Remuneration Trends and Insights

Pay Increase Barometer

Mercer’s Pay Increase Barometer measures the extent to which salaries are passed on at, below or above market rates in the past nine months.

 

 

April 2022

Mercer’s pay increase barometer measures the extent to which salaries are passed on at, below or above market rates in the past nine months. The terms ‘contraction’, ‘stable’ and ‘expansion’ are used to define the proportion of individuals that in the past nine months have received below, at or above market rates, respectively.

 

Mercer’s remuneration database operates on a rolling basis, with organisations providing remuneration data submissions throughout the year. As a result, each month we share the overall barometer findings in addition to industry-specific results for those sectors for which reportable data is available. 

 

The April pay increase barometer shows 45% of incumbents in the sample received above-market (expansion) movements when compared to Mercer’s reported overall median same-incumbent employment cost movement. While the proportion of incumbents in the “expansion” category has had a 10.9 percentage point downward shift from March, this has occurred simultaneously to an uplift in the overall median same-incumbent movement figure, indicating the market overall is seeing increased salary movements.

 

For an incumbent to receive an at-market (stable) pay movement, they would have received an increase of +/- 1% above or below Mercer’s overall median employment cost movement. The barometer for April shows almost a third of the market has received a remuneration increase within that range (32% of incumbents).

 

For those 23% of individuals that received a below-market (contraction) pay increase, the movement was more than 1% below Mercer’s overall median employment cost movement recorded. The proportion of incumbents in the “contraction” category has increased slightly compared to results from earlier in the calendar year, however, it should be noted again, this is occurring at the same time as the overall market median movement is increasing. As a point of comparison, the number of incumbents receiving a salary freeze (or 0% salary movement) has dropped over the course of the year, from 27.3% of incumbents in January 2022, to 19.4% in the April database figures. Please see the Quarterly Remuneration Trends – Q2 2022 for more insights. 

 

When broken down by reportable industry, the highest proportion of above-market or “expansion” pay increases were awarded by healthcare, and construction and engineering organisations, with 78% and 64% of incumbents in the sample, respectively, receiving above-market pay increases. The high-tech and retail industries passed the highest proportion of at-market pay increases, with 65% and 51% of incumbents, respectively, within a percent of the overall median. While finance and insurance organisations passed on the highest proportion of below-market pay increases, with 83% of incumbents reporting a below market increase.   

 


 

Disclaimer: While every care has been taken to ensure the accuracy of the information, no warranty is given in respect thereof.


 

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