As the economy continues to bounce back and strengthen there is a demonstrated increase in the way of pay raises for many American workers. In 2014, the consulting firm Mercer found that there would be a new annual pay raise of around 2.9 percent. This was up 0.1 percent from last years pay raise average of 2.8 percent and significantly higher than 2009’s 2.1 percent. Though the pay raise is increasing we are still far off from the average pay raise increase of 3.5 percent that was present through the mid-2000’s.
The slow progression of pay raise is still being attributed to the 7.6 percent unemployment rate that the United States is still battling with. With the unemployment rate still around 8 percent the advantage still lies with the current employers in many of the industries. As people are still fighting to get jobs, they can retain their employees without feeling serious pressure of increasing their salary offers.
This year Mercer also found in their study that around 50 percent of all salary increases are going to be given to the top tier employees. The top tier employees are on average going to receive a 4.6 percent increase, with the next tier of employees receiving a 2.6 percent increase and then the bottom receiving a mere 0.2 percent increase. There are many other companies that are taking to alternative monetary incentives such as spot cash rewards, milestone incentives and signing bonuses to drive their employees.
With every city in the United States having different job options and base salaries it comes as no surprise that there can be a huge fluctuation in salary increases across the board. San Francisco was found to be the American city with the biggest pay raises in the 2013 year. This is partially due to being the home of huge technology powerhouses such as Google (GOOG) , HP (HP) and Apple (APPL) . Within the city alone there is a constant stream of startups generating thousands of new jobs a year. Their annual pay raise in 2013 was around 4.3 percent, a total 1.4 percent above the national average. Baltimore and Chicago trail after with notable pay raises of 3.5 percent and 3.1 percent respectively