The news is not good for workers who were expecting their full bonus this year.
For the fifth year in a row, U.S. employers don’t expect to fully fund employee bonuses, according to a new report from Towers Watson.
The average projected bonus funding for 2015 is 89 percent of target, down from 93 percent last year. Companies have fully funded their bonus pools only twice since 2005. “Employers are continuing to take a conservative approach to funding their bonus pool,” Towers Watson managing director Laura Sejen said in a statement.
While some companies will give all employees the same percentage of their bonus, others vary the amount based on performance, with the lowest rated employees receiving about 65 percent of their target payout, compared to 119 percent for the best workers.
Related: These Agencies Doles Out the Biggest Bonuses
A separate survey by Towers Watson earlier this year found that more companies are shifting their compensation packages to include more short-term incentives and bonuses. Eighty-five percent of workers took home a bonus this year, up from 81 percent last year. Nearly 90 percent of employees exempt from overtime were eligible for an annual or short-term bonus.
That study found that companies plan to give employees an average salary bump of 3 percent, with the best workers getting a 4.6 percent raise and the worst workers receiving a salary increase of less than 1 percent.
A forecast by Aon Hewitt projected similar raises next year, noting that the historic raises of 4 percent or more won’t be returning any time soon.
