[US] Organisations taking more ‘strategic’ approach to pay

New research has revealed that average salary budgets for US organisations are likely to remain stable in 2027, increasing by 3.4 per cent, only slightly lower than their 3.5 per cent increase in 2026, CFO Dive reports.

A new report from advisory and broking firm WTW showed employers taking a cautious approach to salary planning, with respondents citing cost-management pressures, a tight labour market and inflationary concerns.

WTW found that organisations are moving away from broad-based pay increases and taking more strategic pay approaches.

More than one-third of companies have reportedly made adjustments to their compensation programs. Adjustments include providing higher salary ranges and bonuses or spot awards for key employees.

According to Brittany Innes -WTW’s senior director of product strategy and rewards data intelligence - salary budgets have remained in a “relatively narrow range” over the past few years after a period of unusually high increases following the pandemic. 

Between 2022 and 2026, actual reported increases in the US consistently exceeded 3 per cent; the highest actual increase, reported in 2023, was 4.3 per cent, Ms Innes said. 

In the wake of the pandemic, organisations reportedly adjusted to “a more sustainable compensation environment.” However, Ms Innes added, they continue to face talent-related pressures with many now balancing those needs against ongoing cost-management concerns.

“Compensation remains important, but employers are being more deliberate about their spend,” she said. 

Source: CFO Dive

(Link and quotes via original reporting)

New research has revealed that average salary budgets for US organisations are likely to remain stable in 2027, increasing by 3.4 per cent, only slightly lower than their 3.5 per cent increase in 2026, CFO Dive reports.

A new report from advisory and broking firm WTW showed employers taking a cautious approach to salary planning, with respondents citing cost-management pressures, a tight labour market and inflationary concerns.

WTW found that organisations are moving away from broad-based pay increases and taking more strategic pay approaches.

More than one-third of companies have reportedly made adjustments to their compensation programs. Adjustments include providing higher salary ranges and bonuses or spot awards for key employees.

According to Brittany Innes -WTW’s senior director of product strategy and rewards data intelligence - salary budgets have remained in a “relatively narrow range” over the past few years after a period of unusually high increases following the pandemic. 

Between 2022 and 2026, actual reported increases in the US consistently exceeded 3 per cent; the highest actual increase, reported in 2023, was 4.3 per cent, Ms Innes said. 

In the wake of the pandemic, organisations reportedly adjusted to “a more sustainable compensation environment.” However, Ms Innes added, they continue to face talent-related pressures with many now balancing those needs against ongoing cost-management concerns.

“Compensation remains important, but employers are being more deliberate about their spend,” she said. 

Source: CFO Dive

(Link and quotes via original reporting)