53% of employees expect a pay rise this year and 40% plan to look for another job if this doesn’t happen/ 62% of employers plan to raise wages (survey)

Some 53% of employees expect their salaries to increase this year, and 40% plan to look for another job if this does not happen due to rising inflation, according to a survey conducted by an online community of employees in Romania, Agerpres.ro reports.

The Undelucrăm.ro survey (an online community of employees in Romania, with more than one million employees on the platform) was conducted in December 2022, and 3,834 employees and 446 employers (HR specialists of companies) responded. Respondents come from IT, retail, financial-banking, BPO & services, telecommunications, consumer goods manufacturing, healthcare services, industrial manufacturing, HoReCa, hydrocarbon/energy production-transport, scientific/technical services, construction/furniture, media&culture.

According to the survey, around 27% of employees say they would need a 20-30% pay rise to make ends meet, 20% say 10-15%, and around 19% need a rise of between 15% and 20%. On the other hand, around 7% of respondents said they would like a pay rise of more than 50% to make ends meet. At the same time, 6.5% of employees said they could make do with the expenses they have even if their salary did not increase this year.

If their salary is not increased, 41% of employees plan to look for another job, 19% will try a renegotiation with their direct manager, 13% will look for additional collaboration or a second job, and 9% would appreciate being offered other benefits.

Some 19% have no plans in case they do not receive a higher salary this year.

Some 35% of employees say their salary is increased annually, 28% only as a result of renegotiation, 19% of employees have higher salaries based on performance, and 12% say their company only increases salaries annually for certain positions. Nearly 2% of respondents answered that they get a higher salary every quarter and 5% every two years.

If they don’t get a higher salary this year, 29% of employees say they will manage but will make small adjustments, i.e. go on holidays less or buy some products cheaper. Around 23% think they will manage, but only if they make very big adjustments – they will stop buying new clothes, choose own-brand products as often as they can, pay close attention to utility costs (energy, water).

Some 17% think they will find it very difficult to get by because the instalments and other major expenses already account for a lot of their monthly income. Around 13% said they would have a hard time even if they have no payments because their salary is quite low and they have no prospects for growth. 10% said they would have a hard time because payments represent a large percentage of the family’s monthly income, but they are also helped by their parents. On the other hand, 8% say they will manage quite well and will not cut back on their expenses.

For their part, some 62% of employers said they plan to raise employees’ salaries this year, 21% only for certain positions, and 17% will not raise them.

Around 36% of HR specialists say that in the companies they represent salaries will increase by 5-10%, around 22% say the increase will be 5%, and in 17% of companies it will be an increase of 10-15%. About 2.5% of HR experts mention a 30-40% increase in the companies where they work.

Also, 52% of employers say that the salary increase they want to make is as part of an annual plan to keep their employees motivated, 28% want to do so because of the economic climate, 17% because of labour market dynamics, and 2.5% because of the company’s outperformance. Around 5% want to increase staff salaries for other reasons.

Those who will not increase salaries have decided to do so because they want to reward their employees in other ways – 39%. Around 28% will not increase salaries because the company’s financial situation at the end of 2022 does not allow for a salary increase, 17% because of the whole macro-economic context and 17% because the companies in which they work only increase salaries following employee-employer negotiations.

When asked what employers should do in the current economic context, half of HR professionals think that salaries should increase according to performance. 17% think that employers should create other ways to increase employee engagement, well-being and performance even if salaries are not increased (e.g. offer different vouchers for different types of services, courses and training).

On the other hand, around 11.5% believe that companies should increase the salaries of all employees directly in line with inflation. Another 11% think that everyone’s salaries should be increased in line with the company’s annual policy, and the same percentage think that employers should let go of non-performing employees and increase the salaries of those involved.

„We see from this survey a pertinent expectation from employees to have higher salaries this year given the economic climate and also a commensurate intention from companies. We also note the attention of HR specialists to increase salaries in a way that is proportionate to the macroeconomic situation, but also to employee performance. It is worth noting that employers are thinking of different ways to motivate their employees even if they can’t afford a salary increase,” said Costin Tudor, founder and CEO of Undelucram.ro.