Businesses are planning for 3.8% pay increases in 2024— just slightly less than the 4% businesses actually paid out in 2023.
The new projection, from compensation data and software company Payscale, Inc., is actually the same 3.8% prediction employers made last year, but companies ultimately needed to pay out more because of the tight labor market.
Of course, that market is now tightening — albeit slowly — and that is reflected in pay plans for 2024.
While 78% of employers believe their 2024 salary budgets will increase or stay the same compared to 2023, another 22% expect to lower their salary budgets. That's up from 9% a year ago.
Even so, experts say many employers will find it hard-pressed to dial back too much on raises when push comes to shove.
