Candidate Care & Compensation: Finding the Balance in a Cost Conscious Market

2026 is looking to be a positive year for the hiring front, and although the compensation conversation can be complex, we have a few tips for employers and candidates to help with this.

On one side, candidates are navigating a prolonged ‘cost of living’ squeeze. Everyday expenses remain elevated, and for many professionals, a job move is now closely tied to the need for greater financial security. On the other, businesses are operating in an environment where margins are tighter, forecasts are cautious, and large scale salary inflation simply isn’t sustainable.

The result is a delicate balancing act that places candidate care firmly at the centre of compensation strategy

The ‘cost of living’ reality for candidates

For many people in the New Zealand workforce pay expectations are no longer about lifestyle upgrades, they’re about maintaining stability.

Recent economic commentary from Westpac highlights continued pressure on household budgets and subdued consumer confidence. While inflation has eased from its peak, essential costs for housing, transport, and food remain high. This reality is shaping how candidates approach the job market.

Naturally we’re seeing candidates entering conversations with clearer minimum salary expectations, placing greater emphasis on certainty and transparency, and becoming less willing to move roles without a tangible improvement in total compensation

Why employers are tightening the purse strings

At the same time, many organisations are being more conservative.

Economic uncertainty, ongoing investment in technology and infrastructure, and rising operating costs mean businesses are carefully managing payroll growth. Broad pay increases are harder to justify, particularly in larger or more mature organisations.

This doesn’t mean employers are disengaged from candidate needs, but it does mean compensation strategies are becoming more nuanced and more creative.

Looking beyond base salary

One of the clearest shifts we’ve seen is a move away from viewing compensation as salary alone. There is a growing importance of alternative benefits in attracting and retaining talent. While base pay remains critical, many professionals now evaluate roles through a broader lens.

These benefits can include:

Flexible or hybrid working arrangements: these have remained a core part of compensation conversations since their rapid adoption during the pandemic. The ability to balance professional responsibilities with personal commitments, whether through hybrid schedules, flexible start and finish times, or remote options, is often a decisive factor when comparing roles, particularly when salary movement is limited.

Additional leave or purchased leave schemes: Many candidates place high value on time. Whether that’s spending more time with family, prioritising rest and recovery, or managing life outside of work more sustainably. For employers, these schemes can be a relatively low-cost way to support wellbeing while signalling trust and flexibility.

Professional development and training budgets: Access to training budgets, certifications, conferences, or structured learning pathways signals an organisation’s commitment to long-term capability building. In markets where immediate pay increases are constrained, development opportunities can play a critical role in attracting candidates who are motivated by growth and progression.

Health, wellbeing and mental health support: The conversation around wellbeing has evolved significantly over the past decade. Benefits such as wellbeing allowances, access to counselling services, mental health days, and supportive leadership practices are increasingly important to candidates assessing whether a workplace will support them over the long term.

Clear progression pathways and performance linked incentives: When immediate salary increases aren’t possible, clarity becomes essential. High-performing candidates want to understand how and when remuneration can grow. Clearly defined progression pathways, transparent performance metrics, and incentive structures tied to results help maintain engagement and motivation.

For employers, these tools can be more sustainable than permanent salary increases and when aligned with what their top candidate genuinely values, they can be highly effective.

Candidate care starts before the offer

Compensation doesn’t exist in a vacuum. How it’s discussed and how candidates are treated throughout the hiring process plays a significant role in how an offer is perceived.

Strong candidate care includes:

·       Early, honest conversations about salary ranges

·       Clear explanations of total compensation and benefits

·       Respectful, timely communication throughout the process

·       Thoughtful feedback and realistic timelines

We consistently see that candidates are more receptive to balanced offers when they feel informed, respected, and engaged, even when the salary isn’t at the very top of the market.

A shared responsibility

For employers, the challenge is to articulate value holistically: not just what you pay, but how you support people. Clear communication, flexibility, and long-term thinking are now core parts of a competitive offer.

For candidates, it’s about being informed and intentional. Understanding market benchmarks, knowing what matters most to you in a role, and approaching negotiations with clarity (rather than confrontation) leads to better outcomes on both sides.

Finally,

The current market may not be defined by excess, but it is defined by opportunity.

Organisations that invest in thoughtful compensation strategies and genuine candidate care will attract strong talent. And candidates who approach conversations with preparation, realism, and openness are more likely to secure roles that support both their financial needs and long-term goals.

At Gambit, we see these conversations every day and help create outcomes that work for everyone. In preparation for a hiring boom in 2026, we are releasing our Gambit Salary Guide at the beginning of February so employers and candidates can be well informed for these conversations.

If you have any questions about how you can approach candidate care and the compensation conversation with your next employer, or your next employee, please reach out.

Thomas Hoksbergen | 09 355 8324 | thomas@gambitrecruitment.co.nz