As the economy expands and more workers are confident in their job security, employees are taking the initiative to ask for pay raises. With compensation strongly tied to job satisfaction, employers should pay attention to these requests as they are becoming more frequent and could boost worker engagement and productivity.
A survey by Accountemps highlighted the rise of compensation hikes, with more than 4 in 10 chief financial officers saying the number of requests for raises or promotions is higher than it was two years ago. The increase in workers asking for advancement in their careers or compensation is a sign that the economy is stabilizing. Since the economy is experiencing growth and seeing higher employment rates, more employees are leaving their current jobs to pursue other opportunities. The accounting and finance professional staffing firm cited a report from the U.S. Bureau of Labor Statistics that found workers are quitting their jobs at the highest rate in six years.
With the risk of their top talent exiting the company, employers should focus on adjusting their compensation programs to adequately provide pay for workers depending on their performance.
A survey from human resources firm Aon Hewitt said national salaries will increase to 3 percent in 2015, up from 2.9 percent in 2014. With the 2015 rise in compensation representing a seven-year high in pay raises, companies are exploring various options for properly rewarding their workers, including bonuses.
Higher bonuses could help further company mission
With incentive compensation like bonuses, companies can recognize and reward employees who achieve business goals and further the firms’ missions. The Aon Hewitt report found that 91 percent of companies give bonuses to employees.
As companies are looking to restructure their incentive compensation programs, Accountemps recommends firms offer greater bonuses.
Bonuses are accounting for a larger portion of company payroll budgets with this type of compensation, representing 12.7 percent of total payroll funds – an all-time high in the 38 years of the survey’s history, according to Aon Hewitt.
“Employers must be proactive and closely scrutinize compensation levels to stay competitive and keep good staff,” said Bill Driscoll, a district president with Accountemps, in a related news release. “It’s better to be prepared than surprised by an employee’s request for a raise or promotion. Now’s the time to proactively connect with key team members to identify advancement opportunities and discuss viable career paths.”