Hiring freeze in place in almost 1 in 4 Arkansas businesses and organizations

The Arkansas Compensation Association reported Friday (Aug. 21) that almost one in four Arkansas companies have instituted a hiring freeze or have frozen employee wages.

ACA says its 2009 Compensation & Benefits Survey is the largest in the state, and surveyed 106 companies, organizations and governments for the newest survey. The survey reports salary data on 140 jobs and more than 20 benefit & leave policies.

According to the ACA report, 24% of Arkansas companies reported having a hiring freeze in place, and 22% of companies have frozen wages. The salary and wage increases reported for 2009 are between 1% and 3%, less than previous years, ACA noted.

The report also noted that more companies no longer provide a 401(k) retirement fund match for employees. Also, health care deductibles are increasing, with the average deductible at $645 for individuals and $1,483 for a family. The average prescription drug co-pay among the companies surveyed is $10 for generic, $29 for mid-range and $48 for name brand drugs.

“Increasingly companies are passing benefit costs to employees,” ACA noted in a summary of the report.

News of wage freezes recently hit close to home. The Fort Smith Board of Directors were asked Aug. 17 by City Administrator Dennis Kelly to consider a wage freeze for all city employees in 2010. Planned salary increases in 2010 range from $544,000 to $823,000, or as much as 2% of the city’s average annual operating budget. The city faces an estimated revenue shortfall of $1.5 million, with $620,000 resulting from declining collections of the countywide sales tax.