Over a third of employers handed out ‘peanut butter raises’ this year—now, a quarter of bosses admit they're losing top talent because of bad pay

Boss sits with worker to discuss raise at office (Credit: Olga Rolenko / Getty Images)

Employees have long been sold the idea that working hard and outperforming their peers would lead to sizable pay hikes and title upgrades. But now, some companies are ditching merit-based wage bumps in favor of “peanut butter raises”—and it’s hurting employee morale.

Around 36% of U.S. companies say they gave out standard, across-the-board pay increases this year, according to a recent Payscale report. These “peanut butter raises”—which are spread out evenly to all staffers, regardless of their performance—have been dolled out as companies grapple with economic uncertainty. And those who work in industries like government and education are often on the receiving end; the report notes peanut butter raises are more common among sectors with huge workforces, hourly staffers, and step-structures.