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What to Expect for 2008 Pay Raises

What to Expect for 2008 Pay Raises



Estimated read time: 2-3 minutes

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Paul Nelson, KSL NewsradioIf you're depending on getting a raise in 2008, some economists say you may be in for some bad news. They say employers are planning to increase their budgets by less than 4 percent, so raises could be pretty small.

It would be nice, but not everyone has a job where they get raises every year. However, it's not uncommon for people in Utah to see a little bump in their pay grade every January.

One woman says, "We get them once a year."

A law clerk says, "For the law clerks, they get raises dependent on their years in law school."

People who do get them say they sort of need them every year.

"Raises are a must-have."

"Really it just covers the cost of living, and with the gas prices being what they are, we would like more."

Well, the outlook is not looking great on the national level. Two different reports say pay raises in 2008 will not be very good, barely out-pacing inflation. Some economists say the dipping housing market and rising foreclosure rates are causing a big ripple effect.

Utah Department of Workforce Services Chief Economist Mark Knold says, "Nationwide, it has kind of been more in the news in the last month or two than ever in terms of these foreclosures [and] the mortgage meltdown. It's hitting the stock market now."

Knold says other factors are hurting potential raises across the nation, like slow employment growth. However, there may be some good news for people in the Beehive State.

"[At] 4.7 percent employment growth we lead the nation in employment growth. We outdistance the second closest state, Arizona, at 3.4 percent. We're standing high and above all the other states so we're almost in a bubble, like in a unique little situation," Knold says.

So, what does that mean for the average employee here?

"We should probably have another strong year of wage gains in 2008," he says.

However, we're not out of the woods yet. Knold says many Utahans bought homes a few years back, and many of them used adjustable mortgage rates to qualify for their homes.

"When you bought in with these creative mortgages, in three years it was going to readjust itself. Well, those are coming due here in 2007 and 2008," Knold warns.

He says he believes Utahans will be able to survive these adjustments if they‘re smart with their projected raises for this year.

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