Pay raises for 2015 are expected to be 3% next year, up from 2.9% in 2014, but is that enough? According to Managing Director Laury Sejen at Towers Watson, “Your average employee is barely keeping ahead of inflation. It’s a little bit disappointing.”
As the market tightens and competition heats up among employers, it is crucial to review your compensation structure in comparison to the market. Most employers may not be able to make major increases in salaries across the board, but reviewing key employees and top performers to ensure you are keeping them happy is an absolute.
But money is not everything when keeping employees engaged and motivated. Motivation theorists have proven the effects of a salary increase tapers off after six months or so. Therefore adopting sound management practices that engage and motivate your employees is just as important as competitive salaries. Keeping your employees informed, treating them with respect, creating a company culture of teamwork and building ownership are highly motivating tactics that are proven to retain employees.
Interested in learning more about these strategies and how to implement them in your company, contact Scholley Bubenik, President of Premier HR Solutions for a free consultation.