As the 2022 budgeting season quickly approaches, HR and compensation professionals must narrow in on their salary increase strategies for the coming year. Labor market conditions in 2022, such as historic inflation and unprecedented turnover, have had dizzying impacts on the cost of labor.

Looking ahead to 2023, the threat of recession now looms. Projecting salary increase budgets for the next year may feel like a daunting task, but the data and insights from the 2022-2023 Salary Budget Survey can help inform your talent strategies at a critical time in the market.

If one thing is clear in the larger compensation community, it is that salaries are increasing at higher rates. When put up against an inflation rate that sits at a 40-year high and a competitive labor market swelling with alluring job offers, the once typical 2-3 percent increase will likely feel lackluster to many employees.