If the growth curve of the French economy picks up, in terms of wages, the recovery will wait. According to the annual study by human resources consulting firm Mercer, which confirms the finding of other recruiting firms, the overall budget of companies devoted to salary increases is expected to reach a low point in 2021.
According to its annual study on compulsory annual negotiations (NAO), published on July 7, the volume of base salary increase envelopes declared by the companies questioned was established at a median level of 1.41%. That is to say a decline, expected, compared to 2019 (it was then 2.2%) and 2020 (2%), when the crisis had not yet had time to make all its effects felt among respondents.
Based on previous Mercer studies, this is the lowest estimate since 2015, at least. This study is based on a small panel of respondents: on average, 49 human resources directors and compensation managers per month responded to this survey, carried out between October 2020 and March 2021, knowing that the same company could respond within one month. on the other.
An increase of less than 2%
Most of the respondents come from large groups, Mercer customers. But these results confirm the conclusions of other consulting firms. A few
months earlier, Deloitte predicted that the increase in the budget planned by companies for
increasing wages would, for the first time in several years, be less than 2%. And this, for executives as well as for non-executives. A very thin envelope, therefore.
Especially since the rise in consumer prices is still nibbling this boost given to wages. If the inflation rate in 2020 was almost zero (0.5%), in June 2021, consumer prices have already recovered by 1.5% over one year. “Not as low as you might expect. “ However, Mercer’s experts prefer to see the glass half full: “The median budget (…) is not, however, as low as one would have expected given the violence and suddenness of the crisis ”, notes the study.
Only 18.5% of the companies surveyed will resort to a wage freeze. This is “Admittedly higher than in 2019 (1%) but well below the freeze observed at the end of the 2008 financial crisis (38%)”, argues the investigation. And while some employees will not see the color of an increase, others will benefit from a more substantial boost. Only 5% of companies participating in the Mercer study say they have granted an individual raise to all employees, compared to 16% in 2019. In the others, only one in two employees (49%) on average will share the pie. (compared to 61% in 2020 and 55% in 2019). A smaller cake, but bigger slices.
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