Employees at small businesses can no longer count on automatic raises in base pay. Small-Business Employee Pay Stays Flat.
More money only comes for performance that goes above and beyond.
The Great Recession has left deep scars in the minds of many business owners, leading them to hold back on employee compensation even as conditions improve. According to several leading payroll processors that specialize in small businesses, employee pay has stayed virtually flat year over year, in contrast to previous years when generous, automatic raises were the norm.
Increases in base pay at small businesses are being granted only if both the employee and the company exceed expectations. The understanding that base pay would increase yearly is no longer a given. In many cases, additional compensation is given in the form of performance bonuses for tasks that increase revenues like providing a successful sales lead. Many owners have yet to achieve the level of profitability they had prior to the Great Recession and don’t want to risk the financial integrity of the company by increasing fixed expenses like base pay.
About Mike Periu
Mike is a seasoned executive with experience in small business finance and management. He is the founder of Proximo, LLC a leading provider of corporate, consumer and small business education and training services with an emphasis on finance and technology.
Mike Periu is also a leading national voice for individual empowerment through financial education and entrepreneurship. He has been interviewed over 500 times in national and international media, including NBC, Univision, CNN en español, Telemundo, HITN, TVE, RTE, SBS, MegaTV and others.
Mike writes regularly for American Express OpenForum, Yahoo! Finanzas and is a Huffington Post contributor.
Mike has degrees in Finance and International Business from Georgetown University. He is on the Board of Directors of the Council for Economic Education and was a Fellow at the Kauffman Foundation’s Labs for Enterprise Creation.
