Rewritten Article:
A significant number of business leaders have announced plans to offer raises to their employees in 2024. However, a closer look reveals that these raises will only be given to half of the workforce, and in some cases, even fewer employees will receive a raise. This reality poses a challenge for workers who are already grappling with persistent inflation and the highest borrowing rates in over two decades.
According to a recent survey conducted by ResumeBuilder.com, 8% of leaders have no intention of giving raises next year, while another 18% remain undecided. Among the business leaders surveyed, approximately 74% stated that they would be providing raises in the coming year. However, half of these leaders indicated that only 50% or fewer employees would receive a raise.
For those business leaders committed to providing raises in 2024, 82% plan to base the raises on performance, while 55% will grant them for promotions. Unfortunately, a significant portion of these leaders, roughly 69%, intend to offer raises in the form of cost-of-living adjustments. Experts argue that such adjustments are insufficient in the current economic environment, as they fail to compensate for the loss of workers' earning power due to inflation.
Stacie Haller, the Chief Career Advisor at ResumeBuilder.com, emphasized that cost-of-living adjustments should not be considered raises and should instead serve as a baseline. She stressed the importance of compensating employees for their performance or promotions in addition to providing cost-of-living adjustments. Haller's viewpoint is supported by Jay McDonald, an executive advisor with 40 years of experience as a CEO, who believes that cost-of-living measures fall short of actual living costs in today's economic climate. McDonald argues that these measures fail to consider essential factors such as food costs, energy costs, and overall adjustments based on the local economy.
The issue at hand is that when organizations fail to reward high-performing employees and tolerate underperformers, it undermines morale and workplace culture. McDonald points out that employees may even choose to leave a company if they feel their leaders do not value them. Labor relations consultant Jason Greer cautions that receiving small or no raises will likely become the norm in the foreseeable future. He attributes this trend to businesses prioritizing their own needs, such as addressing supply chain issues and resource shortages, over adjusting employee pay. Greer suggests that companies are placing greater emphasis on executive compensation packages rather than considering what they could pay their employees.
In conclusion, while some business leaders have committed to offering raises in 2024, the reality is that only half of employees, and sometimes even fewer, will benefit from these raises. This situation poses challenges for workers who are already facing financial pressures due to inflation and high borrowing rates. The practice of relying heavily on cost-of-living adjustments as a means of compensation is seen as inadequate by experts, who argue for additional rewards based on performance and promotions. Failure to adequately reward employees can have a detrimental impact on morale and workplace culture, leading to potential employee turnover.