This company automatically increases its employees’ salaries by 10% every year

Wednesday 20 - 10:00

A Swedish technology startup operating in the artificial intelligence sector has introduced an unusual salary policy: an automatic 10% pay increase for all employees every year on their work anniversary.

The company, Lovable, founded in 2023, is part of a fast-growing wave of European AI firms competing in a highly competitive global market. Its leadership explains that the decision aims to recognize the increasing value of employees over time and to strengthen long-term retention in an industry often affected by talent shortages.

According to the company’s founder, employees become more experienced and valuable each year, and should not be left uncertain about whether they will receive a raise. This approach also reflects a broader “war for talent” in the artificial intelligence sector, where companies compete aggressively to attract and keep skilled professionals.

By the end of 2025, the startup had already reached a valuation of several billion dollars, highlighting its rapid growth. However, despite its success, the firm acknowledges that salary transparency and retention remain key challenges, especially in a sector where informal salary comparisons and internal speculation can affect workplace morale.

While the automatic increase policy is innovative, it is not widely adopted across the industry. Many companies still prefer performance-based bonuses rather than fixed annual raises. Nevertheless, Lovable does not exclude additional rewards for high performance, combining both stability and merit-based incentives.

This strategy reflects broader changes in European labor markets, where salary transparency and employee expectations are increasingly shaping corporate policies, especially in high-demand fields like artificial intelligence.