And a recent survey by consulting firm Hewitt Associates found that salaries at United States companies have risen by just 1.8 percent so far this year, the lowest increase in more than 30 years.
So, it's understandable that people are nervous about their jobs -- and asking for a raise can be intimidating and daunting, even in the best of times.
But CBSMoneywatch.com Editor at Large Jill Schlesinger explains that you CAN get a raise in a recession: You just have to know how to go about it!
While average salaries are only creeping up, what's called variable pay is at an all-time high: Bonuses, profit-sharing and other kinds of special compensation are at 12 percent of payroll and increasing.
And even in tough times, managers have to do what they can to reward their top people, or risk losing them now, or later, when the economy improves.
Even if you're an average working guy -- not a "bonus guy" -- you can have the moxie to ask your boss for a pay hike. If you're good at your job, now, more than ever, is when your boss NEEDS YOU. Remember, your boss has a boss. And your boss might be nervous about his or her job. So more than ever, top performers are at a premium. Managers don't want to lose them.
So, what's the best approach?
First and foremost, remind your boss of everything you've accomplished over the previous year. Create and maintain a list of your accomplishments, and include everything! Management cares about results -- either how much money you saved or made the company -- not things like how many hours you spent on a project.
If there's a salary freeze at your company, the key is to THINK AHEAD. Maybe you can't get that raise right now, because it won't fit in with your company's accounting office, but you might be able to negotiate for a locked in raise in SIX months, or in the next year.
Or, get your boss to agree to revisit the issue of your compensation in six months and set a date for the meeting if you can.
Ask if you and he or she could pin down some goals for you to achieve in that period -- a certain percentage increase in sales, projects that will be completed -- be as specific as you can.
If the boss absolutely won't budge on money, still -- THINK BIG! There's more to compensation that just the dollars, and be aware that, in these economic times, EVERYTHING should be on the table. Instead, ask if the company would be willing to consider compensating you in other ways, such as bumping up your commission rate or stock options, or giving you more flexible hours, or an extra week of vacation.
Negotiate for a better title, which may help position for more money down the line.
You can also negotiate for things as simple as a better office or workspace: little things that can really improve the quality of your work life.
There are also common mistakes to avoid. It's not about threatening to leave or flaunting other offers. Also, it's not about you, so don't talk about how many hours you work or your mortgage.
It's about results. Focus on the results you're getting for the company, and look for them to deliver results for you.