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It is also true that for more than a few job families there are no "lost dollars" to be recovered. I work in an industry that was badly battered by the recession and we went three years without raises. Over this same period market salaries for many of our positions were reset lower, some by as much as 20%. Employees in these positions are no doubt upset about their pay being frozen for such an extended period of time but I have not heard a complaint from any of them. They know, and management knows, that if they were able to find a comparable position elsewhere it would almost certainly be at a lower salary.

Chuck is right. Today's reality is the new normal. When it happens to stocks, it is termed a "market adjustment," and that's exactly what it was with human talent, too. The reset button was pushed.

The last time the US economy did otherwise, after the release of the Nixon Wage-Price freeze, pay increases ballooned to double-digit rates precisely because employees confronted cowardly managers with those "when things get good we'll make it up" chits they passed out when increases were capped at 5.5%. That maximum cap under the ancient freeze now seems very high, when then it was treated as the minimum. Everything is relative.

While I mostly agree with Chuck, I have not encountered employees seeking retroactive increases. But employees are also aware of the recent performance of our company (growth in revenue, earnings and price per share.) So they are somewhat irritated by management messages that reflect 2009 economic conditions vs 2012 (when discussing potential salary increases.) I don't advocate extraordinary increases as described in earlier comments. But I also believe that continued emphasis upon "bad economy, no increases planned" will accelerate attrition rather than be accepted by the employees. Balance sheets and analyst projections are readily available to all.

For now, this article is correct. However, these "lost dollars" will in some measure be recovered by labor the closer the market gets to 5% unemployment. At that point, markets will rebound, there will be months of churn as people look outside their company for the next best thing, and there they will find the lost dollars.

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