The U.S. economy is showing a faster than expected recovery, as evidenced by aggressive spending on employee retention by various American companies, reports the Wall Street Journal.
Among those include PricewaterhouseCoopers US LLP, which announced the early cancellation of pay cuts and lifting of pay freezes, commencing in July. The policy change applies to its 26,000 U.S. employees and is two months ahead of plan.
Last year, CEOs were concerned that trimming employee numbers during the recession would burn out their workforce and drive high staff turnover once the job market showed improvement. However, instead of spending on retention efforts, they cut or froze pay and employed low-cost rewards, such as thank-you notes, reports the Journal.
By January, some companies began to restore pay cuts and lift pay freezes. Consultants and executives report that further measures now include earlier awarding of pay raises and distributing special bonuses.
"They are feeling more confident in how 2010 will shake out, and want to ward off poaching," says David Smith, managing director of Accenture, a global management consulting group.
Smith reports that companies in health-care, pharmaceutical and especially financial services industries are offering more retention-related bonuses in the past three months.
PricewaterhouseCoopers Chairman Robert Moritz announced an early end to the U.S.-wide pay freeze, in July rather than September, as September is the month when raises are normally awarded for the firm’s employees. Turnover at PwC has been rising in the past three months, and Moritz has been closely monitoring exit interview data.
PwC’s employees in New York, Boston, Houston and Washington, D.C., have left the accounting firm in lieu of government jobs, and posts at energy and financial-services companies. More of PwC’s clients are also hiring, with many of those posts historically being filled by former PwC employees.