Of the 430 companies surveyed, 58% said they would be spending more on training and career development in 2007, compared to only 16% of respondents planning to increase base salaries.
Principal at Mercer Paul O'Malley said companies were reluctant to invest more in pay increases, as well as in pensions and healthcare benefits, as they did not want to increase their fixed costs. "By focusing on training, non-cash rewards and bonuses, they retain flexibility over their investments, and can ensure the highest rewards go to the top-performing employees."
One of the biggest concerns of employers in the coming year is attracting and retaining talented staff, with 83% saying the issue was important. Performance related pay and high pay differentials for top performers were cited as important elements in employers' retention strategies.
Among the least of employers' concerns were adapting rewards to suit older workers. O' Malley expressed surprise that companies were not more concerned about older employees considering how much most of them rely on the skills of more experienced staff.
The survey also found that workers in most demand were in marketing and sales, with 23% of companies looking for candidates in this area, followed by people with engineering (16%) and information technology skills (15%).
Mercer Human Resource Consulting
Review by Joe Gill