When you’re running out of peanut butter, you spread what you have thinly across your toast. And apparently, that’s how are companies are spreading raises this year, according to a recent compensation report.
The idea of a meager “peanut butter raise” that is spread evenly across the company, regardless of performance, is not a new idea, but under this tight labor market of higher unemployment rates and fewer job openings, it’s on the rise.
According to Payscale’s 2026 compensation best practices report, approximately 44% of companies are either planning to do across-the-board — aka peanut butter — raises, or already have. About 16% of organizations said they are doing peanut butter raises for the first time, while 9% say they already do this, and 18% are considering doing it this year.
These across-the-board raises are not an enticingly large amount. In the Payscale report, the average base pay increase was 3.5%, which barely keeps up with inflation. Over the last year, consumer prices have risen, on average, by 2.4%, according to the Bureau of Labor Statistics.
“It’s a short-term strategy with long-term risk, because obviously, if you don’t differentiate on performance, then your ... key high performing talent that are probably driving the most business outcomes for you are going to feel disregarded,” said Ruth Thomas, chief compensation strategist at Payscale.
