- Projected salary budget increases for 2021 match the pay bumps employers made in 2020, according to the Dec. 17 results of an XpertHR survey. Median percentage changes in salary budgets from 2020 to 2021 parallel changes made between 2019 and 2020 in terms of total salary budget, exempt workers, nonexempt workers, and officers and executives.
- Total salary budgets rose by a median percent change or 3% in 2020, a change that employers project will repeat itself in 2021, according to XpertHR. The median percent change in salary budgets for exempt workers in 2020 was 3% and 2.5% for nonexempt workers and officers or executives. The changes are forecasted to be the same in 2021.
- Forty-three percent of the 460 respondents named the economy as a "downward pressure" on total salary budgets for 2021. More than 60% of respondents cited recruitment and retention as a positive influence on their budgeting, signaling a focus on talent, Hellwege said.
XpertHR's findings may signal employers' finances are on the mend, even as the pandemic rages on. "The results show that while COVID-19 has shaken the economy in 2020, employers, by and large, are planning to keep wage increases for 2021 level with those given out this year, rather than reducing raises," XpertHR Surveys Editor Andrew Hellwege said in a press release.
Pay cuts proved a popular COVID-19 response strategy, particularly in the early days of the virus. Gallagher, for instance, published an analysis of Securities and Exchange Commission filings in April 2020 and found that 143 of the 151 companies examined reported pay reductions for at least their CEOs. The Society for Human Resource Management and Oxford Economics later found workers lost some $260 billion in pay cuts.
A separate Gallagher report released in November 2020 concluded the pandemic disrupted 2021 salary increase plans for 45% of employers. The XpertHR findings, collected in October 2020, may provide an update to Gallagher's findings, which were conducted in July and August of last year. Gallagher collected data from 1,283 organizations, while XpertHR's survey group included 460.