Before the economic downturn hit its low point, Chicago-area companies were already projecting low salary increases. Then they adjusted the numbers even lower.
Last May, global consultant Watson Wyatt Worldwide and the Chicago Compensation Association surveyed 55 Chicago-area companies and found they had budgeted an average 3.9 percent salary increase for 2002. By October, out of 57 respondents surveyed, 30 percent said they were going to have to adjust those figures, paying an average 3.4 percent raise instead.
“For salary increases, about one in four organizations reported paying out smaller increases than they’d originally planned,” said Maureen Tarantello, strategic rewards office practice leader for Watson Wyatt. “That is close to what people anticipated last fall.”
The average salary increases in Chicago are fairly close to national averages, which were just slightly higher at 4.1 percent, Tarantello said. Pay raise budgets nationwide decreased an average of 0.5 to 1 percent, the study found.
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