SCOTTSDALE, ARIZ. - Economic turbulence in mid-2005 did not disrupt salary budgets very much according to the year-end update to the WorldatWork Salary Budget Survey. Although there were a number of potential threats in mid-2005, including a destructive hurricane season, a period of fuel price escalation and increases to health care costs, the vast majority of organizations did not choose to adjust the salary budgets they reported in the 32nd annual survey conducted in April 2005.
In October, companies that participated in the April 2005 Salary Budget Survey had a chance to report any changes to their salary budgets occurred since the first quarter. Approximately 43% of the 2,836 participating organizations that responded to the survey in April submitted an updated survey in October.
According to the October update, only about one in five organizations (21%) made an adjustment to their salary budget plan. For organizations making a change, projected 2006 salary budget increases remained the same for all employee groups, except nonexempt salaried, which increased from 3.7% to 3.8%. Additionally, more than half of survey respondents reported higher revenues for the months of May through October than they did for the same period in 2004.
While variable pay continues to be a popular option with companies, it may be more vulnerable to economic threat than salary budgets. As salary budget plans in most companies remained stable throughout mid-2005, variable pay budgets and awards experienced more fluctuation. Variable pay includes incentives such as cash, stock options and bonuses - items generally not included in an employee´s base salary. October data indicates decreases to variable pay budgets for all groups except nonexempt salaried, which actually reported a 0.2% increase. Variable pay awards absorbed an even larger decrease, with awards declining by 0.4% to as much as 1.8% for officers and executives.
More information is available in the full survey report, which can be purchased through the online WorldatWork Bookstore (www.worldatwork.org/bookstore), or by calling WorldatWork (toll-free) 877/951-9191. For media questions about the survey, please contact Andrea Ozias at aozias[at]worldatwork.org or 480/922-2038.
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WorldatWork is the world's leading not-for-profit professional association dedicated to knowledge leadership in compensation, benefits and total rewards, and focuses on human resources disciplines associated with attracting, retaining and motivating employees. For more information, visit us at www.worldatwork.org or call 877/951-9191.
Contact:
Andrea Ozias
Media Relations
Phone: 877/951-9191 (toll free)
Direct: 480/922-2038
E-mail: aozias[at]worldatwork.org