A new survey conducted among HR compensation executives and CEOs produced some chilly findings, as nearly 1 in 3 of respondents reported that they are freezing or considering freezing salaries in response to the economic downturn.
According to Hay Group's "Slowing Economic Spot Survey," more than 30 percent of respondents say their company is freezing or considering freezing base salaries. Meanwhile, 15 percent are freezing salaries for all employees.
Whose salaries are most likely to feel the chill? According to the survey, most respondents reported that executive, management and professional groups are most at risk for salary freezes. Skilled trade and support/clerical groups are less at risk.
"Short of layoffs or salary cuts, this is as serious as you can get in terms of sending out distress signals," Tom McMullen, Vice President at Hay Group said in a press release.
The survey also found that
- 20 percent of companies that responded will be freezing or decreasing staffing levels in the near future
- 23 percent of companies indicated that they have either made changes or are making changes to their high performer retention programs, as respondents identified retaining and motivating their key contributors as a top concern during the economic downturn
The downturn has further caused employers to implement changes or plan changes to their healthcare benefits (27 percent), retirement/pension benefits (20 percent), and training and development programs (28 percent).