By the numbers: The survey, which polled 1,650 U.S. organizations, found that employers' cautious approach is driven by several factors.

32% cite cost management pressures.
28% point to a tighter labor market.
27%remainconcerned about inflation.

The big picture: This stabilization in pay budgets is forcing a change in how companiesallocatecompensation. Rather than across-the-board increases, firms are adjusting their overall rewards programs.

36% are hiring new employees at higher salary ranges.
34%are increasingthe use of retention bonuses and spot awards.
33% are actively adjusting their compensation programs, with another 15% planning to do so.

Zoom out:With hiring slowing down—only 22% of companies are increasing headcount—the focus is shifting from talent acquisition to retention through non-monetary means. Companies are strengthening their employee value proposition by:

Improving the overall employee experience (47%).
Expanding training and development opportunities (40%).
Enhancing health and wellness benefits (38%).

What they're saying: "Salary budgets may be holding steady, but the way organizations are using those dollars is changing significantly," said Brittany Innes, senior director for Rewards Data Intelligence at WTW. "Employers are moving away from broad-based increases and toward more precise, performance-driven pay strategies that target the roles, skills and talent segments that matter most."

SURVEY: Salary Budget Hikes Cool as Firms Pivot to "Smarter" Pay

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