Employers increase use of short-term incentives as cost-effective way to
While employees may not see much improvement in base pay next year, the
prevalence and size of short-term incentives has increased
substantially, according to the sixth annual "Compensation
Planning Survey" released by Buck
Consultants, A Xerox
Company (NYSE: XRX).
The survey analyzed responses from more than 350 organizations to
determine trends in compensation for the coming year.
The median salary increase in 2013 will be 3 percent, as employers
continue to be cautious with their salary budgets. Buck Consultants
predicts that the new normal for salary increases will settle at this 3
The expected size of short-term incentive awards forecast for 2013 is
greater than the target payouts for 2012 and actual payouts in 2011 for
all employee groups except CEOs. Employers see a bonus or other
short-term incentive - a one-time expense as opposed to the annual
expense of a salary increase - as a cost-effective approach for
Hiring and retention bonuses are offered by more than half of the
organizations surveyed (56 percent). Referral bonuses are also offered
by 56 percent of organizations.
The prevalence of ongoing long-term incentives depends on employee
level. For example, stock options are offered to CEOs by 52 percent of
survey respondents but only offered to rank and file exempt employees by
"The results of this survey are similar to past years in terms of
compensation - slow growth, lots of challenges and not a lot of money to
spend," said David Van De Voort, principal, Buck Consultants. "However,
we've moved past the environment of several years ago when employers
were freezing pay and reducing 401(k) matches."
In fact, more than two-thirds (67 percent) of survey participants cited
a focus on retaining top talent in 2013, and more will look to make
additions to their workforce. According to the survey, 46 percent are
planning for normal hiring and 19 percent will be adding staff.
About the Survey
Buck Consultants completed its survey in September. The survey includes
responses from 362 employers, representing virtually every sector of the
Buck's survey report, "Compensation Planning for 2013," is available at
no cost to the media by contacting Ed Gadowski at 910-253-9816. It is
available to other interested parties for $400 by calling 1-800-887-0509
or visiting http://www.bucksurveys.com.
The survey was produced by Buck Consultants' Knowledge Resources group,
which is responsible for national multi-practice legal analysis and
publications, government relations, research, surveys, training, and
About Buck Consultants
Buck Consultants, A Xerox Company, is a leader in human resource and
benefits consulting with more than 1,500 professionals worldwide.
Founded in 1916 to advise clients in establishing and funding some of
the nation's first public and private retirement programs, Buck is an
innovator in the areas of retirement benefits, health and welfare
programs, talent and human resources solutions, compensation, and
employee communication. News and other information about Buck
Consultants are available at http://www.buckconsultants.com.
With sales approaching $23 billion, Xerox
(NYSE: XRX) is the world's leading enterprise for business
process and document
management. Its technology, expertise and services
enable workplaces - from small businesses to large global enterprises -
to simplify the way work gets done so they operate more effectively and
focus more on what matters most: their real
business. Headquartered in Norwalk, Conn., Xerox offers business
process outsourcing and IT
outsourcing services, including data processing, healthcare
benefits management, finance
solutions, and customer
relationship management services for commercial and government
organizations worldwide. The company also provides extensive
technology, services, software
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