PayScale Research Shows Most Companies Aren’t Planning Meaningful Pay Increases in 2019, Despite Retention Concerns and Volatile Talent Market

PayScale recommends companies first “recession-proof” their workforce by getting pay right before evaluating development opportunities, perks and bonuses designed to attract and retain employees

Seattle, Washington, UNITED STATES

SEATTLE, Feb. 12, 2019 (GLOBE NEWSWIRE) -- Today, PayScale, Inc., the leader in modern compensation software, released the 2019 Compensation Best Practices Report (CBPR) which reflects trends and attitudes about compensation, retention and employee engagement from more than 7,000 employers. Entitled “Will They Stay or Will They Go?,” this year’s report reveals that employers are more concerned than ever about retaining their people. Yet, HR managers and senior leaders are reluctant to raise base pay in a significant way when faced with an uncertain economy and are hoping to keep their employees by offering better training programs and benefits.

Here are key findings from the 2019 Compensation Best Practices Report:

• Increased concerns about keeping employees. More organizations (66 percent) in 2019 cited employee retention as a major concern when compared to responses from the previous year (59 percent).

• Employers will keep the purse strings tight when it comes to compensation. Despite robust corporate profits and lower taxes for businesses, few companies report planning a significant pay raise for most of their workforce; nearly 70 percent of respondents project base pay increases of 3 percent or less.

• Not all raises are created equal. More than 40 percent of employers gave base pay increases of 10 percent or more for some jobs at their organization. These substantial raises were typically for highly competitive jobs, such as IT positions, where it is more difficult to attract employees with the right skill set.

• Companies will offer more benefits and perks in lieu of raises than in years’ past:

  • Fifty-nine percent of employers will invest more in training and development programs.
  • Forty-four percent plan to allow remote work (up from 39 percent last year) and 37 percent will offer flex time.
  • About one-third of companies will offer paid family leave in 2019, an increase when compared to the previous year.
  • Prevalence of unlimited PTO has nearly doubled in recent years (9 percent of employers offered it in 2018 compared to just 5 percent in 2016).

• Bonuses on the rise – for some employees – While increases in base pay are tepid, many organizations (66 percent) are planning to use bonuses in 2019 in an attempt to retain their top performers in competitive jobs. These bonuses are typically directly aligned with performance and broader company objectives.

“Our research shows the most successful companies understand the importance of building a positive pay brand at their organization by addressing pay equity, fostering more transparent pay practices and ensuring managers are empowered to have meaningful conversations about compensation,” said PayScale’s Senior Vice President, Tim Low.  “We talk to our customers about the value of a positive pay brand because we’ve seen it drive better business outcomes. In order to entice employees to stay, however, companies should make sure they’re getting base compensation right first, so their employees feel good about their deal. Only then should employers turn their attention to bolstering the perks associated with the position.”

For more information about PayScale’s most recent Compensation Best Practices Report: Will They Stay or Will They Go?, please visit:

About PayScale:
PayScale offers modern compensation software and the most precise, real-time, data-driven insights for employees and employers alike. More than 8,000 customers, from small businesses to Fortune 500 companies, use PayScale to power pay decisions for more than 23 million employees. These companies include Dish Network, Getty Images, Skullcandy, Time Warner, T-Mobile, Macy’s, Sunsweet, UnitedHealth Group, Stihl and Wendy’s. For more information, please visit: or follow PayScale on Twitter:

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