As you plan your compensation strategy and total rewards program, youll want the latest data-driven insights about the labour market. "2023 promises to be another banner year for employees seeking salary increases," says Chris Fusco, senior vice president of compensation at Salary.com. You can review more of the survey findings here. 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%. Moreover, only 2.8% of Asia Pacific employers indicated they have plans or are considering to implement further layoffs and workforce reductions next year, compared to 7.8% in 2021. 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. 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. With all that said, what are we looking at for 2023 preliminary budget projections? Slightly higher than the pre-pandemic levels, the projected salary . Next year's planned pay increases would be the highest on record since 2008. As a result, while painful, at this point the US inflation levels have not risen to the level we typically see for wide-scale intervention in compensationprograms. 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. All Mercer events about talent, investment, and health issues. Industry-wise, financial services is . Separate promotion budgets still dont seem to be the norm only 24% indicated that they have them. Depending on the industry, we may continue to see budgets increase but some organizations bracing for a recession are likely providing conservative merit increases in an attempt to avoid layoffs later in the year. 1 Mercers 2021 E3 Salary Movement Snapshot survey was conducted in July and August 2021 that polled 1,730 organizations globally. However, this will change with the annual inflation figure, which was announced on Monday. However, no one is planning to freeze salaries, even with looming fears of an economic downturn. Evaluate IT position salaries with this in-depth survey. Learn about healthcare offerings that help you create an inclusive benefits program to meet the needs of all employees. The projections for 2022 salary increase budgets jumped almost a full percentage point, from 3 percent in April to 3.9 in November. Will annual increase budgets be higher when we run the survey again in November? 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 . The future of rewards is shifting. Merit increase budgets are tracking at 3.2%*, while total increase budgets, which also include other types of budgeted base pay increases, such as promotion awards, are tracking at 3.5%. 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. 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. Forgotten your login user name or password? Under the 'Manage Cookies' option in the footer, accept the Functional cookies to allow the video to play. Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. Currently, employers are projecting a salary increase of 4.1% for 2023, slightly up from the 4% actual increase employees got this year. Overall, the Consumer Goods industry will see the highest increases in salaries for 2022 at 5.8% while the Retail industry will see the lowest increase at 4.3% across the region. Employee benefits consulting and brokerage, Mental health's impact on work and home life, Mental health and how to improve employee access and support, Pension evolution: Retirement and investment video series, Addressing workforce diversity, equity and inclusion (DEI), Moving mobile employees ahead of inflation, Reshaping the future: Take stock & solidify - Feb 2, 2023, Mercer Global Investment Forums 2022 - Canada, Webinar replay: Global Talent Trends 2022, global pandemic survey on labour market challenges. Current information on important topics related to compensation planning. Access everything you need to know about salary increases, economic indicators, mandatory pay schemes and more with our Global Compensation Planning Report (GCPR). 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. To be considered a participant, confirmation of the data is required in each edition, even if your data has not changed. If you would like more details on the Mercer QuickPulse or US Compensation Planning Survey please contact us at 800-333-3070. The 2023 limits will reflect increases in the Consumer Price Index for All Urban Consumers (CPI-U) from the third quarter of 2021 to the third quarter of 2022. However, only 16% of companies in Asia Pacific formally monitor the market demand for skills. Despite what was projected in 2021 for 2022 salary increases, it has gone up. Bringing you the most up-to-date information on remuneration trends and insights on the current rewards environment, key economic data affecting pay decisions, topical HR issues and more. This would lead us to believe that although they are providing off-cycle increases, inflation is not the driving factor. While pay transparency might be in the news more and more, employers have been slow to modify their communication of pay ranges. Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. This Video is unable to play due to Privacy Settings. Then, collect and incorporate the unique factors of your organization that will influence the budgets (e.g., financial performance, hiring needs, etc.). 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%. As expected, this year, the majority of organizations are planning to provide salary increases in 2022. 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. You are using a browser version that we do not support. 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.. If you have previously participated in the 2023 SBS survey, you can return to the survey, and enter your email address to receive the link to your existing survey submission. Organizations should use this and other salary increase projection information directionally and engage leaders in a discussion focused on internal needs and objectives vs. over-indexing on external market data. There are several findings that are worth noting from our survey of global practices. As a result, forecasted increases are likely understated to actual total increase practices by as much as 25-33% of the overall budget. Small amounts of short-term stress can boost performance. These include: Increased utilization of select non-financial reward programs. As a SBS participant, you will receive free access to individual reports for all available markets in which you have submitted data. Then, collect and incorporate the unique factors of your organization that will influence the budgets (e.g., financial performance, hiring needs, etc.). 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. More centralized review, calibration, and control processes of base salary increases, Greater differentiation in increases between outstanding and competent performers, The use of sustainability, ESG and DEI metrics in incentive plans, Connecting the work the organization does to its mission, vision, and values, Clarifying and communicating employee growth and career development opportunities, Engaging with employees in organization change priorities, Building manager and leader effectiveness to build connections and inclusivity within their teams. The Great Resignation has overwhelmed nearly every industry except two. . Additionally, to keep it in perspective, the majority of employers did report that the percentage of employees receiving off-cycle increases is typically less than 30%. One in three organizations say they have, or plan to take, a living wage approach for hourly wages, according to Mercers Compensation Planning Survey. Only 3% of participants responded that they did not use factors and instead provided an across the board increase, which would indicate that increasing pay across the board for inflation or cost of living is a prevalent practice. 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. Monitor employee movement trends in, out, and within companies around the world with data on turnover, workforce changes, hot skills and more. Organizations in France, Russia, India and South Korea are all forecasting . While wage increases are inevitable, there's more to the solution. SBS is not available to purchase for participants or non-participants; however, there are a number of purchase options available for Global Compensation Planning. How much larger will increase budgets be for 2023? 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. Other industries such as High Tech and Consumer Goods also saw increases over prior year. Likewise, employees with small children have also had a pandemic experience that is vastly different from those who have teenagers or no children. Separate promotion budgets still dont seem to be the norm only 18% indicated that they have them. The total base salary increase budget includes other base pay increases such as promotions and cost of living adjustments, in addition to merit increases. The survey also found a high double-digit attrition rate of overall 20 per cent, along with voluntary attrition at 15.4 per cent. 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 . Participate in as many of the markets listed below, as you like. Review statutory and supplemental benefit details for social security, retirement, medical, death, disability and more. 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 . As skills begin to overshadow education or experience, more companies are implementing skills-based pay practices to attract new talent and retain critical skills. Sky-rocketing prices have begun to raise many questions from US employers on how to manage compensation budgets in times of high inflation. Over half (53%) of organizations said they will comply with local laws and have no plans to broaden transparency beyond what is required. We are seeing markets that have kept COVID-19 under control reporting higher than average pay raises. Ensure your incentive programs are competitive. Take an inclusive approach to benefits. Looking back over the last two decades, inflation has been low most commonly between 0 and 2 percent, while merit budgets have remained relatively stable at around 3 percent. 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%; The survey found that no employers are currently planning to freeze pay in 2023. For more information, visit mercer.com. Individual performance is still the most common factor that employers use to determine the size of an individuals annual increase. If you have participated in this survey within the past year, you will receive an email reminder during the participation period for each edition. This snapshot survey gathers salary increase data for 150+ markets across the globe. Chinas potential in the life sciences sector is undisputed, given its long history and tradition in medicine. Today, Mercer released the results of its 2023 US Compensation Planning Survey revealing that while salaries are going up, 2023 compensation budgets and salary projections for US employers are expected to lag behind inflation. 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.. The projected increment is higher than the pre-pandemic levels of 2019 by 50 basis points. 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. We spoke to over 4,000 professionals and experts to discover the three things leaders and their organizations should focus on to thrive in the year ahead. Manage your transportation benefits efficiently and effectively. Employers are budgeting an average of 3.8% for merit increases compared to the 3.4% actually delivered this year and 4.2% for their total . Salary data for a broad cross-section of jobs within 5 US geographic regions. Singapore, November 17, 2021 -Salary increases in Singapore are rebounding to pre-pandemic levels, with increments expected to average 3.5% in 2022, compared to 3.3% in 2021 and 3.6% in 2019.