U.S. Salary Increase Budgets for 2016

US salary increase budgets for 2015 have a median increase of 3 percent, the same as the previous four years. This median holds for each of the four employee groups—nonexempt hourly (nonunion), nonexempt salaried, exempt, and executive—and across all employment categories. Projections for 2016 are also 3 percent.

A significant development in the US economy in the past year is the increasingly tight labor market. The unemployment rate continues to decline rapidly, standing at 5.4 percent in April 2015, which is within the range of the natural rate of unemployment. While wage growth has been elusive, indicators point to an acceleration in the coming years, as the labor market continues to tighten.