BOSTON (CBS) – There’s nothing more nerve wracking than walking into the boss’s office to ask for a raise. Especially in tough economic times. Everyone knows budgets are tight.
And there appears to be little relief in sight.
An annual report by the firm Mercer finds major employers plan to boost their workers’ salaries by 2.9 percent next year.
That’s essentially the same amount they went up this year, even as prices for gas and groceries skyrocket.
And the pay increases will not be across the board.
The survey of more than 1,500 companies finds more than half of all raises next year will go to the top third of workers, suggesting, like your Mom told you, that you need to keep your nose to the grindstone if you want to make more money.
So why are employers being stingy in the midst of an improving economy?
Because they can.
Think of it as a “buyers market” in real estate. There are still too many people looking for work. Unemployment remains above seven-percent.
It’s basic supply and demand, although some companies also blame higher costs for health care and retirement plans.
Either way, companies still have the leverage.
But like in every market the pendulum will swing back. Eventually employers will be forced to start competing again for talent. And there is a glimmer of hope when you look deep inside this report.
It shows that roughly 3.5 percent of companies froze salaries this year, down from 6.5 percent that froze pay last year.
So clearly they have a bit more money to work with.
Let’s hope that continues through the summer.
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