Among employers awarding merit increases in 2012, the most commonly cited increases ranged from 2.5% to 3.0%. This corresponds closely with SHRM’s recently announced figure of 2.8%.
Last year’s survey indicated an average “planned” merit increase for 2012 of 2.1%. Actual merit increases for 2012, however, were higher than anticipated for the first time in at least two years. On average, 22.6% of responding employers withheld merit increases and 35% withheld general (unrelated to performance) increases from their employees in 2012. (See details in tables below.)
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2012 Actual Salary Increases and Rate Range Adjustments
|
2012 Average Merit Increases |
|||||||||||
|
Answer Options (%) |
N/A |
0.00 to 2.50 |
2.51 to 5.00 |
5.01 to 10.00 |
10.01 or Above |
||||||
|
Salaried Exempt: |
11.8% |
40.6% |
43.5% |
2.8% |
1.3% |
||||||
|
Salaried Nonexempt: |
31.7% |
37.0% |
30.2% |
0.9% |
0.1% |
||||||
|
Hourly Office: |
19.4% |
43.9% |
34.9% |
1.5% |
0.2% |
||||||
|
Hourly Nonoffice: |
27.8% |
42.1% |
28.8% |
1.1% |
0.3% |
||||||
|
Average % of Employers |
22.6% |
40.9% |
34.3% |
1.6% |
0.5% |
||||||
|
2012 Average General Increases |
|||||||||||
|
Answer Options (%) |
N/A |
0.00 to 2.50 |
2.51 to 5.00 |
5.01 to 10.00 |
10.01 or Above |
||||||
|
Salaried Exempt: |
28.3% |
46.8% |
22.9% |
1.5% |
0.5% |
||||||
|
Salaried Nonexempt: |
42.7% |
39.4% |
17.5% |
0.3% |
0.2% |
||||||
|
Hourly Office: |
32.5% |
44.2% |
22.4% |
0.8% |
0.1% |
||||||
|
Hourly Nonoffice: |
38.2% |
41.5% |
19.4% |
0.8% |
0.2% |
||||||
|
Average % of Employers |
35.4% |
43.0% |
20.6% |
0.9% |
0.2% |
||||||
|
2012 Average Rate Range Adjustment % |
|||||||||||
|
Answer Options (%) |
N/A |
0.00 to 2.50 |
2.51 to 5.00 |
5.01 to 10.00 |
10.01 or Above |
||||||
|
Salaried Exempt: |
25.9% |
55.1% |
16.0% |
2.6% |
0.5% |
||||||
|
Salaried Nonexempt: |
41.4% |
46.4% |
11.6% |
0.5% |
0.2% |
||||||
|
Hourly Office: |
33.6% |
50.2% |
14.4% |
1.7% |
0.2% |
||||||
|
Hourly Nonoffice: |
38.0% |
46.7% |
13.3% |
1.7% |
0.3% |
||||||
|
Average % of Employers |
34.7% |
49.6% |
13.8% |
1.6% |
0.3% |
||||||
|
Answer Options (%) |
N/A |
0.00 to 2.50 |
2.51 to 5.00 |
5.01 to 10.00 |
10.01 or Above |
|||||
|
Salaried Exempt: |
13.5% |
28.8% |
29.4% |
18.3% |
10.1% |
|||||
|
Salaried Nonexempt: |
35.1% |
26.7% |
24.2% |
10.9% |
3.1% |
|||||
|
Hourly Office: |
22.9% |
32.6% |
29.5% |
11.7% |
3.4% |
|||||
|
Hourly Nonoffice: |
30.1% |
31.0% |
28.0% |
8.3% |
2.6% |
|||||
|
Average % of Employers |
25.4% |
29.8% |
27.8% |
12.3% |
4.8% |
|||||
Factors that Affect Raises
Respondents chose the three most important factors that affect raises.
|
Answer Options |
Response Percent |
Response Count |
|
Merit/Performance |
84.5% |
892 |
|
Company profits |
59.3% |
626 |
|
Competitors’ wage rates |
34.2% |
361 |
|
Approval of Board of Directors |
27.8% |
293 |
|
Job classification |
23.6% |
249 |
|
Other (please specify) |
14.2% |
150 |
|
Approval of Government Board, Commission, Legislature, etc. |
9.8% |
103 |
|
Department or division |
8.4% |
89 |
|
Seniority |
7.6% |
80 |
|
answered question |
1055 |
|
|
skipped question |
462 |
|
|
total |
1517 |
|
2012 Bonuses
While 8% of respondents offered bonuses in lieu of raises, 65% paid bonuses in addition to salary increases in 2012. 71.7% paid bonuses to their exempt employees in 2012 with 40% offering amounts of 5% or less and 32% awarding amounts of greater than 5%. In comparison, 47% of those surveyed awarded bonuses to their hourly non-office workers with 40% offering 5% or less and 7% awarding amounts greater than 5%. (See details on the tables below.)
2012 Bonuses Are/Were Given …
|
Answer Options |
Response Percent |
Response Count |
|
Instead of base pay increases |
8.0% |
62 |
|
In addition to base pay increases |
44.9% |
348 |
|
Some of both |
20.3% |
157 |
|
Other: None given |
18.58% |
144 |
|
Other: Will be given at end of year |
1.81% |
14 |
|
Other: Given to selected employees |
2.45% |
19 |
|
Other: Given to top of range employees |
0.77% |
6 |
|
Other: Sales commissions only |
0.65% |
5 |
|
Other: Miscellaneous |
2.58% |
20 |
|
answered question |
775 |
|
|
skipped question |
742 |
|
|
total |
1517 |
|
2012 Actual Bonus or Lump Sum Payments
|
2012 Average Annual Bonus % |
|||||||||||
|
Answer Options |
N/A |
0.00 to 5.00 |
5.01 to 10.00 |
10.01 to 20.00 |
20.01 to 30.00 |
30.01 or Above |
|||||
|
Salaried Exempt: |
28.3% |
39.7% |
14.5% |
12.4% |
3.6% |
1.4% |
|||||
|
Salaried Nonexempt: |
51.1% |
40.0% |
5.8% |
2.1% |
0.7% |
0.4% |
|||||
|
Hourly Office: |
43.0% |
47.0% |
7.9% |
1.6% |
0.3% |
0.4% |
|||||
|
Hourly Nonoffice: |
53.44% |
39.6% |
5.6% |
1.0% |
0.4% |
0.0% |
|||||
|
Average % of Employers |
44.0% |
41.5% |
8.4% |
4.3% |
1.3% |
0.6% |
|||||
|
2012 Average Lump Sum Payment % |
|||||||||||
|
Answer Options |
N/A |
0.00 to 5.00 |
5.01 to 10.00 |
10.01 to 20.00 |
20.01 to 30.00 |
30.01 or Above |
|||||
|
Salaried Exempt: |
49.6% |
40.1% |
6.3% |
2.6% |
0.4% |
1.0% |
|||||
|
Salaried Nonexempt: |
63.0% |
33.5% |
2.5% |
0.5% |
0.0% |
0.5% |
|||||
|
Hourly Office: |
56.0% |
41.6% |
1.8% |
0.2% |
0.0% |
0.5% |
|||||
|
Hourly Nonoffice: |
61.1% |
37.2% |
1.4% |
0.2% |
0.0% |
0.2% |
|||||
|
Average % of Employers |
57.4% |
38.0% |
3.0% |
0.9% |
0.1% |
0.5% |
|||||
2012 Rate Range Adjustments
55% of employers responding to our survey made adjustments of 2.5% or less to their exempt employee rate ranges and 16% made adjustments of 2.51 to 5% to that same group. Also, 2.5% made adjustments of 5 to 10%, while 0.54% adjusted their exempt ranges by as much as 10%. 26% made no adjustment to exempt salary ranges in 2012.
A little over 45% of the responding employers made rate range adjustments of 2.5% or less to their hourly non-office workers, with 13% making adjustments of 2.5 to 5%. Less than 2% of employers made adjustments of 5 to 10%, while 0.34% made adjustments of over 10%. 38% made no adjustment to rate ranges for that same group. 35% made no adjustment to employee rate ranges for any employee group.
2012 Rate Range Adjustments
|
Answer Options |
N/A |
0.00 to 2.50 |
2.51 to 5.00 |
5.01 to 10.00 |
10.01 or Above |
|
Exempt: |
26% |
55% |
16% |
2.5% |
.5% |
|
Hourly Nonoffice: |
40% |
45% |
13% |
2% |
.3% |
Criteria Used to Make Rate Range Adjustments
|
Answer Options |
Response Percent |
Response Count |
|
Salary survey of benchmark positions |
53.9% |
545 |
|
Company profit |
42.2% |
427 |
|
Company history |
23.0% |
233 |
|
Other (please specify) |
21.2% |
214 |
|
Consumer price index |
15.8% |
160 |
|
Inflation rate |
15.2% |
154 |
|
answered question |
1011 |
|
|
skipped question |
506 |
|
|
total |
1517 |
|
2013 Salary Increases
Although actual merit increases for 2012 are an improvement over 2012 planned increases, expectations for 2013 still reflect a slow recovery. Though 18% of the employers who responded to this question in our survey expect to offer 2013 merit increases of up to 2.5%, 22% plan no increase at this time and 31% haven’t yet made a decision regarding 2013 merit increases. The survey shows, however, that 27.5% plan to offer merit increases of 2.5 to 5% and 1% plan to offer increases above 5%. The SHRM survey’s recently released figure is similar at 3.0%.
The most common range of amounts indicated for 2013 increases for exempt and nonexempt/hourly office workers is 2.5 to 3%. For hourly non-office workers, the most commonly planned increase is 2 to 2.5%.
According to the survey, 18% of employers plan to offer general increases of up to 2.5% in 2013, 16% plan to award general increases from 2.5 to 5%, and 0.46% plan to offer increases above 5%. 25.5% of employers surveyed plan to offer no general increase in 2013 and 40% have made no decision at this time.
2013 Bonuses
A mere 9% of those surveyed responded with information regarding their plans for bonuses in 2013. 23% of them plan to offer no bonuses and 54% are undecided at this time.
Of those who plan to award them, 8% plan to offer bonuses of up to 2.5% of base pay and 8% plan to offer 2.5 to 5%. 9% of those who responded plan to award bonuses in lieu of raises, 34% will award bonuses in addition to salary increases, and 21% will award both bonuses and raises in 2013.
If bonuses are given, how are they determined?
|
Answer Options |
Response Percent |
Response Count |
|
Determined by individual performance |
48.5% |
401 |
|
Based on company profits |
42.7% |
353 |
|
Based on company performance against budget |
38.0% |
314 |
|
A combination of individual performance and across the board |
19.6% |
162 |
|
Other (please specify) |
16.1% |
133 |
|
Given across the board |
11.9% |
98 |
|
answered question |
827 |
|
|
skipped question |
690 |
|
|
total |
1517 |
|
2013 Rate Range Adjustments
No rate range adjustments are expected in 2013 for 32% of survey respondents, though 20% expect to adjust their rate ranges by up to 2.5%, 0.57% expect to make adjustments of up to 10%, and 37% are undecided.
Rate ranges for 1% of the employers surveyed are regulated by union agreements, for 2% they are legislated, and for 9% they are based on internal criteria such as budget constraints and funding for nonprofit organizations.
2013 Average Rate Range Adjustment Percentage
|
Answer Options |
N/A |
0.00 |
0.01 to 2.50 |
2.51 to 5.00 |
5.01 to 7.50 |
7.51 to 10.00 |
10.01 or Above |
|
Salaried Exempt: |
27.3% |
34.3% |
22.2% |
14.1% |
0.0% |
1.0% |
1.0% |
|
Salaried Nonexempt: |
42.3% |
30.6% |
17.7% |
8.2% |
0.0% |
0.0% |
1.2% |
|
Hourly Office: |
34.8% |
34.8% |
20.2% |
10.1% |
0.0% |
0.0% |
0.0% |
|
Hourly Nonoffice: |
45.5% |
29.9% |
18.2% |
5.2% |
1.3% |
0.0% |
0.0% |
|
Average |
37.5% |
32.4% |
19.6% |
9.4% |
0.3% |
0.3% |
0.6% |
2013 Maximum Individual Increases
21% of the employers responding to this question indicated they will offer no individual increases and 35% are undecided. 34%, however, will offer individual increases of up to 5%, 6% will offer up to 10%, and 4% will offer above 10% to selected individuals.
2013 Maximum individual Increase Percentage
|
Answer Options |
N/A |
0.00 |
0.01 – 2.50 |
2.51 to 5.00 |
5.01 to 7.50 |
7.51 to 10.00 |
10.01 or Above |
|
Salaried Exempt: |
24.5% |
22.6% |
15.1% |
23.6% |
8.5% |
1.9% |
3.8% |
|
Salaried Nonexempt: |
42.1% |
22.7% |
10.3% |
12.5% |
6.8% |
1.1% |
4.6% |
|
Hourly Office: |
32.3% |
21.6% |
20.4% |
20.4% |
3.3% |
0.0% |
2.2% |
|
Hourly Nonoffice: |
42.7% |
18.3% |
18.3% |
14.6% |
2.4% |
0.0% |
3.7% |
|
Average |
35.4% |
21.3% |
16.0% |
17.8% |
5.3% |
0.8% |
3.5% |
2013 Planned Average Merit Increase Percentage
|
Answer Options |
N/A |
0.00 |
0.01 – 2.50 |
2.51 to 5.00 |
5.01 to 7.50 |
7.51 to 10.00 |
10.01 or Above |
|
Salaried Exempt: |
19.4% |
23.1% |
17.1% |
38.1% |
0.0% |
0.000 |
2.2% |
|
Salaried Nonexempt: |
40.0% |
21.0% |
12.4% |
25.7% |
0.0% |
0.0% |
1.0% |
|
Hourly Office: |
26.1% |
25.2% |
22.5% |
26.1% |
0.0% |
0.0% |
0.0% |
|
Hourly Nonoffice: |
37.4% |
20.2% |
21.2% |
20.2% |
0.0% |
1.0% |
0.0% |
|
Average |
30.7% |
22.4% |
18.3% |
27.6% |
0.0% |
0.3% |
0.8% |
2013 Average General Increase
|
Answer Options |
N/A |
0.00 |
0.01 – 2.50 |
2.51 to 5.00 |
5.01 to 7.50 |
7.51 to 10.00 |
10.01 or Above |
|
Salaried Exempt: |
34.7% |
28.1% |
17.4% |
19.0% |
0.0% |
0.0% |
0.8% |
|
Salaried Nonexempt: |
45.5% |
25.3% |
16.2% |
12.1% |
0.0% |
0.0% |
1.0% |
|
Hourly Office: |
36.9% |
27.0% |
19.8% |
16.2% |
0.0% |
0.0% |
0.0% |
|
Hourly Nonoffice: |
43.3% |
21.7% |
19.6% |
15.5% |
0.0% |
0.0% |
0.0% |
|
Average |
40.1% |
25.5% |
18.2% |
15.7% |
0.0% |
0.0% |
0.5% |
Percentage
Demographic Data—Survey Participants
Organizations. A total of 1,517 organizations participated
in this survey, which was conducted in June 2012. Of those
who identified themselves, 51% are privately owned, 9% are
public entities, 38% are government or nonprofits, and 2%
of them are employee owned organizations. 61% are located
in labor markets exceeding 500,000.
Labor Relations. 2.5% of the employers surveyed have a
90-100% unionized workforce. Also, 73.5% of them have a
workforce that is less than 5% union employees.
Exempt vs. Nonexempt. 49% of the respondents have fewer
than 5% salaried nonexempt employees, and 29% have over
50% salaried exempt employees.
Industries. Almost half (45%) of the participants are in service
industries; 21% are in agriculture, forestry, construction,
manufacturing, or mining; 6% are in wholesale, retail, transportation,
or warehousing; and 24% are in real estate, utilities, or “other.”
Participants. Compensation professionals account for 12% of
the survey participants who self-identified, other human resources
professionals make up 67%, and 21% are in other areas with HR
responsibilities.
Industries Represented
|
Answer Options |
Response Percent |
Response Count |
|
Accommodation, Food Services |
1.0% |
10 |
|
Administrative and Support Services |
0.6% |
6 |
|
Agriculture, Forestry, Fishing, and Hunting |
0.5% |
5 |
|
Arts, Entertainment, and Recreation |
1.6% |
16 |
|
Construction |
2.6% |
27 |
|
Educational Services |
5.0% |
51 |
|
Finance and Insurance |
8.6% |
88 |
|
Health Care and Social Assistance |
14.3% |
147 |
|
Information (Media, Data, Telecommunication) |
2.2% |
23 |
|
Management of Companies and Enterprises |
0.6% |
6 |
|
Manufacturing |
17.4% |
179 |
|
Mining, Quarrying, and Oil and Gas Extraction |
0.7% |
7 |
|
Other Services (except Public Administration) |
3.3% |
34 |
|
Professional, Scientific, Technical Services |
7.3% |
75 |
|
Public Administration |
4.0% |
41 |
|
Real Estate and Rental and Leasing |
1.7% |
18 |
|
Retail Trade |
2.6% |
27 |
|
Transportation and Warehousing |
2.2% |
23 |
|
Utilities |
3.3% |
34 |
|
Waste Management/Remediation Services |
0.3% |
3 |
|
Wholesale Trade |
1.2% |
12 |
|
Other (please specify) |
19.1% |
197 |
|
answered question |
1029 |
|
|
skipped question |
488 |
|
|
total |
1517 |
|
To clarify – the N/A’s were no increase? (Not “no answer” or “not available”)and the 0 to 2.5% really don’t contain any true 0%’s because they are in the N/A’s?
I’ll tell you one thing–the natives are getting restless. Too many years of small or nonexistent raises are wearing on employees, especially if the employer is objectively getting better financial results itself.
The new method is very ufusel.Would you kind to speak a bit slower and to emphasize the words.It is not easy to follow the text and to learn the real correct English intonation.Thank you.
I found myself nodding my noggin all the way through.