As your organization turns the page to 2017, it’s time to think about salary budget planning. The only way to ensure your compensation plan is externally competitive is through reputable data, which can be extremely challenging to find. A compensation planning survey is a terrific way to uncover strong, defensible, and current data. Pearl Meyer has recently published its 2017 Compensation Planning Report.
This Year’s Findings
The report includes some interesting data regarding compensation practices for 2017. Eighty-nine percent of organizations surveyed are planning a compensation increase program in 2017, with more than 8% planning a larger increase than they provided in 2016. By contrast, just 2.5% of organizations said that they are planning to provide a smaller increase in 2017 versus 2016. Overall, the projected compensation budget increase for 2017 is 3%, which holds fairly consistent on an average basis year-over-year. The average salary structure adjustment planned for 2017 is 1.9%. Remarkably, over 90% said that they do not differentiate the compensation budget amount by employee type (e.g., exempt, non-exempt, management, or executive).

This year’s report also includes vital data on the timing of salary increases. For instance, over 90% of organizations surveyed state that they provide increases on a focal point (i.e., the same date for all employees) rather than an employee’s anniversary date or another time. In addition, the survey found that for over 23% of participants, the month of April is the most common month for salary increases, while November is the least common month for salary increases to occur. Over 96% of organizations said that increases will be given on approximately the same date in 2017 as in 2016, while 1.4% plan to provide increases at an earlier date in 2017 versus 2016.

When asked which factors are considered if no compensation increase is planned for 2017, the most popular reason was the financial performance of the organization at 40%, while economic conditions was second with 30%.

If your organization would like to participate in the upcoming Compensation Planning Survey this fall or if you would like further information, please contact survey@pearlmeyer.com.
About the Report
Published annually, the Compensation Planning Report is an excellent piece to add to your HR toolkit as you plan for the upcoming compensation cycle. The report contains data from 233 participants in various industries including, Aerospace and Defense, Banking, Construction and Engineering, and Software. Organizations in the survey include employees from 60 countries. Beginning in the fall of 2016, data was submitted on a rolling basis. Participants completed a questionnaire regarding compensation increase budgets, salary structure adjustments, and promotional budgets. Data is reported in aggregate form by industry. The data is also broken down by exempt, non-exempt, management, and executive employee groups.