Pay increases stable in the US

Employers
in America plan to give annual pay increases of just over four per cent – the
same as the last seven years, according to a report.

The
2001/ 2002 US Compensation Planning Survey
, by HR consultants William
Mercer, shows that basic planned pay increases for 2001 and 2002 stand at 4.4
and 4.3 per cent respectively.

The
slight decrease in 2002 is believed to be because of the poor expectations for
the third and fourth quarters of 2000, which may make some employers re-think
the size of the pay increase.

“The
survey indicates that employers had planned to ‘stay on course’ on base pay
increases in 2001 and 2002,” said Steven Gross, leader of William Mercer’s
employee compensation consulting in the US.

“However
as the year progresses we may find that more of them are thinking about
alternative action in case third and fourth quarter performances do not meet
expectations.”

Over
one-third of organisations surveyed are offering individual non-management
incentives, with another 21 per cent considering introducing these, to
reinforce a pay-for-performance philosophy.

The
use of competency-based pay has increased by 7 per cent to 19 per cent this
year and another 17 per cent of employers are thinking about using the same
approach.

More
than 1,500 American-based companies were polled, employing more than 14 million.

www.wmmercer.com/us-news

By Paul Nelson

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