A new compensation survey released by Associated Industries shows almost half of responding employers are anticipating modest employment growth next year, a positive sign in spite of the lowest respondent participation to date.

Notable increases in pay freezes and pay cuts in management-level employment are due to a larger number of public-sector employers participating in the survey, says Bill Sweigert, vice president of training and development for Associated Industries.

Of the respondents to the survey, 45 percent said they expect to see modest growth in employment for 2013, up from 33 percent last year.

The survey also found that layoff rates for companies were at or near their low for a four-year period. Employers reported a continued gradual decline in indefinite layoffs, down to 15 percent for entry-level staff from 17 percent in 2011. Senior staff also saw a decline in layoffs, to 8 percent from 11 percent, while management saw a slight increase to 5 percent from 2 percent last year. Sweigert says when employers are laying off workers, they generally aren't giving raises.

"On the whole, they're expecting that to be better than it has been," he says.

More governmental agencies and other public-sector employers participated this year compared with previous years, Sweigert says, impacting the results when coupled with a smaller sample size than in previous years.

"Cities, counties and so forth, they weren't immediately affected" by the economic downturn, he says. "It's beginning to affect them, where it may not have immediately impacted them back in 2008 and 2009."

About 50 percent of all employers reported they froze management-level staff this year, a four-year high, and more than double the 20 percent of last year. Also, 22.5 percent of companies said they issued broad-based pay cuts for management staff. Sweigert says the trend over the last three years has been for management to take a bigger hit rather than to pass the cuts on to entry-level staff. He says it's unclear whether that trend continued into this year.

Notable increases in management pay freezes are related to the influx of public sector employers reporting, he says.

"This year, I think we have to take this with a grain of salt," Sweigert says, pointing to the sizable drop in sample size and a change in sample composition that could have skewed the results.

He believes public-sector employers are starting to report more now because they are feeling an economic strain that most managed to avoid. He attributes the delay to the erosion of tax revenues caused by the lingering economic slowdown.

For 2012, Associated Industries reported 40 employers were involved in the survey. Sweigert says that's the lowest participation rate since the organization began conducting a special survey addressing workforce adjustments and compensation in 2009.

"That's anecdotal evidence that employers are trying to do more with less," Sweigert says.

He says he had far more people commit to turning in the survey than actually did, even after extending the deadline by six weeks.

Sweigert says sudden spikes this year for management compensation freezes and pay cuts aren't too alarming, when looking at the Inland Northwest as a whole.

"What's phenomenal to me is that in the first couple of years in this downturn, every survey you looked at, roughly 75 percent of those people working the manufacturing, wholesale and distribution sectors had freezes or pay cuts," he says. "We've rushed through that major calamity, and we're slowly clawing our way back."

Associated Industries sells the full report for $145 to members and $300 to others.