NEW YORK – If you thought an improving economy was going to get you a bigger raise this year, guess again.
U.S. businesses are, on average, increasing their salary budgets by 3.5 percent for 2004, the same level as last year’s forecast, according to a new survey private research group Conference Board released Wednesday.
If the 2004 gain comes to pass, it would mark the second time in 11 years that salaries advanced under the 4 percent mark. The expected salary gains for 2005 are also expected to come in below 4 percent, the report said.
“Although U.S. business continues to rebound from the economic downturn, companies are still paying close attention to cost control,” said Charles Peck, who headed the salary survey for the Conference Board.
The 3.5 percent average salary gains for the current year extend across the spectrum of positions, from executives on downward. The predicted gains were fairly consistent in various lines of business too, with insurance industry workers doing a little bit better than the overall average, and utility workers doing the worst on a relative basis.
The good news, the group said, is that salaried employees will nonetheless make some headway, as inflation is likely to come in under the rate of salary gains.
The Conference Board said it’s projecting a 2.2 percent increase in inflation for 2004, although it expects to see a 2.7 percent increase over next year, suggesting a smaller real advance in salary for 2005. In May, overall inflation versus a year ago stood at 3.1 percent.
The meager salary gains expected for the current and coming year come at a time when the economy is charging ahead. While output growth has for some time been quite solid, recent months have also witnessed a marked improvement in hiring. Yet as those jobs have piled up, there’s been some controversy over whether they pay as much as those lost during the recession.
Companies have been able to afford the extra hiring, along with the salary gains, by way of much improved profit levels. Goldman Sachs noted recently that over the last two and half years profit margins have seen a near record advance, “and now stand at the highest level in postwar history.”
They’ve been driven in part by very strong gains in productivity, which have aided companies during a period where the ability to raise prices has been considerably constrained.
Average pay
The average annual wage in Washington state grew by 2.3 percent to $38,794 last year, the state’s Employment Security Department reported Wednesday.
That will result in an increase in minimum payments for jobless benefits.
On a weekly basis, the average wage was $764. The minimum unemployment benefit is set at 15 percent of the average wage, which will increase to $111 from $109 on July 1.
The maximum weekly payment has been capped at $496 by the Legislature.
Last year, about 387,213 Washington residents received unemployment benefits. The average payment was $312 a week.
Average pay
The average annual wage in Washington state grew by 2.3 percent to $38,794 last year, the state’s Employment Security Department reported Wednesday.
That will result in an increase in minimum payments for jobless benefits.
On a weekly basis, the average wage was $764. The minimum unemployment benefit is set at 15 percent of the average wage, which will increase to $111 from $109 on July 1.
The maximum weekly payment has been capped at $496 by the Legislature.
Last year, about 387,213 Washington residents received unemployment benefits. The average payment was $312 a week.
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