37% of organizations globally indicated that their salary adjustments for 2024 were lower than expected during their 2023 compensation planning. 43% of respondents reported that their salary budget increases were in line with their 2023 projections.
For those organizations that saw higher actual salary budgets in 2024 compared to their initial forecasts, the primary reasons cited were:
- Inflationary pressures (40%)
- Cost management concerns, such as rising supply costs (37%)
- Anticipated or actual recession leading to weaker financial results (31%)
Looking ahead, organizations are projecting an average salary increase of 4.3% for 2025, which is slightly lower than the 4.4% actual increase seen in 2024.
Average voluntary attrition rate, by location
Voluntary attrition rates vary by location, with the highest rates in Mexico (10%) and the lowest in United Arab Emirates (3%), highlighting the importance for client to consider location differences in employee retention strategies.
Average voluntary attrition rate among key markets worldwide
Source: WTW 2024 Salary Budget Planning Report – Global (December)
| Location |
Average voluntary attrition rate |
| China |
4% |
| Mexico |
10% |
| United Arab Emirates |
3% |
| United Kingdom |
6% |
| United States |
5% |
Planned salary budget increases
Inflationary pressure, concerns related to cost management and the anticipation of a recession or decline in business results are among the top factors influencing 2025 budget plans. This is a departure from the prevalent concerns of recent years when business leaders were contending with tight labor markets and evolving employee expectations. As a result, many organizations are preparing for 2025 budget increases that are slightly lower than that of recent years but more in line with the actual spend they’ve made in 2024.
Organizations also granted higher bonus payouts for 2024, and are expected to repeat it in 2025
Percentage of annual incentives (actual and target) and LTI in CEO base salary
Source: WTW 2024 Executive Compensation Survey Report
| Country |
Actual bonus % of base salary |
Target bonus % of base salary |
LTI % of base salary |
| China |
39% |
50% |
0% |
| Mexico |
62% |
58% |
65% |
| United Kingdom |
114% |
100% |
158% |
| United States |
129% |
125% |
575% |
Percentage of annual incentives (actual and target) and LTIs in CFO base salary
Source: WTW 2024 Executive Compensation Survey Report
| Country |
Actual bonus % of base salary |
Target bonus % of base salary |
LTI % of base salary |
| China |
35% |
35% |
25% |
| Mexico |
32% |
39% |
25% |
| United Kingdom |
75% |
75% |
120% |
| United States |
76% |
80% |
249% |
Trends expected to shape 2025 rewards decisions
- Geopolitical shifts might impact trade and executive talent flows
- Conservative salary increases caused by economic uncertainties
- Review of incentive plans driven by increased M&A and transaction activity
- Reframing of sustainability measures and their role in incentive plans
- Resetting pay-mixes for better trans-Atlantic alignment
- Continued focus on value creation and associated incentives
