Employee motivation: Pay rises in Western Europe 'fall short of Central Europe and Middle East'

Date: 23/06/2011

Employers in Western Europe have given out pay rises to executives at an average of 2.7 per cent, which could potentially damage employee motivation of lower-level staff.

But while for some, receiving a pay rise is a welcome boost to their pay packet, the research, from Mercer, shows that the rate is still one of the lowest levels in Europe, the Middle East and Africa, Employee Benefits reports.

In central and eastern Europe, salary increases averaged 5.8 per cent - but around ten per cent said they would be freezing salaries again this year.

Some of the highest pay rises were seen in companies in Belarus (12 per cent increase) and Kazakhstan and Ukraine (ten per cent).

Johan Ericsson, principal at Mercer, told the news provider: "Europe has patiently sat through several years of pay freezes so this data is a welcome indication that spring has come.

"However, the relatively low increases in Western Europe reflect the continued uncertainty in this market compared to other regions."

He added that organisations are "increasingly reliant" on non-fiscal rewards such as incentives and recognition and sales incentives.

Brendan Barber, general secretary for the Trades Union Congress, recently said that there is a growing gap between director and employee pay, which is damaging staff morale.

Posted by David Farrior 

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