U.S. businesses are not likely to increase worker pay in 2017, even as the unemployment rate continues to slow.
That's according to new data from the Conference Board, a business research firm, which surveyed 461 companies. Those companies expect to increase their compensation budgets by the median of 3 percent in 2017 -- the same rate as over the past six years.
Companies are increasingly awarding employees with performance-based bonuses, as opposed to raises, other research suggests. Bonuses accounted for 12.9 percent of businesses' compensation budgets in 2015, up from just 7.5 percent in 1996, according to Aon Hewitt, a management consulting firm.
Amid belt-tightening, companies view giving bonuses as less risky than increasing pay budgets, according to Matteo Tonello, a managing director at the Conference Board.
"These alternative compensation vehicles offer more flexibility and do not commit cash resources in advance and for the long term," Tonello told the Wall Street Journal. "They can be tailored to end-year performance and cash availability, and can be significantly reduced in the following year if a softening performance requires it."