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Employers Respond to Economy

March 11, 2011

Fewer employers froze wage increases, cut employee bonuses and implemented layoffs in the last six months, according to a survey of human resources professionals released this week by the Society for Human Resource Management.

"Organizations are responding to minor improvements in the economy by reinstating employee wage increases and bonuses which shows that they are invested in keeping their workforce intact," said Evren Esen, manager of SHRM's Survey Research Center. "Fewer organizations have hiring freezes and layoffs both signs that some job growth is occurring."

According to the poll, 60 percent of businesses made budget cuts across the entire organization, down from a high of 73 percent in the fall of 2009.

The number of employers that hired contract or temporary workers in the past six months (23 percent) has increased since the fall of 2008 survey (12 percent).

Thirty-eight percent of organizations said they have re-hired employees laid off due to the recession.

Twenty percent said they reduced employee benefits in the last six months, the highest level since the fall of 2008, when the first in this series of economic polls was released.

The benefits most frequently reduced were healthcare coverage for employees (91 percent), healthcare coverage for spouses and dependents (89 percent), company paid relocation programs (55 percent) and the amount of leave an employee could accrue (54 percent).

The poll, which measures opinions held by 405 randomly selected HR professionals, was conducted Nov. 8, 2010 – Jan. 13, 2011.