It indicates how employers have shifted their focus on how to pay their employees.

Most employees view base salary as a barometer of their worth, so thinking about a steady decrease in the amount of money being provided to them has had a psychological impact. That's why organizations looked to variable pay as a way to counteract that -- until recently.

The fact we saw 10 percent of organizations freezing salaries was astronomical. It was a really unusual year.

The good news is that after seeing very significant reduced spending overall, companies are projecting a slight recovery for 2003.

They're clearly sending a message to employees that they will be rewarded for high performance.

They're seeing that as a way to reduce their costs in some places. Some might think employers are taking a Scrooge mentality, but they're putting it into a different form.