U.S. employers are “staying the course,” according to a new survey of pay increases planned for 2014.
A Mercer survey released Tuesday said employee raises averaged 2.8 percent this year and won’t change much next year. A 2.9 percent average is expected. Raises averaged 2.7 percent in 2012 and 2011.
But the survey also noted that salary increases for top-performing employees – identified as about 7 percent of the workforce – will rise higher as companies pay top talent more in an effort to keep them on staff.
”Employers recognize that their greatest challenge is to retain their top performers to avoid post-recessionary flight of these valuable assets,” said Jeanie Adkins, an executive with Mercer’s Rewards practice.
“This includes providing higher pay increases along with other non-cash rewards such as training opportunities and career development,” she said.
Highest-performing employees earned average base pay increases of 4.6 percent in 2013, compared to 2.6 percent for average performers and 0.2 percent for the lowest performers. The survey produced every indication that pay-for-performance is “alive and well” as a compensation practice, the company said.
Mercer’s pay survey, which has been done for more than 20 years, reaches 1,500 mid-size and large employers nationally.