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UBS personnel compensation survey: moderate increases in 2005

| Media Releases Switzerland

Nominal wage growth of 1.4% expected

UBS's latest wage survey suggests that nominal wage levels will rise by 1.4% in 2005. Respondents expect inflation to be 0.9%, as a result of which the real increase should be about 0.5%. These are the main findings of the 16th UBS personnel survey of companies in 19 industries.

Like last year, the most generous pay deals are expected in the telecoms/IT and energy sectors (2.0%). Large raises are also expected by the companies surveyed in the banking and capital goods sectors (1.8%). Very small increases, on the other hand, are anticipated in the sectors hardest hit by the last economic downturn, including printing and graphic design (0.8%) and the textile industry (0.4%).

Of the companies implementing bonus systems (the proportion has increased slightly to 76%), roughly half expect bonuses to be kept at the same level as in 2004. Nearly 40% foresee higher bonuses.

As regards the economic trend going forward, respondents appear to be about as optimistic as they were in last year's survey. A majority (63%) believe the upturn will continue in 2005.

Although respondents foresee favorable economic conditions for the next year most of them remain cautious about staff planning. Only 21% are planning to expand their workforce, while 40% don't see a substantial change in their headcount. However, almost none of the surveyed companies are planning to cut staff numbers sharply.

The source of these findings was the annual wage survey conducted by UBS, which took place between 27 September and 18 October 2004. The survey covers companies and employer associations in 19 sectors that account for about 64% of total Swiss workforce. The average discrepancy between the survey's estimates and the official wage figures published by the Swiss Federal Statistical Office in the period from 1989 to 2003 was only 0.34%.

The detailed findings will be available on the Internet from noon today:

Zurich, 29 October 2004
UBS

Nominal wage increases in selected Swiss industries

2004

2005

Min.

Max.

Median

Min.

Max.

Median

Energy

1.0%

2.5%

2.0%

1.0%

3.5%

2.0%

IT Services

1.5%

2.3%

1.9%

0.0%

3.0%

2.0%

Telecommunications

1.4%

2.5%

2.2%

1.8%

2.3%

2.0%

Banking

0.5%

1.5%

1.0%

1.5%

2.3%

1.8%

Machinery, Electronics, Metals

0.0%

2.1%

1.0%

0.0%

2.0%

1.8%

Retail Trade

0.5%

1.8%

1.3%

1.5%

1.8%

1.7%

Automotive

0.0%

1.3%

0.5%

0.6%

2.0%

1.6%

Watches

0.0%

0.7%

0.5%

1.0%

3.0%

1.5%

Insurance

0.4%

1.5%

1.0%

1.0%

2.0%

1.5%

Chemicals, Phamaceuticals

1.0%

1.5%

1.3%

0.7%

2.3%

1.5%

Construction

0.0%

1.0%

0.6%

0.9%

1.5%

1.4%

Transport

0.0%

2.0%

0.7%

0.0%

2.0%

1.3%

Media

0.0%

1.8%

0.6%

1.0%

1.6%

1.2%

Food, beverages

1.0%

2.0%

1.2%

0.5%

1.8%

1.1%

Cantons

1.0%

1.3%

1.1%

0.0%

1.9%

1.0%

Hotels, Restaurants

0.2%

3.0%

0.7%

0.0%

1.3%

1.0%

Printing, Graphics

0.0%

1.0%

0.4%

0.7%

1.0%

0.8%

Textiles, Garments

0.5%

1.8%

0.8%

0.0%

1.5%

0.4%

Swiss Average

0.9%

1.4%