Global real wages are on the rise. After a 1% drop in 2023 and a strong 1.8% rebound in 2024, real salaries, wages adjusted for inflation, have grown by a median 1.7% in 2025, with a 1.8% increase forecast in 2026. This marks the second and third consecutive years of positive growth.
While inflationary pressures remain, this steady improvement signals a gradual stabilisation in real earnings and a slow but meaningful recovery in global workers’ purchasing power.
However, the UK is one of the worst-performing countries in Europe and the world, according to the latest Salary Trends Report by ECA.
Key findings from ECA's Salary Trends Report 2025-26:
- Asia Pacific continues to lead the world in wage growth, with a median real increase of 3.1% in 2025, more than double the rate in Europe (1.4%)
- Pakistan tops the 2025 global ranking with a real salary lift of 7.5%
- Turkey (4th place this year) tops the 2026 forecast with an estimated real salary rise of 8.1%
- The UK saw a real salary increase of just 0.4% in 2025, placing it 21st out of 25 European countries, ahead of only Austria, Romania, Russia and Ukraine
The report points to greater stability than in the pandemic years of the early 2020s, with both nominal salary growth and inflation beginning to move back toward historical norms.
“This provides welcome relief for employers and employees alike,” said Neil Ashman, Analytics Manager – Location Insight at ECA International.
“However, the story is not uniform: while Asia is powering ahead, workers in the UK, other parts of Europe and even the US are still feeling the squeeze from inflation, which, although falling, remains stubbornly high compared to their nominal pay awards.”
UK slips down European rankings
Ranked 52nd out of 66 countries surveyed, UK workers continue to face some of the weakest real wage growth globally, due to stubbornly high inflation.
Despite a nominal salary increase of 3.8%, UK workers saw a real-terms increase of just 0.4% in 2025. This places the UK significantly behind its G7 peers, including France (+2.2%), Germany (+1.5%), Italy (+1.8%) and Canada (+1.5%). The outlook for 2026 is slightly better, with a forecast real increase of 1.1% as UK inflation is predicted to cool. However, it is still expected to lag behind the rest of Europe, again taking 21st place next year.
The picture is not entirely optimistic for the rest of Europe either. Although Hungary is predicted to make the global top 10 in terms of real wage increases, no European country is expected to see a higher nominal salary increase in 2026 compared to this year.
Asia Pacific powers ahead
Asia Pacific continues to be the engine of global wage growth, with countries from the region dominating the top 20 real salary increases for both 2025 and 2026. India leads the G20 in 2025 with a real salary increase of 6.2%, thanks to strong nominal pay growth and relatively low inflation.
Other major economies in the region are also seeing healthy real salary gains, including China (+4.1%), Indonesia (+4.2%) and Singapore (+3.1%). However, economic volatility continues to impact the region. Notably, China’s economic growth slowed in Q3 2025, as trade tensions with the US flared up. Inflation in the region is expected to rise to 2.2% in 2026, eroding some of the gains seen this year.
Contrasting fortunes in the Americas, Africa and Middle East
The median real salary increase for the Americas was just 0.9% in 2025 and will rise to 1.5% in 2026, well below Africa and Middle East which achieved 2% real salary growth this year, with the same increase predicted for 2026.
Workers in the United States have seen a meagre 0.8% real pay increase in 2025, rising to 1.1% in 2026, while Canada’s real pay has grown by 1.5% in 2025 before an expected dip to 1.4% next year.
“The lower-than-expected growth in real pay in the US is a reminder that global events, such as the introduction of tariffs, can quickly shift the outlook, causing actual figures to diverge significantly from forecasts.”
The report highlights extreme divergences elsewhere. Turkey, despite grappling with inflation of 34.9%, is set to have one of the highest real salary increases in the world at 5.1% for 2025, thanks to huge nominal pay awards of 40%. With lower inflation predicted next year, Turkey is expected to top the global rankings for real wage increases in 2026.
In stark contrast, Argentina sits near the bottom of the 2025 global rankings. A nominal salary increase of 27.5% was completely wiped out by soaring inflation of 41.3%, resulting in a 13.8% cut in real-terms purchasing power for workers. Some good news should be on the way though, with real wages predicted to return to positive growth in 2026 as the government’s economic programme yields results.
“The data reveals a world of contrasts,” added Ashman. “Countries like Turkey are managing to keep wages ahead of inflation through aggressive nominal increases, while nations like Argentina have continued to see living standards eroded. This underscores the critical need for businesses to have a clear and data-driven strategy for managing compensation in different regions.”
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For more information please contact Izzy Jenkins at The Think Tank at izzyj@thinktank.org.uk or call +44 (0) 20 4592 8789
Notes to Editors
About ECA
ECA helps organisations manage cross-border workforces with confidence. Our integrated platform and advisory services cover the full spectrum of global mobility—from long-term assignments and international remote work to business travel compliance and cost benchmarking.
With over 50 years of experience and a customer base spanning 300+ locations worldwide, we support the mobility programmes of companies headquartered in more than 70 countries, managing over one million employees across borders.
Our proprietary data underpins key decisions, from pay and benefits to compliance risk and policy design. This includes cost-of-living and housing benchmarks in over 500 locations, and survey insights drawn from global employers across all industries.
ECA’s platform brings together tax, immigration, assignment tracking, and travel compliance into a single, streamlined experience for HR, mobility and reward teams. Tracker Software Technologies became part of ECA in 2024. Global Expat Pay, supported by ECA since 2022, continues to operate independently while benefitting from shared insight and infrastructure.