How to Negotiate a Raise When You’re Underpaid in 2026

Updated August 2026

Negotiating a raise in 2026 takes more than walking in and asking nicely. You need proof of underpayment, a clear record of what you’ve delivered, and a sense of when to actually bring it up. Right now, 62% of employed Americans say their income hasn’t kept pace with inflation over the past 12 months. That gap alone makes the case for a raise stronger than it’s been in years. This guide walks through how to negotiate one in 2026 using current data, scripts you can adapt, and tactics that work even in tech, where pay bands and internal structures often box people in before they start.

Below, you’ll find how to verify you’re underpaid using benchmarks from Robert Half and Levels.fyi that actually reflect 2026 conditions, not numbers from two years ago. You’ll see how to put a number on your impact, whether that’s an AI model you shipped or uptime you protected. There’s guidance on when to ask, tied to review cycles and company wins, plus scripts for delivering your case and handling the “we don’t have budget” response with retention-cost math instead of guesswork. One threshold to keep in mind: if your pay sits 10% below market, asking isn’t just reasonable. It’s the smart move.

Confirming You’re Underpaid in the 2026 Tech Market

Start by proving your pay sits below market, using 2026 figures from Robert Half, Levels.fyi, or the New York State Department of Labor. Skip anything from 2023 or 2024. Tech pay moves fast these days, tied to AI adoption, cybersecurity demand, and the ongoing reshuffling around remote work.

Check your base against the 75th percentile for your role, city, and years of experience. A data scientist in Austin, for instance, earns a median of $140,000, which lands $13,000 below the 75th percentile figure of $153,000. Fall under that line and you’re underpaid, plain and simple. Don’t forget to weigh equity into the picture: a $30,000 RSU grant at a startup sounds generous until dilution eats away 40% of its value over a few years. Total compensation is the number that matters, not just the base.

If you’re a data scientist in Austin earning $140,000 and your last review praised you for stepping into a team lead role, that $13,000 gap becomes even harder to ignore. You’re already doing higher-level work without the higher-level pay.

Location & Skill Adjustments in 2026

Remote workers get hit by geo-differentials more than most people realize. A software engineer in Boise earns 32% less than a counterpart in San Francisco doing the identical job. Get paid on the Boise scale while your employer bills San Francisco rates for the work, and you’re short $42,000 a year. Pull up Levels.fyi’s 2026 data and compare yourself against people in your actual metro area, not some national average. Worth checking skill premiums too: AI/ML specialists earn 18% more than peers in adjacent roles without that specialty. The U.S. Bureau of Labor Statistics (2026) reports that total compensation costs for civilian workers rose by 3.4% over the 12-month period ending June 2026, underscoring that the cost of labor is rising faster than nominal wages in many sectors.

Documenting Your Impact with 2026-Specific Metrics

Numbers win arguments. Pull real figures from 2025 and 2026 rather than vague summaries. Skip “I improved systems.” Say instead: “Reduced system downtime by 27% after deploying AI-powered monitoring.”

Track how AI tools changed your output. If your team rolled out a new AI code assistant in Q1 2026 and productivity jumped 31%, put that number in your pitch. Tools like Best AI Cash Flow Forecasting Tools for Small Business Owners on a Budget can help model the dollar impact of your work. Saved your company $175,000 in operational costs on a project? That’s a direct ROI figure worth citing by name.

Expanded Responsibilities Post-Layoffs

A lot of tech workers picked up extra duties after the 2025 layoff wave. Managing five people without the title to match? Write it down. Track the hours: “Covered 20% more of the DevOps pipeline than before the layoffs.” Bring that into your pitch directly. The New York State Department of Labor puts it simply: “Articulate value-added duties that justify an increase.”

Real average hourly earnings for all employees increased by only 0.7% from August 2024 to August 2025, according to BLS data from 2025. This indicates that most workers are seeing little real wage growth, making underpayment claims more defensible.

Timing Your Request Around 2026 Reviews and Wins

Timing decides more than people admit. Bring up a raise right after a product launch, strong Q4 results, or a successful AI rollout. Steer clear of freeze periods: 46% of tech firms froze raises in 2026 after Q1 earnings came in soft.

A real-world caveat: if your company has just announced layoffs or a hiring freeze, even a solid case can be rejected outright. In that situation, job security matters more than a raise. Waiting until the next quarter, when the financial picture clears, is often the smarter choice.

Line your ask up with the review calendar. Review scheduled for June 2026? Start prepping in April. Use your 1:1 to talk growth first, salary second. That framing keeps things positive rather than transactional. On a 12-month review cycle, ask for a mid-cycle check-in instead of waiting the full year to raise the topic.

Recent trends show that over-the-year wage growth for civilian workers reached 3.2% for the 12-month period ending June 2026, per the U.S. Bureau of Labor Statistics (2026). This modest increase highlights that inflation has outpaced nominal pay growth, reinforcing that many professionals are effectively losing ground.

Crafting a Data-Driven Raise Request

Frame the ask as correcting a market gap, not solving a personal problem. Try: “My current base sits 12% below market for a senior data scientist in Austin. Given my impact, I’m requesting a 15% increase.”

Robert Half’s 2026 data puts average budgeted raises at 3.5%, so a 15% ask needs the underpayment math to back it up, which you’ve already built. Leave room for flexibility too: “I’d also consider a 5% equity grant if base pay is capped.” That signals you’re not locked into one outcome.

Delivering the Conversation with Scripts

Open with value, not need. “I’ve delivered three major AI model deployments this year, increasing system accuracy by 41%. I’d like to discuss my compensation in line with market benchmarks.”

If your manager asks about your current salary, try: “My current compensation is 12% below the 75th percentile for my role, location, and experience. I’m seeking alignment.” Hold off on naming a specific number unless pushed directly.

Send a follow-up in writing afterward. Something like: “As discussed, I’ve attached a summary of my contributions and market data. I’m confident this reflects my value to the team.”

Navigating Pushback or a Partial Offer

Hear “budget constraints”? Respond with: “I understand. But replacing a high performer in AI or cybersecurity costs 1.5 to 2 times their salary. My retention is more cost-effective than hiring.”

A partial raise is worth taking, but push for something on top of it. Try: “I’d accept a 10% increase if we can also add a four-week sabbatical or increase PTO by 10 days.” Equity and remote flexibility work as bargaining chips here too.

Deciding Next Steps If the Raise Falls Short

Offer comes in below your number? Take your documentation and start looking elsewhere. A 2026 study found that professionals who negotiate but get turned down are 38% more likely to land a better offer outside their company.

Weigh offers on total compensation, not headline base pay. A Seattle role paying $175,000 base with $45,000 in equity can beat a San Francisco offer of $160,000 base but only $22,000 in equity, depending on vesting terms and company trajectory. A hybrid ai portfolio strategy under can help model which offer actually wins out over time.

Keep in mind that while real hourly earnings rose just 0.7% from August 2024 to August 2025, total compensation costs for civilian workers climbed by 3.4% over the same period, indicating that employers are absorbing more costs in benefits and non-salary components. This shift makes equity and flexibility more valuable in negotiations.

None of this works if your data is stale or your ask ignores how your specific company sets pay. Salary bands, hiring freezes, and internal equity policies vary enough that a script built for one company can fall flat at another. Treat these numbers as a starting point for your own research, not a guarantee.

Related reading: Is AI.

Frequently Asked Questions

Can I negotiate a raise if my company has a hiring freeze?

Yes, especially if you’re a high performer. Retention costs outweigh hiring costs. Use data: replacing a skilled AI engineer costs 1.5–2 times their salary. The U.S. Bureau of Labor Statistics (2026) reports that total compensation costs rose 3.4% over the 12-month period ending June 2026, showing that labor expenses are increasing even during freezes.

How do I respond if my manager says “We don’t have budget for raises”?

Reply: “I understand. But retention costs more than raises. I’ve documented my impact. Could we explore non-salary perks like additional PTO or flexible hours?” This shifts the conversation from cost to risk, using data from Robert Half (2026) on retention costs.

What if my role has structured salary bands?

Base pay may be capped, but equity, bonuses, and flexibility are still negotiable. Use a ai expense tracking couples: manage tool to model long-term savings from better benefits. Total compensation can still rise even without a base increase.

How do I prove underpayment without public data?

Private tools like Levels.fyi or Payscale work, or ask trusted peers directly. Robert Half’s 2026 guide also includes role-specific benchmarks worth citing. The Levels.fyi 2026 database provides anonymized, peer-reviewed salary data across tech roles and locations.

Should I mention a competing offer?

Only if it’s real. A genuine offer paying 10% more in total compensation is worth mentioning. Bluffing isn’t worth the risk to your credibility. A 2025 Bankrate report found that only 44% of workers expect to ask for a raise in the next year, meaning those who do are at a distinct advantage.

Is my remote work compensation fair compared to in-office peers?

Often not. Remote workers in lower-cost cities are frequently paid less than in-office peers doing the same job, even when the work is identical. A software engineer in Boise earns 32% less than one in San Francisco. Use location-adjusted data from Robert Half (2026) and Levels.fyi to assess fairness.

How much of a raise should I request?

Start with 10–15% if you’re below market. A 15% increase is reasonable if your pay is 10–15% under the 75th percentile. The BLS (2026) shows a 3.2% wage increase over the year, so anything above that is a strong case for adjustment.

Can I negotiate a raise after a performance review?

Yes, but timing matters. If your review was positive, follow up within 30 days. Use the performance discussion as a springboard. The Robert Half 2026 guide notes that employees who align raises with performance reviews are 2.3 times more likely to succeed.

What if I’m asked to leave after asking for a raise?

It’s rare, but possible. Keep the conversation professional. Document everything. If you’re pushed out unfairly, you may have grounds under Department of Labor (DOL) protections against retaliation for salary discussions.