Raise or Holiday Bonus? Companies are More Likely to Give One, not Both

By: Lauren Mineau

This time of year is all about giving, and that sentiment is often shown by employers.

But rather than receiving a gift that gives all year long, like a pay raise, many companies are more likely to give a one-time holiday bonus.

Recent studies by Bankrate.com and Accounting Principals found that many workers should expect a little cash around the holidays, but not necessarily a raise.

Only 38 percent of employees earned a bigger salary at their current job in the past year, Bankrate found after surveying about 1,000 participants in November.

But there’s some good news about that holiday bonus. The average anticipated holiday bonus is up 66 percent this year at $1,797, compared to $1,081 in 2016 and $858 in 2015, according to a recent study by Accounting Principals.

U.S. unemployment hasn't been this low since 2000, according to the Bureau of Labor Statistics. In previous years, employers often had to up salaries in order to keep employees happy, but recently that hasn’t been the case. Wages rose only .1 percent within a 12-month period that ended in September 2017. Inflation is slow, so there is less pressure to keep cost-of-living raises going.

Wages rose only 2.4 to 2.5 percent for the 12-month period ending in September 2017.

"There's slow growth in economy, inflation is slow, [and] productivity growth is abysmally low. All of that makes it difficult for employers to pass along higher wages when they're not able to pass on higher prices to customers," Bankrate.com chief financial analyst Greg McBride said.

Hiring managers at Accounting Principals say the best way to stay in the running for a salary boost of any kind is to remain motivated all year round.

Expect Bonuses not Pay Raises This Holiday Season

Holiday Hiring Trends