Press Room
Press Contact:
Melissa Sharp
202-315-5565
melissa.sharp@worldatwork.org

WorldatWork Report: U.S. Salary Budget Increases Come in at 3 Percent

Primed for Growth, Salary Budget Increases Hold Steady

Aug. 1, 2017 — WASHINGTON, D.C. — According to WorldatWork's annual Salary Budget Survey, released today, employers in the United States report that the average 2017 total salary increase budget is 3.0 percent (mean and median), the same as it has been for the past three years. Respondents are planning for a slight increase for 2018 salary increase budgets but only up to 3.1 percent.

"With a tight job market and reported financial gains, we might expect to see more growth in salaries," said Kerry Chou, WorldatWork senior practice leader. "In the United States in particular, there are other factors that might explain this plateau in growth, including the increased use of variable pay or non-cash based rewards, or an overall more conservative pay philosophy. We are also looking closely at the impact several regulatory actions have had on salaries: the rising minimum wage in certain regions and the overtime rule. It's possible that these changes may not have been reported as a salary budget increase in some cases. While the OT rule has been blocked, many organizations had already implemented the changes and chose not to undo them. So, with the continued 3 percent increase of salary budgets and these un-reported salary changes, this picture could be brighter for the workforce than it initially appears."

Select Survey Highlights

  • Base salary increases (e.g., general increase/Cost-of-Living Adjustment [COLA], merit increase) are being awarded to 89 percent of employees in 2017, on average.
  • Promotional increases were awarded to 7.9 percent (median: 7.0 percent) of employees in 2016, one-tenth of a percentage point lower than the 8.0 percent average in 2015 (median: 7.0 percent). Of the promotional increases received, the size of the average pay increase remained unchanged at 8.4 percent (median: 8.0 percent).
  • The percentage of organizations using variable pay increased by one percentage point for the third straight year to 85 percent in 2017. This number has been hovering around 80 percent for many years. An improving economy could result in these variable pay increases while the fixed costs remain controlled.

State Level Data
The survey reports on salary budget increases for all 50 states as well as selected major metropolitan areas. As in recent years, the state salary budget increases for 2017 showed little variance. The increases ranged from 2.9 percent to 3.1 percent, with the median at 3.0 percent. The metropolitan areas showed more variance, ranging from 3.0 percent to 3.3 percent. "The metropolitan areas that show the highest percentages, such as the Pacific Northwest, Los Angeles, Dallas or Atlanta, tend to be in regions of the United States that are driven by high-tech or minimum wage increases," Chou noted.

Canada
Aggregated across all Canadian employee categories, regions and industries, the average total salary budget increase is 2.8 percent in 2017 (median: 3.0 percent), in line with last year's projection. The median figure is unchanged since 2011.

"We are seeing some good news for the Canadian workforce as we are starting to see an increase in the salary budgets," said Chou. "Canada faced some problems last year, including low oil prices and massive wildfires, that may have contributed to lower numbers in 2016. With 2017 showing an increase, this may indicate some recovery. We expect the 2018 numbers to increase even more."

The average total salary increase budget in Canada is projected to return to 3.0 percent in 2018 with the median total salary budget increase expected to remain firm at 3.0 percent. The survey also provides a breakdown by province and major metropolitan area.

About the Survey
The "WorldatWork 2017-2018 Salary Budget Survey" is the largest survey of its kind with 4,942 responses from 19 countries representing nearly 15 million employees. (Global Top-Level Results). The survey closed in May 2017. Survey respondents are WorldatWork members employed in the human resources, compensation and benefits departments of mostly large U.S. companies. All data include zero-percent responses.

Credentialed journalists may request a complimentary copy of the survey report by contacting Emily McGee at emily.mcgee@worldatwork.org   
NOTE: WorldatWork includes zero-percent responses in the analysis, unless otherwise noted, because a zero represents a decision not to budget for a program and/or employee category that exists in the responding organization.

 



About WorldatWork®
The Total Rewards Association

WorldatWork is a nonprofit human resources association and compensation authority for professionals and organizations focused on compensation, benefits and total rewards. It's our mission to empower professionals to become masters in their fields. We do so by providing thought leadership in total rewards disciplines from the world's most respected experts; ensuring access to timely, relevant content; and fostering an active community of total rewards practitioners and leaders.

WorldatWork has more than 70,000 members and subscribers worldwide; more than 80% of Fortune 500 companies employ a WorldatWork member. Founded in 1955, WorldatWork has offices in Scottsdale, Ariz., and Washington, D.C., and is affiliated with more than 70 human resources associations around the world.

Have Questions?

Phone

+1 877 951 9191

USA and Canada

+1 480 951 9191

Other Countries

Online

Chat currently unavailable.

Email Us