Current Salaries and What to Expect in 2009

While it was slowly brewing for many years, the economic crisis has finally become a national talking point. For many months, people tried to say that there was an economic crisis and were being shut down and told that the situation was under control. With those days gone and billion dollar bailouts being developed to help keep the economy afloat, it is time to start wondering where every job stands. While many people are able to keep their jobs, there is a great deal of worry about what will happen to our current salaries.

In most years, employees undergo a review to determine raises and cost of living adjustments. This year, however, many businesses are struggling to even stay float and make it through the economic crisis. For many of these businesses, offering raises on top of current salaries will necessitate one of two things; a dip into the profit pool, which is already remarkably shallow for many businesses, or the layoff of less effective employees to provide raises for high performing employees.

The truth is that the latter solution might work well for a number of companies. In such hard times, it makes economic sense to let go of employees who are not bringing in revenue and to give raises to those who are exceeding expectations. Many employers, however, are hesitant to do this, knowing that many workers may not find themselves in a position to get a new job in the current market. Because of this hesitance and a desire to maintain business in the new economy, many businesses are putting freezes on hiring and on current salaries as well. This means that employees are struggling through a year of raised prices and increased financial stress at the same pay rate they had before the economy worsened.

While this is proving a difficult time for employers and employees alike, however, it is important for employees hit by salary freezes to understand that in many cases the freeze is the alternative to massive layoffs. A number of businesses have fired highly paid employees and brought in new workers willing to do the job for far less pay. While this is not necessarily a wise business decision, it is the only way many employers see to survive the hard times when current salaries for original workers reduced or eliminated profit margins.

The current salaries of many workers will stay the same in 2009. For those in sectors that are likely to see pay increases, such as health care and other always demanded industries, raises are still considerably likely to be much smaller. Employees used to seeing raises of five to seven percent will likely see a raise of only three to four percent this year while underperforming employees will likely see far less. Employees should also look for raises based solely on performance this year, rather than a blanket rate. This means everything from incentive bonuses to percentage raises based on job performance statistics.

Some industries will be hit harder than others in regards to current salaries and job security as a whole. While those in needed markets such as health care and grocery will likely see stability and small raises, many industries, such as retail are facing the growing possibility of closures, financial losses, and massive layoffs. IT jobs are being hit particularly hard, as a significant percentage of these jobs are expected to be moved overseas within a year if the economic climate does not shift significantly and rapidly. Because IT is something that is created to be usable anywhere, these jobs are easy to move and the savings incurred can be substantial. While the move will help keep the industry afloat, many jobs in the United States will be lost, leading to a total loss of current salaries for many workers.

While the status of current salaries is different and at least somewhat predictable for many industries, it is important for workers not to panic. While certain industries are bound to be hit harder than others, there are signs that we have seen the bottom. Even a gradual turnaround can have a significant impact on predictions, which are never guaranteed. Until the economy begins to stabilize, there is much postulating on the future but very little hard fact.

For many workers, current salaries are no indicator of things to come. A raise does not mean that a company will survive intact any more than a hiring and salary freeze means that a business is going to fail. In new and uncertain times, employers are doing their best to make a business work in an environment they have never experienced. For workers, the best thing to do is to perform well and exceed expectations. By proving yourself a necessary asset you decrease your chance of losing your job and increase the chances of a raise while also creating an excellent resume and recommendation in the chance that you do find yourself in the market for a new position. The economy is taking a toll on everyone, but what little control we have as workers we must take care to exercise fully.