In 2008, many employees either lost their jobs or their pay was frozen. And every year since then, employees have been crossing their fingers that this will finally be the year where they will see a significant increase in pay. But it’s not.

Aon Hewitt’s U.S. Salary Increase Survey of 1,074 companies shows base wages and bonuses won’t be increasing in 2017 any more than they did in 2016. This is the 5th year companies have predicted a 3% increase but actually only provided a 2.6 – 2.8% average increase. The survey also showed:
12.8% of payroll is going toward variable pay
10% of companies have frozen salaries
A shift to performance-based bonuses or perks instead of raises

On December 1st, we expect to see a huge increase in the number of non-exempt employees due to the increased minimum salary for exempt employees. This means the potential for considerably more overtime hitting your payroll and another reason it’s doubtful we’ll see companies offering higher pay increases.

Another component is the increase to minimum wage. While you may only be providing tiny raises, the state is providing 10% increases. This, too, affects your bottom line in your overall payroll costs.

I like bonuses instead of higher pay but you need to think through a company-wide plan. Everyone should have an opportunity to profit based on company and employee performance. You’ll want a written bonus plan that is communicated in a way that every employee knows exactly what they must do to earn their piece of the bonus.



About Your Columnist

CJ Westrick

CJ Westrick is a featured columnist for Women Lead, the official blog of Connected Women of Influence, where she covers all things human resources and managing people in the workplace. CJ Westrick, SPHR, has been in human resources (HR) management for over 20 years and has maintained her SPHR (Senior Professional in Human Resources) national certification since 2002. She started HR Jungle, a human resources consulting firm, in 2006 to provide senior-level HR expertise to businesses without internal HR.

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