Kenexa logoHR business solutions provider Kenexa has reported a stabilization of salary budgets as determined by its U.S. 2012-13 National Salary Budget Survey, which also forecasts a modest gain of 3 percent for salary budgets for all employees in the U.S. and Canada. This is an increase over 2009 when salary budgets were at record lows for executives and non-exempt employees, falling 2.5 percent and 2.8 percent that year, respectively.

“Since increase budgets bottomed out in 2009, many organizations have been looking forward to the time when they would get back to normal,” said Zahir Ladhani, head of Kenexa’s Compensation business unit. “With increase budgets in North America hovering around the 3 percent mark for two years running, it appears as though we have now achieved a new normal. Budgets such as these will continue to put pressure on organizations to ensure that they are paying competitively and retaining their top talent.”

On average, salaries continue to lag behind pre-recession levels of 2008 which was, incidentally, the most recent time that increases approached 4 percent for all employees. The report goes on to show that companies are increasing variable pay eligibility, primarily for executives, thus allowing companies to budget for awards instead of long-term, pre-determined compensation commitments. The survey found that 71 percent of companies believe that their salary increase budgets for 2013 will remain the same from 2012 while 22 percent predict larger increases year-over-year.

Higher-than-average pay increases in 2012 were experienced by workers in industries including biotechnology and software and networking, seeing 3.5 percent and 3.1 percent salary increases, respectively. Workers in the non-profit, education, government, and construction sectors saw only a 2.5 percent increase over-the-year.



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