American Society of Employers’ (ASE) new 2017/2018 salary budget survey findings: Michigan employers are budgeting modestly for pay raises once again

By: American Society of Employers

Media Contact: Heather Nezich, Communications Manager, 248.223.8040, hnezich@aseonline.org

Livonia, Mich. —September 21, 2017 — The American Society of Employers (ASE), one of the nation’s oldest and largest employer associations, released its 2017/2018 Salary Budget Survey with a number that just isn’t budging: 3%.  This number has remained consistent since 2009.

Additional key findings in the 2017/2018 Salary Budget Survey:

  • The majority of merit dollars granted are going to the employer’s top performers, however we are continuing to see that over three fifths (61%) of organizations are opting to spread their 3% merit budget pools across all of their employees, instead of focusing on their top performers or even their top and average performers. By giving potentially underserved money to low performers, money is taken away from the top performers, putting them at an even greater risk of leaving.
  • Wage freezes continue to remain low. Just 6% of employers surveyed experienced a wage or salary freeze at some point in 2017.  Similarly 6% of employers surveyed anticipate a wage or salary freeze at some point in 2018.
  • Employers continue to rely on variable pay programs to reward performance (84% of employers offer variable pay to at least one employee group). The average expected annual bonus payout, as a percent of salary, in 2018 remains steady at approximately 5% for both Nonexempt Hourly Nonunion and Nonexempt Salaried employees, 10% for Exempt Salaried employees, and 31% for Officers/Executives.

The survey findings were announced by ASE President and CEO, Mary E. Corrado.

“Given improvements in the economy, notably the job growth, we might have expected to see more significant increases to budgeted salary increases,” Corrado said. “However, employers remain conservative in their approach to pay administration and have shifted to other cash and non-cash incentives to reward performance.  This trend is likely to continue based on data collected in ASE’s Quarterly Economic and Employment Survey which also points to some softening in the economic outlook in the near-term.”

Background information on the 2017/2018 Salary Budget Survey:

  • 225 organizations from across Michigan participated.
  • Organizations with 1 to 500 Michigan employees made up 82% of the survey sample, while organizations with 501 to 5,000 Michigan employers represented 14% of the sample. The remaining 4% of the sample comes from organizations with more than 5,000 Michigan employees.
  • A variety of industries are represented, with manufacturing organizations representing 59% of the survey sample. The remaining 41% is represented by trades and services organizations.

To obtain a copy of ASE’s 2017/2018 Salary Budget Survey, contact ASE’s Compensation and Benefits Surveys department at surveys@aseonline.org or 248.223.8051. This survey is available free of charge to ASE members, and for $525 to non-members.

About the American Society of Employers (ASE) – a Centennial Organization

The American Society of Employers (ASE) is a not-for-profit trade association providing people-management information and services to Michigan employers. Since 1902, member organizations have relied on ASE to be their single, cost-effective source for information and support, helping to grow their bottom line by enhancing the effectiveness of their people. Learn more about ASE at www.aseonline.org.