U.S. employers are forecasting average wage increases of 3.5% in 2026, consistent with 2025 levels. A recent survey, which polled over 1,500 employers in the United States, showed that 53% plan no change to their salary increase budgets, while 31% expect to reduce them. Only 15% anticipate budget increases, signaling a continued shift toward cautious compensation planning even as overall wage growth holds steady.
While 3.5% remains elevated relative to pre-pandemic norms (about 3%), it marginally edges out current inflation. The most recent reading (June 2025) of the Consumer Price Index showed rising inflation of 2.7% year over year, meaning many employees may see limited real income growth.
Employers should continue to monitor economic and compensation trends. Contact us today for more resources.