What is Wage Drift?

Wage Drift is the phenomenon where wages increase beyond the agreed-upon or expected rate, often due to factors like market conditions, employee bargaining, or changes in company policies. It refers to the gradual rise in salaries over time, especially when wages grow faster than inflation or the official pay structure set by collective bargaining agreements. Wage drift can occur in both unionized and non-unionized environments and may reflect competitive pressures or shifts in labor demand.