Compensation in 2026: What the Numbers Can and Can’t Tell You

As 2026 gets underway, many leaders are looking for a clear signal.

Has the market finally settled, and can we plan with confidence now?

The answer is yes. And also no.

Hiring conditions have normalized compared to the past several years. The market is no longer overheated, nor is it frozen. But that sense of calm can be misleading. While salary growth has moderated, the cost and risk of hiring decisions remain elevated, and missteps are harder to unwind than they were in prior cycles.

This is where compensation numbers can be incredibly useful. It is also where they are often misunderstood.

Our newly released 2026 Compensation and Hiring Guide is designed to help leaders interpret the market realistically, not chase headlines or rely on assumptions that no longer hold. Before you download it, here is what the numbers can tell you and what they cannot on their own.

What numbers can tell you

1. Pay growth has cooled, but hiring has not gotten cheaper

One of the most common assumptions we hear is that a softer labor market automatically translates to lower hiring costs. In practice, that has not been the case.

Base salary growth has moderated from recent highs, but total hiring cost remains elevated due to longer search cycles, narrower candidate pools for high-impact roles, and increased replacement risk when hires miss the mark.

Recent national data reinforces this nuance. According to the latest ADP National Employment Report, median pay rose 4.4 percent year over year for employees who stayed in their roles. For those who changed jobs, median pay rose 6.6 percent. The gap is not dramatic, but it is persistent.

The takeaway is not that wages are surging again. It is that mobility still commands a premium, and compensation expectations have not reset as far as many employers assume.

2. Titles matter less. Scope and impact matter more.

Across functions, we continue to see the same pattern repeat. Two roles with the same title can carry very different expectations, accountability, and risk.

As organizations operate leaner, decision authority is pushed deeper into roles. Scope expands without a corresponding title change. Compensation decisions increasingly hinge on impact, not labels.

The numbers reinforce what many leaders are already experiencing firsthand. Paying by title alone is becoming unreliable. The most effective compensation strategies start with clarity around outcomes, span of control, and ownership. The market should validate those decisions, not define them.

3. Technology is reshaping roles, not eliminating them

AI continues to influence how work gets done, but not in the simplistic way many headlines suggest.

What we are seeing instead is fewer seats with broader scope, higher expectations per hire, and greater value placed on judgment, adaptability, and execution. Technology is changing workflows and productivity expectations, but it has increased the importance of clearly defined outcomes and decision authority.

Compensation expectations reflect this shift. Roles that combine functional expertise with the ability to operate in more complex, technology-enabled environments remain highly competitive, even as overall hiring becomes more selective.

4. Transparency has become a credibility signal

Pay transparency is no longer just a compliance issue. Candidates increasingly expect clear ranges earlier in the process, consistent messaging across stakeholders, and fewer late-stage changes.

Organizations that treat transparency as a strategic decision tend to move faster and close stronger candidates. Those that do not often experience prolonged searches or late-stage fallout, even when their offers fall within market range.

What the numbers can’t tell you

1. There is no single right number

Compensation numbers are a reference point, not a rulebook.

When ranges are used to automate decisions rather than inform judgment, organizations often overpay for mis-scoped roles, underpay high-impact contributors, or create internal equity issues that surface later.

Strong outcomes come from using numbers to pressure-test assumptions, not replace thoughtful planning.

2. National averages do not solve contextual challenges

As variation increases by industry, ownership structure, and growth stage, broad averages are becoming less useful on their own.

What matters more in 2026 is how quickly you need results, how much authority and accountability the role carries, and how clearly success is defined. Without that context, even accurate numbers can lead to flawed decisions.

3. Waiting for better conditions is rarely neutral

Many organizations are operating in a cautious middle ground, delaying both hiring and exits. While this can preserve short-term stability, it often creates longer-term costs through team overload, performance drift, and delayed succession planning.

When urgency returns, decisions tend to be made with less leverage and fewer options. The strongest outcomes come from aligning compensation philosophy, role scope, and approval parameters before pressure sets in.

Why this year’s guide is different

Our 2026 Compensation and Hiring Guide reflects what we see every day in active searches and candidate conversations across privately held, founder-led, and private equity-backed organizations.

This year’s edition includes updated compensation ranges across key functions, expanded Accounting and Finance coverage from mid-level through executive roles, insight grounded in searches completed over the past year, perspective for private equity-backed companies navigating longer hold periods, and considerations for international employers entering or expanding in the U.S. market.

Most importantly, the guide is designed to help leaders apply the numbers, not just reference them.

A final thought for 2026 planning

The organizations seeing the strongest hiring outcomes right now are not chasing market highs or waiting for clarity to appear. They are making clearer decisions earlier, aligning role design, compensation strategy, and hiring approach before urgency shifts the balance.

That is what this guide is built to support.