Wage inflation has been relatively subdued for a number of years, however 2015 saw this start to change and in 2016 we anticipate that wages are going to accelerate quite dramatically. Why you may ask? Well let’s look at the factors that contribute.
So 2016 really for the first time since 2007 will see the stars align and see your employee confident of their position, having a skill set that is in increasing demand, who understands their worth and who has easily accessible paths to other opportunities. They are being driven to explore opportunities by a gradually dropping real income and, as a consequence, are going to push for higher compensation while your competitors needing to hire talent in a restricted market are going to pay more to find it. Simple!! Of course the employment market is like the housing market. Just because house prices have risen 15% doesn’t mean yours has. Skill sets are the same. Many will still bemoan the apparent state of the economy and suggest employment statistics are rigged and inaccurate. This may give a sense of security to some employers. But if your employees have the “in demand” skill sets then you need to have your wits about you and as we approach pay reviews and budget setting, it would be wise to keep this in mind. Staying ahead of this inflation internally will be far easier and less damaging to your business than hoping for the best and then chasing the market. Morgan Philips provides “market mapping services” to clients to give accurate and up to date compensation data, allowing a true assessment of internal compensation and hence the potential flight risk of staff. Individual projects give smaller and more focused ranges than those available online, which are often very vague and as such of little use. Do give us a call here to learn more about the service or to discuss the current trends in the market and hiring plans for 2016. Morgan Philips Executive Search +16172738293 www.morganphilipsexecutivesearch.com