The Social Security administration is estimating another significant COLA for 2023 – coming in at a whopping 8.7 percent. This is the highest increase in almost 40 years, the third year in a row of significant increases and roughly 5% above what the rate was originally expected to be.
In a recent article by salary.com, it reported that over 1/2 of polled U.S. employers planned higher year-over-year budget increases next year compared to 2022. This includes salary increases, which are expected to average in the 5% to 7% range in 2023.
For employers it impacts certain benefit accounts, retirement plans and other programs (see highlights below). To learn more about how the COLA is calculated, the history of COLA increases since 1975 and 2023 COLA facts: CLICK HERE
The People Perspective offers Compensation Benchmarking services to help you determine where you’re employees are sitting compared to peers in similar roles. This is a great and helpful resource for planning out cost of living increases for your team. Reach out to email@example.com to find out more about this service.