Only a few short years ago, our nation was in economic turmoil. Organizations didn’t know where to even start creating competitive compensation offerings because of the uncertainty of things. We accurately predicted that the best thing companies could do was to hang on to their top performers and talent, pay them fairly, and use real-time salary data to gauge trends as they were happening. Now, it’s up to comp managers to up the ante with strong compensation strategies in the top growth markets.
Overall, things are looking positive for compensation budgets
We’ve actually come a long way since the latest recession—we’ve seen with new business growth, unemployment numbers at record lows, and companies that are actively planning their best compensation budgets for 2016. What’s on everyone’s minds is where things stand in terms of industries and regions where job growth will result in the best compensation for workers.
Job and compensation growth on the horizon
The PayScale Index, which provides up-to-date salary data and market trends, indicates some of the strongest areas for potential growth. Overall, our index findings for the fourth quarter of 2015 indicate that, “wage growth will be around 0.1 percent, resulting in an annual wage growth of 0.6 percent”.
Real Wages vs. Compensation Budgets
It’s important to note that based on inflationary and cost-of-living rates, real wages are down by 8 percent. The PayScale index major findings were major findings in the Q3 2015 PayScale Index were:
- Healthcare and Social Assistance, as well as Retail jobs, were up by as much as 1.2 percent over last quarter’s figures
- IT Jobs fell for the first two quarters of 2015, but once again picked up in Q3, growing 0.6 percent for the quarter and 0.5 percent for the year
- Engineering jobs also experienced an uptick this quarter, with wages growing 0.9 percent for the quarter and 0.8 percent for the year
- STEM jobs also experienced wage growth in Q3: 0.8 percent for the quarter and 0.9 percent for the year, which caused their wages to almost fully recover from the major dip they took in the first half of 2015
Additionally, in an October 2, 2015 news release from the US Department of Labor, a number of industries have shown marked growth in 2015 and are predicted to remain strong for 2016:
- Jobs in information management increased by 12,000 in September and haves increased by 44,000 over the year
- Employment in professional and business services continued to trend up in September, with job growth has averaging 45,000 per month thus far in 2015
- Retail trade employment trended up in September, as employment rose in general merchandise stores adding some 15,000 jobs
- Employment in food services continued on an upward trend in September, in fact adding 349,000 new jobs this year
The above industries can expect to be planning some remarkable compensation budgets going into 2016 so they can attract and retain their best employees. By using accurate salary data and tapping into multiple resources for building salary ranges and compensation plans, any company can control costs while remaining competitive.
Job seekers who are looking to education and training in order to attain a job in one of the above industries will also want to check out the newly released 2015-2016 PayScale College Salary Report to evaluate their goals.
What are your thoughts?
How do the above trends affect your 2016 compensation plans for your company? How will you overcome any potential obstacles? We want to hear from you! Please leave your comments and questions below.