Survey: Merit pay for Mass. workers to rise

Massachusetts workers can expect merit pay raises of 3 to 4.5 percent this year, up slightly from last year, according to a new survey.

The survey of 223 employers was from the Associated Industries of Massachusetts, which represents more than 7,600 businesses and institutions.

The group said yesterday its survey found that budgets for merit pay raises at Massachusetts employers are starting to "slowly ramp up in 2007."

According to the survey, 38 percent of respondents predicted increases of 3 to 3.4 percent, while 35 percent predicted increases of 3.5 to 4.5 percent.

Last year, a majority of firms surveyed said they had budgeted for 3 to 4 percent increases in merit pay, and 13 percent of respondents said they had instituted a pay freeze.

This year's modest increase in merit-pay budgets underscores "how high nonwage costs for health insurance, workers' compensation, and unemployment insurance serve to impact the ability of employers to increase salaries and wages while remaining competitive in the global marketplace," Brian Gilmore, executive vice president of public affairs, said in an e-mail.

CHRIS REIDY