Talent Management - January 2009 - (Page 22)

Show ’Em the Money: Compensation Trends 2009 Alison Avalos There may not be a lot of money for bonuses in 2009, but total rewards packages can be leveraged to attract, motivate and retain the best talent. E mployers and employees can’t have a conversation these days without the uncertainly of the global economy entering the discussion. Employees are keeping track of inﬂation rates and hoping with ﬁngers crossed that their paychecks keep up. For talent managers, the relevant question is, is it an employer’s responsibility to award pay raises based on inﬂation or based on merit? ued from 2003-04, when salary-budget increases hit an all-time low of 3.6 percent. For now, it appears organizations are able to ﬁnd and keep the employees they need with a broad total rewards package that includes moderate pay increases. However, since data was collected in April, many adverse economic events have taken place, including a rise in inﬂation and unemployment, and the ﬁnancial crisis. It will be interesting to see if organizations will be able to meet their 2009 budget projections. Salary Budget Trends Findings from the WorldatWork “2008-2009 Salary Budget Survey” show that in 2008, organizations were planning to continue the pay increases awarded in recent years. Very few organizations, in fact, expected to Pay-Increase Drivers In the past year, one of the most common questions among total rewards practitioners and talent management leaders has been, “What should we do for our employees in a contracting economy: make cost-of-living adjustments to salaries, give cash subsidies for gas, take over loans for employees who are in default?” The answer is simple if the goal of a total rewards program is kept top of mind: offer what is necessary to attract, motivate and retain the talent to achieve desired business results. What is necessary may vary by employee, organization and industry. Organizations give pay increases because they must compete to be attractive employers and drive employee performance through rewards. The same is true of other compensation, beneﬁts and work-life programs. Implementing programs in response to inﬂation or short-term problems such as energy prices may provide temporary relief, but won’t necessarily help the employer sustain its workforce. It also can create long-term challenges such as entitlement mentalities in employees. Finding a good balance between educating employees on how to be better consumers and initiating programs ABOUT THE SURVEY The 35th annual WorldatWork “Salary Budget Survey” is one of the largest and most comprehensive salary budget surveys in the industry. More than 2,700 participants responded to this survey. The “Salary Budget Survey” reports data for more than 14.2 million U.S. and Canadian employees. The data represents a wide range of industries that are distributed across four regions of the United States and 13 provinces in Canada. freeze pay because, even in a struggling economy, pay increases continue to be an important tool to attract, motivate and retain talent. The total salary-budget-increase averages in the United States and Canada were 3.9 percent in 2008 and expected to increase by the same amount in 2009. (See Figure 1.) This levels off an upward trend that contin- 22 January 2009 talent management magazine www.talentmgt.com http://www.talentmgt.com

Table of Contents Feed for the Digital Edition of Talent Management - January 2009

Talent Management - January 2009 Editor’s Letter Contents Human Performance Leading Edge Learning Connections Integrate Web 2.0 Into the On-Boarding Experience Show ’Em the Money: Compensation Trends 2009 Transition at the Top How Hollywood Manages Talent and What You Can Learn Get the Most Bang With Limited Training Bucks Life After Layoffs Attract Specific Talent Groups Performance Management: Its Time Is Now Helping the Helpers Advertisers’ Index Editorial Resources Full Potential

Talent Management - January 2009

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