salaries by 15 to 20 percent or more by taking similar jobs at other companies. Part of the reason this
opportunity exists relates to a surprising compensation paradox. “Base salaries are barely keeping up
with inflation,” reports Morrow.
New Mercer research confirms that “employers
are not budging on salary budgets” at a time when 89
percent of executives expect increasing competition
for talent in the coming year. Salary increase budgets
for 2018 are flat at 2. 8 percent, according to Mercer,
and projected to rise, barely, to 2. 9 percent in 2019.
Employee perception of fair pay has dropped from
57 percent to 52 percent during the past five years,
and employees’ perception that pay is linked to performance has declined from 55 percent to 47 percent,
according to Mercer Sirota analysis.
So what gives? Sardone suggests that that current compensations systems, after years of dispensing small salary increase budgets, have “made differentiation difficult and has caused pay raises to
be less a reflection of performance and more about
maintaining at least a minimum level of competitiveness.” Another possibility exists: HR executives are waiting for artificial technology and its
variants, like robotic process automation (RPA), to
take on significantly more work and significantly
reduce the number of new hires their companies
need. This reasoning is riskier for companies to
embrace. While it seems certain that RPA and AI
will dramatically reshape a large number of professional duties, it remains uncertain when this will
occur, how long it will take to play out and how
evenly it will play out across different functions,
companies and industries.
The World Economic Forum’s new Future of
Jobs report projects that intelligent automation
will create 58 million more new jobs than the number of jobs it eliminates by 2022. Kai-Fu Lee, the
founding director of Microsoft research, former
president of Google China and author of the new
book: AI Superpowers: China, Silicon Valley and
the New World Order, argues that AI’s impact will
lack the apocalyptic drama of a blockbuster disas-
IS ‘Pay for Innovation’ NEXT?