Holiday cheer: More bonuses this year
Poll finds that nearly two-thirds of employers plan to offer year-end rewards, and some are even increasing the amount.
NEW YORK (CNNMoney.com) -- Employers are ramping up bonus payments this year to help retain the best workers as the economy slowly improves, according to a consulting firm survey released Thursday.
Challenger, Gray & Christmas, Inc., an outplacement consultancy, said 64% of employers are planning to hand out holiday bonus checks this year, up from 54% last year.
The poll of 100 human resources executives also found that more companies are planning to give bigger bonus checks this year.
A full 8% of the employers surveyed plan to increase the amount they award this year, compared with none last year.
While employers remain reluctant to expand payrolls, there is growing concern that job market improvements in 2010 could bring an exodus of workers, according to John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
"Companies are not quite ready to ramp up hiring, but they are beginning to see the light at the end of the tunnel," Challenger said in a statement.
Last week, the U.S. Labor Department said employers cut 11,000 jobs in October, which was far below any of the job losses posted over the last 23 months. The nation's jobless rate improved to 10% from a 26-year high of 10.2% the month before.
Still, employers have cut 7.2 million jobs since the beginning of 2008. And most economists expect unemployment to remain high well into next year.
The dismal job market and the looming threat of layoffs has weighed on worker morale, Challenger said, and employers are hoping a bigger bonus will help keep their employees happy.
"Companies are also sending a message that we appreciate that this has been a tough year for everyone, and that the workers' part in ensuring continued survival is recognized," he said.
The poll also found that most companies are tying the size of bonus checks to the performance of the company or individual. According to the survey, 63% of those awarding holiday bonuses are basing them on performance.
Despite the overall increase in the number of companies awarding bonuses, 16% of respondents said that, while they awarded bonuses in 2008, they did not plan to do so this year. That's up from 13% last year.