Employers Still Giving Raises, Mostly to High
WorldatWork 37th Annual Salary Budget Survey Analyzes Employer Pay Strategies
July 21, 2010 09:04 AM Eastern Daylight Time
WASHINGTON--(EON: Enhanced Online News)--U.S. employers are reporting a 2.5% average salary budget
increase across all employee categories for 2010, which means many employees may expect a base pay raise of
around 2.5% before the year is over. However, the size of the raise changes when the employee’s performance is
factored in. Low performers can expect to see minimal increases of up to 0.7% or nothing at all, middle performers
might expect a nominal base pay raise of 2.4%, and high performers may expect an average of 3.7% (54% higher
than a middle performer). Surveyed employers reported that roughly 24% of employees are rated as high
performers, while most are classified as middle performers.
These were just a few of the conclusions drawn from theannual WorldatWork 2010-2011Salary Budget Survey,
the largest survey of its kind with 2,497 respondents representing 15.5 million U.S. employees.
“With underfunded salary budgets this year, employers want the most bang for their buck,” said Anne C. Ruddy,
CCP, president of WorldatWork. “They are no longer averse to withholding merit increases for poor performers so
they can afford to grant meaningful increases to better performers.”
The survey also found that one in three companies has a separate promotional budget as standard practice. A
promotion could mean an additional 7% to 8% increase for the promoted employee's base salary. In addition, a top
performer can expect to benefit from an employer’s variable pay program. “In this economy, being an average
performer just doesn’t cut it anymore,” said Alison Avalos, research manager for WorldatWork. “Companies expect
performance and are willing to reward employees based on organization success, individual performance or both.
Pay for performance is alive and well.” For 2010, employers are budgeting an average o