Annual Research Report Finds Average Salary Increases Started to Slip in 2024

WALTHAM, Mass. October 29, 2024—Salary.com, a leading provider of compensation market data and software, shared the results of its annual National Salary Budget Survey. Now in its 14th year, the survey collected responses from over 1,000 human resource professionals across 20 industries in the U.S. and Canada to see how companies are planning salary increases.

This year’s survey found that the median salary increase stayed at 4 percent, but average increases dropped from 4.3 percent to 3.9 percent.

Salary.com says this drop is because fewer companies are giving higher raises. The number of companies giving raises between 5 and 6.9 percent fell from 25 percent to 14 percent. This trend could be linked to lower inflation and stable unemployment after the economic instability caused by the pandemic and the Great Resignation. The survey also showed a return to typical salary increases of 3 to 3.9 percent, as reported by 38 percent of respondents in 2024, compared to 25 percent in 2023. Expectations for 2025 are similar to 2024.

“Last year, we noted that salary increases might be at a peak, even with 4 percent becoming the norm. While 4 percent remained the median in 2024, further analysis suggests a shift is happening,” said Andy Miller, Vice President, Compensation Consulting at Salary.com. “This is important for HR and compensation teams as they plan budgets for next year, considering factors like industry, location and work arrangements.”

The 2024-2025 National Salary Budget Survey also showed:

• Geographically, the Northeast U.S. had the lowest salary increases, while the West Coast had the highest. The Northeast averaged 3.6 percent, compared to the national average of 3.9 percent. New York City (3.7%) and Boston (3.3%) had lower increases compared to San Francisco (4%) and Seattle (4.3%).
• Regarding industries, Construction (4.2 percent) and Education, Government & Non-Profit (4.3 percent) had the largest increases. Hospitality (3.4 percent) and Transportation (3.6 percent) had smaller increases. Hospitality continues to adjust to local and regional minimum wage changes while recovering from the pandemic.
• Defining pay for remote employees is still a challenge. The most common approach in 2024 was to set pay based on the employee’s primary residence (29 percent). Other methods included using a national pay rate (24 percent), regional pay rates (14 percent), or the closest employer location (12 percent). About 14 percent of respondents did not have remote employees.

Miller added, “In 2024, many organizations experienced a level-set moment. Some sectors and regions saw increases, while others saw decreases, matching changes in labor markets, new laws, and evolving situations. Staying on top of these trends is key to good planning.”

To buy a copy of Salary.com’s 2024-2025 National Salary Budget Survey, visit https://store.salary.com/national-salary-budget-survey.

ABOUT SALARY.COM

Salary.com has been helping organizations with human capital needs for over 25 years. The company leads the industry in compensation data, software, and services. More than 30,000 organizations in 22 countries use Salary.com’s solutions to hire and keep talent and compete in a changing world.

Salary.com provides over 10 billion data points across more than 225 industries using a proprietary AI framework to ensure fair pay. The company’s main product, CompAnalyst^®helps organizations simplify hiring, reduce guesswork, and increase retention. Employee trust depends on fair pay, and Salary.com helps get it right. Please visit www.salary.com/business.

Media Contact:

Kate Achille
The Devon Group for Salary.com
kate@devonpr.com