Our 2 Cents on 3 Percent Raises

03/08/2018 CHRC

Our 2 Cents on 3 Percent Raises

“Will I get a raise? How much?” is a question on everyone’s mind at this time of year.

Since January, the press has been full of stories telling everyone to only expect a 3% raise. Well, compensation consultants hate generalities almost as much as statisticians do.

There is a reason that Commonwealth HR Consulting keeps a link to the Atlanta Fed front and center on our resource page. Not only do we think that the Atlanta Fed gets it (using a methodology developed by the San Francisco Fed), but we think this is a wonderful resource for organizations to reference based upon your location(s), labor market(s), and labor force(s).

As for that 3.0% increase?   We urge you to take a look at Charts 2 and 3 at the Atlanta Fed’s site.  In January, the Distribution of Individual Wage Growth showed:

25th Percentile = -2.2%

50th Percentile/Median = 3.0%

Average = 5.2%

75th Percentile = 14.0%

Chart 3 indicates that 14.9% of the group that the Fed tracks, received a 0% increase.

Some food for thought. Especially if you are an employer who is consistently giving increases to employees who have not upgraded their skills in years … and at the same pace as those employees who possess hot skills, the 14% hot skills. Read More Here