Pay increase budgets have finally started to rise in 2010, supporting the predictions of many economists that the U.S. may see modest economic improvements this year. The newly released 2010 Compensation Data Manufacturing survey results show pay increase budgets have increased to 2.2 percent, up from 1.9 percent in 2009. Continued increases are expected over the next year, as manufacturers predict an uptick in 2011 to 2.6 percent.
Although increases to pay increase budgets are starting to become apparent, the economic recovery is expected to be slow, so manufacturers will likely continue making conservative compensation choices, said Amy Kaminski,
director of marketing for Compdata Surveys, the nation's leading compensation and benefits survey data provider. Although keeping current employees on staff is a top concern during the jobless recovery predicted by most economists, increasing pay will continue to be a difficult priority until an upswing in the economic climate becomes more visible.
According to the survey, pay increase budgets vary within the industry as non-durable goods manufacturers had the highest budget, 2.5 percent. Distribution and warehouse and durable goods companies followed at 2.1
percent. Non-durable goods companies are projecting the highest pay increase budget in 2011 at 2.7 percent, with distribution and warehouse and durable goods companies following at 2.6 percent. The 2010 Compensation Data Manufacturing survey results also show pay increase budgets vary across different regions of the country. Manufacturers in the Northeast reported the highest pay increase budgets, 2.5 percent.
This is closely followed by organizations in the South Central and West regions at 2.3 percent. Respondents in the Northeast and West are projecting the highest pay increase budgets for 2011, 2.8 percent. Companies in the Midwest and South Central follow at 2.6 percent.
