Overview of Salary Expectations and Their Implications
Mexican companies have become more cautious regarding salary increases for 2026 due to economic uncertainty, potentially increasing the risk of employee turnover and demotivation, according to experts.
Key Findings
- Only 62% of Mexican companies expect to raise employee salaries, with 30% yet to decide and 8% ruling out any increase.
- The majority (65%) plan to adjust salaries merely to keep pace with inflation, down from 77% expecting similar increases for 2025.
- Annual inflation slowed to 3.57% in October, below September’s 3.76%, according to Mexico’s National Institute of Statistics and Geography (Inegi).
- AON predicts a 5.4% average salary increase for non-unionized workers and 6.4% for unionized workers in 2026.
- Regional disparities exist, with the Pacific, Northeast, Central, Bajio, and Mexico State expected to see smaller salary increases in 2026 compared to 2025.
Factors Influencing Moderated Salary Increases
Beyond companies’ conservative strategies, macroeconomic context, U.S. tariff policies under Donald Trump’s administration, supply chain adjustments, and upcoming labor regulations (e.g., reducing the workweek from 48 to 40 hours) contribute to companies’ prudence in budgeting, according to Oliver Odreman of Michael Page Group.
Compensation Strategies to Retain and Attract Talent
Salary adjustments solely for inflation adjustment pose challenges in retaining and attracting talent. Only 9% of employees report having non-salary compensation, per Michael Page data.
- Flexible work arrangements, such as flexible hours, short Fridays, and free birthdays, are valued by 37% of employees.
- 95% of employees consider flexibility “important or very important” when attracting talent, according to Michael Page’s study.
- Companies and employees today seek comprehensive packages beyond salary, including hybrid formats, major medical insurance, performance-based bonuses, grocery vouchers, meal vouchers, entertainment discounts, and restaurant discounts.
Failure to adapt compensation strategies to employee expectations may lead to decreased motivation and a 15.1% average turnover rate in 2025, with 8.3% being resignations, as per AON’s study.
Top Five Desired Employee Benefits
- Major medical insurance
- Bonuses
- Savings fund
- Hybrid work arrangements
- Support like vouchers, grocery discounts, and meal allowances
Key Questions and Answers
- Q: What percentage of Mexican companies expect to increase salaries in 2026?
A: Only 62% of Mexican companies anticipate raising employee salaries in 2026. - Q: How do companies plan to adjust salaries in 2026?
A: Most companies intend to adjust salaries merely to keep pace with inflation, down from 77% expecting similar increases for 2025. - Q: What factors are influencing companies’ cautious approach to salary increases?
A: Macroeconomic context, U.S. tariff policies, supply chain adjustments, and upcoming labor regulations contribute to companies’ prudence in budgeting. - Q: What compensation strategies can help retain and attract talent amidst moderated salary increases?
A: Flexible work arrangements, major medical insurance, performance-based bonuses, and comprehensive benefits packages can help companies retain and attract talent. - Q: What are the top five desired employee benefits when accepting a job offer?
A: Major medical insurance, bonuses, savings fund, hybrid work arrangements, and support like vouchers, grocery discounts, and meal allowances.
