercer is a business of Marsh McLennan (NYSE: MMC), the worlds leading professional services firm in the areas of risk, strategy and people, with 81,000 colleagues and annual revenue of over US$19 billion. Access the Canada Compensation Planning Survey for insights to help with pay decisions in that country. This is a continuation of practices seen over the last year, which resulted in significant gaps in employers total compensation spend relative to budgets for 2022. To find out what creative approaches you can be taking, contact us here. In this survey, you may submit all selected markets in a single submission. More than 72% indicated their budgets are finalized between October and January, with most selecting November or December. 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. Will annual increase budgets be higher when we run the survey again in . Just always keep in mind that you will likely see a change from the September to the November publication of the projected budget numbers. Despite a divergent economic outlook across markets in Asia Pacific, companies in the region are forecasting an average 4.8% increase in overall salaries in 2023, according to the annual Total Remuneration Survey (TRS) 2022 conducted by Mercer. How will you use this information to develop your proposal, knowing its preliminary? The majority (80%) of organizations are beginning to determine their 2023 annual increase budget, and overall salaries are going up. In March 2022, only 19% indicated that they were budgeting for off-cycle increases, but in this pulse survey, 53% of participants report that they will provide off-cycle increases. By using our site, you agree that we can place cookies on your device. To be considered a participant, confirmation of the data is required in each edition, even if your data has not changed. In summary, wages are going up, but inflation is not the trigger. Workspan Magazine supplies in-depth analysis on pressing issues. To be considered a participant, confirmation of the data is required in each edition, even if your data has not changed. Your total rewards program for the new normal. Plus, why CEOs are losing confidence in their direct reports. 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. Start by examining your organizations work-life balance, opportunities for internal promotions and benefits packages. However, no one is planning to freeze salaries, even with looming fears of an economic downturn. The average merit increase will be 3.8%, compared to 2022's 3.4%, and the total increase budget will be 4.2%. Banking and Financial organizations tend to openly communicate their structure information, even without being asked, more so than other industries. Please see ourPrivacy Policyfor details. So many things in our world are changing. 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. Compensation is going up. 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. This calculation gives us a look at how much average salaries are changing due to hiring rate increases and off-cycle adjustments. In the 1980s, most employers moved away from cost of living wage increases and instead focused on cost of labor the market rate for the job being performed. Organizations should also remember that pay is only one tool in their toolkit; take a broader view of total rewards and implement benefits that help meet workers needs particularly those that are low to no cost, but of high value like flexible working, or financial wellness programs.. All Mercer events about talent, investment, and health issues. November 2022 results. The projections for 2022 salary increase budgets jumped almost a full percentage point, from 3 percent in April to 3.9 in November.

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