Merit increase

Early Forecast: 2018 U.S. Salary Budget Increase Pegged at 3.2%

Economic growth is picking up, but will wages keep pace?
May 31, 2017
Planning Global Compensation Budgets for 2018 by ERI Economic Research Institute, a compensation analytics firm in Irvine, Calif. The firm's projections are based on data from over 20,000 companies and analysis of government statistics, such as the following:

• Gross domestic product in the U.S. is expected to increase by 2.5 percent next year, up from 2.3 percent in 2017 and 1.6 percent in 2016—an improvement but below the Trump administration's goal of 3 percent growth for the economy.
  
  
• Inflation is forecast to slow to 2.4 percent, down from 2.7 percent this year but higher than the 1.3 percent reported for 2016.
  
  
• The unemployment rate is predicted to fall slightly to 4.6 percent, down from 4.7 percent this year and 4.9 percent in 2016.

A Subsequent Report

In July, World at Work, an association of total rewards professionals, released top-level results from its 2017-2018 Salary Budget Survey, with actual 2017 and projected 2018 salary budget increases that account for planned general increases/cost-of-living adjustments and merit increases. In the table below, the "mean" is the mathematical average while the "median" is the middle value after listing reported budget increases expectations in successive order. Outliers, or extreme values on either the high or low end, have the biggest effect on the mean and less effect on the median.

Total U.S. Salary Budget Increases by Employee Category

Employee Category
Actual 2017
Mean
Actual 2017 Median Projected 2018 Mean Projected 2018 Median
Nonexempt hourly nonunion
3.0% 3.0% 3.1% 3.0%
Nonexempt salaried
3.0% 3.0% 3.1% 3.0%
Exempt salaried
3.0% 3.0% 3.2% 3.0%
Officers/executives
3.0% 3.0% 3.2% 3.0%
All
3.0% 3.0% 3.1% 3.0%

Source: WorldatWork 2017-2018 Salary Budget Survey, top-level results. Survey data collected through May 2017.

In Canada, the average 2017 salary budget increase (both mean and median) was 3.0 percent, WorldatWork reports. For 2018, Canadian employers project a salary budget increase of 3.1 percent (mean) and 3.0 percent (median).

World at Work this year received a total of 4,942 survey responses for 11 countries in addition to the U.S. and Canada.

"Companies are budgeting conservatively," said Kerry Chou, CCP, senior practice leader, WorldatWork. Nevertheless, "I wouldn't expect to see widespread adjustments to the 2018 budget."

Investing in Workers

"The 2018 projections indicate salary increase budgets throughout the majority of the world between 2 percent and 5 percent," said Linda Cox, CCP, global total rewards expert at ERI Economic Research Institute. "The global economy seems to be gaining momentum," she noted, and the U.S. economy is expected to expand due to the current administration's eased fiscal policy, among other factors.

However, wages haven't kept up with rising productivity in the U.S. and elsewhere, while technology has driven the decline in labor's share of national income, Cox pointed out. (For a different viewpoint, see the box below.)

For employers, the economic recovery provides "an opportunity to look at their total rewards strategies and practices" to ensure fair distribution of rewards based on performance for all employee groups, Cox said.

Employers should also ask whether they are preparing their workforce for technological advances, such as artificial intelligence, that will continue to displace jobs.

"A breakthrough in technology fundamentally changing the way people work also requires an investment in human capital to prepare employees for the future," Cox noted.

Wage Growth Is Low but So Are Inflation and Productivity

Forecasts based on economic data are subject to interpretation, and different economists will judge differently whether the glass is half full or half empty.

Over the last 24 months through March, for instance, U.S. inflation has been pegged at 1.4 percent a year and productivity growth at 0.6 percent, Neil Irwin, senior economics correspondent for The New York Times, recently reported.

"Those are very low numbers," Irwin noted, and "you may expect average worker wages to have risen only 2 percent." However, "the average hourly earnings for non-managerial private-sector workers rose 2.4 percent a year in that period," which is "more than we might have expected, with inflation and productivity so weak."

"If anything," Irwin wrote, "the numbers show that workers are capturing more than their share of the spoils from a growing economy."

Wage-Constraining Pressures

"Some economists also point to rising costs of benefits such as health care as a brake on take-home pay," wrote MarketWatch's Jeffry Bartash. "If companies have to pay more to insure their employees, they’ll offset the cost by raising wages more slowly."

He also noted global competition, given that "companies may be too afraid to take on added labor costs for fear of losing out to domestic and foreign rivals who pay workers less," and the skills gap, since "many U.S. workers...lack the necessary skills to warrant higher pay" and "companies have to pay more to train new or future employees who won’t be as productive when the first start out."

Downward pressures on wage growth were also noted by Scott Kingdom, vice chairman of the Korn Ferry Institute, a research affiliate of pay consultancy Korn Ferry Hay Group.

"On the face of it, it doesn't make sense: strong demand for labor, yet stagnant wage growth," Kingdom observed. "The deeper reasons reveal a labor market that, in most sectors, is not as tight as unemployment numbers make it seem. Many employers can easily hire the talent they need without having to bid up on wages."

There are exceptions to the low-wage norm, Kingdom pointed out. "Top performers, especially those in high-growth niches such as in technology or alternative energy, always make more money. They may, in fact, see a bidding contest for their services."

But elsewhere, "in this era of ever-growing efficiencies and companies trying to boost profits by reducing expenses, wage growth is likely to be muted."

Different Strokes

While employees typically expect annual pay raises that outpace inflation, "that may not be a huge issue with all workers," Kingdom added. "Some baby boomers, for example, scarred by the 2008 recession and nearing retirement, may be just happy to have work regardless of pay." Moreover, "some people who aren't negotiating as hard for money are seeking instead different incentives such as flextime, telecommuting, and additional vacation and paid time off."

 

What is the inflation rate for 2019?

Federal Open Market Committee (FOMC) in its latest meeting on March 21, forecasted that PCE inflation rate in the United States will average at 1.9 percent in 2018 then increase to 2.0 percent in 2019 and stabilize at around 2 percent over 2020.

Dec 19, 2018

 

How much do Amgen sales reps make?

This estimate is based upon 29 Amgen Sales Representative salary report(s) provided by employees or estimated based upon statistical methods. When factoring in bonuses and additional compensation, a Sales Representative at Amgen can expect to make an average total pay of $143,517.

Aug 24, 2018
Amgen Sales Representative Salaries | Glassdoor

 

There's a Massive Pay Gap Between Pharma and Biotech Sales Reps

Lots of new therapies are headed for the market.

By SY MUKHERJEE
June 23, 2016

Being a medical sales rep is a pretty sweet gig, salary-wise. But a new survey highlights huge pay gaps between different types of health product marketers, with biotech dominating the compensation game.

Pharmaceutical sales representatives earn the lowest average total compensation among all medical sales people, according to a MedReps.comsurvey of nearly 3,300 active medical sales employees. A lot of that has to do with commissions and bonuses—while pharmaceutical marketers earned the fourth largest average base salary out of the nine surveyed sectors, their bonuses were by far the lowest.

The survey highlights just how critical commissions are for medical sales reps, especially in high-cost fields such as surgical devices (which had the fourth-lowest base salary but by far the biggest average commissions/bonuses) and medical equipment.


MedReps.com

But biotech was the clear winner in the salary wars, clocking a $165,000 total pay package that puts it at a 35% advantage over its pharmaceutical counterparts. Traditional pharmaceuticals typically deal in small-molecule chemical drugs while biotech tackles biologically-derived products and technologies. Despite recent market volatility, biotech has largely been booming over the past five years, driven by exciting new treatments such as cancer immunotherapies.

That might help explain the wage gap. “These complex [biotech] products are in demand and require smart, hard-working sales people to introduce them to the medical community,” wrote the study authors. “The level of complexity of most biotech products may explain why biotech employers offer higher base salaries and pay more in total compensation than employers in any other product niche.”

The survey also highlights other disparities stemming from age, experience, job title, and gender. Very roughly speaking, women in general earn 76 cents to a man’s dollar in the U.S. (there are notable caveats for this). That gap is a bit narrower in the overall medical sales rep industry—the survey finds that women professional in the field make 80% of what a man makes.

But there’s a bit more equanimity in both pharma and biotech sales. Women pharma reps make about 90% of what men earn, while women biotech reps make about 87%. Census bureau data have also shown that white males in the medical profession outpace women when it comes to salary.

 

Is Amgen hiring?

 

Yep, losing money by staying here with no merit increase.

 

Yep, still no merit increase.

 

Haha...very funny! The poster is calling others incompetent when he or she can’t spell or use proper grammar. Hilarious!

 

Great news - this just in:

We are all getting a healthy raise, uncapped IC plan, $200/bottle for every bottle sold, $1,000/month company car allowance, $.20/mile, a gas card, paid time off between Xmas and NYears, and 4 weeks vacation.


APRIL FOOLS! Could not resist.

 

LOVE it. Wait, we DON'T work for Amgen (a real company with real benefits).

 

Stay home more.

 

You must be one of the ones supporting the green new deal! Work hard, stay focused and you will make money.

 

Figure out what your 2% increase would be (if you worked for a real company). Take that amount of time off while loading fake calls to the physicians you are supposed to see every two weeks. Keep interviewing in the mean time.

Amgen is hiring.

 

Great idea.

 

Still no merit increase.

 

They collapsed the Hawaii territory so they have the money to give everyone a 10% merit increase.

 

The stock is at $1.79 so i doubt it.

 

Yep, losing money working here.

 

They don't care. FIVE RSSs just left and they don't seem to give a shit. Some were newbies that didn't even make their 90 day mark.