BambooHR, the leading cloud-based human resource platform, has published its latest annual study on worker sentiment regarding compensation. The report reveals that 40% of salaried employees have not received a salary increase, while those who did saw an average raise of 3.6%, reflecting a continued decline from previous years. These findings spotlight critical challenges in employee satisfaction, compensation equity, and workforce dynamics.
Key Insights on Compensation Trends
1. Stagnant Wages and Employee Dissatisfaction
- 40% of employees reported no salary increase, while the average raise for the remaining 60% declined from 6.2% in 2022 to 3.6% in 2024.
- One-third (33%) of employees expressed dissatisfaction with their pay, up from 23% last year.
- Rising costs have left 50% of employees struggling to make ends meet, amplifying workplace dissatisfaction.
2. Growing Compensation Gap
- Disparities exist between managers and individual contributors:
- 56% of individual contributors believe senior leadership lacks understanding of living on typical wages.
- 42% of VP/C-suite employees feel valued by their company, compared to only 12% of individual contributors.
- 55% of employees think their CEO is overpaid.
3. Gender Pay Discrepancies
- Men received higher salary increases (4.8% vs. 2.7%) compared to women in the past year.
- Historical data indicates men consistently receive larger raises, with gaps widening over time.
4. Generational Perspectives on Pay
- Gen Z: Reports the highest satisfaction rates (79%) despite lower compensation.
- Millennials: 62% are actively job-seeking, reflecting dissatisfaction with pay and career growth.
- Gen X and Baby Boomers: Show lower correlations between pay dissatisfaction and mental health compared to younger generations.
Addressing Pay Equity: Insights from Experts
- Transparency and fairness are crucial for workforce cohesion.
- Modern compensation tools provide opportunities to address wage gaps and ensure equal pay.
- Leaders must leverage these resources to uphold equitable compensation standards and mitigate the risk of employee dissatisfaction or turnover.
To read BambooHR’s annual compensation report “The Great Pay Divide: Compensation Trends for 2025”, visit:Â https://www.bamboohr.com/resources/data-at-work/data-stories/2025-compensation-trends
BambooHR’s annual study underscores the importance of addressing pay equity and understanding workforce dynamics to retain talent in competitive markets. Companies that prioritize fair and transparent compensation practices are better equipped to build motivated, cohesive teams and navigate economic challenges.
