Expected Salary Increase 2025

9 out of 10 Belgian companies plan to increase base salaries. This finding comes from our annual 'Salary Budget Poll', which maps out salary budget expectations. This year, 299 Belgian organizations shared their plans, and the results reveal a clear trend: despite economic uncertainties, companies continue to invest in their employees, albeit with a more strategic approach.

Reward Management
15.11.2024
Wouter Beuckels

More salary increases, but cautious with larger raises

The percentage of companies planning to increase base salaries has risen to 94% this year, compared to 82% last year and 57% in 2022. These figures underline a growing commitment among organizations to keep employee salaries competitive. However, fewer companies are planning large increases of more than 2.5%: only 17% for 2025, compared to 28% in 2024.

More room for promotions

An interesting development is the increase in companies allocating a separate budget for promotions. In 2025, 64% of organizations plan to do so, a rise of 34 percentage points compared to last year. Similar to 2024, they budget less than 1% of the total payroll for this. One in five companies sets aside more than 1%.

Variable pay: from luxury to norm

Another notable trend is the sharp rise in variable pay. While only 39% of companies budgeted for it last year, this figure will increase to 80% in 2025. Senior executives and management benefit the most from this. For workers and employees, however, the focus on variable pay remains much more limited: 58% of companies allocate no variable pay for workers, and 30% do not budget for it for employees.

As job levels increase from workers to senior management, organizations are more inclined to allocate higher percentages for variable pay. More than 20% of companies budget over 20% of pay as variable for senior management, reflecting a stronger emphasis on performance-related rewards at higher levels. Organizations are increasingly offering substantial variable incentives for these positions.
Wouter Beuckels
Senior Manager - Hudson Reward

The impact of wage indexation

Despite the increased focus on variable pay and promotion budgets, automatic wage indexation remains a major challenge. Almost all companies (90%) anticipate this and predict an indexation increase of 2% to 4% in 2025. However, only 31% consider an indexation rise of more than 3.5%, even though this is considered a realistic scenario by the Indexation Commission.

Wage indexation thus remains a significant burden on budgets. This raises the need to question the current system. While the principle itself is sound, the way it is applied without nuance calls for critical reflection. Why not consider a staggered indexation system where the link is dropped above a certain salary threshold? This could provide companies with much-needed breathing space.

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About the author

Wouter Beuckels, Senior Manager Talent Management

Wouter Beuckels is een ervaren manager en expert op vlak van Compensation & Benefits bij Hudson.

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