25% of companies are going to freeze salaries

A survey conducted by Mercer showed that about one fourth of businesses have frozen workers' salaries for 2009. Moreover, another 20% of businesses are considering a salary freeze, while the rate was only 5% a year ago. The company predicts that one third of the businesses will have frozen wages at 2008 levels by the end of this year.

The study also shows that executives are less likely to get a salary increase in 2009. This year only 61% of companies plan on raising their executives' pay, and 77% of respondents are planning to decrease the executive compensation from October projections. Besides, President Obama and Treasury Secretary Geithner had recently announced plans on setting a maximum level of executive pay in companies receiving government bailout funding at $500,000.

Even, those companies that plan on offering raises to their employees are forecasted to give smaller pay increases (3.2%), in comparison to the planned level (3.6% according to an October study).

The Labor Department reported that employers have already cut 598,000 jobs in January, which makes the highest monthly job-loss since December 1974.

Mercer is an outsourcing and consulting firm.