In 2026, US employers are expected to grant employees raises that are largely in line with what they’re receiving this year, according to a Payscale report released on Aug. 7.

Economic concerns drive smaller compensation budgets. The report, which draws on a survey of more than 1,500 Payscale clients conducted in May and June, finds respondents expect workers will see their base pay go up by 3.5% next year, on average, down just 0.1% from this year.

But for organizations planning to shrink their compensation budgets, economic concerns loom much larger than in previous years. Of the respondents who said their 2026 budget for salary increases is expected to be lower than their 2025 budget, nearly two-thirds (66%), said they were “concerned about future economic conditions or business

See Full Page