What is a Market Adjustment Raise?

A market adjustment raise is a salary increase based on industry-wide compensation levels, aiming to match the pay rates of other companies in the industry. Organizations typically provide a market rate adjustment so that salaries are competitive to attract and retain talent. For example, a UX designer may receive a market adjustment raise after industry data reveals a high demand and talent shortage of UX professionals.

There is no set time of the year for market adjustment raises, as they usually depend on industry trends, market changes, and competitor strategies. However, some organizations offer market adjustment raises during annual performance or compensation reviews to ensure employees’ salaries remain fair and competitive.