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Results from Culpepper’s annual survey of salary budgets reveal that global base salary increase budgets are projected to rise from 1.89 percent in 2009 to 2.88 percent in 2010.
According to the compensation firm's
2009-2010 Salary Budget & Planning Survey, preliminary findings released in August 2009 show that:
Salary freezes. The number of companies freezing salaries is projected to decline from 37 percent in 2009 to 13 percent in 2010. For comanies with frozen salaries, 23 percent plan to unfreeze them by the end of 2009.
Salary reductions. 13 percent of companies reported that they cut salaries in the prior 12 months. For companies that reduced salaries, one-third planned to reverse reductions by the end of 2009.
Average global base salary increases. Global base salary increaes are projected to rise from 1.90 percent in 2009 to 2.88 percent in 2010. Excluding salary freezes, global base salary increases are projected to rise slightly from 3.23 percent in 2009 to 3.25 percent in 2010.
United States. Base salary increases in the U.S. are projected to rise from 1.66 percent in 2009 to 2.68 percent in 2010. Excluding freezes, salary increases in the U.S. are projected to rise slightly from 3.05 percent in 2009 to 3.08 percent in 2010.
Canada. Base salary increases in Canada are projected to increase from 1.07 percent in 2009 to 2.39 percent in 2010. Excluding freezes, salary increases in Canada are projected to increase from 2.87 percent in 2009 to 3.01 percent in 2010.
Europe. On average, base salary increases for countries in the Eurozone are significantly lower than other countries in Europe that have not adopted the euro (€) as their official currency.
Regions with the lowest salary increases. Base salary increases in Canada, the United States, and the eurozone are lower and less volatile than other regions of the world.
Regions with the highest salary increases. Base salary increases in South America and Africa are higher and more volatile than other regions of the world.
Salary range structure increases. Base salary range structure increases are projected to rise from 1.25 percent in 2009 to 1.58 percent in 2010. Excluding freezes, salary range structure increases are projected to decline from 2.81 percent in 2009 to 2.58 percent in 2010.
In August 2008, before the global economic crisis unfolded, average base salary increases exceeded four percent (Figure 1), and only 2 percent of companies were freezing salaries (Figure 2). From late 2008 through mid-2009, the number of companies freezing salaries increased to 37 percent, which drove average base salary increases below 2 percent.
Notes: The data collection time period for each data point is provided in parenthesis. Averages include salary freezes (zeros).
Notes: The data collection time period for each data point is provided in parenthesis.
Salary FreezesThe number of companies freezing salaries across all jobs and locations is projected to decline from 37 percent in 2009 to 12 percent in 2010.
Plans to Unfreeze Salaries:For companies with frozen salaries, 23 percent plan to unfreeze them by the end of 2009:
28 percent plan to unfreeze salaries before the end of 2010.
4 percent plan to continue freezing salaries through the end of 2010.
45 percent of companies are uncertain when they will unfreeze salaries.
Salary ReductionsThirteen percent of companies reported that they cut salaries in the prior 12 months.
Plans to Rollback Salary Cuts:For companies that reduced salaries, one-third plan to reverse reductions by the end of 2009:
One-fifth plan to reverse salary reductions before the end of 2010.
8 percet plan to keep salary reductions in place through the end of 2010.
40 percent of companies are uncertain when they will reverse salary reductions.
Plans to Reinstating Salaries and Providing Salary Increases:For companies that plan to reverse salary reductions:
64 percent plan to reinstate salaries back to original levels and then award base salary increases on original, unreduced salary levels.
36 percent of companies plan to determine base salary increases on reduced salary levels.
Salary Reductions in 2010:For companies that did not reduce salaries in 2008 or 2009, only 1 percent plan to reduce salaries in 2010.
Global Overview of Base Salary IncreasesTable 1 provides aggregated average base salary increases for 2009 and 2010 for major geographic regions throughout the world.
Table 1: Base Salary Increases by Global Region
2009Average BudgetedBase Salary Increases
2010Average ProjectedBase Salary Increases
Including Companies Freezing
Excluding Companies Freezing
Global / Worldwide
Mexico & Central America 
Caribbean & West Indies
(Non-European Union) 
Middle East / Africa
Middle East 
Mexico & Central America includes data collected for the following countries: Costa Rica, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, and Panama.
Caribbean & West Indies includes data collected for the following countries: Barbados, Bermuda, Dominican Republic, Jamaica, Puerto Rico, and Trinidad & Tobago.
South America includes data collected for the following countries: Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Paraguay, Peru, Uruguay, and Venezuela.
European Union includes data collected for 27 countries in the European Union. The
European Union breakout is a combination of
 eurozone (also known as euro Area and euroland) includes data collected for 16 countries in the European Union that have adopted the euro as their official currency: Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, Netherlands, Portugal, Slovakia, Slovenia, and Spain.
Non-eurozone includes data collected for 11 countries in the European Union that have not adopted the euro as their official currency: Bulgaria, Czech Republic, Denmark, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Sweden, and the United Kingdom.
Non-European Union includes data collected for the following countries in Europe that are not in the European Union: Armenia, Croatia, Iceland, Norway, Russia, Serbia, Switzerland, Turkey, and Ukraine.
Middle East includes data collected for the following countries: Bahrain, Iraq, Israel, Jordan, Kuwait, Lebanon, Omar, Qatar, Saudi Arabia, and United Arab Emirates.
Africa includes data collected for the following countries: Algeria, Cameroon, Egypt, Kenya, Morocco, Nigeria, South Africa, Tanzania, Tunisia, and Zimbabwe.
Asia includes data collected for the following countries: Bangladesh, China, Hong Kong, India, Indonesia, Japan, Macau, Malaysia, Pakistan, Philippines, Singapore, South Korea, Sri Lanka, Taiwan, Thailand, and Vietnam.
Pacific includes data collected for Australia and New ZealandData for individual countries and breakouts by job level and function for the United States and Canada are available in the comprehensive version of this report.
The salary increase data in this report includes COLA (cost of living adjustment), inflation, merit, and other non-promotional increases.
Culpepper Trends Survey of 835 participating organizations reporting salary increase data for over 73 countries.
Survey Dates: June 24, 2009, through August 21, 2009.
By Sector: Technology 54%, Life Sciences 12%, Health Care Services 7%, Energy 2%, Engineering 3%, Other 22%
By Number of Employees: Up to100: 19%, 101 to 500: 20%, 501 to 2,500: 27%, 2,501 to 10,000: 22%, Over 10,000: 12%
Culpepper Trends Surveys, September 2009
Culpepper and Associates conducts worldwide salary surveys and provides benchmark data for compensation and employee benefit programs.
More Employers Plan to Undo Cutbacks in Pay, Benefits, SHRM Online Benefits Discipline, September 2009
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