According to the human resources consulting firm Aon Hewitt’s annual U.S. salary increase survey, despite the fact that the economy is getting stronger, you shouldn’t expect much increase in your salary or much of a bonus next year.
The survey of 1,074 U.S. companies shows that the percentage of payroll budgets going to “variable pay” will be at 12.8%, meaning the percentage companies are willing to spend on bonuses will be flat from last year, with the projected increases for wages also holding steady at just 3%. All this despite a stronger job market and economy that would usually suggest companies would want to shell out more for their payroll in order to compete to keep their employees.
“It’s a little counterintuitive, given the strengthening economy and job creation numbers,” said Ken Abosch of the findings. Abosch, who heads the firm’s broad-based compensation practice for North America, went on to say, “It’s indicative of the pressure organizations are under to keep the lid on fixed costs.”
While the projected 3% raises are slightly higher than 2016’s actual raise rate of 2.8%, Abosch said that it was unlikely companies would actually hit the number, as they “haven’t hit that number in five tries.”
Abosch added that not everyone in the workforce is even eligible for raises, noting that “virtually all” white-collar professionals are but that non-union hourly workers are only eligible at a rate of about 14%.
“It creates haves and have-nots,” he said on Monday.