You may be in line for a larger pay increase next year.
The pandemic caused businesses to cut back on compensation, but now companies are planning to boost raises to levels not seen in several years.
Employers project average annual salary increases of 3% for executives, management, professional employees and support staff in 2022, a survey by benefits consulting firm Willis Towers Watson found. That's up from 2.7% in 2021 and the average 2.8% boosts that were seen for a number of years before the pandemic.
Manual labor and production employees can expect increases of 2.8% in 2022, up from 2.5% this year, according to the survey, which was conducted between April and June 2021. A total of 1,220 companies across various sectors participated.
"What we are seeing today is really a structural shift in labor markets," said John Bremen, managing director of Willis Towers Watson.
After a tremendous amount of instability over the past couple of years, the labor markets are trying to find a new balance, he said. A larger number of people are changing jobs than usual and companies have higher salary budgets.
"What this leads to is an opportunity that is ripe for employees to self-advocate and help their current employer understand their value," said Bremen, who added he wouldn't be surprised if average salaries were higher than 3% next year.
Meanwhile, a lot of employees are choosing to leave their jobs rather than have that conversation.
Before you say "I quit," consider going to your boss and asking for a raise. Here's how.
Employees are in the driver's seat and more confident than ever, thanks to the shortage of available labor right now, said Blair Heitmann, career expert at LinkedIn.
That said, asking for a raise is always about timing, so look into how the company is doing financially and where you are in your job, such as whether you are close to getting promoted or have recently taken on more responsibility.
Research the job market, and look up salaries on sites like Glassdoor or on LinkedIn Salary to get a better understanding of your worth.
You'll have to demonstrate your accomplishments, so make sure you have them at your fingertips. Once you know what you want to say, practice with friends, family or past colleagues.
"Talking about your accomplishments can feel awkward, but being able to speak to them effectively is essential to negotiating a higher salary," Heitmann said.
You may even want to get some intel from your boss.
Ramit Sethi, personal finance coach and best-selling author of "I Will Teach You to be Rich," suggests setting up a meeting with your supervisor to ask what you need to deliver to become a top performer. Then, set about accomplishing them before scheduling a meeting for a raise.
Don't just walk into your boss's office and demand a raise — that will have the opposite effect.
Instead, set up a meeting to reconnect with your supervisor on your long-term goals. If it is safe and possible, schedule an in-person conversation, Heitmann suggests. If not, meet over video in a quiet area, free of distractions.
When you meet with your manager, start with the reasons you love working for the company and explain your long-term goals.
"Focus on why you deserve a raise, not why you need or want one," Heitmann said.
Don't be afraid to self-advocate. Share examples of your successes and any positive feedback you've received.
"It is not about bragging," Bremen said. "It is about clearly and objectively articulating the contribution you've made over the past several years."
In fact, many people underestimate how strong a negotiating position they have, Sethi said.
"The vast majority don't negotiate and are afraid to negotiate, but a single $5,000 raise early in their career can turn into hundreds of thousands of dollars," he said.
Meanwhile, if you were also looking for work outside your company and received a competing offer, don't mention it, Heitmann warns.
"If your boss feels cornered or coerced into giving you a raise, it could impact your working relationship moving forward — and result in fewer opportunities for raises and promotions down the line," she said.
A "no" doesn't have to be the end of your negotiation. Instead, treat it like a performance review, Heitmann said.
"Find ways to actionably achieve goals outlined by your boss to set yourself up for success in the future," she advised.
Remember, compensation is more than just money. If your company can't come up with more cash, consider asking for more paid time off or a flexible work schedule.
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.