#United States #Raleigh #AEC Industry #FMI Corporation #Compensation Trends

FMI Corporation Unveils 2026 Compensation Trends Study

FMI Corporation, a prominent consulting and investment banking firm, has recently published its 2026 Compensation Trends Study, shedding light on the evolving compensation strategies within the Architecture, Engineering, and Construction (AEC) industries. As competition for talent intensifies across the labor market, the study dives into how firms are adjusting their practices to attract and retain skilled personnel.

The report is based on survey responses from 218 companies across 40 states, highlighting various aspects of compensation planning. This comprehensive study is conducted every three years and aims to identify trends in base pay, incentives, and additional forms of compensation related to mobility and travel. FMI's findings suggest an industry trend of treating compensation as a strategic investment in human resources.

Key Findings

Among the important insights from the study are the following:

• - Stabilizing Base Pay: The average base pay increase reported recently is 4%, with projections for 2026 indicating budgets of 4.3% for raises. Notably, a staggering 99% of the respondents intend to implement salary increases this year.

• - Formal Pay Ranges Becoming Common: A significant 78% of firms have adopted established base pay ranges; however, only 45% have a formalised compensation philosophy. This shift reflects a move towards structured pay practices in the industry.

• - Prevalence of Short-term Incentives (STI): A remarkable 94% of participating firms offer STI programs, with 75% directly tying these initiatives to their corporate strategy or business goals—a practice that bolsters alignment between employee performance and business outcomes.

• - Growth of Long-term Incentives (LTI): In a notable development, more than half of the firms surveyed now provide long-term incentive packages, a significant increase from the 35% to 40% range observed in previous years.

• - Emerging Importance of Mobility Compensation: While 58% of firms have employees who regularly travel for work, only 28% have set formal written policies to govern travel or assignment benefits. This discrepancy signifies an area ripe for improvement in compensation practices.

Strategic Focus on Retention

Priya Kapila, a partner at FMI and head of its Compensation team, emphasizes that retention is increasingly critical when developing compensation strategies, particularly for seasoned leaders and high-impact employees. Companies are advised to look beyond immediate compensation package decisions, to also consider how they can reinforce performance, support career succession, and encourage top talent to grow within their organizations.

Conclusion

The 2026 Compensation Trends Study highlights the evolving nature of compensation within the AEC sector, marking a clear trajectory towards more strategic, competitive, and structured approaches in attracting and retaining the right talent. As firms continue to adjust their practices in response to the changing labor landscape, the insights from this study will serve as a valuable resource for shaping future compensation strategies in the built environment.

With the findings provided in this research, AEC firms are well-positioned to enhance their competitive edge through thoughtful compensation planning and a focus on employee retention and satisfaction. For those seeking additional details, the full report is available for download from FMI Corporation’s official website.