Average Raise Percentage: Average Annual Raise and What Is a Good Raise
Almost every page on this question quotes a budget projection published the previous autumn. This one uses what US employers reported actually paying out, set against the inflation rate from the same year, so you can see whether your raise moved you forward or just held the line.
Coaching, not legal or financial advice.
What are you negotiating?
Your offer or current pay
Market-rate band
Talking points
Email template
Timing
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Direct answer
The average raise percentage in the US in 2026 is 3.1 percent for a standard merit increase and 3.4 percent once promotions and market adjustments are counted, based on Mercer actuals collected in March 2026. Inflation over the 12 months ending July 2026 was also 3.4 percent, so the average American raise this year bought nothing: it matched prices exactly and left real pay flat. A good raise in 2026 is therefore any figure meaningfully above 3.4 percent, and the two reliable routes to one are a promotion, worth 8.7 percent on average, or changing employers, worth 4.4 percent. This is career coaching, not financial advice.
The problem
People hear "about three percent" at a review, feel vaguely flat about it, and have no idea whether that is normal, generous, or a quiet pay cut. So they say thank you, and another year compounds on top of whatever gap was already there.
How Counteroffer handles it
Counteroffer turns the benchmark into an actual ask. It takes your pay, title, and level, works out where you sit against the market range rather than against the merit pool, and tells you whether you are asking for a raise or asking to be repriced. Those are different conversations funded from different budgets, and bringing the wrong one costs people thousands. Then it writes the case: the number, the evidence behind it, and what to say when your manager tells you the budget is already set. It prepares the pitch, so treat it as coaching rather than a promise about the outcome.
▲ the numbers
What the average raise actually was in the US in 2026.
These are the figures employers reported actually paying, not the projections published months earlier, plus the inflation rate over the same period. That last row is the comparison almost nobody makes, because the raise data and the price data are published by different organizations several months apart.
| Benchmark | Figure | Source |
|---|---|---|
| Merit increase actually delivered, 2026 | 3.1% | Mercer US compensation survey, March 2026 actuals. Projected at 3.2% in October 2025 |
| Total salary increase actually delivered, 2026 | 3.4% | Mercer, March 2026. Includes promotions and market adjustments, so it runs above merit |
| Projected total salary increase budget, 2026 | 3.6% | WorldatWork 2025 to 2026 Salary Budget Survey, US mean |
| Inflation, 12 months ending July 2026 | 3.4% | BLS Consumer Price Index for All Urban Consumers |
| Core inflation, excluding food and energy | 2.5% | BLS CPI-U, July 2026. Energy ran 14.7% and food 3.0% |
| Average increase that comes with a one level promotion | 8.5% | Mercer, March 2026. Roughly two and a half times the merit figure |
| Share of the US workforce expected to be promoted in 2026 | 8.6% | Mercer. 9.2% of salaried and 8.2% of hourly staff, down from about 10% in 2025 |
| Wage growth for people who stayed in their job, July 2026 | 3.6% | Atlanta Fed Wage Growth Tracker, three month moving average. Up from 3.4% in June |
| Wage growth for people who changed employer, July 2026 | 4.4% | Atlanta Fed Wage Growth Tracker. Up from 4.1% in June |
| Employers naming individual performance a key driver of 2026 increases | 89% | Mercer, March 2026 |
Read the first two rows together, because they explain why the numbers on other pages disagree with each other. A merit budget covers annual performance increases only. A total salary increase budget adds promotions, market adjustments, and equity corrections on top, which is why it is always the larger figure. When a manager says "the budget is three percent," they almost always mean the merit pool, and the money for a promotion or a market adjustment sits in a different pot with a different approval path.
the stat everyone quotes
"The average raise percentage tells you what to expect."
It tells you what the budget was. That is a different question.
A merit budget is a pool, expressed as a percentage of total payroll, that a company sets months before anyone is told a number. It is an accounting input. It was never designed to answer the question you are actually asking, which is what your own pay should be. Two people at the same company with the same performance rating routinely land at 2 percent and 4.5 percent out of the same 3.1 percent pool, and both of those are ordinary outcomes rather than signals.
The bigger problem is what a percentage increase quietly preserves. It is applied to whatever you are currently paid, so it carries every existing error forward. A 3.1 percent raise on a salary that is 15 percent under market leaves you 15 percent under market, and it will do the same next year, and the year after that. Nothing in a merit cycle is designed to find that gap, let alone close it. It compounds in the background, which is why correcting it almost always takes either an outside offer or a deliberate market adjustment request.
So the useful question is not whether you beat the average. It is which budget you are asking from. If your pay sits inside the market range for your title and level, you are in the merit conversation, and roughly 3 percent is the honest expectation no matter how strong your year was. If your pay sits below the range, you are asking for a market adjustment, which at most US employers is a separate pot approved by different people, and the case for it is benchmark data rather than performance. Bring the performance argument to the market adjustment budget and a manager who genuinely wants to help you still cannot.
▲ how to do it
How to work out whether your raise was actually any good.
Convert the percentage into real money first
Percentages hide size in both directions. A 3.1 percent raise on 62,000 dollars is 1,922 dollars a year, which is about 74 dollars per biweekly paycheck before withholding and closer to 50 after it. Do that arithmetic before you decide how you feel about the number, because a figure that sounds insulting as a percentage sometimes looks reasonable as money, and a figure that sounds generous sometimes does not survive contact with your paycheck. Our pay raise calculator converts it both ways.
Subtract inflation before you judge it
A raise is only a raise in real terms. Inflation over the 12 months ending July 2026 was 3.4 percent, so a 3.4 percent increase left you exactly where you started, and anything below that was a pay cut you were thanked for. This is the single most useful comparison on this page. If your household spends heavily on energy, note that the energy index alone ran 14.7 percent over the same period, so your personal inflation rate may be well above the headline.
Find out which budget your raise came out of
Ask your manager plainly whether the number was a merit increase, a market adjustment, or a promotion increase. Those come from different pools and mean completely different things about how you are seen. A 3 percent merit raise in a year with a 3.1 percent pool means you were treated as a solid average performer. A 3 percent market adjustment means somebody looked at benchmark data and concluded you were slightly underpaid. The label carries more information than the figure.
Benchmark the salary, not the increase
The size of the increase is a distraction from the question that actually sets your pay: what does this role pay in this market at this level? Find the range, find where you sit inside it, and within a minute you will know whether the last raise was fine or whether you are carrying a structural gap. Someone at the bottom of the band who got 5 percent is still underpaid. Someone near the top who got 2.5 percent may be perfectly well paid. Asking for a raise walks through building that case, and total compensation covers the parts of the package that never show up in the salary line.
Compare it against what leaving pays
The Atlanta Fed has tracked this every month for years using Current Population Survey microdata. In July 2026, people who changed employer saw 4.4 percent wage growth against 3.6 percent for people who stayed. That gap is not an argument for quitting. It is a measurement of how much of your pay is set by competition rather than by tenure, and it is the benchmark your annual review is quietly competing against whether anyone says so or not.
Ask before the budget is set, not after
Merit pools are locked months before raises are announced, which is why an excellent case made in review week gets a sincere "there is nothing left this cycle." Find out when compensation planning happens at your company, then start the conversation before it with the market data and one specific figure already in hand. If your raise was below inflation and your pay is below the range, that conversation is a market adjustment request, and the email below is written for exactly that.
copy and paste
The market adjustment email.
Use this when the raise you received was inside the normal merit range but your salary is below market. It deliberately does not argue about the percentage, because the percentage was never the problem. It asks from a different budget.
Subject: Compensation review for [your role] Hi [Manager], Thank you for the increase this cycle, and for the feedback in the review. I wanted to raise something separate from the merit conversation, because I think it is a different question. Looking at current market data for [title] at [level] in [metro area], the range runs from roughly [bottom] to [top], with the midpoint around [midpoint]. My base is currently [your salary], which sits [below that range / at the bottom of that range]. Over the past year I have also taken on [the specific scope you own now that you did not own before], which benchmarks at the [level] end of the range rather than where I was originally placed. I would like to ask for a market adjustment to [your number]. I understand that is not merit budget and may need a separate approval, and I am happy to put the benchmark data in writing for whoever needs to see it. Could we find 30 minutes to talk it through before the next planning cycle? Thank you, [Your name]
Swap the bracketed parts for your own numbers. Counteroffer writes this for your exact offer.
▲ frequently asked
Average raise questions people actually ask.
What is the average raise percentage?
The average raise percentage in the US in 2026 was 3.1 percent for merit increases and 3.4 percent for total salary increases including promotions and market adjustments, based on Mercer actuals collected in March 2026. Projections published in late 2025 ran slightly higher at 3.2 and 3.5 percent, and WorldatWork projected 3.6 percent, so what employers delivered came in about a tenth of a point under plan.
What is a good raise percentage?
Anything meaningfully above 3.4 percent, which is both what inflation ran over the 12 months to July 2026 and what the average total increase delivered. At 3.4 percent you broke even. Five percent is a genuinely good annual raise in this market. Eight to ten percent almost always means a promotion or a market adjustment rather than merit, because merit pools are not large enough to fund it.
Is a 3 percent raise good?
It is average, and in 2026 it is slightly below inflation, so a 3 percent raise this year is a small real pay cut. It is not an insult and it is not a warning sign, because it is what most people received out of a 3.1 percent merit pool. Whether you should accept it quietly depends on where your salary sits in the market range, not on the percentage itself.
Is a 5 percent raise good?
Yes. Five percent is roughly 60 percent larger than the 3.1 percent average merit increase and about 1.6 points above inflation, so it is real gain rather than a hold. At most US employers, a 5 percent merit increase means you were rated in the top tier of your team, or that part of the number was actually a market adjustment rather than merit.
What is the average raise after 1 year of work?
For most people the first annual raise is simply the standard merit increase, 3.1 percent in 2026, because a first review rarely carries a promotion or a repricing with it. The exceptions are worth knowing: roles with a formal step or grade structure, and anyone hired below the band who negotiated a written compensation review at 6 or 12 months. We work through the whole tenure ladder in the average raise after 1 year of work.
What is the average raise for a promotion?
An average of 8.7 percent for a one level promotion in 2026 according to Mercer, roughly two and a half times the average merit increase. The catch is availability. Only about 8.6 percent of the workforce was expected to be promoted in 2026, down from around 10 percent the year before, so the best paying raise available is also the hardest one to get. Negotiating a promotion raise covers how to ask when the title arrives without the money.
How much of a raise should I ask for?
Ask for the gap between your current pay and the market range, not a percentage above your current pay. If you are already inside the range, a merit conversation realistically lands between 3 and 5 percent. If you are below the range, ask for the figure that brings you into it, which is often 10 to 15 percent and occasionally a good deal more, and present it as a market adjustment backed by benchmark data rather than as a large raise.
Do raises keep up with inflation?
In 2026 they matched it and nothing more. The average total salary increase delivered was 3.4 percent, and CPI inflation over the 12 months to July 2026 was 3.4 percent, so the average worker finished the year with the same purchasing power they started with. Core inflation excluding food and energy was lower at 2.5 percent, so the picture looks better for households less exposed to energy prices.
What is the average annual raise in the US?
Between 3 and 4 percent in a normal year, and 3.4 percent in 2026 counting all types of increase. That figure has been remarkably stable outside the 2022 to 2023 period, when tight labor markets briefly pushed budgets above 4 percent. Measured a different way, from actual paychecks rather than employer budgets, the Atlanta Fed put overall US wage growth at 3.8 percent in July 2026.
Why was my raise lower than the average?
Because the average is a pool, not an allocation. A 3.1 percent merit budget is distributed across a team using performance ratings, so a rating of meets expectations usually pays below the pool figure while the top rating pays above it. Position in the salary range matters too: many employers deliberately give smaller percentage increases to people already near the top of their band, because the band, rather than the person, is what caps the pay.
What is a cost of living raise?
A cost of living adjustment is an across the board increase tied to inflation rather than to your performance, and outside of union contracts, federal pay schedules, and Social Security it is far less common in the US private sector than people assume. Most private employers fold inflation into the merit budget instead of running a separate adjustment. We cover how to ask for one, and what to ask for instead when the answer is no, in the cost of living raise guide.
▲ sources
- Mercer: most US employers plan to keep 2026 salary increases flat to 2025
- WorldatWork: Mercer says actual 2026 pay increases trailed predictions
- WorldatWork 2025 to 2026 Salary Budget Survey: US and global projections
- US Bureau of Labor Statistics: Consumer Price Index Summary, July 2026
- Federal Reserve Bank of Atlanta: Wage Growth Tracker
Last updated August 2026. Figures are estimates and market data changes; verify anything you plan to quote in a negotiation.
▲ what it uses
The features behind average raise percentage.
▲ more use cases
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Counteroffer is educational career coaching, not legal, financial, or HR advice.