While forecasts of 2020 economic performance indicate caution, Korn Ferry predicts a slight increase in salaries for the coming year. In the US, an average 3% pay increase is predicted, which is the same as the prior two years. Adjusted for the expected 1.6% inflation rate in 2020, the real wage increase is forecast to be 1.4%, up from last year’s 0.6% increase.
While the projected real-wage growth is beneficial for workers, the lower rate of inflation embedded in the number may indicate expectations of a stalling economy which could, in turn, drive unemployment rates. These expectations are indicated in the recently released data from the Conference Board and American Staffing Association.
The Conference Board reported that consumer confidence decreased slightly in November
for a fourth consecutive month, driven by a softening in consumers’ assessment of current business and employment conditions. That is due in part to increased trade uncertainty that has delayed investments, especially among manufacturers. However, they report that consumers’ short-term expectations improved modestly, and expect growth in early 2020 to remain at around 2%. In the index’s survey of consumers, those saying jobs are “plentiful” decreased to 44.8% from 47.7% while those claiming jobs are “hard to get” increased to 12.7% from 11.6%
The ASA Staffing Index Year-to-year comparison for the 4 weeks ending November 17 reflect a decline in staffing jobs of 6.3% and remain lower than levels seen in prior recent years.
Implications for Workforce Planning
Workforce planning for 2020 corporate initiatives must factor in conservative growth projections as well as the need for critical high-demand skills. This challenge can be met with effective workforce composition planning (best worker class for each assignment) and innovative sourcing techniques. To learn more contact us at email@example.com.