Over six in 10 staff say they’re expecting a wage rise from their current employer this year.1 Is your payroll function set up to deliver?
The sense that workers want, and perhaps more importantly, ‘need’ a pay rise has never been quite so strong. And not by the traditional route - switching jobs - but through their current employer.
And although six in 10 received a pay rise last year, with increases averaging 6.4%, the appetite for a pay increase is stronger than ever.1
Indeed, research undertaken for ADP’s People at Work 2023: A Global Workforce View, for which ADP Research Institute® interviewed over 32,000 employees in 17 countries around the world, revealed that most workers are highly optimistic about their prospects.
Regardless of the economic fortunes of their industry or their employer, optimism about pay increases was particularly high in the US and Europe, with the majority of workers expecting an uplift of 8.3% and a third looking for 10% or more.1
Of course, how you view this statistic depends on your pay grade. Setting aside the question of affordability, if you’re responsible for payroll there will be a long list of questions that need answering.
Q. Do you have visibility of pay data?
When it comes to deciding who gets what, can you see at a glance what people are doing and earning? Only then can you make decisions about scale increases based on a wide variable of factors, from performance to the cost of rehires.
According to our research 73% of companies2 simply don’t have the payroll data to make this possible.
Perhaps it’s worth noting that younger and older workers are genuinely prepared to move. Among younger workers (aged 18-34), 20% are prepared to move industries, while 25% are considering starting their own business. Conversely, one in six over 55s (17%) are thinking about early retirement.1 Employers could soon feel a skills squeeze at both ends of the age spectrum.
Being able to spot and reorient trends in payroll data is arguably more important than ever. Our research shows that 76% of the workforce say they would seek employment elsewhere if they discovered that their company had an unfair pay gap or no DEI (diversity, equity and inclusion) policy.3 Food for thought. We live in a connected world where ethics are increasingly important.
Q. Can you create reports easily?
This all depends on your ability to pull wage reports on demand. When we asked payroll leaders what they wanted, top of the list were higher reporting speed and access to sharper analytics
In fact, 98% of business leaders now expect payroll data to be able to inform their payroll strategies.4 Whether your business is growing organically or through mergers and acquisitions, you’ll need accurate modelling, forecasting and reporting.
Q. Are your results based on integrated data?
Another issue that needs serious attention is integration. Our research showed that 74% of companies are still running different payroll systems across multiple geographies.2 Without easy comparison, decision making is never easy.
Meanwhile 44% of global payroll teams spend 21 hours or more reconciling data between HR and payroll systems every week.4 Of course, that number jumps when you’re with dealing with multiple payroll providers in different countries who will invariably be using different systems.
The solution – team up with a true payroll services partner
Finding the time to think about, let alone ensure your payroll function is primed to support workers’ evolving pay expectations, is a big ask of whoever’s responsible for payroll in your company. Whether you’re running it internally or managing one or more providers, your payroll people are likely to be pushed to their limits already.
Whoever manages this function for you needs to be experienced, skilled and responsive enough to guide you through progressing your payroll to keep pace with ever-increasing workforce expectations.
For more detail on how to get your payroll future-fit and change-ready, you’re welcome to download our free ebook ‘Is your payroll keeping pace?’
1. ADP Research Institute, People at Work 2023: A Global Workforce View
2. ADP, The potential of payroll: Global payroll survey 2021
3. ADP Research Institute, People at Work 2022: A Global Workforce View
4. ADP, The potential of payroll: Global payroll survey 2022