The Great Resignation, high inflation, and a rebounding economy have led many employees to expect a wage increase in 2022. And depending on where you work, those expectations may be justified.
When it comes to salary negotiations, employees have the upper hand. Many companies have been short-staffed for months and struggle to retain qualified employees.
This talent shortage has led many companies to offer wages increase. Last spring, Amazon announced it would raise wages between 50 cents to $3 per hour for more than 500,000 employees.
Experts agree that many employees will see a salary bump in the coming year. But what that’s going to look like will largely depend on the industry you work in.
The talent shortage leads to wage increases
It’s an employee’s job market right now, and businesses are struggling to find and retain qualified employees. There simply aren’t enough workers to fill the available positions.
This shortage has led many companies to increase employee compensation between 5-10%. And the hardest-hit industries have seen raises as high as 20%.
But these kinds of wage increases aren’t happening across the board. Instead, these increases are happening for the most highly sought-after roles. For instance, there is a massive demand for experience in supply chain logistics, digital marketing, and data analysis.
There’s also a significant demand for employees that are skilled in cybersecurity, AI, and engineering. Hourly workers, like restaurant and warehouse employees, are also in short supply right now.
In particular, companies are competing to hire employees with solid technical skills. That means highly competent employees are in an excellent position to bargain for the salary and benefits they want.
A salary hike may not be enough
Many employees will see their salaries increase in 2022. But what’s interesting is that a salary bump alone may not be enough to hang onto qualified workers. Across the board, companies have raised wages for workers only to continue to struggle with hiring.
Increasingly, companies are finding that employees want more than a higher salary. For instance, Synchrony increased its minimum wage for entry-level workers to $20 per hour, but it didn’t stop there.
Executive vice president DJ Casto said that Synchrony wanted to show its employees that it supports their career ambitions. So, in addition to raising pay, the company began reworking its tuition reimbursement program. Along with achieving a four-year degree, Synchrony employees can take a skills program they can complete over several months.
Target is another good example of companies that have re-imagined employee benefits. In addition to raising its hourly wages, the company expanded its training and benefits programs. And these efforts seem to be paying off — Target says its turnover for hourly employees is lower than it was in 2009.
So if you’re looking for ways to attract and retain more qualified employees in 2022, a higher salary is a good place to start. But it’s essential to find other ways to invest in your employees, like offering flexible schedules and an exciting benefits package.