Under enormous pressure to attract and retain talent, Microsoft is increasing employee compensation globally to stay competitive with some of its major technology competitors, including Amazon and Meta.
Redmond, Washington plans to nearly double its global merit-based salary increase budget and increase its range of annual share-based remuneration by at least 25% for senior executives and below. according to a GeekWire report. The news was first reported by Business Insider.
“In particular, we are almost doubling the global merit budget,” Microsoft CEO Satya Nadela said in an email Monday morning. “Merit budgets will vary by country, based on local market data, and the most significant increases will be focused where the market requires and at levels from the beginning to the middle of the career. We are also increasing annual stock ranges by at least 25% for all levels 67 and below. ”
The reference to “levels 67 and below” applies to employees to senior directors, according to GeekWire.
For the technology market, the talent shortage is much worse than the overall level of national unemployment, which is around 3.6% in the United States; for the technology industry, that’s only 2%, according to CompTIA, a non-profit association for the IT industry and workforce. This has led employers in the United States to increase demand for workers – and to review salaries and qualifications (such as a four-year college diploma).
“This increased investment in our global compensation reflects our ongoing commitment to providing a highly competitive experience for our employees,” a Microsoft spokesman said in an email to Computerworld.
Next are Microsoft’s salary increases similar moves by Apple and Alphabet, which target selected groups of employees in the software and hardware engineering departments, according to reports.
In December 2021, Apple gave selected hardware, software, silicone design and operations managers share bonuses ranging from $ 50,000 to $ 180,000 to stop Facebook’s desertions to Meta. according to Bloomberg.
In March, the company distributed a second round of share-based bonuses to some employees of up to $ 200,000. Bloomberg announced.
Microsoft is reportedly most concerned about employees leaving Amazon, which doubled its cap on compensation from $ 160,000 to $ 350,000 earlier this year. Bloomberg reported in February.
However, Microsoft is strongly focused on improving its video game skills, which means it wants more developers for its gaming efforts, in particular. In January, Microsoft acquired Activision, maker of Call of Duty, World of Warcraft and Candy Crush for a record $ 68.7 billion. The acquisition puts Microsoft at the forefront of the gaming industry and possibly the meta-universe of virtual reality.
Compensation is important, especially for younger employees, according to a study by Robin Powered, a manufacturer of workplace management software. His survey of 600 Generation Z employees found that most who were ready to leave their positions now said the reasons behind their plans included more money (53%), better adjustment elsewhere (33). %), increase (30%) and better workplace culture (24%). In addition, 74% of respondents said they were ready to stay in their current jobs to increase to 20%.
By 2025, Generation Z – 72 million people born between 1997 and 2012 – will make up about a third of the workforce, according to Robin.
“When we asked Generation Z employees how important happiness is to them in their work, a shocking 44% said they would stay in a job they were not happy with, provided the salary was satisfactory, but another 47% would choose happiness over money.” , showed a study by Robin Power.
About one in five organizations (18%) plan to add at least one additional salary increase this year, according to research firm Gartner. Just over a third (36%) of the 122 companies that responded to the April Gartner survey said they had not yet decided whether to offer additional increases. And one in three organizations are planning ad hoc salary reviews this year, compared to the standard annual review, a Gartner study found.
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