The 2014 Pay Raise Forecast

Anna Williams
Posted

pay raiseGood news: You’ll likely be banking a slightly bigger paycheck this time next year.

According to a new survey of more than 900 mid- to large-size U.S. companies, employers plan to bump salaries an average of 3% in 2014.

Although the modest uptick is pretty much on par with raises for 2012 and 2013, it’s an encouraging sign of an improving economy. In the midst of the recession in 2008, up to 75% of employers were freezing wages, USA Today reports. But, now, according to the survey which was conducted by Towers Watson, just 4% of companies have no intentions of upping workers’ pay.

As USA Today notes, with inflation for 2014 forecasted to hit between 1.3% and 1.8%—per Fed chairman Ben Bernanke’s predictions on Wednesday—these pay raises, though seemingly modest, would still outpace inflation.

Of course, some employees will make out better than others. While hourly wage workers are expected to gain 2.9%, managers and salaried employees will likely average 3%, and executives even more, at 3.1%.

Actual work performance could play a part as well: Last year, company all-stars with the highest performance ratings raked in an average boost of 4.3 to 4.5%—while those on the lower rungs of performance received an average raise of 1.3%.

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High-level employees can look forward to even higher bonuses in 2014, as the survey says that executives are posed to cash in on bonuses equal to almost 42% of their salaries.