Group 1 - Only 6% of companies plan to increase budgets, while 21% will reduce pay budgets due to cost management concerns, expected recession, poor financial performance, tight labor market, and inflationary pressures [3] - Companies are shifting from a traditional budget distribution approach to a more strategic allocation, rewarding employees who grow skills and contribute to financial outcomes [4] - GameStop has introduced a performance-based plan for its CEO, linking stock options to achieving a $100 billion market capitalization and $10 billion in cumulative performance EBITDA [5] Group 2 - A Mercer report indicates that most U.S. companies plan to distribute merit-based salary increases equally, rather than focusing on high-demand skills or market gaps [6] - Companies are using limited budgets to retain critical talent, resulting in decreased voluntary turnover rates, and are enhancing employee experience through training, health benefits, and compensation program changes [7] - U.S. salary budgets are expected to remain stable at 3.4% in 2026, reflecting a labor market equilibrium with lower demand and ongoing supply shortages [8]