American Society of Employers’ (ASE) new 2016/2017 salary budget survey findings: despite low unemployment, it’s more of the same for employee pay increases in 2017

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Media Contacts: Barbara Fornasiero, EAFocus Communications, 248.260.8466, barbara@eafocus.com; Heather Nezich, ASE, 248.223.8040, hnezich@aseonline.org

Livonia, Mich. —Aug. 31, 2016— The American Society of Employers (ASE), one of the nation’s oldest and largest employer associations, released its 2016/2017 Salary Budget Survey with a number that’s beginning to sound like a broken record: 3%. Despite economic growth and continued low unemployment, that’s the amount Michigan employers are budgeting for employee pay raises in 2017.

4 Key findings in the 2016/2017 Salary Budget Survey:
• Most employees will see just a 3 percent increase in pay in 2017, a number that has remained constant for the past several years.
• The majority of merit dollars granted are going to the employer’s top performers. This year’s survey findings, however, reveal more employers (up 14% from two years ago) are distributing merit dollars across all employee groups, with the largest amount of dollars going to top performers, while low performers receive a smaller amount. In past years, top performers received most merit dollars and average performers received some merit dollars.
• Wage freezes remain low; consistent with 2016, only 4% of employers surveyed anticipate a wage or salary freeze in 2017.
• Employers continue to rely on variable pay programs to reward performance, with 83% of employers offering variable pay to at least one employee group. The average expected annual bonus payout as a percentage of salary in 2017 remains steady at approximately 5% for both Nonexempt Hourly Nonunion employees and Nonexempt Salaried employees, 9% for Exempt Salaried employees, and 24% for Officers/Executives.

The survey findings were announced by ASE President and CEO, Mary E. Corrado.

“The ASE 2016/2017 salary budget data reflecting an average 3% for merit raises is consistent with several national surveys as well, so this is not a Michigan phenomenon,” Corrado said. “It appears the shift toward modest raises and variable pay and reward options is no longer a trend, but a compensation practice that’s here to stay – at least until the next upheaval in the economy or labor markets.”

Merit Dollars Distribution_Graph 2016

Background information on the 2016/2017 Salary Budget Survey:
• 231 organizations from across Michigan participated.
• Organizations with 1 to 500 Michigan employees made up 83% of the survey sample, while organizations with 501 to 5,000 Michigan employers represented 14% of the sample. The remaining 2.5% of the sample comes from organizations with more than 5,000 Michigan employees.
• A variety of industries are represented, with manufacturing organizations representing 60% of the survey sample. The remaining 40% is represented by trades and services organizations.

To obtain a copy of ASE’s 2016/2017 Salary Budget Survey, contact ASE’s Compensation and Benefits Surveys department at surveys@aseonline.org or 248.353.4500. This survey is available free of charge to ASE members, and for $525 to non-members.

About the American Society of Employers (ASE) – a Centennial Organization
The American Society of Employers (ASE) is a not-for-profit trade association providing people-management information and services to Michigan employers. Since 1902, member organizations have relied on ASE to be their single, cost-effective source for information and support, helping to grow their bottom line by enhancing the effectiveness of their people. Learn more about ASE at www.aseonline.org.

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