New research finds AEC firms expanding incentive programs and formalizing pay practices as competition for talent continues
RALEIGH, N.C., Sept. 2, 2026 /PRNewswire/ — FMI Corporation, a leading provider of consulting and investment banking services to the built environment, today released its 2026 Compensation Trends Study. The study provides new insights into how architecture, engineering and construction (AEC) firms are adapting compensation strategies to attract and retain talent in an increasingly competitive labor market.
Based on responses from 218 companies across 40 states, the study examines compensation planning, base pay, short- and long-term incentives, and mobility and travel-related compensation. Conducted every three years, the study provides insight into evolving compensation practices and trends across the built environment.
The findings point to an industry increasingly treating compensation as a strategic investment in talent. While base pay increases have begun to stabilize following post-pandemic escalation, incentive programs continue to expand, and firms are placing greater emphasis on formal, consistent approaches to compensation.
“Compensation is about much more than what appears on an employee’s paycheck,” said Priya Kapila, partner and head of FMI’s Compensation team. “The most effective programs connect compensation decisions to a company’s broader talent and business strategy. Firms that understand what the market is paying and build clear, competitive programs around that information will be better positioned to attract the people they need and keep their strongest performers.”
Among the study’s key findings:
- Base pay increases are stabilizing. Firms reported an average recent base pay increase of 4%, with average 2026 increase budgets of 4.3%. Nearly all respondents (99%) plan to provide raises in 2026.
- Formal pay ranges are becoming the norm. 78% of companies have established base pay ranges, although only 45% have a formal compensation philosophy.
- Short-term incentives (STI) are nearly universal. 94% of participating firms offer STI programs, and 75% tie those programs to corporate strategy or business plans.
- Long-term incentives (LTI) are expanding significantly. For the first time since FMI launched the study, more than half of respondents offer LTI, up from the 35% to 40% range seen for several years.
- Mobility and travel compensation is an emerging priority. 58% of surveyed firms have employees who are required to travel, but only 28% have established formal written policies governing travel or assignment benefits.
“Retention has become one of the most important considerations in compensation strategy, particularly for experienced leaders and other high-impact employees,” Kapila said. “Companies should be thinking beyond annual pay decisions and asking how compensation can reinforce performance, support succession and give key employees a reason to build their careers with the organization.”
The 2026 Compensation Trends Study is based on responses collected in February 2026 from companies representing a range of AEC sectors, company sizes and ownership structures. More than two-thirds of participating companies are closely held, and average annual revenue among respondents is $1 billion.
Download the 2026 Compensation Trends Study.
About FMI
FMI is a leading provider of consulting and investment banking services to the built environment. We provide services in the areas of strategy, leadership and organizational development, training, operational performance, mergers and acquisitions, financial advisory and private equity.
CONTACT:
Katie DeRee
katie.deree@fmicorp.com
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SOURCE FMI Corporation
