For the third consecutive year, salary increases in corporate America are below 4 percent, as employers remain cautious regarding salary increase budgets, according to the Conference Board.
Salary budgets will average only 3.5 percent this year and will remain at this level next year as well, the Conference Board reported.
"The recovery from the economic downturn appears to be leveling off, and U.S. companies are paying close attention to cost control," says Charles Peck, compensation specialist at the Conference Board.
For all industries as a group, 2005 salary budgets are averaging 3.5 percent, virtually identical to last year's projections. This is true for all three employee groups: nonexempt, exempt and executive.
For all but one of the individual industry groups, actual 2005 budgets were practically the same as what was projected. The lone exception: the insurance industry, where salary budgets of 3.5 percent were below the 3.7 to 3.9 percent that had been forecasted. This year is the third time in 11 years that median increases have fallen significantly below 4 percent, the Conference Board reported.
