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. Ensure your incentive programs are competitive. Salary Budget Snapshot Survey Info - Mercer The Retail industry is expecting the biggest jump to 12.6%, from 8.1% in 2021, followed closely by the . 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. 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%. Notify me when the next survey opens! Our whitepaper analyzes some of the big trends for 2022, such as improving employee wellness and leveraging remote work in your strategies . For example, the US median increases have risen from 3.0% (during the middle of 2021) to 3.5% (as of now). Simply revisit the survey and click the submit button to confirm previously entered data. Employers 'play it safe' with salary projections for 2022 Mercer projects record increases for 2023 retirement plan limits We have provided the data excluding those organizations that are not providing an increase. First look at increase budgets for North America. While pay transparency might be in the news more and more, employers have been slow to modify their communication of pay ranges. Source: Mercers 2021 Health on Demand report, 50% of Canadian employers facing higher than usual levels of attrition reported that limited career advancement was a driver, 27%reported a desire for industry change, 27%reported burnout and poor work-life balance as a key cause. By. Japan, New Zealand and Australia are the lowest at 2.3%, 2.6% and 2.8% respectively. Buy or Participate TRS - The Key to Designing Competitive Pay Packages worldwide. 2022 by Mercer that polled 636 organizations across 15 industries in Thailand between April and June this year. Need compensation planning data in Canada? This would lead us to believe that although they are providing off-cycle increases, inflation is not the driving factor. We use cookies to improve your experience. Marsh McLennan is the leader in risk, strategy and people, helping clients navigate a dynamic environment through four global businesses. As a SBS participant, you will receive free access to individual reports for all available markets in which you have submitted data. Salary increases for 2022 going up | HRMorning Despite an influx of legislation aimed at increasing pay transparency, the survey found employers have been slow to modify their communication of pay ranges outside of state mandates. Now is the time for employers to close any gaps in competitiveness and keep a close pulse on the market for fast-moving market segments. The Workspan suite provides news and insights, delivered in a variety of concise, easily digestible formats. 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. You will receive a unique link via email to access your survey submission. The average merit increase will be 3.8%, compared to 2022's 3.4%, and the total increase budget will be 4.2%. SBS is not available to purchase for participants or non-participants; however, there are a number of purchase options available for Global Compensation Planning. The projected increase is slightly . Theres an increased use of select cash compensation programs in the new war for talent and increased utilization of select non-financial reward programs. Be a part of our global team dedicated to building brighter futures for employers and their people. No two workplaces will have the same answers to these questions. Use your compensation budget wisely. The new type of job that ChatGPT is making companies scramble to fill. By participating in the survey, you will automatically receive the results for free when they publish. 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 . Employers who successfully reshape their workforce and total rewards models would gain an advantage in retaining talent and keeping employees engaged and productive even as they move beyond the pandemic. Industry-wise, financial services is . 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. As for the percentage of the total base salaries that are set aside for promotions, this year participants indicated that they budget 1.3%, which slightly higher than this time last year. With 11.3million job openings, employees have options. 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. While pay is a driving factor for many workers, it is not the only one. The Healthcare industry is lagging behind the market at 3.3% merit and 3.6% total increases. In the August edition of Mercers 2022 US Compensation Planning Survey pulse, 78% of the almost 1200 participant organizations reported that they are just in the preliminary stage of determining their 2023 annual increase budget. Employers in Thailand cautiously optimistic in projected salary This snapshot survey is conducted four times per year and provides up-to-date salary increase budgets for 100+ markets across the globe. Another way to boost their wealth without breaking the bank: expand the purpose of group savings plans to allow workers to save for a variety of goals, both short- and long-term. 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. With all that said, what are we looking at for 2023 preliminary budget projections? The survey findings indicate that organizations globally are in the process of making, or are considering, significant changes in their salary increase budgets for 2022. The Video could not be loaded because the privacy settings are disabled. Visit the US & Canada Participation Station! Will annual increase budgets be higher when we run the survey again in November? Given the continued impact of the pandemic on business conditions, accelerating inflation, and labor supply and demand imbalances, organizations felt compelled to adjust their compensation increase budgets in the latter part of 2021 and early 2022. The projections for 2022 salary increase budgets jumped almost a full percentage point, from 3 percent in April to 3.9 in November. Regardless of the compensation increase figure you look at, none are rising near the level of inflation creating much angst foremployees. Simply revisit the survey and click the submit button to confirm previously entered data. This Video is unable to play due to Privacy Settings. For more information, visit mercer.com. 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. Cost of labor is a function of supply and demand, and is typically measured through compensation surveys that contain the going rate for jobs. 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 . Discover which types of transportation benefits companies typically offer and understand Survey respondents are typically HR professionals, and their organizations cover a broad range of of size, geography, and ownership structure. Workspan Magazine supplies in-depth analysis on pressing issues. Overall salary increments projected for 2023 to average 4.8% across markets in Asia Pacific, but real salary increases are nominal. US employer salary projection 2023 to lag inflation - Mercer For this survey, there is a particular focus on salary increase projections for 2022. How will you use this information to develop your proposal, knowing its preliminary? 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 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. Review market practice and statutory requirements of paid and unpaid time off for a selection of core leave programs. Lastly, take the opportunity to become more transparent around pay. This survey digs into the why and how of talent global mobility programs within your company's overall strategy. With all that said, what are we looking at for 2023 preliminary budget projections? 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. And a quarter of employers plan to give increases in the range of 5%-7% in 2023. And of course, the reason is the tight labor market. 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. As a result, forecasted increases are likely understated to actual total increase practices by as much as 25-33% of the overall budget. Theres one thing certain about the future of work: unpredictability. In the US, however, its more likely the high inflation we are seeing today will be temporary, driven by supply shocks from COVID lockdowns and the Russia/Ukraine crisis, and that well see a return to more normal levels of inflation. Developing a compensation strategy for remote employees will be central to their long-term retention. Learn which factors impact pay the most and how pay differs relative to the market average. From job search strategies to networking and interview tips, our coaches and tools are here to help. However, no one is planning to freeze salaries, even with looming fears of an economic downturn. Separate promotion budgets still dont seem to be the norm only 18% indicated that they have them. You may access your survey submission at any time to make updates. 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. So many things in our world are changing. This Video is unable to play due to Privacy Settings. For example, the US median increases have risen from 3.0% (during the middle of 2021) to 3.5% (as of now). You May Get a Raise in 2022 | Kiplinger Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. Salary data for a broad cross-section of jobs within 5 US geographic regions. Companies in the U.S. are planning to increase employee salaries by an average of 4.1% overall in 2023, WTW's recent Salary Budget Planning Report found. However, should the economic situation continue to decline, that may change this outcome. Senior Principal Kurt Groeninger talks about creating the foundation for your ESG strategy by setting up the right infrastructure for your organization. If you have participated in this survey within the past year, you will receive an email reminder during the participation period for each edition. Sustained merit salary increase of 4.5% for 2022, also forecasted for 2023 . Sky-rocketing prices have begun to raise many questions from US employers on how to manage compensation budgets in times of high inflation. We are creating a new Remuneration Trends and Insights website. Currently, employers are projecting a salary increase of 4.1% for 2023, slightly up from the 4% actual increase employees got this year. Stay on top of the latest leadership news with This Week in Leadershipdelivered weekly and straight into your inbox. That's according to Mercer's newly released 2023 US Compensation Planning Survey, which revealed that employers are budgeting an average of 3.8% for merit increases in 2023, compared to the 3.4% delivered in 2022 - and 4.2% for their total increase budget for next year (compared to 3.8% this year). Forgotten your login user name or password? These include the Hospitality, Airlines, Retail and Luxury Goods sectors.. Start by examining your organizations work-life balance, opportunities for internal promotions and benefits packages. Salaries in Indonesia expected to increase in 2022 as economy - Mercer We have seen this manifest through an emerging shift in approach to compensation setting for low wage workers. Moreover, only 2.8% of Asia Pacific employers indicated they have plans or are considering to implement further layoffs and workforce reductions next year, compared to 7.8% in 2021.