5 Reasons Why Not Everyone Will Get A Pay Rise In 2025 (And Who Will See The Biggest Gains)

The short answer to whether everyone gets a pay rise in 2025 is a definitive no, but the outlook for salary growth remains surprisingly robust in many regions, even as economic uncertainty persists. As of late 2025, global salary increase budgets are moderating slightly compared to the post-pandemic spike, yet they are still significantly higher than pre-2020 levels, driven by persistent labor market dynamics and the lasting impact of inflation. This year marks a critical pivot point where compensation decisions are becoming less about blanket cost-of-living adjustments and more about strategic, performance-centric investments in specific, high-demand talent pools, creating a stark "Great Pay Divide" across industries and job roles. The reality is that while the median global salary increase is projected to be around 4.5% for 2025, this average masks a dramatic variation that will determine if your personal income truly grows, stagnates, or even declines. Real wage growth, which adjusts for inflation, is the key metric to watch, and for the third consecutive year, a majority of countries are expected to see positive gains, according to compensation experts like WorldatWork and Mercer. However, the true winners will be in sectors undergoing rapid transformation, while those in plateauing industries or roles susceptible to automation may find their compensation budgets frozen or cut.

The Global Forecast: Will Your 'Real' Pay Increase?

The headline figures for 2025 salary budgets offer a positive, yet cautious, global outlook. The overall trend shows employers planning for continued pay increases, but the focus has shifted sharply from nominal increases to *real wage growth*.

Global and Regional Salary Increase Projections for 2025

Compensation data from organizations like WTW and The Conference Board indicates a general easing of salary pressures, but with regional hotspots showing much higher figures. * Global Average: The average global salary increase is projected at approximately 4.5% for 2025, with expected inflation around 2.6%. * United States (US): US employers are projecting salary increase budgets in the range of 3.5% to 3.7%. Crucially, real wages in the US have been growing faster than inflation, which is a positive sign for purchasing power. * United Kingdom (UK): Wage growth is expected to ease but remain strong, with annual growth in average earnings hovering around 4.1% to 4.6%. * Asia-Pacific (APAC): Dynamic economies like Indonesia are expected to see some of the highest increases, with projections around 6.3%. This is often driven by a competitive labor market and higher regional inflation rates. The good news is that 91% of countries surveyed are predicted to see positive Real Wage Growth in 2025, meaning the pay increase outpaces the rate of inflation, allowing employees to genuinely improve their standard of living.

The Great Pay Divide: Which Industries Are Leading (and Lagging) in 2025?

The notion that "everyone" gets a pay rise is dismantled by the dramatic disparity in compensation budgets across different sectors. The economic landscape of 2025 is rewarding specific skills and industries while leaving others behind, creating a clear Pay Divide.

The Top Winners in the 2025 Compensation Race

Certain industries, driven by global strategic priorities, talent scarcity, and major capital investments, are significantly outperforming the global average. * Oil & Gas Sector: This sector is projected to lead the pack, with some forecasts indicating average salary increases as high as 8%. This boom is fueled by sustained energy demand and the need for highly specialized engineering and technical talent. * Manufacturing (Tech Roles): The resurgence of Manufacturing in many regions, coupled with Industry 4.0 Technologies and Reshoring Initiatives, is creating a massive demand for skilled workers. Tech professionals within this sector are seeing impressive Tech Compensation Growth, with some reports showing increases up to 15.1%. General manufacturing specialists are also projected to see 4-6% growth. * High-Demand Tech Specialties: Roles in Cybersecurity, Data Science, and specialized Cloud Computing continue to command premium pay due to the persistent Talent Demand outpacing supply.

Sectors Experiencing Stagnation or Moderation

Not all sectors are enjoying the same upward pressure on wages. * Healthcare Sector: After significant increases during the pandemic, Healthcare salary growth is plateauing, with compensation budgets hovering around 3.4%, slightly below the US average. * Administrative and Support Roles: Occupations that are highly susceptible to Automation and new Artificial Intelligence (AI) Adoption are at risk of slower wage growth, as firms look to improve Productivity Growth through non-labor means. * Executives and Low-Skill Service Jobs: In some US forecasts, Executives may see a lower average increase (e.g., 2.2%), while workers in low-skill roles may only see increases tied to Minimum Wage Rates or struggle with stagnant wages due to Economic Uncertainty.

The Future of Compensation: AI, Transparency, and Performance Pay

Beyond the raw numbers, 2025 is defined by transformative trends in how compensation is structured and delivered. These trends are critical to understanding who gets a pay rise and why.

The AI and Skills-Based Revolution

The proliferation of AI is fundamentally reshaping the Labor Market Dynamics and compensation strategies. * AI-Driven Wage Premium: Firms that use AI extensively are often larger, more productive, and critically, pay higher wages. This creates a wage premium for employees who possess the skills to work alongside and manage AI systems. * Skills-Based Hiring: The focus is shifting from job titles to demonstrable skills. Companies are implementing Skills-Based Hiring and compensation models, meaning an employee's pay rise is directly tied to acquiring and applying high-value, future-proof skills, such as Generative AI Proficiency or Green Job Growth expertise. * Performance-Based Pay Systems: There is a pronounced move towards more Performance-Based Pay Systems, where merit increases and bonuses are heavily weighted to individual and company performance, rather than across-the-board raises. This directly impacts the "everyone" question, as underperformers are more likely to be excluded from the increase pool.

The Rise of Pay Transparency and Equity

Pay Transparency is one of the most significant compensation trends for 2025, driven by evolving legislation and employee demand. * Mandates and Employee Demand: More companies are adopting transparent compensation practices, where salary ranges are disclosed internally or externally. This trend is forcing employers to address internal inconsistencies and commit to Pay Equity to close gaps like the persistent Gender Pay Gap. * Global-Local Strategy: For organizations with a large Remote Work Compensation footprint, the challenge of adopting a consistent Global-Local Strategy for pay is paramount. The location of the employee increasingly dictates the pay range, further complicating the idea of a universal raise. In conclusion, while the overall economic climate suggests that the average worker will see a nominal pay rise in 2025, the reality is far from universal. The determining factors are now highly granular: the industry you work in, the specific skills you possess (especially those related to AI and Industry 4.0), and your individual performance. The era of the blanket pay rise is over; 2025 is the year of the strategic salary increase, where those who adapt to the new Compensation Trends will reap the most significant financial rewards.

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