Amid stubbornly high inflation, average paychecks will rise by about 4% next year, according to a survey of employers by consulting firm Willis Towers Watson.
However, a 4% wage hike — the largest in 15 years — won’t do much to alleviate inflation currently running at a 40-year high of 9.1%, KTLA reports.
In other words, despite modest efforts by employers to keep workers’ compensation in line with the economy, many will effectively experience a pay cut and diminished purchasing power.
“Compounding economic conditions and new ways of working are leading organizations to continually reassess their salary budgets to remain competitive,” Hatti Johansson, a research director at Willis Towers Watson, said in a statement.
More than a third of the roughly 1,400 organizations surveyed said they plan to give raises more frequently than in the past, with many saying they probably will give workers two salary bumps next year.
More than two-thirds of respondents said they’re aiming to boost employee satisfaction with more remote work.
Unlike the private sector, the Social Security Administration sets annual cost-of-living adjustments for beneficiaries based on the inflation rate.
The nonpartisan Senior Citizens League estimates that Social Security recipients will receive a 10.5% cost-of-living adjustment for 2023. That would translate to average monthly checks climbing by about $175 to $1,668.
While higher healthcare costs will put a dent in that increase, this is a fair way of helping people weather inflationary storms.