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Current Economic Climate Leads to Salary Increases

salary increase

1.5 minute read

In a response to a tight labor market and record-high inflation, employers plan to raise salaries 4.1% in 2023, according to Willis Towers Watson’s (WTW) Salary Budget Planning Report. These increases will be the largest since 2008 and 64% of employers have budgeted for higher pay raises than last year.

Inflation is having a direct impact on employees. Four in ten workers live paycheck to paycheck, according to another WTW survey, and this often applies to even high-salaried workers. For example, full-time faculty wages decreased by 5% in 2022 after adjusting for inflation, according to the American Association of University Professors’ annual report. Thus, creating the need for many organizations to increase wages.

Some employers are even going beyond salary increases, introducing inflation-offset bonuses or making changes to their current compensation programs to require more frequent salary reviews.

Employers should continue to monitor labor, inflation, and compensation trends. The employment landscape is continuously changing as workers deal with the realities of the current economic climate. Download the bulletin for more details.

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National Insurance Services is not a law firm and no opinion, suggestion, or recommendation of the firm or its employees shall constitute legal advice. Readers are advised to consult with their own attorney for a determination of their legal rights, responsibilities and liabilities, including the interpretation of any statute or regulation, or its application to the readers’ business activities.

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Erin Woulfe

Erin Woulfe

Erin Woulfe likes to write about things that matter. Keeping her finger on the pulse of what’s happening in the public sector world, she blogs about the latest legislative news and employee benefit trends that affect our school, city and county clients. She’s been with NIS since 2002. “I love connecting to our clients and providing them with the tools they need in order to administrate their plan,” says Erin. “Whether that be materials to educate their employees on certain benefits, how to effectively communicate change within an organization, or providing tips and how-to’s to help them make their job easier.”