Modest Salary Increases Expected For U.S. Workers In 2001

Compiled ByGlenn Hasek A survey by Lincolnshire, Ill.-based Hewitt Associates LLC found that U.S. employees will see modest salary increases in 2001. According to the 24th annual U.S. Salary Increase Survey, average salary increases for next year are projected to be 4.4% for salaried exempt employees, 4.3% for salaried nonexempt employees, 4.1% for nonunion hourly workers, and 4.5% for executives. The consulting firm surveyed 856 organizations. Moderate salary increases are being offset by the steady growth in companies implementing variable compensation plans. According to Hewitt, 78% of surveyed organizations have at least one type of variable pay plan in place, up from 70% in 1999 and 47% in 1990. "Variable compensation is viewed as a 'win-win' by both employers and employees," says Ken Abosch, principal and motivation content leader for Hewitt. "For an employer, variable compensation is not a fixed cost, but rather a self-funding plan that pays out awards when specific business, individual, or group goals are achieved." The U.S. city with the highest projected salary increase in 2001 is San Francisco at 5.6%. The city with the lowest projected salary increase is Cleveland at 3.8%.