A new survey revealed that employees at big corporations are set to see an average pay increase of 3.9% next year.
Transcript:
Conway Gittens: Here’s what we’re watching on TheStreet today.
The Dow kicks off a new week in record territory as investors gear up for an expected rate cut by the Federal Reserve. Investors are pricing in a 63 percent change of half-percentage point interest rate cut, according to the CME FedWatch tool, and only a 37 percent chance of a quarter-percentage point ease.
In other news -it’s almost time for your annual sit-down to discuss a raise for next year, and a new survey indicates your paycheck is likely to get bigger.
Large corporations expect to boost compensation budgets by 3.9 percent for 2025, which is slightly better than the 3.8 percent rate for 2024, but down from the 20-year high of 4.4 percent in 2023.
The survey, conducted by the Conference Board, shows companies understand that in this market -they’re going to have to pay up to prevent their best workers from being poached. “A shrinking labor supply is driving businesses to focus on retaining their current workforce, leading to sustained salary increases and higher real wage growth as inflation moderates,” says Conference Board chief economist Dana Peterson.
As part of the survey, company’s revealed – that in order to stay competitive – they plan to reserve money for pay tweaks throughout the year as well. This includes money for promotions, counter offers, salary adjustments, role changes, rewards for valuable team members, and other reasons. That’s the good news. The bad news: employers surveyed said they will be giving out fewer sign-on and retention bonuses than they did during the pandemic years.
By the way: Workers are coming out ahead in the battle against inflation. The annual inflation rate in August was up 2.5 percent, while average hourly earnings rose 3.8 percent.
That’ll do it for your Daily Briefing. From the New York Stock Exchange, I’m Conway Gittens with TheStreet.
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