According to the most recent Conference Board Salary Increase Budget Survey, workers should expect to receive a little boost in their paychecks in 2022 due to the pay rise plan. In a recent survey, employers said they want to boost the budget for raises by 3.9 percent next year, marking the greatest rise since 2008.
Increases in the minimum wage rates for hourly employees in numerous states in 2021 contributed to the budget rise in part. In addition, there is continuing talk about raising the national minimum wage rate.
The second issue that is causing firms to invest more dollars toward employee compensation is a decrease in the number of employees. Inflation.
As noted by the Conference Board, although 46 percent of employers claim that salary hikes for recruits demand a greater budget, 39 percent claim that they have boosted compensation due to rising costs.
Unfortunately, according to Forbes, the income gains are likely to be lost amid inflation. According to the most recent Bureau of Labor Statistics data, the entire cost of goods and services is expected to increase by 6.2 percent in 2021. Furthermore, inflation is expected to persist until 2022, according to projections.
In a report prepared by Gad Levanon of the Labor Market Institute for the Conference Board, it was asserted that “many companies ascertained their pay raise budgets previously in 2021, before the full extent of the carrier in inflation and rising wages was apparent, and before they realized how much other businesses would be having to raise pay rise budgets.”
It cites the tight labor market as another factor contributing to the growth in pay levels. Companies are also increasing employee perks and giving flexible work hours to recruit qualified employees. Additional compensation increases are also possible in the next year for employees.
“As more organizations alter their strategies to account for the increase in salaries and inflation,” Levanon said, “salary rise budgets may be revised higher in the coming months.”
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