BambooHR®, the leading cloud-based human resource platform, today released its annual study of worker sentiment around compensation, revealing that 40% of salaried workers haven’t received a salary increase. For the 60% who did, the average increase was 3.6%, marking a continued decline from 4.6% in 2023 and 6.2% in 2022—a 42% decrease over two years.
“When basic needs outside of work are put at risk, you’ll start to see employees lose focus on the job and even search for opportunities that can help them better stay afloat,” said Anita Grantham, Head of HR at BambooHR. “While it’s not uncommon for savvy business leaders to cut costs in difficult economic times, that has to be weighed against the strain the business might experience if you lose high-performing employees due to stagnant wages.”
Compensation Gap Grows
Further analysis of compensation data shows discrepancies continue across various populations like manager vs. individual contributor.
- One-third (33%) of employees feel dissatisfied about their current financial remuneration—an increase from 23% last year—and 50% struggle to make ends meet due to rising costs.
- 56% of individual contributors feel senior employees lack an understanding of living on a typical wage.
- 42% of VP/C-suite employees feel extremely valued by their company, whereas only 12% of individual contributors feel the same, while over half (55%) of employees think their company’s CEO is overpaid.
Gender Pay Discrepancies
Men are more likely to receive raises, receive bigger raises, and feel more secure and satisfied regarding their compensation.
- 64% of men received a salary increase in the past year, compared to 55% of women, and men’s average increase was 4.8% compared to women’s 2.7%.
- BambooHR’s historical data shows that men have consistently reported higher salary increases than women, with men receiving 4.9% last year and 6.4% in 2022, while women received 3.5% and 5.2% respectively.
Generational Perspectives
Employees in different stages of their careers have differing expectations and attitudes toward compensation, reflecting other multigenerational workforce trends.
- Despite lower overall compensation, Gen Z workers report the highest satisfaction rates at 79%, compared to 70% for all other generations.
- Compensation’s impact on mental health varies significantly by generation: 45% of Gen Z and 44% of Millennials report a direct connection, dropping to 30% for Gen X and 22% for Baby Boomers.
- 62% of Millennials report actively seeking new job opportunities, followed by Gen Z at 54%, Gen X at 48%, and only 31% of Baby Boomers.
“The Equal Pay Act requires workers to be given equal pay for equal work, regardless of their gender or identity. Today’s workplaces thrive on transparency and fairness, and nothing erodes team cohesion faster than discovering unequal pay for the same work,” said Alex Bertin, Director of Total Rewards at BambooHR. “With modern compensation software and benchmarking readily available, companies have all the resources they need to ensure fair pay across their organization. Leaders who choose not to use these tools leave themselves open to wage gaps.”
To read BambooHR’s annual compensation report “The Great Pay Divide: Compensation Trends for 2025”, visit: https://www.bamboohr.com/resources/data-at-work/data-stories/2025-compensation-trends
Methodology
BambooHR conducted this research using an online survey prepared by Method Research and distributed by RepData among n=1,512 adults (age 18+) in the United States who are full-time salaried employees. The sample was equally split between genders, with a spread of age groups, race groups, household income, job titles, industries, and geographies represented. Data was collected from September 13 to 24, 2024.