Service Leadership Inc. Reports Early Signals of Cooling Wage Inflation

Findings show wage inflation continuing to decline in 2026, providing opportunity for IT solution providers to improve profitability

Jan. 28, 2026 at 11:39am

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Service Leadership Inc., a ConnectWise company, has announced early findings from its 13th Annual IT Solution Provider Compensation Report, which shows that wage inflation is expected to continue declining in 2026. The report provides insights into compensation trends across various IT solution provider roles, including management, sales, technical positions, and a new category of automation engineers. The data suggests a return to historical norms, with best-in-class providers planning fewer top-level increases compared to lower-performing peers. Regional differences are also highlighted, with Europe showing more stubborn wage inflation compared to other regions like the US and Australia/New Zealand.

Why it matters

The report's findings on cooling wage inflation provide valuable insights for IT solution providers as they make compensation decisions and plan for future profitability. Moderating wage pressures can help improve gross margins and overall business performance, especially for top-performing providers who are able to optimize their workforce and investments in automation.

The details

The 13th Annual IT Solution Provider Compensation Report from Service Leadership Inc. analyzes compensation data across over 60 common IT solution provider roles. Early findings show that wage inflation, which peaked in 2022, has been on a downward trend since then, with 2025 seeing the most significant decline. This trend is expected to continue into 2026, with best-in-class providers planning far fewer top-level increases above 6% compared to lower-performing peers. Regional differences are also notable, with Europe lagging behind other regions like the US and Australia/New Zealand in terms of wage inflation moderation. The report also highlights that value-added resellers (VARs) are anticipating even lower wage increases than managed service providers (MSPs), and that private equity-backed providers are planning far fewer top-level increases than privately owned firms.

  • The 13th Annual IT Solution Provider Compensation Report will be released in early March 2026.
  • Wage inflation peaked in 2022 and has been on a downward trend since then, with 2025 seeing the most significant decline.

The players

Service Leadership Inc.

A ConnectWise company dedicated to providing total profit solutions for IT solution providers, including publishing the leading vendor-neutral, IT solution provider financial and operational benchmark: Service Leadership Index®.

ConnectWise

A company that powers IT businesses by simplifying operations, enhancing experiences, and driving growth. ConnectWise is trusted by IT solution providers worldwide and has been committed to partner success for more than 40 years.

Peter Kujawa

EVP & GM of Service Leadership & IT Nation at ConnectWise.

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What they’re saying

“Our findings from the compensation survey show the trend of lower wage inflation over the past few years continuing into 2026, in most regions worldwide.”

— Peter Kujawa, EVP & GM, Service Leadership & IT Nation (apnews.com)

“In 2025, there was improvement and the 2026 projections show the most wage inflation improvement since 2023, giving IT solution providers an opportunity for further improvements in gross margin and ultimately, profitability.”

— Peter Kujawa, EVP & GM, Service Leadership & IT Nation (apnews.com)

What’s next

The final 13th Annual IT Solution Provider Compensation Report will be available for purchase at a price of US$1,999 in early 2026, and those who participated in the survey will receive a complimentary copy upon its release.

The takeaway

The cooling wage inflation trends highlighted in the Service Leadership Inc. report present an opportunity for IT solution providers, especially top-performing firms, to optimize their workforce investments and drive improvements in gross margins and profitability. This data can help providers make more informed compensation decisions and stay competitive in the evolving IT services landscape.