'06 Raises Not Likely To Satisfy
By Archana Prakash© Pasadena Star-News, December 21, 2005
Counting on a few extra bucks to get you through 2006? Most employees working for San Gabriel Valley companies shouldn't count on it.
Fewer than one-third of the 1,400 chief financial officers polled nationwide said they will give bigger salary increases to their employees in the coming year, with only 20 percent anticipating a boost in bonuses, according to a survey conducted by Robert Half International Inc.
CFOs who said they did expect to increase compensation in 2006 said raises would increase by a mean of 5percent. Bonuses were set to increase by a mean of 7percent, according to the survey.
"In my own experience, I think that compensation has remained flat in the last few years," said Joseph Bellavary, director of human resources at accounting firm RSM McGladrey. "There have been no drastic increases or decreases across the board, unless they are in a business that is aggressively hiring."
Gary Kaplan, owner of Gary Kaplan & Associates, a Pasadena-based executive search firm, said any difference in employee compensation depends on how well the economy is doing.
"It's a fairly accurate statement to say that people may not receive higher compensation (in 2006), just because the economy improved in 2005," Kaplan said. "It was a good year so employees received decent bonuses. But to prophesize into 2006, the question remains: is it going to change?"
If the economy is as strong in 2006 as it was in 2005, Kaplan figures compensations may increase.
If the economy remains stable, Kaplan said he doesn't think increases will factor in. However, other factors do hold a place in the equation, Kaplan said, citing the active labor market and the retirement of baby boomers as possible incentives for companies to give a little more to their employees.
For the accounting business, raises and bonuses in 2006 will probably rise, according to Bellavary. Public accounting has boomed since the Enron scandal, he said, calling for aggressive hiring.
Kaplan said the trends seen across the country in the coming year - whatever they may be - will be felt in the San Gabriel Valley economy as well.
"The San Gabriel Valley is a microcosm of what goes on nationally," Kaplan said. "There are a number of substantial companies based here, feeling the same competitive pressure and economic pressure the rest of the country is."
