Why your raise might look a little nutty in 2026

Like it or not, employers are spreading raises like peanut butter in 2026

HERE’S SOME GOOD news for anyone hoping for a raise this year (and especially for anyone worried they might not have earned it): 44 per cent of firms surveyed by Payscale say they are planning to give standard, across-the-board pay raises this year, as opposed to targeted, merit-based increases.

Click here to view this article in the London Inc. Worklife newsletter

They’re calling it ‘peanut butter raises’ — as in, spread evenly, like peanut butter — and they’re shaping up to be a new dynamic in salary increases for 2026.

Story Continues Below

 

“Tying pay increases to performance ratings has come under criticism in recent years for being too subjective and prone to bias,” wrote Payscale. “The rise in organizations electing to standardize pay increases across employees is driven by a need to alleviate administrative burden, especially where resources are strained and pay budgets are under pressure.”

One such major company is Starbucks, which opted to give its corporate employees a standardized two per cent raise last year, pitching it as a prudent way to retain workers while controlling overall costs.

The trend is likely going to differ between large and small companies, Payscale notes. Larger companies are more likely to offer this kind of across-the-board pay hike because they’re easier; smaller companies may have to be more flexible and targeted, because challenges vis-a-vis retention and recruitment can be more substantial.

Story Continues Below

 

So, it’s probably good news — for everyone except the top performers, of course.

“With no differentiation based on performance, it’s easier to give everyone something. But there is a risk that top performers will feel disadvantaged in that environment,” said Payscale’s chief compensation strategist, Ruth Thomas.

That said, if you think you fall into that category, you may have to get creative, should you choose to try to negotiate your compensation for the year. “Base pay is not your only lever, and organizations may look more at bonuses and promotions when base pay budgets are restricted.” Kieran Delamont