The slumping economy has caused merit pay increases to decrease to 2.8%, down from the 3.71% expected in June. Cost of living increases are budgeted at around 1.2%, and higher among small businesses, states new data from
Merit increases remain the largest at companies with over 1,000 employees, hovering at around 3%, while cost-of-living increases are the largest at nonprofit companies.
"We are just trying to keep doors open," one respondent reportedly said.
According to the survey, 38.5% of respondents are changing plans because of the economy. An additional 30.5% are considering changes. Only 23.6% are moving forward with initial budget expectations. Nearly four-in-ten companies responding plan to reduce pay, offer smaller or no rate increases (24.4%) or delay effective dates of raises (15.3%).
One respondent said that while they were not freezing increases, they were cutting back on employee's eligible hours.
The survey was conducted in late October via online polling. 541 people responded.
