Banking on a Pay Raise? Don't Count on It
American workers probably shouldn't bank on a significant pay raise next year, according to two private surveys released Tuesday.
Consultancies Watson Wyatt Worldwide Inc. and Hay Group found that median pay raises for 2009 fell between 2 percent and 3 percent, with early predictions for 2010 not much better, according to a Wall Street Journal report Tuesday.
Salaries in 2010 are expected to climb a little more than 3 percent – the smallest forecasted increase in the 29 years Hay Group has tracked pay data. Watson Wyatt said its prediction is among the lowest ever.
The consulting firms had predicted salaries would jump 3.5 percent to 4 percent over the last year. Both surveys included salaried employees and hourly wage workers.
Official reports are in line with the forecasts. The U.S. Labor Department reported average pay increases fell to 2.2 percent in the 12-month period ending March 31, down from 3.2 percent from a year earlier.
The new findings are hardly surprising. Employers have bee scrambling to reduce costs since the country slid into a deep recession that it has yet to climb out of, though many economists expect to see economic growth at some point in 2010. Jobs have been slashed and some workers have been given outright pay cuts or forced to take unpaid furloughs.
Considering the country's economic problems, some workers may not even consider stagnating wages to be all that much of a problem.
"Today, people are more focused on job security than they are on a pay increase," David Wise, a senior consultant at Hay Group told the Journal. "If they can keep a job, they're already ahead of the game."
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