Belgium Salary Budget Planning Survey highlights a total salary increase of 5.3% in 2022

This survey was conducted amongst 41 organizations with the intention to capture more precise data from the Belgian market, following the recent rise in inflation rates. We researched the 2021 actual and 2022 expected salary increase budget rates across Belgian entities.

The participants came from a wide variety of industries, such as High Tech, Consumer Products, Pharmaceutical and Health Sciences. The division between industries is shown in the overview below:

Overview of the distribution of the 41 participants across a diverse range of industries

Key Economic Figures* used as background for this survey are:

• Inflation as of February: 8.04%
• Average annual forecasted inflation:
  • 2022: 6.2%
  • 2023: 1.5%
• Next pivotal index reached: July 2022

Derived from the Federal Planning Bureau of Belgium

The vast majority of the 2022 forecasted salary increase budget is dedicated towards the mandatory index that has/or will take place in the course of the year.

Facts from the survey:

• 3 out of 4 companies have their salary review in the first 4 months of the year.
• Total Salary Budget increase for 2022 is 5.3%* (up from 3.2% in 2021)
• Total Merit only increase for 2022 is 1.2%* (down from 1.6% in 2021)
• Only 1 out of 4 companies are looking to increase their merit budget in 2022.

*Overall average

General results and recommendations:

Organizations are looking to award – on average – a total salary increase of 5.3% in 2022. This is 2.1% more than 2021. This being said, the vast majority of this rise in salary increase budgets is based on the mandatory index imposed by the Belgian Joint committees.

In the majority of industries in Belgium, a system of automatic mandatory indexation of salaries is applicable. Belgium’s largest joint committee (JIC200) have finalized their negotiations, which resulted in wage increases of 3.58% as of January 1st 2022 for approximately 40% of Belgian employees. Depending on the indexation mechanism followed by the joint committee (different for every company), wages have or are forecasted to increase on average up to 4% in 2022.

For many companies this leaves little to no budget for providing additional merit increases. Our survey indicates that organizations are lowering their merit budget with 0.4% on average, compared to 2021. Only 1 out of 4 companies are looking to increase their merit only budget for 2022.

Our recommendations are to:

1. Leverage accurate market data to make thoughtful pay decisions
2. Modernize your rewards philosophy, to accommodate employee expectations
3. Be transparent to your employees about budget policy decisions taken
4. Take into account your industry challenges and company affordability

For further details or a copy of the full report, please contact Douglas Leenen.

Author

---

Douglas Leenen

Lead Associate, Work & Rewards

email Email

---