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Setting your global compensation and benefits strategy for the year ahead

2021 salary increases, HR trends and benefits changes around the world

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Beyond Data

By Darryl Davis | November 3, 2020

Staying ahead of HR trends around the world is never easy. Our research highlights international benefits and compensation changes which could affect your organization in 60 countries.

When COVID-19 started spreading around the world and global businesses saw major disruptions, employers and governments alike fell back on policies and programs forged by previous economic crises to control costs, ensure safety, support businesses and employment. But as time has proven, 2020 was no ordinary year.

Arguably it’s the year when the “H” was put back in “HR,” as concerns about people and wellness became a daily concern. But it was also a year when cost control became a top priority for employers as well. Organizations have turned their toolboxes upside down to address these multi-layered and sometimes conflicting needs and may find they must increasingly think outside of the box as pressures persist and evolve.

For most multinational employers, this backdrop makes global compensation plan management more daunting than usual.

The delicate game of salary budget planning

1out of 5
organizations reporting pay freezes in 2020

Autumn is generally the time for setting budgets, including salary increases for the year ahead. Traditionally, setting salary budgets takes many variables into account, including business performance, consumer price movements, market positioning and the previous year’s budget, and distills it down to a single number. When looking at market data, most organizations use “market median” as their North Star.

But, in a world where we saw lower consumer price pressures over 2019 and a fragmented approach to salary increases with nearly one in five organizations reporting pay freezes in 2020, simply looking at the median may no longer be the best approach.

To an extent, this can be explained by the different ways the pandemic impacted different sectors; some struggling to survive, while others thriving. Where and when COVID-19 began impacting countries also plays a roll, as many 2020 salary increase budgets were decided prior to the first wave of the pandemic. While 2021 suggests little change at the median and upper quartile, the bottom half of the market could look rather different if fewer organizations forego pay reviews.

Key challenges and changes for multinational organizations

Staying abreast of HR trends in markets where your organization operates is no easy task. From annual salary increases, variable compensation practices, key economic data and labor market indicators to benefits data including social security systems, mandatory benefits, perquisites, public holidays, and annual and family leave by country, the shear mass and variety of information can make it hard to spot developments and understand fundamental details.

To that end, we’ve compiled a quick infographic highlighting the most important HR trends for key markets in 2021 to assist you in your global compensation and benefits planning. Download it today and let us know what you think!

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2020-2021 Global 50 Remuneration Planning Report

Pay and benefit practices in 60 major economies presented in a clear and concise format by country.

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