Key findings from compensation report and OPR 2018
The ASA biannual compensation study and the annual Operating Performance Report (OPR) now are available and as expected are showing favorable trends for the plumbing-supply, PVF, PHCP and HVAC industry. The biggest contributor for the positive trends has been the growth in economy. The real gross domestic product (GDP) has been trending positive with 2017 seeing growth of 2.3%. The U.S. dollar continues to be strong and interest rates remain historically low; however, it is expected that interest rates will continue to rise during 2018.
In 2018, companies across the United States are projecting salary budget increases with early projections indicating increases will be just over 3%. Inflation grew by 2.1% in 2017 and is expected to continue to grow by 2.4% in 2018. Forecasts for 2018 project an unemployment rate of 3.8% which, if it holds true, will be the lowest unemployment rate since 1969. Currently, the economy is experiencing both low unemployment rates and a surplus of job openings. When this occurs the competition for talent increases, resulting in higher employee turnover rates and increased compensation levels. The turnover rate for employees was 3.6% in 2017; the highest it has been in the past 10 years.