Workers have received big pay increases over the past few years, but their pay could soon drop amid economic uncertainty, according to findings released Monday.
Almost half (49%) of 600 business leaders This Month’s Survey by ResumeBuilder.com 26% of respondents said they would not give their employees a cost-of-living adjustment (COLA) next year, and 26% said they would not give their employees a raise at all, or likely not at all. Of those who give COLA, 48% give him an increase of 3% or less. Additionally, more than half expect to reduce their workforce in 2024.
This could be bad news for workers whose salaries continue to be hit by more than two years of rampant inflation. Even though wages at many companies rose significantly over the past two years, helped by labor shortages, most of the gains were swallowed up by inflation. It’s only recently that inflation has subsided and workers have begun to regain lost purchasing power, but it looks like things could change again. According to ResumeBuilder.com, nearly three-quarters of business leaders say the job market is back in their favor.
“Cost of living increases are critical for the vast majority of workers who are already underpaid and whose wages are not keeping pace with inflation,” said Stacey Haller, chief career advisor at ResumeBuilder.com. Even if the rate is raised to 3.6%, an increase of less than 4% will not result in an increase in earning power or wages. ”
What is a cost of living adjustment for businesses?
A cost of living adjustment (COLA) is an adjustment made to people’s pay to keep pace with inflation. This is intended to ensure that workers maintain the same standard of living year after year.
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A famous example is Social Security. The government provides her COLA in a recipient’s benefit check each year based on the rate of inflation. In 2024, there will be a 3.2% increase to account for inflation.
Reinstating the COLA is also one of the demands of the strike by auto workers who have been burned by the past few years of inflation.
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Will wages rise in 2024?
If you’re a good worker at a company that’s giving you a raise, your chances may be about even.
Overall, 74% of business leaders said they still plan to give raises, but not everyone said that, according to ResumeBuilder.com. Half of business leaders say less than 50% of their employees receive a raise, and that most raises (82%) are based on performance. 79% of companies said that if they were lucky enough to get a raise, the increase would be larger than in recent years.
According to ResumeBuilder.com, one-third of business leaders think it’s most important to reward senior-level employees, so if you’re a mid- to senior-level employee, you can It is said that the sex may be slightly higher.
Medora Lee is USA TODAY’s money, markets and personal finance reporter. Please contact us at mjlee@usatoday.com. Subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.
