mercer 2022 salary increase projections

Salary data for a broad cross-section of jobs within 5 US geographic regions. 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. The Workspan suite provides news and insights, delivered in a variety of concise, easily digestible formats. Other factors commonly considered include internal equity and current salary compared to midpoint or market value. According to Sunit Patel, Mercer's chief actuary for health and benefits, "One issue is that people have been deferring or cancelling care for the past two years and, while that lowers cost in the short term, it can increase cost over the longer term when medical conditions . It's time to get connected. Participate to get your free snapshot report! 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. This reality tends to advantage employees in terms of real spending during low . "May you live in interesting times" is an English expression claimed to be a translation of a traditional Chinese curse. Take a proactive approach to managing your workforce in a competitive job market. First off, use this as directional information and combine it with additional sources. To find out what creative approaches you can be taking, contact us 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. 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%. 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. While pay transparency might be in the news more and more, employers have been slow to modify their communication of pay ranges. The Video could not be loaded because the privacy settings are disabled. Monitor employee movement trends in, out, and within companies around the world with data on turnover, workforce changes, hot skills and more. Mercers 2022 Global Talent Trends found that organizations are increasingly placing emphasis on the sustainability of human capital, with one in three executives believing that delivering on good work standards such as fair pay or worker protection will deliver the greatest ROI, and nearly nine in 10 HR leaders say that delivering on good work standards is a priority for HR. Across the industries surveyed, the Chemicals industry is expected to see the biggest rebound in salary increment at 5.5% in 2022, up from 4.9% in 2021. If you would like more details on the Mercer QuickPulse or US Compensation Planning Survey please contact us at 800-333-3070. Compensation is going up. Banking and Financial organizations tend to openly communicate their structure information, even without being asked, more so than other industries. Simply revisit the survey and click the submit button to confirm previously entered data. 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. All Mercer events about talent, investment, and health issues. 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 . Please see ourPrivacy Policyfor details. BY Jim Wilson 19 Jul 2022. This is according to the annual Total . Of the 62% that plan to adjust structures in 2023, we expect to see the structures increase by 3.0%, which is just above the average actual adjustment of 2.9% reported in March of 2022. 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. Across industries, Financial Services is leading the market at 4.0% merit and 4.7% total increases. 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. By. Flex work and full-time remote work are increasingly part of the employee value proposition. While pay is a driving factor for many workers, it is not the only one. For more information, visit mercer.com. Create a solid foundation for your pay structure. 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. . Resources: Leading in the New Shape of Work. 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. Then, collect and incorporate the unique factors of your organization that will influence the budgets (e.g., financial performance, hiring needs, etc.). A competitive leave policy is a benefit to everyone. Through its market-leading businesses including Marsh,GuyCarpenterandOliverWyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. 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 . As you plan your compensation strategy and total rewards program, youll want the latest data-driven insights about the labour market. View our expertise through the lens of your existing organizational culture to determine what kinds of solutions may work best for your remoteteam. 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. 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%. If you need more assistance, we have team members standing by to help. 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. Our look at pressing problems and solutions for board directors. It can be difficult to keep up with relevant compensation trends and how they impact your organization. We have seen this manifest through an emerging shift in approach to compensation setting for low wage workers. Simply revisit the survey and click the submit button to confirm previously entered data. Lets dive a little deeper into some of these trends in compensation planning. Participants will receive a complimentary executive summary report of the results! Survey respondents are typically HR professionals, and their organizations cover a broad range of of size, geography, and ownership structure. 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. Be a part of our global team dedicated to building brighter futures for employers and their people. Regardless of the compensation increase figure you look at, none are rising near the level of inflation creating much angst foremployees. 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 . Knowledge is powerful. For example, remote workersespecially those living in small communities or rural areasmay be more enticed by virtual offerings for medical and mental health support. 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%; 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. This, combined with a strong job market, has heightened employee expectations for increased compensation this year; and employers are responding. The short answer is: they havent. Most organizations address gaps in competitiveness over time through merit budgets, but the current labor market warrants a more aggressive approach to market adjustments to ensure that pay is competitive for all employees not just in aggregate. 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.. This would lead us to believe that although they are providing off-cycle increases, inflation is not the driving factor. 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.. Wages are on the rise. Japan, New Zealand and Australia are the lowest at 2.3%, 2.6% and 2.8% respectively. More than 72% indicated their budgets are finalized between October and January, with most selecting November or December. However, there is some variation by industry: In order to accommodate the increasing annual increase budgets, salary structures are increasing as well. Compare your company to the market with base salary and total cash compensation data for up to 50 benchmark jobs. 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%). Still, only 24% of companies will communicate an employees grade/band upon request. Based on the average of five firms gathering compensation data ( Normandin Beaudry, Mercer, Pa yscale, LifeWorks, and Eckler ), projected increases to Canadian salaries in 2023 are expected to be approximately 3.8%. Most employers reported that the pay increases are in direct response to . Not only can doing so enhance retainment, it can also save your organization money in the longrun. If you experience any issues accessing your survey, please contact us. Use your compensation budget wisely. A separate Grant Thornton survey of 1,500 full-time U.S. employees found that 51% would give up a 10% to 20% salary increase . Survey participation: March 13 March 24. This snapshot survey is conducted four times per year and provides up-to-date salary increase budget data for 100+ markets across the globe. Given the current climate, salary projections for 2022 are lower than expected, according to Normandin Beaudry. Likewise, we are seeing an increase in the total increase budget for 2023: 3.9% for 2023, compared to 3.4% in 2022. From job search strategies to networking and interview tips, our coaches and tools are here to help. 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% . Actual increases were higher than predicted. Source: Mercers global pandemic survey on labour market challenges and return to the worksite. Complete/update all the tabs identified below, prior to the deadline for each edition, to ensure you receive access to the results! Notify me when the next survey opens! . 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). Overall salary increments projected for 2023 to average 4.8% across markets in Asia Pacific, but real salary increases are nominal. US salaries are going up, but compensation budgets for next year and salary projections are expected to lag inflation, according to the "2023 US Compensation Planning Survey" released by Mercer. The 2023 survey is now open. Our whitepaper analyzes some of the big trends for 2022, such as improving employee wellness and leveraging remote work in your strategies . Forgotten your login user name or password? 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. Indonesia, 21 December 2021 - Salary increments in Indonesia are on the rebound to pre-pandemic levels, with median pay increases projected to hit 6.5% in 2022. 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. 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. The days of a standardized one-size-fits all employee benefits package could be drawing to a close. Time is limited. That's a far cry from just a couple of years ago. At Mercer, we believe in building brighter futures. The consumer price index rose 8.5 percent over the last 12months the highest inflation the US market has seen in more than 40years. 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. 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. However, should the economic situation continue to decline, that may change this outcome. This Video is unable to play due to Privacy Settings. 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. Understand how features such as eligibility, performance measures, timing, payout and governance will help you design and structure the best sales incentive plans for your company. Visit the US & Canada Participation Station! 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. Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. We continue to stand at a crossroads in the world of work. First look at increase budgets for North America. These include: Increased utilization of select non-financial reward programs. The new type of job that ChatGPT is making companies scramble to fill. Simply revisit the survey and click the submit button to confirm previously entered . 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. 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). Access information and participation materials for a range of compensation and benefits surveys conducted in the US and Canada. 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. Savy employers are starting to do the same, expanding their labour market beyond regional boundaries. To be considered a participant, confirmation of the data is required in each edition, even if your data has not changed. The Total Remuneration Survey, Mercers flagship annual compensation and benefits benchmarking study, identifies current pay practices and benefits policies, as well as budget, hiring and turnover trends for the year ahead. This product is included in the Talent All Access Portal US Edition, your single source for 20+ best-selling reports at a discount! 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. 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. ARLINGTON, Va., Jan. 13, 2022 (GLOBE NEWSWIRE) -- Fueled by tight labor markets, U.S. employers are boosting their original salary increase projections for 2022 as the Great Resignation shows no . except for those from the High Tech industry, can also expect higher bonus payouts this year, based on Mercer's mid-2022 forecast. 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. We use cookies to improve your experience. You need reliable compensation planning insights to help you navigate through this unique labor market.In a series of brief surveys, you'll access key data points like annual increase budgets, structure adjustments and incentive usage that meet your immediate compensation planning needs. Over half (53%) of organizations said they will comply with local laws and have no plans to broaden transparency beyond what is required. The average merit increase will be 3.8%, compared to 2022's 3.4%, and the total increase budget will be 4.2%. These include the Hospitality, Airlines, Retail and Luxury Goods sectors.. 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. While wage increases are inevitable, there's more to the solution. Stay on top of the latest leadership news with This Week in Leadershipdelivered weekly and straight into your inbox. Total increases were slightly higher at 2.9%, decreasing to 2.6% when factoring in those not providing increases. 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. Salaries for U.S. employers could lag behind inflation in 2023, according to a new survey from Mercer. When it comes to total rewards, DEI can mean an inclusive benefits package: forward-thinking employers, for instance, are beginning to offer fertility and surrogacy benefits to same-sex couples, and support gender affirmation surgery. Likewise, we are seeing an increase in the total increase budget for 2023: 4.2% for 2023, compared to 3.8% in 2022. All country salary values are the median increases presented at headline values, unless otherwise stated. Remuneration Trends & Insights. Marsh McLennan is the leader in risk, strategy and people, helping clients navigate a dynamic environment through four global businesses. September 22, 2022 Canada, Toronto Today Mercer released the results of its 2023 Compensation Planning Survey revealing that inflation continues to put significant pressure on the compensation budgets and salary projections of Canadian employers.. Canadian employers report they are budgeting 3.4 per cent for merit increases and 3.9 per cent for their total budget increase for 2023. Ensure your incentive programs are competitive. 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. However, this will change with the annual inflation figure, which was announced on Monday. Start by examining your organizations work-life balance, opportunities for internal promotions and benefits packages. 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. 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. Organizations in France, Russia, India and South Korea are all forecasting . We are in the midst of a labor shortage in the US, and wages are moving up especially for hourly pay. Mercer's 2021 Total Remuneration Survey (TRS) also saw projected overall wage increases across all 18 industries 1 surveyed.. Business sentiment for 2022 remains positive as companies expect to . 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. As a result, forecasted increases are likely understated to actual total increase practices by as much as 25-33% of the overall budget.