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. For this survey, there is a particular focus on salary increase projections for 2022. Employers are increasingly using off-cycle increases to combat retention concerns, along with other issues. Small amounts of short-term stress can boost performance. E2 focuses on 2023 and 2024 salary increase budgets (total and merit). 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 . What metrics will be used to nurture their soft skills and leadership abilities? Most organizations globally are reporting an uptick in their median total salary increase budgets for 2022 vs what they had planned in 2021. To find out what creative approaches you can be taking, contact us here. With all that said, what are we looking at for 2023 preliminary budget projections? Recent articles reported by our team on important business-news developments. As you plan your compensation strategy and total rewards program, youll want the latest data-driven insights about the labour market. Start by examining your organizations work-life balance, opportunities for internal promotions and benefits packages. Your total rewards program for the new normal. Time is limited. Developing a compensation strategy for remote employees will be central to their long-term retention. 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%. That's a far cry from just a couple of years ago. Simply revisit the survey and click the submit button to confirm previously entered data. How will you use this information to develop your proposal, knowing its preliminary? Once you have clicked Submit to complete the survey, a confirmation email will be sent to you. 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. Forgotten your login user name or password? These products are all included in Talent All Access Portal+, but can also be purchased separately. 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. From that lens, we are seeing that salaries across the board have increased 4.0%, but there are some significant differences by industry. 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. 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. When comparing the average base pay per employee from 2021 to 2022, wages increased an average of 4.9percent. Employers are also recognizing the value of knowing what skills reside within the organization, how demand for skills can swiftly shift with the market, and the importance of deploying or developing existing employees to meet changing needs. The consumer price index rose 8.5 percent over the last 12months the highest inflation the US market has seen in more than 40years. Simply revisit the survey and click the submit button to confirm previously entered data. 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. Slightly higher than the pre-pandemic levels, the projected salary . This Video is unable to play due to Privacy Settings. Update your submission as needed, and click the Submit button! However, with teams spread across a country or globally, employers need to overcome key challenges in fostering a sense of organizational values and processes. Most employees today see compensation as a blackbox and dont understand how their pay is set. 41% of organizations will have a higher salary increase budget in 2022 than 2021. Theres one thing certain about the future of work: unpredictability. 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. 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 . Currently, employers are projecting a salary increase of 4.1% for 2023, slightly up from the 4% actual increase employees got this year. Organizations that recognize the specific lifestyles of their employees will have a head start in attracting and retaining toptalent. Through its market-leading businesses including Marsh,GuyCarpenterandOliverWyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. Weve combined annual compensation survey data and recent rewards and benefits pulse surveys to provide anticipated salary increases for 2022. Access everything you need to know about salary increases, economic indicators, mandatory pay schemes and more with our Global Compensation Planning Report (GCPR). 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. This snapshot survey is conducted four times per year and provides up-to-date salary increase budget data for 100+ markets across the globe. 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. Participate to receive a free country report for all markets where you provide data! Still, only 30% of companies will communicate an employees grade/band upon request. Organizations in France, Russia, India and South Korea are all forecasting . If you experience any issues accessing your survey, please contact us. Will annual increase budgets be higher when we run the survey again in November? Overall median salary increments projected to hit 5% in Malaysia next year, up from 4.8% this year . BY Jim Wilson 19 Jul 2022. 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. 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 last remaining legacy of this historical practice is reflected in some labor contracts and collective bargaining agreements where wage increases remain indexed toCPI. Review market practice and statutory requirements of paid and unpaid time off for a selection of core leave programs. 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. 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%. You will receive a unique link via email to access your survey submission. There are several findings that are worth noting from our survey of global practices. 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. 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. Access to the free individual reports will be provided once each edition is published. 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. "May you live in interesting times" is an English expression claimed to be a translation of a traditional Chinese curse. We continue to stand at a crossroads in the world of work. 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. The typical practice is a 1.5X difference in increase percentages between these performers (e.g, an outstanding performer receives a 4.5% increase vs. a competent performer receiving 3.0%). Across industries, Financial Services is leading the market at 4.0% merit and 4.7% total increases. 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 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. Workspan Daily provides fresh news, every weekday. 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. 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 . 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. Now part of the Mercer QuickPulse TM survey series to give you the latest insights in compensation planning and total rewards. The projected increment is higher than the pre-pandemic levels of 2019 by 50 basis points. These are the highest budgets weve seen since the 2008 financial crisis. The Federal Reserve has already begun taking aggressive action for this to happen. The top three sectors with the highest salary increase projected for 2022 are technology, e-commerce, and IT-enabled services. Recession fears dont seem to be impacting increase budgets, Employers are increasing pay outside of the annual cycle.