2009 Salary Increase Budgets Change Significantly
March 11, 2009

Results from Culpepper’s recent update survey on base salary increases for 2009 reveals that companies have made significant changes to their salary budgets in response to the global financial crisis.

Since August 2008, global base salary increase budgets for 2009 have declined by an average of 39 percent from 4.23 percent to 2.59 percent (Figure 1). The percentage of companies planning across the board salary freezes in 2009 has increased from 2 percent to 25 percent (Figure 2).

The table below provides a high-level summary view of results from a recent Culpepper Pay Trends Survey on 2009 salary increase budgets. Data was collected from January 19th through March 5th from 557 organizations reporting salary increase data for 90 countries.

Government and Union Mandated Increases
It is worth noting that the percentage of companies freezing salaries is actually higher if government and union-mandated increases are excluded. Many participants reported they have a global, company-wide salary freeze in place for 2009, with the exception of required increases for jobs in locations mandated by government statutes and/or union contracts.

Additionally, some companies reported they are only providing salary increases for employees in countries with high inflation.

Salary Increase Budgets Vary
In this time of economic uncertainty, it is critical to attract top talent and retain high performing employees who will drive your organization’s success in difficult market conditions. You cannot afford to guess about compensation rates for key employees or make "across the board" salary increases or freezes. It is important to carefully consider differences by country, job, company size, industry sector, and ownership status.

* Additional Base Salary Increase Data Tables
In addition to the data table above, we provide a more comprehensive report with 19 detailed data tables with budgeted base salary increases for 2009, including:

• United States

  Breakouts are provided by:

  • Job Function/Level:
    Executives, Operations Managers & Professionals, Sales Managers & Reps, IT Managers & Professionals, R&D Managers & Professionals, and Hourly/Non-Exempt Employees.

  • Number of Employees

  • Industry Sector:
    Technology, Life Sciences, Healthcare Services, Research Institutes & Organizations, Energy, and Other.

  • Ownership:
    Public, Private, and Non-Profit.

• Canada

  Breakouts are provided by:

  • Job Function/Level:
    Executives, Operations Managers & Professionals, Sales Managers & Reps, IT Managers & Professionals, R&D Managers & Professionals, and Hourly Employees.

  • Number of Employees

  • Industry Sector:
    Technology, Life Sciences, and Other.

  • Ownership:
    Public and Private.

• Latin America
  Breakouts are provided by:

  • Region: Mexico & Central America, Caribbean & West Indies, and South America.

  • Country: Argentina, Barbados, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, Guatemala, Mexico, Peru, Uruguay, and Venezuela.

• Europe
  Breakouts are provided by:

  • Region: European Union, Eurozone, Non-Eurozone, Non-European Union.

  • Country: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Luxembourg, Netherlands, Norway, Poland, Portugal, Romania, Russia, Slovakia, Spain, Sweden, Switzerland, Turkey, Ukraine, and the United Kingdom.

• Middle East & Africa
  Breakouts are provided by:

  • Region: Middle East and Africa.

  • Country: Bahrain, Egypt, Israel, Kenya, Lebanon, Morocco, Saudi Arabia, South Africa
    and the United Arab Emirates.

• Asia-Pacific
  Breakouts are provided by:

  • Region: Asia and Pacific.

  • Country: Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand,  Pakistan, Philippines, Singapore, South Korea, Sri Lanka, Taiwan, Thailand, and Vietnam.

Availability of Comprehensive Report as Downloadable PDF

• Free to Participants in 2009 Salary Increase Budget Update Survey

• Free to Subscribers of Culpepper Pay Practices & Policies Surveys
  (includes Culpepper Library and Small Company Plus Subscribers)

• $295 for Non-Participants and Non-Subscribers

  To order this report, send your request to our sales team.

Data Source:
Culpepper Pay Practices Survey of 557 participating organizations.

Survey Dates:
January 19, 2009 through March 5, 2009.

Participant Breakdown by Industry Sector:
Technology 55%, Life Sciences 13%, Healthcare Services 5%, Research Institutes & Organizations 3%,
Energy 2%, Engineering 1%, Other 21%

Participant Breakdown by Number of Employees:
Up to 100: 23%, 101 to  500: 24%, 501 to 2,500: 23%, 2,501 to 10,000 19%, Over 10,000: 11%

Participant Breakdown by Ownership/Corporate Status:
Public 40%, Private 50%, Non-Profit 8%, Government 2%

Copying. If you copy portions of this report into your own publication, please cite your source by including the following:

"Source: Culpepper Pay Practices Surveys, March 2009, www.culpepper.com"

Other Related Reports and Surveys:

• 2009 Salary Increase Budgets for 2009 and 2010 (September 2009)

• 2009 Compensation Plans Hit Hard by Economic Downturn (December 2008)

• Strategies to Control Compensation Costs in 2009 (November 2008)

• Salary Increase Budgets for 2008 and 2009 (August 2008)