Large Firms Shift to Individual Salary Increases in 2026

The 2026 salary landscape is defined by a return to individual meritocracy. A study conducted by WTW highlights that large enterprises are abandoning collective salary hikes in favor of individualized adjustments. This shift is largely driven by the slowing rate of inflation, which reduces the pressure for uniform, across-the-board increases to cover rising costs of living.

The findings suggest a return to pre-pandemic norms where performance and individual contribution take precedence over collective bargaining. For employees, this means that salary growth will be more closely tied to personal achievements and role-specific metrics rather than broad economic trends. The study focused primarily on the practices of major corporate groups, providing a clear view of the strategies employed by the largest market players.

While the method of distribution is changing, the total financial commitment from these companies is not. The study found that the budgeted increases for wage bills stand at 3.1% for 2026. This figure mirrors the budgeted increase for 2025, which was also 3.1%.

This consistency in budgeting is significant. It demonstrates that despite the shift to individual increases, companies are not reducing their overall spending on labor. Instead, they are reallocating resources to reward top performers and retain key talent. The steady budget suggests stability in corporate financial planning, even as they adapt to a changing economic environment.

The return to individual salary increases creates a more competitive environment within large firms. Employees will likely need to demonstrate clear value and performance to secure raises at the 3.1% average rate. This shift places greater emphasis on performance reviews and individual goal setting.

For the broader labor market, this trend among large groups could influence smaller companies. As the economy stabilizes, the focus shifts from retention through inflation-matching raises to retention through merit-based rewards. This transition marks a new phase in the post-pandemic labor market, balancing corporate budget constraints with the need to motivate and retain skilled workers.