Pay Range Adjustments Slowly Trending Upward

Kansas City, Kan. — When it comes to employee pay, it’s no surprise that establishing pay ranges for certain jobs is the most effective strategy to ensuring employees earn a competitive wage, without overcompensating them. The BenchmarkPro 2011 survey results found 79.5 percent of companies have formal pay structures with pay ranges. The average pay range adjustment reported for 2011 was 1.7 percent, up slightly from 1.6 percent reported in 2010. Companies are projecting pay range adjustments of 1.8 percent in 2012.

Pay range adjustment amounts vary by industry as employers in manufacturing and distribution adjusted pay ranges by two percent. Utilities companies and banking and finance organizations increased pay ranges by 1.9 percent and 1.8 percent, respectively. The lowest pay range adjustments were found in not-for-profit at 1.1 percent.

Although national average pay range adjustments may be slowly trending upward, the length of time between those adjustments is growing as well. In 2011, companies reported an average of 15.5 months since they last made adjustments to their pay ranges. That’s up from 14.5 months reported in 2010 and 11.4 months reported in 2009.

“Companies are making an effort to increase their pay ranges again, but the fact they are waiting longer between increases indicates they are continuing to take a cautious approach to increasing pay,” said Amy Kaminski, director of marketing for Compdata Surveys, the nation’s leading pay and benefits survey data provider. “With all the debate about the possibility of a double-dip recession circulating, it’s no wonder employers would be hesitant to loosen their purse strings too quickly.”
If an employee is over their specified pay range, 77.5 percent of companies in the South Central region of the country withhold granting pay increases to the employee’s pay. Seventy-five percent of companies in the Southeast withhold increases, compared to 73.3 percent in the Midwest. Companies in the Northeast withhold increases for employees over their pay range at a rate of 67.1 percent. Conversely, 66 percent of companies grant lump sum increases to employees who have exceeded their pay range maximums.

About the Survey
BenchmarkPro 2011 contains cross-industry data on over 300 benchmark job titles. Data was collected from nearly 3,700 employers reporting for more than 18,000 locations across the country. The results provide a comprehensive summary of pay data and pay practices with an effective date of March 1, 2011.

Compdata Surveys is the nation’s leading compensation and benefits survey data provider. Thousands of U.S. organizations provide data each year ensuring the reliability of our results. Compdata Surveys has been providing comprehensive data at affordable prices to organizations from coast to coast since 1988. For further information about their compensation and benefits surveys, contact Michelle Willis at (800) 300-9570.